UFC IPO News and the Future of MMA

UFC owners at Endeavor raise $511 million during IPO as stock prices jump 5 percent on first day

Dana White set into motion the new era in the history of Mixed Martial Arts (MMA) as he joined the Endeavor Group Holdings (Endeavor) executives, Ari Emanuel and Patrick Whitesell, to ring the New York Stock Exchange opening bell on the day of Endeavor’s IPO.

Endeavor is a holding company and the most popular brand owned by Endeavor is the mixed martial arts company Ultimate Fighting Championship (UFC). Endeavor owns an impressive list of sports properties, events, and sells sports video programming on behalf of clients including the International Olympic Committee, the NFL, and NHL. Also, Endeavour operates WME and IMG representing major actors, directors, athletes, models, and more.

What does the IPO mean for the MMA world?

The UFC not only the largest MMA organization in the world but also the organization which is a part of a publicly traded organization. As a publicly-traded organization, the holding company is bound to produce results. And for the brighter side, UFC is among the top performers for Endeavor.

However, exposure to a focused business model could unleash a more efficient and aggressive organization upon the unorganized MMA industry. The growth in revenue will be a determining factor for EDR and this means that the promotion will look forward to striking new business deals, keep innovating, establishing new sources of revenue, and diversifying their operations.

The UFC has the head start, reputation, total market domination, and resources when it comes to MMA. This is good for MMA as the shift in business focus could lead to required changes in the industry. MMA is still at its growing stage and the sport requires improvements in many departments to be called a truly global sport.

The scope of diversification that the UFC can bring in would be something the other players won’t be able to catch up with. The diversification can mean tough competition when it comes to athlete relations, product licenses, broadcast rights, additional content, and so on.

The existing players will have to set their defense stronger to retain their market share. The organizations that fail to develop their niche in terms of partnerships, licensing, athlete relations, and diversification will join an exclusive club where dinosaurs have memberships.

If the revenue is set to increase, this will benefit fighters who continue to bring in the numbers. However, there will be a demand for fighters to upgrade their skill set beyond the cage. The athletes will have to focus on their business potential, public relations, media exposure, marketing partnerships, licensing, and will have to evolve from the traditional mindset of an athlete. Also, expanding into new markets could open doors for more athletes from different nations to compete at the highest level of the sport.

It will take time to understand how the event turns out and what will be the changes. But there is no doubt that this marks a new beginning for the next stage of growth for MMA and everything that is related to MMA.

On a side note, the risk of investing in Endeavor’s IPO is the fact that that the shares sold provide little to no say over corporate governance. Investors in the IPO will get Class A shares and hold just 0.4-0.5% of voting rights depending upon the underwriters’ decision to exercise their option to purchase additional shares. This means that the control is still with the captain in change and the speculations are still subjective.

About the author

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Hari Bhagirath is the former Chief Creative Officer at BRAVE Combat Federation. Currently, he heads Strategic Relations and Financial Communication for a major Fortune 100 organization. He is also the co-founder of Totem Capital, a private wealth management initiative.

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