Sherdog’s Story of the Year: EliteXC’s Rise, Fall
Loretta Hunt Jan 5, 2009
It was a major coup to watch a live mixed martial arts event on
network television in 2008, but the sport’s greatest achievement
this year was a mixed blessing that ended as quickly as it
began.
On Oct. 20, the news of Pro Elite’s demise wasn’t totally unexpected, but it still stung as it rippled through the fight community in a matter of hours. After 20 months and over 20 events, the parent company of EliteXC, ShoXC, King of the Cage, Rumble on the Rock and the UK’s Cage Rage was $55 million in the hole, had depleted its remaining funds and was closing up shop.
Employees inside the lavish Los Angeles office were told to pack up
their belongings and go home. Fighters, training their hearts out,
were informed that a Nov. 8 event in Reno, Nev., was cancelled. The
end was very sudden and rather indicative of the rollercoaster year
the sport rode through after a meteoric rise in 2006 and 2007.
A case study of Pro Elite’s grand plans and poor execution would probably be a sound tool for would-be investors interested in trying their hand in fight promotion. After all, the majority of the executives that led Pro Elite undoubtedly had the best-laid intentions for the company but lacked either the experience or the power to steer the ship in the right direction when it needed it most.
On Feb. 28, Pro Elite threw its first trump card down onto the green felt table, securing a network television deal with CBS for four live events in 2008. It was a deal that the industry’s leader, the UFC, should have gotten but didn’t. It might have been the UFC’s need for creative control of its product or its savvy not to sign into a deal where it would be impossible to turn a profit, but the UFC’s loss was Pro Elite’s gain for the time being.
Even with stars like Gina
Carano, Pro Elite had bitten
off more than it could chew.
On the strength of its two brightest stars, Kevin “Kimbo
Slice” Ferguson and Gina Carano,
EliteXC leapfrogged nearly eight years of groundwork laid by Zuffa
LLC.
EliteXC “Primetime,” which aired on CBS’s “Saturday Night Fights” on May 31, became the most-watched North American MMA event ever with 4.85 million viewers. The main event, which pitted Ferguson against British brawler James Thompson, remains the most-watched North American MMA fight with nearly 7.3 million viewers. These numbers still stand.
A second “Saturday Night Fights” event that July fell 43 percent in the ratings, but CBS seemed undeterred with the returns of Slice and Carano heading into EliteXC “Heat” on Oct. 4 in Miami.
By then it was no secret that Pro Elite was out of money, as the publicly traded company was required to disclose its piling debt for all to see. Extravagant spending on satellite promotions like Cage Rage and KOTC proved fickle investments. There wasn’t enough capital and staff to hold successful events under each banner’s name, so a number of the brands sat dormant. In its quest to become a multi-promotion giant, Pro Elite had bitten off more than it could chew.
The knight in shining armor was CBS, which already owned 20 percent of Pro Elite through its Showtime Networks brand. On Sept. 17, Showtime filed public notice with the SEC announcing its intention to enter preliminary negotiations for the purchase of the fledgling company.
A deal seemed imminent as Oct. 4 approached, but the life-saving agreement died on the vine after a string of bizarre occurrences.
Aging UFC legend Ken Shamrock cut his eyebrow the morning of the show and required stitches that made him medically ineligible to fight in the main event against Slice. Light heavyweight Seth Petruzelli was promoted from the undercard to replace Shamrock on an hour's notice and stunned Slice with a short right jab, chasing the mystique out of the feared Internet brawler in a fateful 14 seconds.
“Heat,” which was funded entirely by Showtime, still drew 4.56 million viewers and almost matched the initial May numbers on CBS.
But negative press surrounding questionable conduct before the main event between Petruzelli and EliteXC promoters quickly cornered the headlines after Petruzelli intimated afterward on a Monday morning talk show that promoters had given him added monetary incentive to stand with the ground novice Slice.
Pro Elite officials later denied any wrongdoing, calling the pre-fight locker room discussion a "knockout bonus" offer, but public outcry led the Florida State Boxing Commission to open an investigation on the matter. Pro Elite was later cleared of the accusations, but the damage had been done.
“Standgate,” as many Web sites called the rancid affair, questioned the sport’s very legitimacy, which had been painstakingly earned over the last 15 years. The Pro Elite and EliteXC names were sullied beyond repair and CBS pulled the deal.
The damage was substantial, but not all was lost.
In November, CBS and Showtime renewed its interest in airing live fights -- the numbers were just too good to pass up. The networks spent the rest of 2008 in negotiations with the UFC and San Jose-based fireplug Strikeforce, which airs a taped one-hour show on NBC in the early Saturday morning hours. Numerous ex-EliteXC executives also found new investors and attempted to enter the bidding race on their own as well.
Pro Elite, which was whittled down to a skeleton staff of CEO Chuck Champion and a few others, has attempted to keep its foot in the door with CBS as well, though its past faux pas are hard to overlook.
In the bullpen, EliteXC fighters have had to sit, wait and endure the uglier side of business. A handful of the more prominent ones had their fight contracts listed up for grabs at a public auction sale set for Nov. 17 by Showtime in an attempt to recoup on loans given to Pro Elite totaling some $4 million and more.
The proposed auction seemed nothing more than posturing though, possibly to keep the vital fighters from straying too quickly, and was quietly cancelled a few days before its scheduled date.
In the new year, fighters like Slice, Carano, Jake Shields, Robbie Lawler, Frank Shamrock and Nick Diaz are still on the sidelines waiting for word on what promotion, new or already established, will lock down a deal with CBS and Showtime.
It was a combination of ambition, not-so-endless funds and good fortune that led to the ascension of EliteXC and its three-event run on broadcast television. It was mismanagement, a misappropriation of said funds and a clash of egos at Pro Elite’s boardroom table that ensured its downward spiral.
The next wave of promoters -- one of which could land on CBS -- need only acquaint themselves with Pro Elite’s trials and errors to learn that the business of selling fights ain’t all it’s cracked up to be.
Because its crash and burn affected nearly everyone in the mixed martial arts community from fighter to manager to rival promoter to fan, the rise and fall of EliteXC on CBS is Sherdog.com’s Story of the Year for 2008.
Story of the Year kicks off awards week at Sherdog.com. Check back all week for additional awards.
On Oct. 20, the news of Pro Elite’s demise wasn’t totally unexpected, but it still stung as it rippled through the fight community in a matter of hours. After 20 months and over 20 events, the parent company of EliteXC, ShoXC, King of the Cage, Rumble on the Rock and the UK’s Cage Rage was $55 million in the hole, had depleted its remaining funds and was closing up shop.
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A case study of Pro Elite’s grand plans and poor execution would probably be a sound tool for would-be investors interested in trying their hand in fight promotion. After all, the majority of the executives that led Pro Elite undoubtedly had the best-laid intentions for the company but lacked either the experience or the power to steer the ship in the right direction when it needed it most.
It started promising enough in late 2006 when Pro Elite, helmed by
boxing promoter Gary Shaw and amiable TV producer Doug Deluca and
fueled by slew of major investors, entered the fight game with a
roar. A broadcast deal with premium pay cable channel Showtime
followed within weeks, and the show launched its first live event
“Destiny” on Feb. 10, 2007, in sleepy Southaven, Miss., to widely
favorable reviews. Seven additional shows aired in 2007, and it
appeared that the Las Vegas-owned UFC would finally have some
competition.
On Feb. 28, Pro Elite threw its first trump card down onto the green felt table, securing a network television deal with CBS for four live events in 2008. It was a deal that the industry’s leader, the UFC, should have gotten but didn’t. It might have been the UFC’s need for creative control of its product or its savvy not to sign into a deal where it would be impossible to turn a profit, but the UFC’s loss was Pro Elite’s gain for the time being.
Esther
Lin/Sherdog.com
Carano, Pro Elite had bitten
off more than it could chew.
EliteXC “Primetime,” which aired on CBS’s “Saturday Night Fights” on May 31, became the most-watched North American MMA event ever with 4.85 million viewers. The main event, which pitted Ferguson against British brawler James Thompson, remains the most-watched North American MMA fight with nearly 7.3 million viewers. These numbers still stand.
A second “Saturday Night Fights” event that July fell 43 percent in the ratings, but CBS seemed undeterred with the returns of Slice and Carano heading into EliteXC “Heat” on Oct. 4 in Miami.
By then it was no secret that Pro Elite was out of money, as the publicly traded company was required to disclose its piling debt for all to see. Extravagant spending on satellite promotions like Cage Rage and KOTC proved fickle investments. There wasn’t enough capital and staff to hold successful events under each banner’s name, so a number of the brands sat dormant. In its quest to become a multi-promotion giant, Pro Elite had bitten off more than it could chew.
The knight in shining armor was CBS, which already owned 20 percent of Pro Elite through its Showtime Networks brand. On Sept. 17, Showtime filed public notice with the SEC announcing its intention to enter preliminary negotiations for the purchase of the fledgling company.
A deal seemed imminent as Oct. 4 approached, but the life-saving agreement died on the vine after a string of bizarre occurrences.
Aging UFC legend Ken Shamrock cut his eyebrow the morning of the show and required stitches that made him medically ineligible to fight in the main event against Slice. Light heavyweight Seth Petruzelli was promoted from the undercard to replace Shamrock on an hour's notice and stunned Slice with a short right jab, chasing the mystique out of the feared Internet brawler in a fateful 14 seconds.
“Heat,” which was funded entirely by Showtime, still drew 4.56 million viewers and almost matched the initial May numbers on CBS.
But negative press surrounding questionable conduct before the main event between Petruzelli and EliteXC promoters quickly cornered the headlines after Petruzelli intimated afterward on a Monday morning talk show that promoters had given him added monetary incentive to stand with the ground novice Slice.
Pro Elite officials later denied any wrongdoing, calling the pre-fight locker room discussion a "knockout bonus" offer, but public outcry led the Florida State Boxing Commission to open an investigation on the matter. Pro Elite was later cleared of the accusations, but the damage had been done.
“Standgate,” as many Web sites called the rancid affair, questioned the sport’s very legitimacy, which had been painstakingly earned over the last 15 years. The Pro Elite and EliteXC names were sullied beyond repair and CBS pulled the deal.
The damage was substantial, but not all was lost.
In November, CBS and Showtime renewed its interest in airing live fights -- the numbers were just too good to pass up. The networks spent the rest of 2008 in negotiations with the UFC and San Jose-based fireplug Strikeforce, which airs a taped one-hour show on NBC in the early Saturday morning hours. Numerous ex-EliteXC executives also found new investors and attempted to enter the bidding race on their own as well.
Pro Elite, which was whittled down to a skeleton staff of CEO Chuck Champion and a few others, has attempted to keep its foot in the door with CBS as well, though its past faux pas are hard to overlook.
In the bullpen, EliteXC fighters have had to sit, wait and endure the uglier side of business. A handful of the more prominent ones had their fight contracts listed up for grabs at a public auction sale set for Nov. 17 by Showtime in an attempt to recoup on loans given to Pro Elite totaling some $4 million and more.
The proposed auction seemed nothing more than posturing though, possibly to keep the vital fighters from straying too quickly, and was quietly cancelled a few days before its scheduled date.
In the new year, fighters like Slice, Carano, Jake Shields, Robbie Lawler, Frank Shamrock and Nick Diaz are still on the sidelines waiting for word on what promotion, new or already established, will lock down a deal with CBS and Showtime.
It was a combination of ambition, not-so-endless funds and good fortune that led to the ascension of EliteXC and its three-event run on broadcast television. It was mismanagement, a misappropriation of said funds and a clash of egos at Pro Elite’s boardroom table that ensured its downward spiral.
The next wave of promoters -- one of which could land on CBS -- need only acquaint themselves with Pro Elite’s trials and errors to learn that the business of selling fights ain’t all it’s cracked up to be.
Because its crash and burn affected nearly everyone in the mixed martial arts community from fighter to manager to rival promoter to fan, the rise and fall of EliteXC on CBS is Sherdog.com’s Story of the Year for 2008.
Story of the Year kicks off awards week at Sherdog.com. Check back all week for additional awards.
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