SBJ/July 1-7, 2013/Events and Attractions

New sponsorship sales boost revenue for Pro Cycling Challenge

The USA Pro Cycling Challenge will see more than 15 percent growth in total revenue this year over 2012, with the majority coming from new sponsorship sales. The growth comes despite a $2.5 million nonpayment from one of the race’s founding partners, Exergy Energy.

In its third year, the USA Pro Cycling Challenge will still lose money in 2013, according to CEO Shawn Hunter, but it is on pace to break even by 2015.

“We’ve added a lot of endemics from the cycling and endurance sports space,” Hunter said. “Our existing sponsor base is all on multiyear contracts, so it was nice to get interest from new brands.”

The race, which has an operating budget of approximately $10 million, begins Aug. 19 in Aspen, Colo., and finishes Aug. 25 in Denver.

At the founding partnership level — which industry sources valued in the mid-six figures — the race has added Jelly Belly jellybeans, diabetes pharmaceutical manufacturer Novo Nordisk, Clif Bar and Jackson Life Insurance. Also coming on board as a new partner at that level is Colorado State University, which will sponsor the Best Young Rider jersey that is awarded to the top rider under the age of 25.

Partners at that level earn branding along the course, activation in the pre- and post-race expo space as well as advertising on the race’s NBC Sports and Eurosport broadcast, and the Tour Tracker, a free online live streaming service.

The race also is adding two amateur mass-participant events, including the 108-mile ride on Aug. 11 in Fort Collins, which is being sponsored by UnitedHealthcare.

“We like the partnership because we can show that cycling isn’t just about pro racing, it’s something people can do regardless of age,” said Dave Tjaden, chief marketing officer for UnitedHealthcare.

The race’s growth in revenue comes after it launched a lawsuit against Idaho-based renewable energy company Exergy for delinquency of payment. Hunter declined to comment on the lawsuit, other than to confirm the race was seeking $2.5 million in back payments.

Exergy did not respond to emails or calls for comment.

Exergy came on board as a founding partner of the race in 2011 in a three-year deal. Industry experts valued the deal at $1 million annually. Exergy previously owned branding on the USA Pro Cycling Challenge’s race leader’s jersey and its podium. That branding space will be taken over by founding partner Smashburger.

Hunter said the race is currently talking with three brands about buying title sponsorship.

“Our model works — if one sponsor pulls out, we don’t collapse,” he said. “We are where we expected to be in year three.”

Fred Dreier is a writer in Colorado.

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