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John Hendricks Q&A 'We’re able to invest with confidence'
By Scott French, Soccer America Discovery Communications founder and CEO John Hendricks fell in love with women's soccer at the 1996 Olympics. His latest creation -- the WUSA -- may give the sport a true national, and international, presence. SOCCER AMERICA: How did you get into soccer? JOHN HENDRICKS: It was with my kids, my daughter [Beth] and son [Andrew] -- they played very early. ... I never played when I was a kid. I loved sports, especially team sports, and I played the typical baseball and football. ... It kind of culminated for us when we went to the Olympics in 1996. I was overwhelmed by the crowd assembled in Athens, Ga., and by the deep connection made by most of the kids in the audience, cheering. And it was not just Mia Hamm -- they knew all the other players. I just knew in the stands that night that the missing ingredient was television, that if television was added, it would be overwhelming for the country. ... It was kind of a milestone for me. SA: You've never played? JH: No. ... Well, with the kids sometimes. Postseason father-daughter games. ... Soccer wasn't offered at our high school at all, and not at the University of Alabama-Tuscaloosa. UAH [Alabama-Huntsville] did have a soccer team -- it was a big sport at UAH. When I was there, I actually went out to a couple games. It was fun to watch. I really didn't get involved in any depth until the kids started playing.
SA: When did you first start thinking about creating a professional women's league? JH: I'm going to guess '97. I was reading USA Today one morning, I saw that the NSA [National Soccer Association] was being formed, that one of the cities was Washington. And I saw to my dismay that for the venue, they had picked a local high school, one right down the street from us. Throughout my business life, I've had -- as many people do -- the philosophy that you don't have a second chance to make a good first impression. ... I called Brit Kirwan, who was the president at the University of Maryland -- he's now [president] at Ohio State -- and said, "Wouldn't you like a pro soccer team with Mia Hamm, that caliber of player, at the University of Maryland?" I got a very favorable response. I connected that day with [NSA consultant] Jen Rottenberg, said, "Instead of a high school, how about the University of Maryland?" That was kind of how I got started into it. Jennifer asked me if I'd consider being an investor. I said, "Sure, I'll take a look at the business plan." Several months later, I talked with [U.S. Soccer professional development committee chairman] Burt Haimes and [former USSF President] Alan Rothenberg. It seemed at the time there was a lot of focus on the '99 World Cup, raising sponsorship for that. It seemed most of the soccer community was anxious for the focus to be for the World Cup. I think that's what ultimately happened to the NSA: The timing was wrong. ... In retrospect, it was probably a good decision. It let this phenomenal event happen, which was the springboard for the WUSA. SA: How has the WUSA impacted your duties, or your time, at Discovery? JH: Not much. Discovery is my full-time occupation. It's still a great adventure for me professionally to continue to grow Discovery worldwide. ... I do what most CEOs do, focus on the next five years' development and start to grow the next five- to 10-year time frame. SA: What are your day-to-day WUSA duties? JH: There's a board of governors; I'm the chairman of that. The board meets by telephone about once a month. There are six of us on the board: the five investors -- Time Warner, Cox, Comcast and Amos Hostetter. Julie Foudy is the sixth representative. [My responsibilities are] more on overall guidance. I'm more involved with the strategy, making sure all the ingredients of success for the league are in place: final approval of the television exhibition plan, final approval of all venues, all the salary, budgets ... things like that. SA: How much are you, and your fellow investors, willing to lose? JH: We faced that as we went through the business plan. First, you have to come up with the amount of losses we could have over the next five years. We feel it will take four or five years to get to operational break-even. The business plan calls for losses of $37 million. We're all committed to $40 million. We went beyond -- we felt we needed an additional amount of money we'd be willing to invest on a per-market basis for venue development. That's another $24 million, a total of $64 million. With this investor group, if we got into a fifth year and said, "Hey, we need another $20 million," everyone would be willing to fund this, whatever amount it would take. We're able to invest with confidence. With this group, we have television [companies involved], and a big part of any sports league is promotion. This investor group guarantees great television exposure. Not only games, but commercials. I know that was an element of success for the '99 World Cup. People fell in love with this team; there were all those great commercials -- Julie in the doctor's office ... That's what we'll be creating in January and February, a whole slate of wonderful commercials featuring all the players Americans fell in love with, plus all the international stars -- Sun Wen and Sissi, all this talent. Now, if we were missing any of these elements, it would be tough to start a league. And if we were missing the world's best players, it would be a problem. If we were missing the financing, it would be a problem. If we were missing promotion and television exhibition, it would be a problem. Those are the bedrock, and they give all a great sense of optimism. SA: Can you envision best-case and worst-case scenarios for the next year, five years, 10 years? JH: We don't know how far up is. Here's what's expected: We'll get to operationally break-even if we have an average attendance at each game of 7,500 people with ticket sales at $11.50 each. That's the target. If it's a little less, nobody will be concerned, but we expect it will be at that level, perhaps much higher. We'll just have to see. SA: So, you can see no scenario in which the league would fail? JH: I can't. It's hard for us to imagine that with the financial support, the television support we have. Soccer is something growing in the population, not declining. More and more young people play soccer. We're pretty optimistic. Now, if I was talking this time last year -- when I wasn't certain we'd get all the top U.S. players and all the top international stars, wasn't sure about the venues in each market, wasn't sure about television -- I'd have a different position. That's why we worked so hard to make sure all the elements were in place. SA: Is there anything in particular you learned to do or not to do because of MLS' experience? JH: I studied MLS, studied other sports leagues. Just making careful to have five years of funding in place, make sure we have the marquee players, that's an advantage we have over -- right now, they're starting up a major-league lacrosse league, and one has to ask: Are there stars that will resonate with the fan base? That's a real advantage we have: Brandi, Mia, Sun Wen. The soccer community really recognizes those stars. Imagine a pro basketball league that didn't have a Michael Jordan. We have that. We have a Mia Hamm. Scott French is a senior editor at Soccer America Magazine
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