League to bring U.S. back to velodrome AutoTrader.com renews with NBA Breaking Ground: NHRA looks to Paciolan Nike’s Converse sues 31 companies PowerBar narrows sponsorship focus From the Field of Information Management Roc Nation in acquisition mode End the one-size-fits-all approach How brands can reach the two Brazils Pete D’Alessandro
SBJ/March 14-20, 2011/Labor and AgentsPrint All
Editor's note: This story is revised from the print edition.
Donald Dell remembers that the decision to launch one of the seminal sports marketing firms in U.S. history was simply about doing business. The ProServ co-founder said that he and his partners in a Washington, D.C., law firm had no choice but to launch the agency, which went on to produce many influential sports marketers and was the predecessor to today’s Octagon.
ProServ co-founder Donald Dell
“Basically, we couldn’t sell,” he said at a ProServ reunion held earlier this month at George Washington University in conjunction with the schools’ Sports Industry Networking and Career Conference. Since that prohibition was an impediment to sports marketing, the law offices of Dell, Craighill, Fentress & Benton gave birth to Professional Services Inc., quickly shortened to ProServ. The firm spawned a generation of sports leaders, and, in retrospect, offers a classic case study of a successful operation that couldn’t maintain the basis for its success — keeping its top people together.
Professional ethics aside, there were more practical reasons for the firm to solicit business under another name when it launched in 1970. “We learned that when we sent out a letter on legal stationery and were trying to sell something, it just didn’t work,” said Frank Craighill, after a series of panel discussions in Washington on the history of the agency, which was formed with the likes of Ashe and Stan Smith. “People didn’t know whether they were being sued or we were trying to get their legal business. ProServ rapidly proved itself as the better alternative for the business we wanted to build.”
ProServ largely built its business around professional tennis, and the agency grew to become the biggest rival of industry pioneer IMG. At its peak in the early 1980s, ProServ had 200-plus athletes under contract, including Michael Jordan, Denis Potvin, Dave Winfield and Jimmy Connors, before it split over personalities and various other factors.
Frank Craighill and Lee Fentress split to form Advantage International, which was purchased by IPG in 1997. It later combined with other sports agencies to form the basis for what is now Octagon, which, along with IMG, represent the two behemoths in sports marketing and management.
The Dell and Ray Benton-led ProServ was acquired in 1999 as part of the SFX Sports roll-up, a stock play that ultimately failed to produce solid sports marketing or the anticipated financial gains.
Aside from marketing athletes with the majesty of Jordan or the stature of Ashe, ProServ and its descendants can lay claim to pushing sports globally by working to formulate, and then negotiate, some of the first global rights deals around the FIFA World Cup and the first TOP Olympic deals.
“Give [Adidas president and ISL founder Horst] Dassler credit there, but he trusted us,” said Craighill, recalling signing the first TOP deal for Adidas in Seoul, South Korea, a few years before the 1988 Olympics. “A lot of people give Horst credit for getting the Olympics to South Korea. He did business in five languages and saw the global opportunities early because of his experience with international sports and business.”
From left: Gary Stevenson, Donald Dell, Frank Craighill and Ray Benton discuss the agency
When the former Davis Cup captain Dell was a young adult, there was no future in pro tennis. “If you said you were a tennis player, the next question was always, what else do you do?” he said. “If I made $200 a week, I thought I was doing great. You were a tennis bum. Whereas the golfers were all respected. I got into it with that in mind.”
In the early-1970s, tennis became an open sport, boomed professionally around magnetic stars and took off at the grassroots level. Since IMG was built on the backs of legendary golfers Arnold Palmer, Jack Nicklaus and Gary Player during the 1960s, tennis had the potential to be a powerful differentiator as an undeveloped sport.
But in a case of what almost wasn’t, Dell told the story of taking Ashe to meet IMG founder Mark McCormack four times about representation, before Ashe suggested that Dell represent him. At first, Dell dismissed the idea. “At the time, I wanted to be the next Clarence Darrow,” he said, of his trial lawyer aspirations. But he reconsidered largely due to Ashe’s lobbying. Their first deal in 1970 was a five-year endorsement deal for Ashe with Head for $25,000 a year that included a 5 percent royalty on all Head rackets.
Ivan Blumberg, who started with ProServ in 1983, recalled a culture where results took precedence over billable hours. “These were competitive people who took their desire to compete on the court and brought it into the office,” said Blumberg, who served as general counsel and managing director of ProServ, and is now CEO of Athletes for Hope. “It didn’t matter what day it was. That office was full every Saturday.”
Sara Fornaciari came to ProServ after she couldn’t find work as a sportswriter. There were no female sportswriters then, so instead she became the first female sports attorney. Tracy Austin became her first client, and Fornaciari eventually served on the WTA board and was executive director of the WTA Players Association.
“There was a feeling we were building something at the ground floor and we all got to see this industry change radically during our careers,” she said. “We could do about 10 different jobs in a week: TV, marketing, operations, getting sponsors, legal and events. Today, it’s much more narrowly focused.”
With many first and second generation ProServ employees present, there was time to patch up and dissect the divorce that happened almost 28 years to the day of the GWU conference. For a time, it was like “The War of the Roses,” with ProServ and Advantage factions housed in the same downtown D.C. building, one floor beneath the other.
The conference’s Jeremy Silkowitz (left) and Lisa Delpy Neirotti with Dell, Benton and Craighill
“To some degree, it became known as Donald Dell’s firm,” Dell said. “We did very well for 13 years, but maybe there was some resentment.”
During one of Meredith Geisler’s early days at Advantage, she was at the Landover, Md., home of Len Bias, fending off the media hordes that descended after the death of the Boston Celtics’ draft choice, who died from a cocaine overdose two days after being selected second overall in the 1983 NBA draft. Geisler remembers that she interviewed at both ProServ and Advantage, had offers from both, but chose the latter, where she stayed for 13 years. “They each had distinct personalities,” she recalled. “ProServ guys were brash and confident. Advantage was more comfortable and supportive. Since I was just out of school, I chose supportive.”
Of course, some were bittersweet in looking back. “Sure, there is some lamenting about what could have been,” said Jerry Solomon, who was at ProServ from 1980 to 1993, and now heads sports marketing, management and event firm StarGames. “This place was such a great springboard for the industry.”
IMG kept itself intact by founder McCormack’s intelligence, vision and personality. Perhaps it was impossible for ProServ to continue with four strong personalities at the top. “We all felt a strong loyalty to ProServ,” said Disson, who has worked for both ProServ and IMG. “IMG was always known as Mark McCormack’s company, and the loyalty was to him. That was the biggest difference.”
In talking to many about the company, it comes back to a familiar theme stated by one of Octagon’s most tenured employees, who requested anonymity in saying, “This is a story of a company that, at one point, just couldn’t hold on to all of its people.”
Of all the athletes serviced by ProServ, there was unanimity of opinion that Arthur Ashe was the most extraordinary individual. “He was like Nelson Mandela,” said company co-founder Ray Benton. “Just a fantastic human being.”
ProServ client Ashe was “just a fantastic human being,” Benton said.
Like the others, “mine’s not even close, it’s Arthur Ashe,” Donald Dell said. “Michael Jordan for 10 years was exciting, charismatic and helped us take off with basketball. But as a human being, it was clearly Arthur. America lost a great friend and a great person when it lost Arthur.”
Added Frank Craighill, “Arthur was good friend of all of ours and a unique human being. … That original group of Arthur, Stan [Smith], Bobby Lutz and Charlie Pasarell were a fabulous group of athletes — all of whom accepted the responsibility of their roles and who did all the right things. The latter group of athletes changed.”— Terry Lefton
Longtime NASCAR driver agent Rod Moskowitz is spinning off from Motorsports Management International to create his own agency by acquiring the contracts of top drivers Denny Hamlin, Kasey Kahne and Jamie McMurray.
The new agency, which will be known as Fuel Sports Management Group, will be run by Moskowitz, who worked for MMI for 11 years, and former Ray Evernham Motorsports executives Rick Russell and David Jessey. Evernham, who at one time considered buying MMI, will be an adviser and member of the board along with Jack Giarraputo, Adam Sandler’s partner at Happy Madison Productions.
MMI founder Cary Agajanian will continue to represent Tony Stewart and work in NASCAR, as well as drifting and other motorsports. He expects to maintain a close relationship with Fuel Sports Management.
“I’m a big supporter of the entrepreneurial spirit, and that’s why this has been cooperative and agreeable decision,” Agajanian said. “Whatever he does in the future, we’ll still have an affiliation, and it will allow MMI to concentrate on some growth areas we weren’t able to focus on before. I want to see Rod succeed. He’s worked very hard for us and done a great job.”
Moskowitz said, “Cary’s been a visionary in motorsports, and he wants to see people that he’s mentored, like myself, continue to grow in their career. He wanted to put more of his time into driver development, and our interest is in providing elite drivers with first-class support. We have three elite drivers, and to the extent we execute and exceed the drivers’ expectation, we’re confident our business will grow and we’ll add other high-profile drivers.”
Moskowitz, who has a law degree from the University of Maryland, says Fuel Sports Management Group will offer athlete management, sponsorship sales and consulting services. His vision is to put more emphasis on marketing and sales that strengthen the drivers’ businesses. Jessey, who will serve as the agency’s executive vice president of sales and marketing, will use his experience in team sales at Evernham Motorsports to help teams secure new partners, build drivers’ endorsement portfolios and support the drivers’ other foundations and other businesses.
Jessey’s efforts will be centered on the businesses around McMurray, Hamlin and Kahne. The opportunities around McMurray and Hamlin are somewhat limited because the bulk of the inventory on their cars is sold. McMurray drives Earnhardt-Ganassi Racing’s No. 1 car sponsored by McDonald’s and Bass Pro Shops, and Hamlin drives for Joe Gibbs Racing’s No. 12 car sponsored by FedEx Kinkos. But Kahne is moving from Red Bull Racing to Hendrick Motorsports’ No. 5 car in 2012, and will need to find a long-term sponsor for that car. He also has a World of Outlaws team with three cars for which Fuel Sports Management will sell sponsorships.
“A few years ago, when I was at a race team, we didn’t want outsiders coming in and offering help,” Jessey said. “Now that’s changed. Almost every team is working with agencies or multiple agencies, so the sales business will be one big part of what we’re doing.”
If Fuel Sports Management succeeds in packaging a driver with a sponsor and bringing it to a team, its driver likely would enjoy more leverage in contract negotiations, but Moskowitz said that’s not why the agency is focused on sales.
“For any good sponsorship to work well, it has to make sense for the team owner, the sponsor and the driver,” Moskowitz said. “To the extent we can assist the teams in working to secure additional sponsorship, particularly associated with our driver clients, we view that as a win-win result and the team will have more resources to perform better on the track and the driver will increase his marketability.”
Fuel Sports Management will be based in Mooresville, N.C., where it will lease space from Evernham.
Evernham looked at buying MMI a year ago but backed off in order to focus on his own consultancy instead. As an adviser to Fuel Sports Management, he will lend a supporting role by talking to drivers looking for racing insights.
Agajanian founded MMI in 2000, and quickly built it into one of the leaders in the driver representation business. He said MMI plans to build out its drifting business and develop some new media and marketing capabilities.
“I love the business of managing and directing young drivers’ careers, and MMI will still do everything we did before, but I believe we’ll be focused a lot more on these other areas of business,” Agajanian said.
Free agency usually starts with the new league year, and that point would have come earlier this month in a normal NFL year. But without a renewed CBA, agents and general managers were cooling their heels.
While no one last week knew exactly what the new free agent system would be for players — whether part of an agreed-to deal or if the NFL puts in new rules to operate the league — many agents were expecting that players with four years of service would be able to be free agents.
“If there is a new agreement, it is going to be four years,” said one prominent agent. “The players are not going to give on that.”
This agent added that NFLPA Executive Director DeMaurice Smith was very strong on that point during the union’s agent seminar at the NFL combine in Indianapolis last month.
That was the system until last year, the final, uncapped year of the expiring CBA, in which players had to wait six years instead of four to become unrestricted free agents. Players with four and five years of service last year were restricted free agents, and most of them signed one-year tenders.
In a normal year, there would be about 400 unrestricted free agents. If and when there is a new deal, assuming four years to free agency, agents say there could be more than 600 unrestricted free agents on the market.
In sports across the board, stars get paid and get picked first. Some agents think that players who are considered second-tier guys might not get big, multiyear deals in a market flooded with talent and will settle for one-year deals instead. Others say no, because while there will be a lot of free agents on the market, there will be a lot of open job slots, as well. That could bode well for players.
In any case, the longer it takes for the NFL and NFLPA to reach an agreement, the shorter the time frame may be for agents to negotiate any large number of player contracts. “It could be pretty hectic,” said one agent.
Agents asked for anonymity because they were not authorized to speak publicly on CBA negotiations or what a future system might look like.
Adding to the uncertainty is the fact that many star players, such as Peyton Manning, were franchise tagged by their teams. The NFLPA has taken the position that the franchise tags are not enforceable because the designation was made for a year, 2011, in which there is no CBA, while the NFL says the teams have the right to tag players. Whether or not those tags stick could be a matter for litigation if it is not something the league and union can agree on in collective bargaining.
ORNSTEIN SENTENCE DELAYED: NFL insider Mike Ornstein, best known as the former marketing agent to Reggie Bush, is scheduled to report on March 29 to FCC Florence, a federal prison in Florence, Colo., about 90 miles south of Denver, according to an official with the U.S. Marshals office in Cleveland.
A Cleveland federal judge originally ordered that Ornstein report to prison March 3 for the eight months he was sentenced to in November. The Federal Bureau of Prisons inmate locator showed last week that Ornstein was not in Bureau of Prisons custody after previously being listed as “in transit,” which is federal law enforcement terminology for being in the custody of U.S. Marshals.
It was not clear why the reporting date was changed for Ornstein, who was seen in Indianapolis last month for the NFL combine. Many of the court documents in the Ornstein case have been sealed.
Ornstein pleaded guilty last year to two felonies involving scalping Super Bowl tickets and the sale of NFL jerseys falsely advertised as game-worn.
CAA SPORTS SIGNS FREESE: CAA Sports has signed David Freese, starting third baseman for the St. Louis Cardinals. He will be represented at CAA by a team of agents, led by Nez Balelo. He was formerly represented by Tannenbaum Sports Management.
Liz Mullen can be reached at email@example.com. Follow her on Twitter @SBJLizMullen.