Cashing in on the UFC Mania

Who makes money on MMA in Canada?

Richard Warnica 0 Premium content image

Lorenzo and Frank Fertitta, the sons of a Las Vegas casino mogul, bought the Ultimate Fighting Championship in 2001 for US$2 million. Eight years later, the brothers sold just 10% of the company in a deal that valued the total property at US$2 billion.

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Today, the UFC brings in US$500 million in revenue annually from its pay-per-view shows alone, according to Bloomberg. The U.S. remains the company’s largest market, but Canada, say company officials, is its most fervent. Thanks largely to the popularity of the UFC, a whole constellation of mixed-martial arts-linked businesses have sprouted up in this country in the past decade, offering everything from low-level fights to action figures and mortgages. Here’s a breakdown of who makes money on MMA in Canada, and how they’re doing it.

UFC

Gate

The UFC sold a reported 20,145 tickets worth US$3.71 million for its March 16 Montreal show, a card topped by Canadian welterweight champion Georges St-Pierre. UFC’s record: 55,724 tickets sold for US$12 million in Toronto in 2011.

UFC’s record ticket sales for a single card was US$12 million.

Edmonton’s Maximum Fighting Championship, one of the larger second-tier promotions, has an upcoming event in Edmonton with about 1,000 tickets available for between $43 and $130 each.

Fighters

Former UFC light-heavyweight champion Lyoto Machida earned $200,000 for a Feb. 23 fight. Lower-profile fighters generally earn just a fraction of that. Some top-tier fighters, like middleweight champion Anderson Silva, can negotiate pay-perview deals that approach seven figures.

Top-tier fighters’ per-fight fees can be up to $1 million.

Bonuses

UFC fighters are eligible for $50,000 bonuses for the “fight of the night,” “knockout of the night” and “submission of the night.”

Training

The UFC owns a chain of licensed mixed-martial-arts gyms in the United States (plus one in Australia). Former UFC champion Randy Couture owns his own collection of branded Xtreme Couture training centres, including a giant location in suburban Toronto. Hundreds of less prominent gyms now offer MMA training in Canada.

MMA gym memberships run upwards of $100/month.

MMA fighters consume a bizarre, lucrative and not always legal array of supplements, including amino acids, whey proteins ($79.95 for a 2.3 kg tub), testosterone replacement injections and, in at least one case, medical marijuana.

Equipment and Apparel

Ontario apparel maker Hayabusa sells fight gear, including gloves, training pads and an “exoforged armoured cup” offering “100% impenetrable groin protection” for $24.99. Canadian entrepreneur Jamie Salter bought TapouT, the most famous name in MMA apparel, in 2010.

Corporate Sponsorship

The UFC earns millions every year selling sponsorship rights to major buyers like Bud Light, Harley-Davidson and Dodge. Smaller shows, too, rely heavily on sponsors to pay the bills. Aggression FC, an Edmonton-based fight circuit, has deals with companies including EllisDon construction and CanWest Concrete Cutting and Coring.

Fighters in televised bouts routinely sell ad space on their shorts to make ends meet. (The CFL’s Hamilton Tiger Cats once took an ad.) Others launch spinoff businesses, like MMA Mortgages, an Ontario brokerage founded by a former pro fighter.

TV

The UFC has a seven-year deal with Fox in the United States worth an estimated US$600 million. In Canada, Sportsnet and FX Canada have the rights to air UFC fights and the Ultimate Fighter reality show. The MFC has a much smaller deal to show cards live on HDNet Fights and on a tape delay on TSN.

UFC’s seven-year broadcast deal with Fox is valued at $600 million.

The Fight Network, run by former media baron Leonard Asper, shows a host of second-, third- and nth-tier fighting cards from promotions including Battlefield Fight League and Extreme Fighting Championship Africa.

Pay-Per-View

Pay-per-view is the UFC’s golden goose, and the main reason the company remains the only major player in the global MMA business. The company has reported more than one million pay-per-view buys—at about $50 each for standard definition and $60 for HD—but most cards sell closer to the 500,000 mark.

UFC’s annual revenue from pay-per-view shows estimated at $500 million.

The UFC also sells pay-per-view rights to bars, restaurants and even strip clubs. According to a bartender at the House of Lancaster Gentleman’s Club in Toronto, a card topped by St. Pierre brings in the biggest crowds.

Licensing

The UFC sells its name to all kinds of products, including a video game by EA Sports, action figures by Markham, Ont.’s Round 5 collectables (for $49.99, you, too, can own a limited-edition likeness of referee Mario Yamazaki) and clothing for men, women and children.

The MFC sells licensed apparel, including this onesie boasting “My Dad Can Kick Your Dad’s Ass.”

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