The Alliance of American Football announced on Tuesday that it received a $250 million cash investment from Carolina Hurricanes owner/CEO Tom Dundon, which comes after Week 2 of its inaugural season. Dundon, who had been previously introduced to AAF CEO and co-founder Charlie Ebersol, had been monitoring the progress of the AAF before committing to being an investor.
"Every start-up is in a position to benefit from more capital," an AAF spokesperson told CBS Sports.
"Since the beginning, it has been crucial that the foundation of the Alliance be set with world-class partners and Tom Dundon represents just that," Ebersol said in a statement obtained by CBS Sports. "Tom, Bill Polian, and I will work with our great team at the Alliance to expand our football operations and technology business. Tom is a self-made American success story who brings a wealth of knowledge in the sports, entertainment and finance worlds and proven leadership to our organization."
Dundon will also serve as chairman of the AAF board of directors moving forward.
"As a lifelong sports fan and entrepreneur, I've always valued the opportunities generated in the ecosystem of sports and entertainment," said Dundon. "I'm impressed with the Alliance's stunning growth in-stadium and across TV, mobile and social media in just these first few weeks."
The Athletic previously reported that Dundon's investment came as the AAF was "running short on cash, and quickly." However, a spokesperson for the AAF told CBS Sports that the announced investment was planned, and that the Athletic's report that some players did not receive their paychecks on time ahead of Week 2 was due to a glitch in moving to a new payroll system. The AAF asserted that no one was in danger of not being paid.
"The two events are not related," one AAF GM said. "I've been told Tom Dundon reached out to be an investor earlier in the [last] week. We were made aware of the potential payroll issue early Friday morning. Every player in the Alliance was made aware of the issue and the expected resolution today [Tuesday]. We switched payroll companies late January/early February and there was a glitch with the transfer."
The $250 million investment hits what the spokesperson referred to as a milestone in getting more capital for the start-up football league. Ebersol told the Associated Press on Tuesday that the AAF will not be seeking new investors at this time. "We won't bring in anybody for capital. We're not going to take people's money," he said. "We have to decide who are the partners we want to be in business with. The Alliance already has great relationships with partners such as MGM (Resorts). There won't be any money-raising. It will be growing the business."
Ebersol told CBS Sports in January that a key challenge for the Alliance was the lack of infrastructure from the start, whereas when Dick Ebersol, Charlie's father, helped launch the XFL 2001, that infrastructure with NBC Universal and General Electric was already in place.
Listen to Ben Kercheval and Will Brinson break down the biggest AAF takeaways from Week 2 on the Pick Six Podcast: