In a bid to support cash-strapped athletic departments, private equity firms are mobilizing to inject millions of dollars into struggling programs. Drew Weatherford, a former Florida State quarterback turned private capital investor, has partnered with Gerry Cardinale of RedBird Capital Partners to launch Collegiate Athletic Solutions (CAS), a project aimed at infusing instant cash into athletic programs.

Weatherford and Cardinale have already met with approximately 50 FBS programs, offering a flexible capital solution that can be deployed at the discretion of the athletic departments in conjunction with existing capital resources. CAS aims to assist universities in offsetting financial burdens and adjusting operating structures to align with the anticipated new revenue-sharing model in college athletics.

With the House vs. NCAA settlement on the horizon, Weatherford expressed concerns about the future financial landscape of college athletics. The settlement includes a future player revenue-sharing model and a quasi-salary cap that could amount to as much as $22 million annually per school. This could mean power conference leaders spending up to $30 million annually, taking into account the revenue-sharing cap, reduced NCAA distribution for back damages, and additional scholarships.

To capitalize on these impending changes, Weatherford and Cardinale are now seeking five to ten athletic programs to invest in, with amounts ranging from $50 million to $200 million. Several power conference athletic directors have confirmed ongoing discussions with Weatherford and Cardinale, signaling a growing interest in securing partnership deals.

Athletic departments are recognizing the importance of private equity and capital to stay competitive in the evolving landscape of collegiate sports. The infusion of funds provided by CAS is intended to complement existing capital resources such as debt, booster donations, and bonds. The exact ownership structure remains flexible, with Weatherford describing CAS as a "private capital" solution that allows departments to allocate the lump sum at their discretion.

CAS offers a unique debt-like cost of capital structure, providing returns tied to new revenue generation. This incentivizes CAS to leverage its expertise in areas such as ticketing, hospitality, premium events, media rights, and IP monetization to drive sustainable long-term growth. The collaboration aims to bridge the gap between premium intellectual property and optimized revenue streams, fostering an environment where departments can compete and thrive.

Weatherford emphasized his belief in leveling the playing field and expanding the number of teams capable of winning national titles. The concern lies in using football revenue to subsidize the rest of the sports and support money-losing Olympic programs. Despite the multi-billion dollar television contracts received by athletic departments, the funds have often been directed towards facility projects, coaching salaries, and administration roles in order to compete with rivals.

As the impending revenue-sharing model looms, administrators are scrambling to secure additional funds. The task of generating upwards of $30 million within a 14-month timeframe is challenging, with the Big Ten and SEC being in a relatively better position compared to the ACC and Big 12.

While some remain skeptical about the need for private equity, the reality is that athletic departments are searching for alternative avenues to finance their operations. The CAS initiative, led by Weatherford and Cardinale, presents an opportunity for struggling programs to access the necessary capital and remain competitive in the evolving collegiate sports landscape.

As the paradigm shift in collegiate athletics continues, private equity firms like CAS are poised to play a significant role in providing financial stability and operational expertise to athletic departments across the nation.