The University of Utah made history this week by becoming the first major college athletic program to partner with a private equity firm. The unanimous vote by the school’s board of trustees on December 10, 2025, approved a groundbreaking agreement with New York-based Otro Capital that could generate up to $500 million in capital.
The deal represents a significant evolution in college sports financing, one that will be closely watched across the industry. For the millions of families investing in youth sports as a pathway to college scholarships, understanding this shift matters. The model Utah is testing could reshape how college athletics programs are funded and operated nationwide.
The Deal Structure
The University of Utah will create a new for-profit entity called Utah Brands & Entertainment LLC to manage the commercial side of its athletic department. This includes ticket sales, corporate sponsorships, media rights, licensing, hospitality and other revenue-generating operations.
Otro Capital will take a minority ownership stake in exchange for a significant capital infusion, with the university maintaining majority control through its Growth Capital Partners Foundation. Athletic Director Mark Harlan will chair the board of the new entity, which will be led by an external president overseeing day-to-day operations.
The university retains control over athletic decisions including coaching hires, scheduling and student-athlete welfare. The deal includes an exit strategy allowing Utah to repurchase Otro’s stake after five to seven years.
Otro Capital was founded in 2023 by former RedBird Capital Partners executives, including Alec Scheiner, who previously served as president of the Cleveland Browns and senior vice president of the Dallas Cowboys. The firm was also instrumental in creating Legends Hospitality, a major player in stadium operations and sports venue management.
Why This Happened Now
The timing of this deal reflects the financial pressure facing college athletic departments nationwide. The House v. NCAA settlement now allows schools to pay student-athletes up to $20.5 million annually, with that figure increasing 4% each year over the next decade.
Utah athletics reported a $17 million deficit in fiscal year 2024, spending $126.8 million against $109.8 million in revenue. While the football program generated a $26.8 million profit and men’s basketball added $2.6 million, the remaining 17 sports programs lost $21.2 million combined.
Similar deficits exist across college sports. Ohio State, despite generating $254.9 million in revenue, ran a $37.7 million deficit. Colorado projected a $27 million shortfall. The traditional funding model of donor contributions and ticket sales is no longer sufficient to cover rising costs.
The Olympic Sports Question
The relationship between college athletics and Olympic sports development presents both opportunity and uncertainty under this new model. Olympic sports programs including swimming, diving, gymnastics, wrestling, track and field, and others represent the primary development pathway for American Olympic athletes.
Data from the U.S. Olympic and Paralympic Committee shows that 88% of American summer Olympians at the 2016 Rio Games competed in college. Over 70% of U.S. Olympic swimmers since 2000 came through collegiate programs. For winter sports at the 2018 PyeongChang Olympics, one-third of Team USA members were former college athletes.
Private equity firms typically focus on profitability and return on investment. The business-oriented decision making this brings could take several directions. Operational efficiencies and revenue optimization might generate resources to support a broader range of sports. Alternatively, pressure to maximize returns could lead to resource reallocation away from non-revenue programs.
The University of Utah has explicitly committed to maintaining its Olympic sports programs. President Taylor Randall stated the deal will help grow women’s and Olympic sports. The structure keeps athletic decisions including program offerings under university control rather than investor authority.
The question for youth sports stakeholders is whether improved revenue generation can sustain more comprehensive athletic programs, or whether profit pressure will eventually impact program offerings despite current commitments.
The Youth Sports Pipeline Connection
Changes to college Olympic sports programs would directly impact youth sports participation and development. College scholarships serve as a significant motivator for families investing time and money into youth sports training.
Research from the Aspen Institute shows that roughly 20% of youth sports parents believe their child has the ability to play Division I college sports. This belief influences enrollment decisions in travel programs, specialized training and development academies.
The impact on youth sports could unfold in several ways:
If college programs expand or improve through better revenue generation, more scholarship opportunities could increase youth participation in Olympic sports. Enhanced facilities and resources at the college level might strengthen the entire development pipeline.
Conversely, if college opportunities diminish, youth participation could be affected as families reassess their investments. Swimming, wrestling and gymnastics programs at the youth level rely heavily on the college pathway as a development goal.
Greg Earhart of the College Swimming and Diving Coaches Association noted in Sports Illustrated that changes to college programs create downstream effects. When parents make decisions about youth sports enrollment, news about college program changes factors into their calculus.
COVID demonstrated the interdependence between college and youth sports. When NCAA facilities closed to youth programs, junior diving programs that had been developing future Olympians lost access to facilities. Some coaches transitioned to college positions for stability. Four years later, some markets still face gaps in availability and coaching capacity.
Private Equity Already in Youth Sports
The entry of private equity into college sports parallels a trend already underway in youth sports. Over the past three years, Apollo Global Management co-founder Josh Harris and Blackstone executive David Blitzer have used their family foundations to acquire youth sports properties through a company called Unrivaled Sports.
Private equity involvement in youth sports brings both professional management and business pressure. Improved facilities, better marketing and operational efficiency can enhance the participant experience. The capital these firms provide enables facility upgrades and expansion that individual operators might not afford.
The concern among some advocates centers on accessibility. Higher facility fees, tournament costs and program expenses could accelerate economic stratification in youth sports. The counterargument is that professional management and economies of scale might actually improve efficiency and cost structure over time.
What Makes Utah Different
Several factors enabled Utah to move forward where other schools and conferences have stalled. The Big Ten explored a $2.4 billion private investment proposal with UC Investments last month, but the deal faced opposition from Michigan and USC. The complexity of getting 18 member schools to agree proved challenging.
Utah’s board of trustees has only 10 members, streamlining the negotiation and approval process. The school also took a more transparent approach, with President Randall and AD Harlan publishing an 800-word letter explaining their rationale on the same day as the board vote.
The university structured the deal to maintain control over athletic operations while partnering with Otro on the commercial revenue side. This separation allowed Utah to access private capital and operational expertise without ceding decision-making authority over sports programs.
Legislative Response and Legal Questions
The deal generated immediate response from lawmakers at both state and federal levels. Representative Michael Baumgartner of Washington posted on social media that Congress would examine the tax-exempt status of universities entering private equity deals. Earlier this year, he introduced the PROTECT Act, legislation aimed at blocking private equity deals with athletic departments or conferences.
Utah state senators Daniel McCay and Nate Blouin expressed concerns publicly. Representatives Brendan Boyle and Lori Trahan also questioned the approach on social media.
Legal experts have varied perspectives on the implications. David Gringer, a partner at WilmerHale specializing in antitrust issues in higher education, told Front Office Sports that treating private equity as a “boogeyman” is misguided. He noted that LLC structures have been used by other schools like Kentucky, Michigan State and Clemson, albeit without private equity involvement, and provide clear benefits including dedicated funding sources and operational flexibility.
Frank Azzopardi, a partner at Davis Polk, expressed surprise at Utah creating a for-profit entity during the SBJ Intercollegiate Athletics Forum, citing potential implications for the university’s 501(c)(3) tax status.
Gringer countered that threats to strip tax-exempt status are unnecessarily inflammatory, calling it “absurd” to penalize a school’s overall tax status based on a standalone entity with private equity investment.
The legal and regulatory framework for these partnerships remains unsettled, creating uncertainty for other institutions considering similar approaches.
What Youth Sports Leaders Should Watch
For those operating youth sports organizations, several aspects of the Utah deal offer learning opportunities:
Program Sustainability: Track whether Utah maintains or expands funding and roster sizes for Olympic sports programs. Positive outcomes would validate the model, while program reductions would signal potential risks across college athletics.
Operational Excellence: Otro brings expertise in ticketing, sponsorships, licensing and hospitality that college programs have traditionally handled internally. Youth sports organizations may identify similar opportunities to professionalize revenue operations and improve business performance.
Donor Equity Participation: Utah offered major donors the opportunity to purchase stakes in the new entity. This model combines traditional philanthropy with investment returns, potentially providing a blueprint for youth sports organizations seeking capital while maintaining operational control.
Revenue-Generating Innovation: The partnership aims to identify new revenue streams through professional sports expertise. Successful innovations at the college level could be adapted for youth sports contexts.
Five to Seven Year Timeline: The deal includes an exit strategy after five to seven years. This timeframe will reveal whether private equity partnership can genuinely improve financial sustainability or if it merely delays difficult decisions. The performance metrics and outcomes over this period will be instructive.
The Broader Trend
Utah’s deal is positioned as a first mover rather than an outlier. Industry executives told Front Office Sports they expect more deals to be announced over the next 12 to 24 months, though likely at a measured pace rather than rapid adoption.
Ben Fund, a partner at Carlyle Group, noted that private equity firms are actively interested in college sports opportunities. Chuck Baker, co-chair of Sidley Austin’s entertainment, sports and media practice, said the main question among both private equity and university clients is whether this will accelerate similar deals elsewhere.
Several schools including Kentucky, Michigan State and Clemson have created similar for-profit entities for revenue generation, though none have partnered directly with private equity firms. These structures provide existing models for separating commercial operations while maintaining university control over athletic decisions.
The difference with Utah is the capital partner. Otro brings both immediate funding and operational expertise from professional sports. Whether this combination delivers better outcomes than university-managed entities will influence how other schools approach their financial challenges.
The Youth Sports Impact
The impact on youth sports depends on how private equity-backed college programs balance financial performance with program breadth. Several scenarios are possible:
Enhanced revenue generation could strengthen college programs across all sports, improving scholarship opportunities and facility quality. Better business operations might create efficiencies that support rather than threaten Olympic sports.
Alternatively, sustained pressure for returns could lead to difficult decisions about program offerings despite current commitments. The five to seven year timeline before exit strategies take effect will be telling.
The Los Angeles 2028 Olympic Games adds relevance to this question. With international competition on American soil, the strength of college programs producing Olympic athletes will be on display.
For youth sports families making long-term investment decisions about their children’s athletic futures, the Utah deal represents a model worth understanding. The answers emerging over the next several years will inform whether similar structures spread across college athletics.
The deal closes in 2026, when Utah Brands & Entertainment begins operations. Whether private equity partnership proves to be an effective solution for college sports sustainability, and what that means for youth sports pathways, will become clearer as results emerge.
The seal has been broken. Private equity has officially entered college sports. How this influences youth sports development will be determined by the execution of this first major partnership.
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Sources
Photo: UtahUtes.com
Primary Reporting:
- Dellenger, Ross. “Sources: University of Utah nearing landmark private equity deal expected to generate $500 million.” Yahoo Sports, December 9, 2025.
- Horney, Ben. “The Private Equity ‘Boogeyman’ Shows Up at Utah.” Front Office Sports, December 12, 2025.
- Axios. “Private equity makes its first college sports play.” December 10, 2025.
University of Utah Coverage:
- The Salt Lake Tribune. “University of Utah nears private equity deal to fund athletics department with Otro Capital.” December 9, 2025.
- The Salt Lake Tribune. “How might private equity’s deal with the University of Utah turn gold? How might it turn sour?” December 10, 2025.
- Deseret News. “University of Utah proposes private equity deal to fund athletics.” December 9, 2025.
- KSL Sports. “University of Utah Announces Landmark Private Equity Deal.” December 9, 2025.
Financial and Industry Analysis:
- Bloomberg. “Private Equity Firm Otro Wins College Sports Deal With University of Utah.” December 10, 2025.
- Wetzel, Dan. “Beware, college sports, private equity has arrived.” ESPN, December 2025.
- Business of College Sports. “Is Private Investment on the Way Into College Sports or Getting Banned?” 2025.
Olympic Sports Pipeline:
- Sports Destination Management. “As Colleges Cut Teams, USA Loses Prospective Olympians.” 2020.
- Bloomberg. “America Is an Olympic Powerhouse, College Sports Rules Could End It.” September 4, 2025.
- SwimSwam. “Now Is the Time: A Call to Protect Collegiate Olympic Sports.” 2025.
- Epstein, David. “Why America’s Olympic Pipeline Might Start Leaking.” The Range, 2025.
- AInvest. “The Shifting Financial Dynamics of College Sports and Its Impact on U.S. Olympic Dominance.” 2025.
Private Equity in Youth Sports:
- The New York Times. “Youth Sports Are a $40 Billion Business. Private Equity Is Taking Notice.” 2025.
- NPR. “When private equity invests in youth sports facilities.” November 25, 2025.
- Vice. “Is This the End of Youth Sports?” 2025.
Additional Context:
- Sports Business Journal. “The NCAA settlement puts Olympic and non-revenue sports on the brink.” June 30, 2025.
- El-Balad.com. “Otro Capital to back University of Utah in college sports’ first private-equity partnership, aiming to raise $500 million.” December 9, 2025.
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