It’s been a roller coaster of a ride for the XFL as they laid off all of their staff last Friday and this past Monday, filed for Chapter 11 Bankruptcy. The XFL operated as a single entity league, meaning they controlled all aspects of the business from player signings, coaches, trainers, and other staff members.
Right now, there are rumors out there speculating that there are people interested in buying the XFL. There have been plenty of leagues in the history of sports that have operated as a single entity league. But, not all of them have survived for the long haul. Currently, there is only two single-entity leagues, and they are Major League Soccer and the Premier Lacrosse League.
Starting as a single-entity league is not bad for beginners. However, from a business standpoint, you’re going to have to turn it into an independently owned-league. When the Arena Football League started in 1987, they were a single-entity league.
As the sport became popular, they became more of independent and gained new owners such as Jon Bon Jovi of the Philadelphia Soul, John Elway of the Colorado Crush, Jerry Jones of the Dallas Desperados, and Tom Benson of the New Orleans Voodoo. These names helped get the league noticed for over five years until the league’s finances were out of control, and it folded after the 2008 season.
When the AFL relaunched in 2010, things seemed to be back on track. Former teams were making their return, but by 2013, things went downhill fast. Teams either folded or relocated to other leagues, and the league became a single entity league with four teams. In their final season in 2019, the league brought in Columbus Destroyers and the Atlantic City Blackjacks to put the AFL at six teams. After the season ended, the league folded up shop for good.
The AFL, like the original XFL, AAF, FXFL, and UFL, were operated as a single-entity league. While they did provide fans with great games, they were bleeding cash and folded up shop. Some leagues owed money to stadiums, players, coaches, medical staff, and others, with a few cases that have gone to court like Dennis Green’s suit against the United Football League in 2012.
While a majority of leagues have failed, one league has had success in operating as a single entity league, and that is Major League Soccer. MLS doesn’t operate as an association of independently owned teams but are individually operated by league investors. Meaning club operators own a financial stake in the league, not their individual teams.
I think most single-entity leagues have aimed to do a similar business plan like the MLS but have not gotten far. Remember, it took Major League Soccer almost twelve years before becoming profitable. During those twelve years, they lost a lot of money, and two teams folded during that time. Once the league began to see success after 2002, they have grown into a twenty-six-team league with plans to reach up to thirty teams.
People who have started leagues have failed to read up on the history of other leagues that have operated as single-entity leagues. Instead of taking the time to study why they have failed, they just repeat those that have failed before them and become yet another stat of failed leagues. If you are going to start a league as a single entity, make sure you have a long-term plan to bring other people into the fold to grow the league that will go from a single entity league to an independently owned league.
Most people want new leagues to succeed, but the consistency of failures year after year from these leagues, makes it harder for people to take new leagues seriously knowing that they will be gone in a year. Again, single-entity leagues are not bad to start, but over time will become a problem if you don’t have a long-term plan.
