hen March Madness kicks off with Selection Sunday this weekend, many eyes will turn to the potential Cinderella stories, the triumphs of little-known teams over well-favored competition—games that bust brackets and lead highlight reels.
College basketball is built on the excitement of upsets. But these briefly victorious underdogs still have no chance to catch the sport’s financial juggernauts, as our latest ranking of the most-valuable college basketball teams shows.
Consider some of the biggest surprises of the past decade. Butler (a No. 8 seed that went to the championship game) and Virginia Commonwealth (No. 11, Final Four) in 2011, Wichita State (No. 9, Final Four) and Florida Gulf Coast (No. 15, Sweet 16) in 2013. All have seen their financials improve—the four teams saw their collective revenues rise by 18% in the year following their tournament runs—yet not one ranks among even the nation’s top 50 basketball programs in terms of annual revenue.
Meanwhile, the Louisville Cardinals have made the NCAA Tournament just once in the past three seasons—a second-round exit in 2017—and have been mired in the fallout from a prostitution scandal and FBI investigation. But they rank No. 1 on our list, and no college basketball team makes more money. Louisville turned $23 million in profit last year, making it more profitable than the NBA’s Cleveland Cavaliers, Oklahoma City Thunder and Charlotte Hornets.
From the 2014-15 season through the 2016-17 one, Louisville basketball averaged annual revenues of $52 million and profits of $30 million; across those three seasons, just four other college teams had more than $30 million in average revenue. The Cardinals play at the state-of-the-art KFC Yum! Center, the third-biggest arena in college basketball. Between that home arena and the nation’s second-most-valuable apparel deal ($11 million annually from Adidas), Louisville leads the field in revenue from royalties and sponsorships. Last season the team ranked third in total home game attendance despite a mediocre on-court performance; ticket sales totaled $14 million.
Those are impressive revenue streams, but what really cements Louisville’s position at the top of the list is an army of well-heeled boosters. Louisville’s athletic department receives more than $30 million a year in contributions. Not only does that total rank alongside some of the biggest athletic departments in the nation—Alabama, Michigan and Ohio State, for three—but it does so without the benefit of a powerhouse football team. (In the past three seasons, the Cards have gone 19-19 on the gridiron.) Louisville’s basketball team accounts for 72% of its athletic department’s booster donations, an average of $24 million a year between 2014-15 and 2016-2017. For context, the basketball squads at Michigan, Arizona and Michigan State bring in an average of $15.5 million combined from boosters over those same seasons.
Close behind the Cardinals in total revenue is cross-state rival Kentucky, which has generated an average of $49 million per year. The Wildcats have led the nation in average home game attendance for eight of the past ten years. Last season’s average of 22,000 fans per game was at least 30% higher than all but five other teams, and it resulted in $22 million in ticket revenue.
Unlike the Cards, the Wildcats have consistently dominated on the court, too. Kentucky has missed the NCAA tournament just twice in the past 27 years, a stretch that includes three championships and 15 trips to the Elite Eight. And among teams at public schools, nobody spends more on recruiting, coaching salaries, support staff, team travel or basketball equipment ($15 million altogether).
Rounding out the top-five most-valuable college basketball teams are three of the oldest members of college hoops royalty: Indiana, Duke and Kansas. Those three programs have been synonymous with the sport since the turn of the century. Kansas, in fact, started its program under James Naismith himself, just eight years after he invented the game of basketball. Combined, the three teams generate over $100 million per year in revenue.
One area not contributing much to each team’s bottom line? The NCAA Tournament’s prize pool.
Yes, the deep tournament runs—and those Cinderella stories—are hugely important for the national exposure that in turn drives TV revenue, merchandise sales and sponsorship deals. But the cash the NCAA pays out for its March Madness champions is actually quite minimal. A trip to the title game could be worth $8.8 million to a team’s conference, but that payout is spread over six years and shared among all conference members. All told, this year’s tournament winner could take home as little as $100,000 per year from its championship victory.
Our ranking of college basketball’s most-valuable teams is based on three-year average revenues across the 2014-15, 2015-16 and 2016-17 seasons (ties in revenue were broken using average profits). To determine team revenues and expenses, we relied on annual filings made by each school’s athletic department to the NCAA and the Department of Education. We also made adjustments to individual line items like contributions, media rights and sponsorships to adjust for differences in accounting practices among athletic departments. (The three private schools on our list—Duke, Syracuse and Marquette—declined to share financial details beyond those published by the Department of Education.)
Each team’s conference earns a tournament unit for every game played, excluding the championship and any first-round games played by conference champions. Those units have a six-year shelf life, and they’re currently worth around $275,000 per year (the value increases slightly each year).
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