A new book tells the story of UFC, a business and a sport
Oliver Bateman
The Ultimate Fighting Championship, the world’s largest mixed martial arts organization, generates over a billion dollars in revenue annually for parent company Endeavor Group Holdings. It is the only profitable MMA organization in the world; the rest are loss leaders. This exhibition of cost-effective business acumen is chronicled by longtime video game writer Michael Thomsen in his recent book, Cage Kings: How an Unlikely Group of Moguls, Champions, & Hustlers Transformed the UFC into a $10 Billion Industry.
Thomsen chronicles the UFC from its humble beginnings in 1993, when figures such as Bob Meyrowitz, Art Davie, and Rorion Gracie launched a no-time-limits, few-holds-barred fighting tournament that quickly gained national notoriety and surprising pay-per-view success. Early on, national efforts led by late Arizona Sen. John McCain sought to limit its reach, which thrust it into financial uncertainty. The beleaguered UFC was sold in 2001 to the Fertitta brothers, casino magnates who transformed the company, under the stewardship of their high school friend Dana White, into the industry leader it is today.
DONALD TRUMP MAKES PIT STOP AT UFC 290 FOLLOWING LAS VEGAS RALLY
Together, the trio was able to weather significant financial losses for several years. Homegrown stars like Tito Ortiz and Chuck Liddell emerged. Then-global leader PRIDE Fighting Championships saw its own profitable business wracked by revelations of yakuza involvement. And The Ultimate Fighter reality show, buoyed by a bloodbath main event between light heavyweights Forrest Griffin and the recently deceased Stephan Bonnar, became a surprising hit for Spike TV.
Thomsen’s narrative traces the careers of influential UFC fighters Randy Couture, Nick Diaz, Ronda Rousey, and Conor McGregor — well-known stories sourced largely from existing autobiographies or biographies of these individuals. However, it’s the character of Dana White, and his uncompromising strategy to maintain cost and message control, that command our attention.
The most crucial component of the UFC’s success has been its astoundingly low costs, primarily achieved through a deliberate policy of fighter pay so low it has been the subject of litigation for the better part of a decade. Endeavor only pays 17.5% of its 10-figure revenue back to the 600 or so fighters on its roster. This model is an incredible bargain for UFC management next to higher-revenue unionized sports like the MLB (54%), the NBA (50%), or the NFL (48%). Even smaller, similarly union-free MMA competitor Bellator, run by White’s longtime fight-promoter rival Scott Coker, returns 44% of a much smaller pool of revenue ($6 million in 2022). Many journalists covering MMA, such as Jonathan Snowden and Ariel Helwani, highlight these disparities in their work, which Thomsen draws on. Yet the cost of critical coverage is that those two were personally blackballed by White, underlining the UFC’s tenacious control over media messaging — a crucial factor in maintaining its image and negotiating power. In its current form, the UFC essentially covers itself, with most of the reporting on broadcast partner ESPN done by UFC employees.
Thomsen reveals how White compensated star fighters off the books to avoid disclosure and thus maintain lower salary expectations across the roster. Still, this genius for nuts-and-bolts tactics doesn’t render White strategically infallible; he has launched disastrous personal ventures into boxing promotion and, most recently, a ludicrous foray into slap fighting. Thomsen wisely spends minimal time on White’s politics, aside from noting that he supported Donald Trump and wants to pay as little tax money and deal with as little regulation as possible — a refreshing change from Abraham Josephine Riesman’s dreadful Vince McMahon biography, Ringmaster, which spends 300 wafer-thin pages tying the WWE magnate’s every move to the former president’s.
Given its recency, Thomsen can’t delve into the Endeavor Group’s recent acquisition of the WWE. Despite superior production values and brand recognition, the WWE has a lower annual revenue and a lower overall valuation than the UFC, and it will be interesting to see if staff positions will be slashed at both organizations as a result of the merger, as they were when Endeavor acquired the UFC in 2016. Under the administration of CEO Nick Khan, the WWE has done a fair bit in the past half-decade to improve wrestler and staff pay. Even so, the world’s largest wrestling company paid out $112 million to its 224 active wrestlers in 2022, or a measly 8% of annual revenue — meaning Endeavor will now have two of the most cost-effective nonunionized producers of streaming sports content under one roof.
The success story of the UFC, as Thomsen emphasizes, is deeply American. It mirrors corporations like Amazon and Walmart in its low-cost, high-revenue model. The UFC proved its worth as a content producer by remaining open during the pandemic; it had no union of athletes that could stop it, and its shows could be hosted in their small Apex facility in Las Vegas. And it had a more or less captive, entertainment-starved audience for several months to grow its brand and further increase its revenue. Partnering with countries such as China, Russia, and the Gulf States underscores the UFC’s relentless pursuit of profit. In that sense, it is a truly modern business enterprise, a child of the anything-goes 1990s corporate world: Cut everything to the bone, expand everywhere, innovate only in areas where a return can be expected — for example, the UFC video packages and fighter kit designs remain mediocre relative to the size of the company because they don’t add much to the business.
Cage Kings delivers a solid summary of the UFC’s ascendance, drawing on a wealth of existing work to spotlight some of the company’s many successes and occasional missteps. Thomsen’s book is hopefully the first of many mainstream releases to explore the inner workings of a company that has excelled at resisting scrutiny, reminding us that beneath the bloody spectacle lies a complex, and often ruthless, business machine.
CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER
Oliver Bateman is a journalist, historian, and co-host of the What’s Left? podcast. Visit his website: www.oliverbateman.com.