Clemson lost the football game, but won the financial gains
Clemson University fell 18 points shy of a national championship Monday night, but the school's football program has been winning on the financial field in recent years and is showing no signs of slowing down.
A dive into the financial statements of Clemson's football program shows that ticket sales, revenue from television broadcasts and donations from rich alumni and ordinary South Carolinians have nearly doubled to more than $63 million since head coach Dabo Swinney took over the Tigers 12 years ago. The team saw a 17% revenue gain in the past year alone.
By comparison, both ticket sales and donations at the larger Louisiana State University, which defeated Clemson 42-25 to win the national championship, dropped 4.6% and 7.5%, respectively, in the school's most recently reported fiscal year, which ended June 2018.
What's more, as long as Swinney remains coach and continues to groom sophomore quarterback Trevor Lawrence, the Clemson football coffers should continue to swell, said Geoff Lottenberg, a Florida-based lawyer who focuses on collegiate sports and intellectual property rights.
Clemson competing for the national title Monday against Louisiana State University "is a major win for them," from a financial standpoint, Lottenberg said on Tuesday. "They were getting Super Bowl type [viewership] numbers for this game. The exposure for the school, win or loss, is tremendous and they only stand to gain year after year."
Ball is big business
Clemson's football program is technically one of many sports offerings within the school's athletic department, but, unlike the others, the gridiron gang is basically a business within itself. For instance, Clemson's football program, according to the university's financial statements, generated nearly $7.6 million in excess revenue — what a business would call profit — in its most recent fiscal year. Clemson basketball, on the other hand, lost nearly $2 million. In fact, football was the only Clemson sport that made money in 2019, documents show.
Clemson football is an operation that has morphed into a multi-million dollar entity despite not receiving direct funding from the university itself. The biggest source of that revenue is ticket sales, which generated nearly $26 million in revenue in the most recent fiscal year. Television broadcast deals bring in another nearly $15 million.
But the football program also makes money off sports camps, concessions stands and bowl games. Another $5 million comes in through donations, not just from alumni, but also South Carolina residents who have long been encouraged to donate to the public university's football programs.
Swinney took over the Tigers coaching job in mid-2008. That year, the Clemson football program brought in $35.8 million in revenue for the 2008-09 season, about half of which came from ticket sales. In Swinney's first full year as coach, revenue fell to $31 million, but has climbed ever since.
Revenue grew to $49 million in 2015-16, the year Clemson won its first national title under Swinney. Revenue jumped again to almost $54 million in 2017-18, when Swinney's secured the Tigers' second national title.
Those figures mean Clemson is a top moneymaker among its Atlantic Coast Conference cohorts, which includes other powerhouses like Florida State and Louisville.
Still, the Tigers revenue cowers when compared to the University of Alabama's 2018 revenue of $111.1 million or the $147 million in revenue that Texas A&M reportedly averaged annually between 2015 and 2017, which is believed to be the most of any college football program.
Donations from Clemson fans account for another large chunk of the school's football financial growth, records show. In 2008, contributions totaled $2.1 million and that number more than doubled to $5.4 million in 2019. And in a state where the closest professional football game is two hours away in Charlotte with the Carolina Panthers, ticket sale revenue to Clemson games have also grown — from $19 million in 2009 to $26 million last year.
South Carolina residents have been donating large amounts to Clemson because "they really want to help keep this [football] program nationally elite," said Davis Babb, CEO of IPTAY, the fundraising arm of Clemson athletics, IPTAY stands for "I Pay Ten a Year," a local fundraising motto that goes back to the 1930s. It's a lot more than $10 these days: Babb said IPTAY has launched a $700 million fundraising effort through 2025.
Swinney has told South Carolinians that their donations fund academic tutoring, life skills coaching and counseling for the student-athletes. Helping a student's life off the field has fueled continued contributions as well, Babb said.
"Our donors see that and realize it's not just an athletic all-in chase," Babb said. "It's about these young people and what they are going to be prepared to do for the next 40 to 50 years after they leave Clemson."
The partnership between pay and play
There's a financial benefit to college football teams winning games, research suggests.
A University of California professor studied the connection between on-the-field success and donations to a school's athletics department. The research found that "winning football games increases alumni athletic donations, enhances a school's academic reputation, increases the number of applicants and in-state students, reduces acceptance rates and raises average incoming SAT scores," professor Michael Anderson wrote.
Anderson concluded that his "estimates imply that large increases in team performance can have economically significant effects, particularly in the area of athletic donations."
Clemson football is doing well financially already, but Lottenberg said he can foresee the program's bank account growing even larger.
One way Clemson could cash in on this week's game is when it's time to renew its broadcast contract, he said. The ACC negotiates contract terms with networks on behalf of the member schools, but Lottenberg said Clemson officials could make a case that "we have the pre-eminent college football playoff team so we should get the lion's share of the revenue."
Even if that pitch falls flat, tickets sales are going to "skyrocket" for Clemson games next season because fans believe the Tigers will compete for the national title soon, Lottenberg said.
ESPN has already pegged Clemson as the favorite to win next season's championship game.
"As long as they keep that coach and keep recruiting [new players], they're going to make more money than they can deal with," Lottenberg said.