Ex-Dartmouth Quarterback Sees AAF Collapse as a ‘Great Case Study’

(Bloomberg) -- Jack Heneghan is uniquely positioned to offer an opinion on why the Alliance of American Football flopped after just eight weeks.

Heneghan was a quarterback with the Arizona Hotshots, one of the AAF’s eight teams. He also has an economics degree from Dartmouth College, which might someday use the collapse of the upstart football league as a lesson in how not to do things.

“It’d be a great case study for a venture capital class or a funding-new-business class,” he said on the Bloomberg Business of Sports podcast.

The league’s original investors included a handful of venture capital firms, such as Peter Thiel’s Founders Fund and Slow Ventures. Other backers include the Chernin Group. A week after its February launch, the league got a $250 million commitment from Tom Dundon, the owner of the Carolina Hurricanes hockey team. In return, he became its executive chairman -- with decision-making control.

The league ultimately faltered after Dundon failed to secure an alliance with the dominant National Football League, a relationship that might have allowed the AAF to become a farm league of sorts for the most lucrative sports organization in the U.S.

Patience Needed?

The lesson, Heneghan said: A league like the AAF needs someone with deep pockets, yes, but more importantly, a willingness to let the business grow over time.

“Patience definitely would’ve been a virtue with something like this, where the ideal end product would be a healthy, thriving minor league for the NFL,” he said, emphasizing that he wasn’t privy to the business discussions of the league’s investors.

Dundon didn’t respond to several email requests for comment on his decision to shutter the league’s business operations earlier this week.

“If you look at just the football, it was getting towards what it should’ve been,” Heneghan said. “It looked like the second half of an NFL preseason game.”

Heneghan may get another shot at spring football.

WWE founder Vince McMahon’s XFL league is scheduled to begin play next year. McMahon tried the idea once before -- it lasted one season. But Heneghan sees one big advantage for the XFL.

“Having one sole investor that is also the founder is probably a good thing,” he said. “I’d be interested in playing, sure.”

To contact the reporters on this story: Scott Soshnick in New York at ssoshnick@bloomberg.net;Eben Novy-Williams in New York at enovywilliam@bloomberg.net

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, John J. Edwards III

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