Saturday, April 20, 2013

Consider this...


I took a peek at "Confident Ross is all business with Dolphins" http://www.miamiherald.com/2013/04/20/3355383/confident-ross-is-all-business.html earlier today.  Its about the stadium, but I was struck by this comment:

"Well, first of all, the benefits of this, the public is the one that really benefits. As we disclosed in our financials, we don't make a lot of money. In fact, we lose a lot of money."

To which I say: hunh? Think carefully about this statement. Is he saying that he's losing money on the Dolphins?  And if he's losing money, then he must be a terrible businessman. 

And who believes that?  A major sports owner loses money?  Not a chance.

Now if he talking about the stadium and saying that he will lose money in the deal, then why is he intent on doing it?  Doesn't make sense, does it?  Who goes into a financial arrangement of this magnitude and believes they're going to lose money?

That's right, they don't! 

So IMHO, if he's misrepresenting (or perhaps lying about) this, how can we believe any of what he says?

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6 comments

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Many businessmen set up corporations or LLCs as umbrella corporations that own stock in other corporations this way they can use losses incurred in one to offset the profits from another.
If you look at the actual out of pocket dollars Ross invests in the Dolphins with signing bonuses plus salaries for all employees he could very well be showing a loss. The costs of financing both the team and stadium purchase plus the costs of operating both the team and stadium could very well be more than the revenues from ticket sales, which would create the loss. I believe Ross said the team could earn a profit if they sell out.
His share of TV revenues could be directed
into a separate corporation.
In any event, there are plenty of sports franchises that lose money and the businessmen who own them do it for ego and other reasons.

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No disrespect...I know what you're saying and so does everyone else with a little business acumen. What I think Dave is saying is don't, no matter what or who you are, assume that the fans are idiots.

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hey david. I understand your point of view and as a fan of the Miami dolphins and ive been living in Miami my whole life too I feel that Miami will benefit the most. All the money that will be used on the stadium will all be made back. So who cares who benefits or not. In the end we get a fixed up stadium and a super bowl in three or four years. I might not like every detail about this whole thing but in the end im happy. And why complain we aren't even paying for the stadium the taxes are on the hotels. The hotels will probably make back all their money too. I really like this blog it just bothers me to hear fans complain about positive things and they make it negative. When your 7o years old and a billionaire you don't really need to care if your losing money or not.

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John - that was basically my point. Thanks. :)

Carl - you're not wrong. There are always shells and other factors in play But he's not losing money and I'd argue that no owner of a major sport is truly losing money.

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Well David, I live in Jersey so I haveno horse in the race