All-Star Varsity's Monopoly

[UCFKnights07]

<a href="">January 22, 2020</a>

 

[molls]

<a href="">January 22, 2020</a>

Justin Carrier (@JustinCarrier) <a href="">

 

[Hoosea]

An article was written by Matt Stoller who runs the newsletter BIG. This newsletter focuses on the politics behind monopolies as far as I can tell. He has done his homework and does a good detailed list of Varsity as a monopoly. He also mentions Fierceboard. Here is the link for those interested: This is Not a Democracy, It's a Cheerocracy: The Cheerleading Monopoly Varsity Brands - BIG by Matt Stoller

Ever watch the Penn & Tellar expose on Varsity. Worth the watch.

 

[Hoosea]

I keep seeing the line in articles varsity owns cheer gyms but it’s never expanded on, do people know what gyms they own or is it a secret type of thing?[/QUOT

 

[Hoosea]

I think that I know an Ohio gym that is owned by varsity. Why the secrecy? Considering Jeff Webb’s sworn testimony that gyms wearing Varsity uniforms score better at competitions both Varsity & their gyms know better than to provide the transparency.[/QUOTE]

 

[Hoosea]

UIL is becoming popular in Texas for High School Cheer. Is UIL tied to Varsity?

While UIL doesn’t falls under the Varsity Spirit brand, like all cheer, Varsity Spirit has a substantial business relationship with the organization that includes: insurance, training, certifications, cheer camp et al to running the UIL National Spirit Competition.

 

[Keep_Believing]

While UIL doesn’t falls under the Varsity Spirit brand, like all cheer, Varsity Spirit has a substantial business relationship with the organization that includes: insurance, training, certifications, cheer camp et al to running the UIL National Spirit Competition.

True, good point.

 

[Hoosea]

I can believe it.

Think of how many camp brands fall under Varsity:

NCA.
UCA.
USA.
UDA
NDA.

1. Google MAP how many cheer gyms and dance studios there are within 50 miles of you.

2. Then Google high schools and middle schools.

3. Assume that every MS and HS has a cheer or dance team.

4. Compare the school programs with the number of gyms/studios.

Even if you're in a gym-heavy area, school cheer participants usually outnumber all star.

90% of them are doing a camp with one of the above brands. Even if it's home/private.

I can definitely see school as the main moneymaker.

Parents are constantly reporting here that AS participant numbers are different than they used to be. It is still considered an elite sport that is not as accessible as HS.

In 2019 Varsity controlled 80% of cheer events - both all star and high school - that’s 600 events in total. They control 90% of uniform market and 90% of cheer camps. They are the only vendor that’s used for liability insurance. They are the only vendor that provides coaching certification for both all star and high schools. They have a controlling interest in both major all star “independent governing” bodies whose bylaws make it absolutely impossible to vote them out. For Christ sake up until last year these “independent governing” bodies had the same address as Varsity. Look at both USASF and IASF’s federal 990 reports to see Varsitys influence and financial control. If you look at leadership positions in the comp cheer industry guess what - they’re stacked with current/past Varsity employees. USA Cheer, which was supposed to be this sports saving grace, Board Of Directors, committees and main employees, is stacked with Varsity employees AND they share employees AND up until a couple years ago had the same mailing address as Varsity. STUNT, which USA Cheer markets as their idea was a Varsity concept (easy to find Stunts story online so why lie?) comprised to give the cheer world a legitimate sport. Only problem was the International Olympic Committee disagreed. Some sites list USA Cheer as a Varsity subsidiary. All of these groups are controlled by Varsity. And make no
mistake Varsity is behind the scenes quietly getting control of high school cheer. They are the largest contributor to the NFHS, sole vendor for many State cheer safety certification process, sole vendor for liability insurance coverage and sole vendor to run State cheer championships. When it comes to high school cheer, like comp cheer, Varsity writes the rules, enforces the rules and dominates every aspect of our athletes experience. That has to change.

 

[molls]

I think that I know an Ohio gym that is owned by varsity. Why the secrecy? Considering Jeff Webb’s sworn testimony that gyms wearing Varsity uniforms score better at competitions both Varsity & their gyms know better than to provide the transparency.

[/QUOTE]

I have worked on Varsity judging panels for several years (only in the all-star side) and have never even once heard anyone discussing the brand of uniforms a team is wearing. Honestly, the only time I've heard anyone discuss uniforms is if they're outright distracting or really visually appealing and adding to the overall impression of the routine. I know this information is mentioned in the article but as someone who is actively on the stand I don't see it being true.

I have my own frustrations with Varsity Brands as a former coach. But I truly believe that they have made fantastic strides in scoring. The system will never be perfect and cut and dry, but each year the numbers become more of a formula which is aiding in consistency. They are making changes to the scoring rubrics to try to alleviate athlete burn out. The process to become a judge with Varsity is not easy and they reward the judges who make the extra efforts to learn more by attending conferences and by being safety certified.

 

[Hoosea]

I have worked on Varsity judging panels for several years (only in the all-star side) and have never even once heard anyone discussing the brand of uniforms a team is wearing. Honestly, the only time I've heard anyone discuss uniforms is if they're outright distracting or really visually appealing and adding to the overall impression of the routine. I know this information is mentioned in the article but as someone who is actively on the stand I don't see it being true.

I have my own frustrations with Varsity Brands as a former coach. But I truly believe that they have made fantastic strides in scoring. The system will never be perfect and cut and dry, but each year the numbers become more of a formula which is aiding in consistency. They are making changes to the scoring rubrics to try to alleviate athlete burn out. The process to become a judge with Varsity is not easy and they reward the judges who make the extra efforts to learn more by attending conferences and by being safety certified.[/QUOTE]

Agree that the scoring process is getting better. That said there are some pretty serious scoring allegations from 2019 Worlds that as far as I know haven’t been addressed. I’d also add that the scoring process has gotten better not because Varsity necessarily wanted it that way. The issue of full score transparency has been a consistent parent/sponsor mantra as well as a contractual obligation imposed by outside forces. And why? Because 1) it makes us feel like we have some control of our $15,000 a year “investment” 2) it’s low hanging fruit - we can read and understand score sheets more so then we can digest the myriad of intermingling and evasive financial reports.

 

[Hoosea]

i mean i understood from the beginning that varsity didnt like the idea of cheerleading becoming an olympic sport.
im also kinda surprised that so many people back him and support him, he sounds like he could care less about the integrity or expanding cheerleading into a more respected sport, he only cares about dollar signs and selling overpriced uniforms and competitions to gullible gyms, owners and parents, etc....
i also wonder how accurate the statement of varsity makes most its money from camps... you would think at this point they are making the most from allstar competitions.

In 2019 Varsity was put on over 600 comps, with over a million paid admissions and it’s been reported 4 million US participants from elementary school through college. And that’s just the US and domestic revenue in excess of $2 billion, the business side of cheerleading is highly profitable.

That bodes well for VB’s new owner, Bain Capital, as it takes over a company that has always been a PE sweetheart.

The owner before Charlesbank, Leonard Green & Partners, paid $131 million for VB in 2003. That PE firm cashed out in 2014, giving itself a paper profit of nearly $1.4 billion — and that’s before all the dividends PE firms routinely award themselves. Bain Capital acquired them for 2.3 billion dollars for a reason.

This! Also, if you consider overhead costs it is significantly more to put on a competition than it is to fly a team around the country to put on camps. Every high school in our area goes to UCA or UDA camp. When I danced way back when, we were able to use our UDA camp to bypass regionals to get a bid to the UDA competition. Don't know if they do that anymore, but it was always the biggest pull for our studio to keep doing it year after year. They'd come in, teach a routine and the score it against the sheet. If you scored x or higher, you'd get an automatic bid.

Remember Varsity owns camps throughout the country meaning they’re probably located there. A lot of times the people running the comps serve as regional reps as well. I don’t think this is where the money is but I do think they use the camps as feeders for other Varsity endeavors like uniforms (they control 80% of the cheer uniform business). The money is in the comps - This is a company with over 600 comps a year leading to 3.2 million athletes paying comp fees and over a million spectators paying to get in the doors. And this is just the USA.

 

[Hoosea]

Serious question. Do you really think government is going to step in for cheerleading, especially when government specifically uses sports to bring in money?

Without a doubt I want some of these requirements challenged legally. However, people are going to have to open their eyes that the same legal issues with schools transporting athletes across state lines create loopholes and business opportunities to get around them. I'm guessing that's where the rule "must attend accredited camp" nonsense came from. I would hope parents would put pressure on school officials to challenge the legality of that requirement, but you can't ignore the fact that most of those camps take place on government owned properties and get a good portion of those expensive camps. In the case where Webb admitted requiring merchandise purchase for additional points, wouldn't you hope our legal system would fine him for admitting that and require him to cease that practice? Did they? If not, no one should be giving money to that comp.

I own up to the fact I defend Varsity on STP, but only to the extent I've noticed too many of these questionable big money requirements end up revolving around and requiring government owned facilities and land. It's happening in all youth sports, not just with Varsity.

I have my own thoughts on how to address this. It’s a tangled web for a reason.

 

[catlady]

I have my own thoughts on how to address this. It’s a tangled web for a reason.

.....what's the reason?

Also, I love to read business news, if you could please provide your sources for the uniform market share percentages, where they own camp land (your quote: "Remember Varsity owns camps throughout the country meaning they’re probably located there."), as well as, their acquisitions costs and debt to income ratio since you know so much about their private equity sale.

 

[caffeineandglitter]

.....what's the reason?

Also, I love to read business news, if you could please provide your sources for the uniform market share percentages, where they own camp land (your quote: "Remember Varsity owns camps throughout the country meaning they’re probably located there."), as well as, their acquisitions costs and debt to income ratio since you know so much about their private equity sale.

^Second the call for sources! While I definitely agree with your point that it is HIGHLY unlike that there would be a government antitrust enforcement action against cheer or any youth sports (too much $$ at stake!), I would be so interested to see the discovery in a private antitrust lawsuit! It would be nuts!

Personally, if there was a private lawsuit, I do think there's at least an argument to be made that the the MLB antitrust exception doesn't apply in the case of youth sports (especially those like cheer, which advertise "national" championship after national championship--hard to say interstate commerce is "incidental" to cheer when everything is aimed "nationally"). And I think a court would take a dim view of the same company setting the rules for uniforms and selling the uniforms--especially when that company can change the rules, like the full-top rule, and make everyone buy new uniforms.... But at the same time, the courts have been so hesitant to chip away at the sports exception--it's a tough call.

 

[catlady]

^Second the call for sources! While I definitely agree with your point that it is HIGHLY unlike that there would be a government antitrust enforcement action against cheer or any youth sports (too much $$ at stake!), I would be so interested to see the discovery in a private antitrust lawsuit! It would be nuts!

Personally, if there was a private lawsuit, I do think there's at least an argument to be made that the the MLB antitrust exception doesn't apply in the case of youth sports (especially those like cheer, which advertise "national" championship after national championship--hard to say interstate commerce is "incidental" to cheer when everything is aimed "nationally"). And I think a court would take a dim view of the same company setting the rules for uniforms and selling the uniforms--especially when that company can change the rules, like the full-top rule, and make everyone buy new uniforms.... But at the same time, the courts have been so hesitant to chip away at the sports exception--it's a tough call.

There's an argument, however, I don't think it would be strong enough even if someone was willing to fight Congress first and Varsity second. There are actually a plethora of cheer uniform companies to choose from if you don't want to give Varsity your uniform business. CHEER UNIFORMS

I have tried to find the various state laws concerning HS athletes attending sanctioned and non-sanctioned events, but the fact remains the majority of these camps, take place on government property. As far as STP, a private convention center owner can't make people stay at certain hotels and why would they? My aha moment was when I read an article from 2015, where a private convention center owner was fighting a bill that would allow government owned convention centers to use hotel tax dollars to use as incentives to get business for their government owned convention center....but, not the privately owned. Most would agree that's a glaring unfair business practice, but evidently it's okay if it's the government. ARTICLE

TIME Magazine quote: And municipalities that once vied for minor-league teams are now banking on youth sports to boost local economies, issuing bonds for lavish complexes that they hope will lure glove-toting tykes and their families. Tourism Commission Pushes for Broader Use of Hotel Tax Dollars
The New York Times ....I could post hundreds of these types of articles.