SALT LAKE CITY — The Salt Lake Stallions will make their home debut at Rice-Eccles Stadium this Saturday, but their fledgling league reportedly nearly folded before the team even returned from its first road trip.
Not even a week after its successful launch on Feb. 9, the Alliance of American Football needed financial assistance to stay afloat, The Athletic reported .
Tom Dundon, the majority owner of the Carolina Hurricanes, stepped up and committed $250 million in funding to help the AAF meet financial obligations, including payroll, according to the sports news website.
ESPN’s Darren Rovell also reported that Dundon essentially now owns the AAF.
“Without a new, nine-figure investor, nobody is sure what would have happened,” a source told The Athletic.
Contrary to reports, AAF CEO Charlie Ebersol claimed the AAF was not in serious financial jeopardy. Ebersol told the Orlando Sentinel the league always had the money to meet payroll and has not been in financial jeopardy. Dundon's early-season buy-in came after positive reviews after the first two weeks of play.
"I felt good last week," Ebersol said. "I’m euphoric this week."
Stallions coach Dennis Erickson briefly addressed the AAF's financial situation during his conference call Tuesday. Not surprisingly, he didn't show any concern.
"The only news is an investor put in $250 million. That’s a great plus for our league," Erickson said. "There’s no financial problems or anything like that. Everything is going fine. This is just a great donation from (Dundon), and he’s going to be a big part of our league."
Ebersol explained to the Sentinel that start-up companies like the Alliance raise money in pieces, beginning with an initial Series A piece.
"After the success of the first week, we had a number of investors come to us and offer us all kinds of different investments," Ebersol said. "Tom Dundon showed up and said, ‘Do you want to continue to raise Series B, Series C and Series D or do you want to raise Series Infinity right now and be taken care of from now on?’ That was an offer I was not going to refuse."
Nevertheless, multiple players didn’t receive their paychecks last Friday, an agent told NBC’s ProFootballTalk. The league claimed that was due to an administrative glitch.
"You can always tell people their checks are going to be a little late," the agent told PFT, "but how many are going to show up on the weekend for games when they don’t see anything hit their bank accounts on Friday?"
The AAF officially introduced Dundon as the league’s new investor and chairman of the board on Tuesday.
"Since the beginning, it has been crucial that the foundation of The Alliance be set with world-class partners and Tom Dundon represents just that," Ebersol said in a statement. "Tom, (co-founder) Bill Polian and I will work with our great team at the Alliance to expand our football operations and technology business. Tom is a self-made American success story who brings a wealth of knowledge in the sports, entertainment and finance worlds and proven leadership to our organization."
Dundon is also co-founder of Trinity Forest Golf Club in Dallas, the majority owner of Employer Direct Healthcare and a primary investor in Topgolf.11 comments on this story
"As a lifelong sports fan and entrepreneur, I’ve always valued the opportunities generated in the ecosystem of sports and entertainment," Dundon said in an AAF press release. "I’m impressed with The Alliance’s stunning growth in-stadium and across TV, mobile and social media in just these first few weeks. ...
"The Alliance has built a foundation of high-quality football, revolutionary technology and world-class partnerships with the NFL, CBS, Turner Sports and MGM Resorts International and I’m excited to work with Charlie, Bill and the league’s partners to help accelerate the growth of The Alliance in its next phase as a company."
The Athletic’s David Glenn also reported that Raleigh, North Carolina, could eventually acquire an AAF team via expansion or relocation.