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Posted on 10/4/22 at 1:40 pm to AggieArchitect04
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Even if we can afford the buyout, it doesn’t change the fact that we allowed ourselves to be strong armed into an idiotic contract.
Guaranteeing less than 50% of today's annual revenue, spread over 10 years, to the person who's success or failure ensures that level of continued revenue generation is an idiotic contract?
I beg to differ. That's ~5% of the revenue his team generates on an annual basis. And that's ignoring growth projections over that 10 year span, which will only decrease the percentage of the program's revenue paid to the HC in each successive year over the life of the contract.
By year 10 of Jimbo's contract (which I doubt will ever come to fruition), A&M would be paying him probably in the range of 3%-4% annual AD revenue.
You seem to be suffering from the same initial number-shock that Sidewalk is. The money in big time CFB has exploded in recent years. These numbers seem shocking because we aren't used to them. But given the current state of the sport they are justified, and the market for coaches is set and supported at these levels.
Unless the bottom totally falls out of CFB, and nationwide interest in the game falls off a cliff. It's not going to go back down.
Posted on 10/4/22 at 1:53 pm to Krampus
quote:
I beg to differ. That's ~5% of the revenue his team generates on an annual basis.
No coach besides Fisher has ever had a buyout of over $50 million. One issue here is not that he's paid $9m/year through 2031, it's that he's owed that regardless of whether he's working at Texas A&M or not.
Let's say you have a few good quarters consecutively, and someone in your organization decides to purchase a $100k F-450 for business use and finance it over a 10-year period with no insurance. If the truck broke down and caught fire after three years, and your company continued to make those payments over the remaining seven years (with 25% of the remaining amount due within the first two months), wouldn't that seem absurd? It would completely hamstring their ability to offset that debt without any associated income.
It wasn't practical, and the original purchaser didn't exhibit fiduciary responsibility for the other employees. It doesn't matter how financially sound the organization is to begin with, the terms of the deal make it a poor decision.
Posted on 10/4/22 at 2:02 pm to paperwasp
Very poor comparison.
A truck is a tool with a limited useful life.
A head football coach is THE revenue driver for the entire athletic program. A good HC's success essentially pays every other employee's salary. He's a little bit more integral to the org than a truck.
In that light, attracting a high level candidate with guaranteed money that the department can easily afford to guarantee would absolutely be fulfilling a fiduciary duty to the rest of the department. Not that an AD actually has such a duty to the rest of his staff, but even in a world where he does, it's not an unreasonable move at all when you look at the big picture.
A truck is a tool with a limited useful life.
A head football coach is THE revenue driver for the entire athletic program. A good HC's success essentially pays every other employee's salary. He's a little bit more integral to the org than a truck.
In that light, attracting a high level candidate with guaranteed money that the department can easily afford to guarantee would absolutely be fulfilling a fiduciary duty to the rest of the department. Not that an AD actually has such a duty to the rest of his staff, but even in a world where he does, it's not an unreasonable move at all when you look at the big picture.
Posted on 10/4/22 at 2:06 pm to SidewalkTiger
quote:
The largest buyout I know of was around $20 million or so.
Jimbo's is over 4x that, the folks who think Jimbo is getting bought out in 2022 or 2023 are completely delusional.
aTm will pull one out of the Auburn playbook. They will self report a recruiting violation and fire Jimbo "For Cause." No buyout...
Violation will be minor so no show cause and Auburn will hire Jimbo for cheap...
Posted on 10/4/22 at 2:12 pm to Krampus
quote:
Krampus
You're delusional.
Jimbo isn't going anywhere until 2024, at minimum.
Posted on 10/4/22 at 2:21 pm to Krampus
quote:
A truck is a tool with a limited useful life.
A head football coach is THE revenue driver for the entire athletic program.
So Jimbo Fisher continues to generate revenue for Texas A&M even when he's no longer employed — i.e., his useful life is unlimited?
Because the truck analogy concerns his buyout.
(Your epistle to SidewalkTiger was that he didn't understand the economies of scale, after he commented about the enormity of his buyout.)
I think you're confusing ROI with sensible debt load.
Posted on 10/4/22 at 2:50 pm to paperwasp
Nobody knows Jimbo better than LSU, Bama and Auburn. With that said non of the above would be or have been interested in Jimbo. Jimbo is a football whore.
That's your wagon you bought. Ride in it!
That's your wagon you bought. Ride in it!
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