IMG Academy sold for $1.25 Billion…yes, billion.
IMG Academy was just sold for an insane amount of money to a private equity company. The school that gave us JJ and Keon Sabb is now owned by some type of corporate behemoth it seems. IMG has to be the primary target of every college program to start the recruiting cycle at this point. How and/or why is this even possible?
Actually, it makes sense. It has a lot of students (30,000 by some estimates), with many of them coming from wealthy families, especially from Asia. They pay full tuition.
FYI, the parent company of IMG created a new business when its mixed martial arts franchise UFC merged with World Wrestling Entertainment to create a $21 billion business.
The buyer owns Nord Anglia education enterprise that has more than 75,000 students on 82 campuses in 33 countries. I know it has partnerships with some big brands such as MIT and The Juilliard School.
This was almost all in the article, but pontificating without information is a competitive sport in some places.
April 26th, 2023 at 10:24 AM ^
Legendary comment lol
April 26th, 2023 at 11:41 AM ^
ALMOST. This story was on Bloomberg ($) yesterday. This came from there.
IMG has 1400 students on campus not 30,000. The difference is the number it has connections with...online, support, recruiting aid, etc.
Read the following more carefully:
Headquartered in Bradenton, Florida, USA, IMG Academy supports the entire student-athlete development journey across its on-campus and online student-athlete education experiences. Founded in 1978, the Company provides a sports-focused boarding school, sports camps, online coaching and college recruiting, and is known for its strong outcomes from the Ivy League to professional leagues. Across its suite of sports education experiences, IMG Academy supports over 100,000 student-athletes, and helped place 30,000 students onto college sports rosters in 2022 alone.
April 26th, 2023 at 12:42 AM ^
Unless I missed it, the Swedish company doesn’t operator the business but is looking to expand. Would be interesting to now their prior experience in this space, as this could easily tarnish the brand if results aren’t met from the student athletes
I have no idea what you just said.
How could you knot now? Meeting the results does knot equal the operator tarnish. Usually.
this is outfacetious. anyone with a mild scriptacular of "no how" would relativize what is going on.
April 26th, 2023 at 10:38 AM ^
It sounds like a bot wrote it, but today's bots are much more eloquent.
April 26th, 2023 at 12:54 AM ^
How is what possible?
It's a private school --- sure, one can question their academic prowess. But there are thousands of private schools across the country, private schools are allowed to exist.
And if they want to have sports teams, those should be allowed too.
If some private equity company wants to spend $1,250,000,000 to buy them --- well, it's their money, they can spend it. If this investment has a lousy ROI, oh well, doesn't affect me.
April 26th, 2023 at 12:58 AM ^
Seems like a slippery slope to me. A company paying $1,250,000,000 isn’t going to give a shit if every single one of their athletes can’t read, as long as they can recoup their investment somehow (sponsorships, tv money, advertisements, etc). Schools don’t get bought for $1.25 billion. Acting like this is a normal private school occurrence is being deliberately obtuse.
But did they pay $1.25B for one school, or for the brand? If IMG Academies start popping up all over the country, that's a different discussion IMO.
Which dovetails to my point about the new owners experience in operating an “IMG” type school, or even what there experience is.
To the OPs point, this isn’t a normal school operator to school operator transaction this a PE that is likely looking to scale the business.
Having worked at multiple companies owned by VCs, their specific experience in the core business may not matter. They probably did buy the brand, and for that amount of cash, hooked the existing leadership and talent pool for several years.
A VCs goal is the expand/grow so they can sell for multiples in the future.
Do not be surprised if IMG is sold again for $5.1B in 5 years. Many VCs have a 5 year goal of 4.5X return, and they usually hit it.
April 26th, 2023 at 10:27 AM ^
I believe you that a VC usually hits their ROI goal, but it is fascinating and kind of scary how similar the successes and failures look from the employees in my experience. I can't speak generally because I've only experienced it twice, but they both began with layoffs, cutting wages/benefits, then attrition from people who find new jobs or retire.
The company that succeeded stabilized from there and had more turnover than before, but not enough to cause significant braindrain. The other company got rid of half its R&D (twice), increased inventory, and decreased manufacturing and quality employees. From the outside looking in, it would be entertaining how baffling the decisions of the private equity firm are if it wasn't harming real people.
Many structure debt/deals that they win no matter what - that's the reality here or in most of these deals. The company often suffers from huge debt load. The investors win either way. Either big or bigly.
That's fair. But it is what it is as regards for-profit High Schools: it's not only the investors who are expecting an ROI on their investment. The parents are expecting it too!
The Avenues schools which have popped up in some ritzy locations over the past few years have the same model ---- those schools don't focus on athletes, but those parents are still paying $65K/year for a reason. The ROI there is the school propelling their kids into a first-tier elite college/University.
Everyone's playing the same game here: the investors expect an ROI, and so do the parents. It's a bit icky, but it's here to stay.
Do you think the school previously cared if players couldn’t read? PE valuated it as the football factory that it is, not as a school.
I don't know what the perceived ROI is, but making sure Johnny can read has never been the primary goal of a lot of these places.
oy. do you think this isn't already the case?
IMG isn’t going to give a shit if every single one of their athletes can’t read, as long as they can recoup their investment somehow (sponsorships, tv money, advertisements, etc).
as the punchline to a terrible old joke goes: we've already decided what you are. at this point we're just negotiating the price.
April 26th, 2023 at 10:23 AM ^
If they want to be in an environment where one gives a shit they can get it for free at a U.S. public school where only 1/3 of 12th graders exceed the academic preparedness benchmarks for Math and Reading that woud qualify then for entry level college courses. The govt spends $15k per highschool student on average and $600 billion annually on k-12.
I doubt a school where parents would pay $84k tuition and has a philosophy of high involving parents in their kids education is going to have issues with kids not reading well just because a VC who did it's due diligence recognized how much value the brand and school has.
April 26th, 2023 at 11:57 AM ^
please, let's not describe IMG parents as "highly involved in their kids' education." IMG exists for one reason and one reason only, and it ain't "education."
PE companies buy hospitals all the time, lever them with debt, extract massive fees, and then shutter the business. Thus leaving healthcare deserts. It's how AMERICA works baby. I just saw a story about one this week where the installed CEO made out with $90M and the PE firm somewhere around $500M.
IMG isn't technically a "school". It is a sports academy focused solely on the development of athletes. They talk "school" but the school part is (was) outsourced to Laurel Springs Academy. Laurel Springs is an online K-12 educational program based in Pennsylvania. Laurel Springs' claim to fame is their parental monitoring system allowing the parents to be more involved in directing and tracking their student's progress. The new owner of IMG, BPEA EQT, owns Nord Anglia Education, a similar online K-12 educational platform but much, much larger than Laurel Springs and international in scope. IMG is simply a $1.25B add-on to the BPEA EQT education platform. My take is BPEA EQT is purchasing the IMG model for athlete development and integrating it with Nord Aglia with the intent of opening IMG-like academies around the world. Hence, they are really buying a scalable business model with a plan for substantial ROI.
April 26th, 2023 at 12:57 AM ^
Made me feel icky when I read it.
Seems Endeavor had to recoup some of that cash they paid for WWE
Vince McMahon's slush fund for paying people off (Dana White's too!) --- it has to be replenished from somewhere.
I'm just wondering if the deal was funded with dogecoin and NFT's.
No. Pickled herring and IKEA giftcards.
Meatballs
The lingonberries pushed the deal over the top.
you stole my joke! take my +1, you jerk.
April 26th, 2023 at 11:01 AM ^
By Odin's command !
How can IMG possibly be worth 1.25 billion? If you believe WSJ valuations, that's more than every college football program in the U.S.
The article lays out the plan. Essentially expansion throughout Asia...
Wow, athletic diploma mills must be a growth industry these days.
Emoni Bates' dad is PISSED!
Not sure how the math works but at about $80k year to go to school and play a sport there, the revenues are obviously quite high. I live across the street from IMG. My high school son is rehabbing there for his torn labrum as they have Johns Hopkins on the campus. My middle school son plays baseball against IMG's middle school team seven times this season. Sometimes the IMG National HS baseball team is playing, and they absolutely look like a college team. Last I checked, they were #1 in the country. Their campus and facilities are amazing. 1/2 of the middle school baseball team is Korean as there are lots of athletes on campus from Asia. While they still speak Korean on the field, many of the kids have learned to yell "Fuck" when things don't go their way - lol. The part that sticks out the most to me about IMG is that there are a lot of people in this world that have a shit ton of money. I don't know how you replicate IMG's all over the country without diluting the product, but I guess we will see.
I haven't started a spreadsheet to do the "maths" on this to determine that $1.25 Bill makes sound financial sense, but I think you've hit the nail on the head with "a lot of people in this world that have a shit ton of money". Combine that fact with another thing we know all too well: there's a lot of people obsessed with the athletic careers of their children and I think you have the basic logic for this deal may make sense.
Both my kids went through the play-in-college track with their sports. One played in college, the other chose not to. For one, the road was easy simply because his high school coach introduced him to the coach who he eventually played for in college right off the bat, which turned out to be a great fit. His travel team wasn't geared towards college play and he only went to one showcase. He was the lucky one. My other kid got sucked into the college sports industrial complex. Expensive travel team that went all over the country. Lessons (with a former Michigan player no less, which was actually fun for her and not that expensive). The travel team was 1 1/2 hours away so add that 3 hour drive in 4 times a week. Then along came Covid. The whole thing burned her out so badly that she no longer plays. I worry about the pressure these kinds of high stakes put on kids. Some, like JJ, absolutely get something out of it and end up rising. Others (one that I know of who went to IMG for tennis) fall victim to all of it at such an early age, and have wasted their youth on something they were not really destined to do to begin with. Parents are so invested in their kids making it that they sometimes don't see it's not what the kid wants. I fear that a giant sports conglomerate with a far reach is just going to ramp this whole process up and cause a lot of kids a lot of pain.
Absolutely agree. I have been having this conversation lately with the parents on my youngest son's travel ball team. We flat out play way too much. We have made a decision to be done in May and take the summer off. He may go try basketball for a couple months. I have never in my life seen so many 12- and 13-year-old kids with arm problems than I do now. Also, these kids that have playing 60-80 games a year burn out when they get into HS. My oldest tore his labrum during football season and he is the only baseball player that plays two sports. He has D1 talent and is draftable, but he really doesn't like baseball anymore. He's a sophomore right now and he is just burnt out on baseball. Loves football though, so that is where he will now focus his efforts.
The times have certainly changed with the kids playing only one sport and the parents fearing their kid will "fall behind" if they don't play all year long. That is such nonsense. It's ok to say "no" to the travel ball organization. Parents with young athletes, my best advice would be to play as many sports as you can. Narrowing in on one or two sports really doesn't have to happen until Sophomore year at the earliest.
April 26th, 2023 at 10:26 AM ^
Once my daughter decided not to play in college during her junior year, the cloud lifted and in her senior year, had the season of a lifetime because it was now just for fun and the love of the game. Even with great athletic ability, not everyone is cut out for that kind of pressure. You have to be a little nuts (as my son is) to deal with everything that comes with playing at that high of a level and being subjected to the kind of scrutiny and criticism that comes along with it.
Just waiting to here that IMG is now going to be a “research facility” that uses it’s students to brainstorm ideas for products like Funzo dolls.
We'll only hear that if their security is a few prawns short of a galaxy.
in other news.....
Michigan football has the #1 recruiting class in the country.
Michigan basketball will field a competitive team next season, with few familiar faces.
Someone without money will always criticize the spending of someone with money.
FIRE BAKICH!
They have a ton of for-profit academies (camps and full-time "schools") that both generate talented athletes and are a place for rich parents to send kids to become the "next big thing" in tennis, golf, lacrosse, etc. Camps are not cheap; "school" is $50K+ annually. It adds up.