- Utah approved a partnership with private equity firm Otro Capital to form Utah Brands & Entertainment LLC, a for-profit arm to run key athletics revenue operations while Utah keeps majority ownership and control.
- The plan could bring more than $500 million to Utah athletics, with Otro taking a share of annual revenue and targeting a five-to-seven-year exit.
- Core athletic department functions such as scholarships, coaching, fundraising, athlete welfare, and NCAA compliance remain within the university.
- The first-of-its-kind structure is being watched as a response to rising college sports costs and widening conference revenue gaps, contrasting with the Big Ten’s larger but contested private-capital proposal.
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The deal approved by the University of Utah (The U.) represents a potential game-changer in how college athletics can be financially structured. By spinning off revenue-oriented operations — media, concessions, licensing, events, brand/content, and finance — into a for‐profit entity, Utah is attempting to capture more of the commercial upside while insulating the core athletic department responsibility (student-athlete welfare, coaches, compliance) within the nonprofit university structure.
Key triggers are in play: rising cost pressures, especially in the wake of expanded student-athlete compensation (NIL and recent NCAA legal settlements allowing up to ~$20.5 million annually per institution), and competitive disparities across conferences. Utah, now in the Big 12, recognizes that revenue in its conference lags the Big Ten and SEC.
Otro Capital views this as a first mover opportunity, signaling an appetite among private investors for more direct financial stakes in college sports revenue streams. Utah’s deal is unique not just in scale but in the fact that fundraising, scholarships, coaching, and NCAA compliance remain with the university — limiting risk around amateurism and regulatory compliance.
But there are strategic and governance risks. Key unknowns include the precise revenue split, competitive critical mass (‘exit’ conditions), ensuring alignment with university priorities (academic mission, Title IX, equity), and maintaining transparency with stakeholders (students, faculty, taxpayers). Moreover, as seen in the Big Ten’s negotiations, there is significant resistance from institutions uneasy about long-term contracts, grant-of-rights extensions, and ceding control over media rights.
In comparing Utah’s initiative with the Big Ten’s proposed deal involving UC Investments (a pension fund) — which would grant the investor 10% of media rights in exchange for ~$2.4 billion upfront — Utah’s model retains university control and is more narrowly scoped. The Big Ten deal, in contrast, hinges on wide consent among 18 member schools and faces pushback over asymmetric benefits, overbinding grant-of-rights extensions, and threats to institutional autonomy.
This suggests that while Utah may have unlocked a path for others, scaling similar arrangements — especially in multi-institution conferences — will require negotiation of legal, regulatory, and stakeholder governance frameworks; institutional capacity; and defensible valuation of long-term media and licensing rights.
Supporting Notes
- University of Utah board of trustees unanimously approved the agreement with Otro Capital to form Utah Brands & Entertainment LLC, a for-profit entity to manage ticketing, concessions, broadcasting, brand licensing, events, hospitality, partnerships and finance.
- The deal could bring “more than $500 million” into Utah athletics, with the university maintaining majority ownership; Otro as minority partner; and a goal for a five to seven year exit.
- Current university athletics department functions such as student athletes, scholarships, coaching, fundraising and NCAA compliance remain under university/nonprofit control.
- The revenue Ot ro earns will be shared with the university; Otro gets portion of annual revenues from operations shifted into Utah Brands & Entertainment.
- According to university officials, the driver of this deal is the financial pressure from rising costs — especially student-athlete compensation, media rights competition, and being in Big 12 where revenues are lower than SEC and Big Ten.
- Big Ten’s $2.4 billion private capital proposal with UC Investments would have given a 10% stake in a new entity holding media rights and sponsorships, but it requires unanimous consent among member schools and faces opposition over revenue distribution, governance, and extended grant-of-rights till 2046.