Update: AAF co-founder Charlie Ebersol told the Orlando Sentinel the following:
“We are a start-up, and start-ups raise money in pieces — there’s a Series A piece, Series B, Series C, etc. After the success of the first week, we had a number of investors come to us and offer us all kinds of different investments. 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.”
Last week we had a story that reported the Alliance of American Football’s better-than-you-might-think coaching salaries. The crux of the story was that the new league had positioned itself as a competitive option for all coaches from the FCS level on down — provided the AAF could position itself as a stable business operation.
Financing is (obviously) a major obstacle for start-up sports leagues, so it wouldn’t be a surprise to read that the AAF was having trouble making payroll in Year 2. However, it was a surprise to see the AAF was struggling to make payroll in Week 2.
According to David Glenn of The Athletic, Carolina Hurricanes owner Tom Dundon has provided the league with an extremely-necessary $250 million infusion of cash. How necessary? According to Glenn:
According to the sources, there was one enormous problem, one that became obvious even before the AAF’s second weekend (Feb. 16-17) of games: The league was running short on cash, and quickly. Without new investors, there was a good chance it was going to miss payroll last Friday.
Writes Mike Florio at ProFootballTalk:
An agent who represents multiple AAF players alerted PFT on Friday that some paychecks weren’t received.
The AAF acknowledged there were payroll issues, but attributed them to an administrative glitch.
The AAF missed payroll in Week 1. They told agents that it was a glitch with switching to a new administrator. They told players would be paid by today the latest.
— Darren Rovell (@darrenrovell) February 19, 2019
It’s curious why the AAF would need a quarter billion dollar investment that, in exchange for all that cash, hands over a controlling stake in this brand-new endeavor. The Athletic reported that Dundon will be announced as the AAF’s new chairman, with Raleigh possibly getting a franchise either by expansion or relocation in the future. It’s unclear what Dundon’s new involvement means for AAF co-founders Bill Polian and Charlie Ebersol.
As always, stay tuned to The Scoop for the latest.