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Published March 3, 2008
Shannon Terry, Rivals.com chief executive, did a whole lot better selling his company the second time around.
Terry, widely credited for playing a lead role in helping create the now-exploding industry of college recruiting content, first sold Rivals.com predecessor AllianceSports to competing company Rival Networks in 2001 for nearly $3 million. The deal quickly imploded in the original dot-com bust, leaving Terry and his partners an opportunity to buy back usable assets out of bankruptcy for pennies on the dollar, but also the challenge of resurrecting what at the time was still not much more than an idea.
Six frenetic years later, Terry and Rivals.com are now part of Yahoo! Sports in a much-ballyhooed $98 million deal struck last spring. Buttressed by the massive traffic generated by the Yahoo! portal, the Rivals.com network in January ascended to the No. 6 slot among sports Web sites, according to comScore traffic measurement reports - more than mainstream stalwarts such as CBSSports.com and SI.com. And Yahoo! Sports, in turn, found itself regularly challenging and often prevailing against industry giant ESPN.com in those traffic reports for the top overall slot.
Annual Rivals.com revenue, $22 million in 2006, soared to roughly $35 million last year as millions of new eyeballs gravitated to the network.
As recently as a year ago, Terry openly feared losing through an acquisition deal the authentic editorial voice that was - and is - Rivals.com's foremost calling card. Nine months after the deal was announced, those fears have gone unrealized.
"It's been an incredible ride, but we've finally created a great situation where we're marrying our sticky, vertical content with the massive reach of Yahoo!," Terry said. "It's been absolutely the best of all worlds."
Plenty of other corporate suitors over the years made similar offers to Rivals.com, particularly as they realized the intense fan interest generated around college recruiting content and its unique fit for online distribution. But most of those bids involved the Rivals.com executive team either being asked to leave with their checks and not take part in a newly merged operation, or to move from their home base of suburban Nashville - provisions that proved to be deal-killers.
Instead, the Yahoo! buy has kept the Rivals.com team fully intact in Tennessee and Terry an integral part of the overall expansion of Yahoo! Sports. Furthermore, Terry, Chief Operating Officer Bobby Burton and Rivals.com have helped make Yahoo! Sports a successful beacon within the larger company that has otherwise struggled to define its overall long-term strategy, and a result is now the active subject of takeover bids.
"This absolutely was always much more than an asset acquisition for us," said Jimmy Pitaro, Yahoo! Sports vice president and general manger. "This was totally a talent acquisition as well.
"When we went through the build-versus-buy analysis relative to college recruiting, we determined it was possible to build something somewhat similar to what Rivals.com had. But we'd never have the kind of relationships Shannon and Bobby have by ourselves. So going down the route to bringing them on board was a no-brainer. And, to their credit, they've been totally engaged in our broader mission."