Carolina Hurricanes owner Tom Dundon stepped in on Tuesday with a nice little post Valentine's Day gift for the Alliance of American Football, investing $250 million into the start-up football league and adding "chairman" to his business card in the process.
There were reports of financial instability within the AAF from The Athletic, but an AAF spokesperson dismissed that in comments made to CBS Sports' Ben Kercheval following the announcement of Dundon's investment.
Dundon himself, in an interview with Adam Gold and Joe Ovies on 99.9 the Fan in Raleigh, said the characterization of the league running out of money was not entirely accurate and said the AAF is now viable for "years and years to come."
"My investment will keep this thing [viable for] years and years to come," Dundon said. "It's not a viability issue, it's just how good can it be."
As Dundon explained it to Gold and Ovies, this was not a situation where the AAF needed cash to pay for money they'd already spent.
"One thing on the $250 million -- that's enough to run this league for a long time. What it takes to invest and build, that will get us through for many years. Someone was mentioning to me earlier, they thought I had to go and pay $250 million because they'd spent it. They have not spent that kind of money. And we're good for many years to come with what I just did."
This is an investment moving forward by Dundon that made for the future, essentially what he called a "Series Infinity" investment round.
"I think they had other people they were talking to -- the amount of money it took for Thursday wasn't an amount of money that would have taken the league down," Dundon said. "You can make me feel really good, but the truth is they had other people they were talking to and other ways to go but I don't think they had a permanent solution like the one I provided. I think that's probably not the right way to describe it, the way the Athletic described it, I don't think that's the way I would position it as much as they were fine getting through.
"There's a big difference between starting to raise capital -- like every start-up does, Series A, Series B ... I told Charlie, you just raised Series Infinity, like it's done now."
Dundon previously purchased the Hurricanes and PNC Arena for $420 million. He's worth well north of $1 billion, with some significant investments now put into multiple sports teams. Just as he talked about the Hurricanes purchase, Dundon doesn't see the AAF money he plunked down as some kind of hobby. He believes the upstart football league can provide a significant return on his investment, but became more willing to dive into the AAF now because he's seen the football being played.
"Every new sports league that comes up somebody calls me about. Anything with a ball where they keep score ... for some reason they call me," Dundon said. "And I saw this one, and I liked the idea but the question of would they be able to pull it together, it's hard to do what they did. And I wasn't interested in that journey, right, from concept to a football game. That risk is not what I do."
He needed to see the finished product on the field before he was willing to put up his own money. Once he saw a product he liked along with an enticing opportunity to invest -- the AAF was clearly willing to negotiate with terms Dundon liked -- the Dallas billionaire made a move pretty quickly to get his money from "my bank" into the AAF's accounts.
It sounds as if Dundon and founders Charlie Ebersol and Bill Polian essentially want to circumvent the concerns that come with raising investment capital and instead move straight into business development. Getting this kind of money in the bank right now should allow the league to do just that.
In other words, this wasn't a bailout from Dundon. This is a springboard for the league from someone with a lot of cash on hand and a keen eye for investing in sports properties.
