Now I know what you are thinking. He just became the highest paid coach in the United States for both professional and collegiate sports, how can he be undervalued?
In finance, you are only worth what you bring in right? If you are not generating revenue you will be shown the door, and if you bring in high revenue, your compensation will show it.
During the nine years Saban has served as head football coach, Alabama has compiled an overall official record of 101-18 (.849) (106-18 on the field), seven bowl game appearances with five victories, a share of five SEC Western Division titles, four SEC championships, and four national championships.
While this generates revenue from TV deals, merchandise, brand value, etc. It is more important to look at what he brings in off the field and why I believe he is worth more than $11 million a year.
This article[/embed]posted by Forbes in 2013 has shown that
Since 2007, Tuscaloosa has swelled its undergraduate ranks by 33% to over 28,000 students. Faculty count has kept pace: up 400 since 2007 to over 1,700. But it's more than growth - it's where the growth is coming from. According to the school, less than a third of the 2007 freshman class of 4,538 students hailed from out of state. By the fall of 2012, more than half (52%) of a freshman class of 6,397 students did.
The school realized $50 million more in out-of-state tuition revenue for last fall's incoming class than it did for the same class in 2007 ($76 million vs. $26 million). Kick in the additional $8.5 million in in-state tuition, which rose to $9,200 a year from $6,400 over the same period, and overall tuition revenue rose to $104 million from $46 million for the respective 2012 and 2007 freshman classes.
And that is only until 2012! If you look at todays figures the freshman classes are increasingly out of state students for Bama, and if you look at SAT/ACT/GPA/Admissions in general for Alabama the school is increasingly becoming a better academic school. The scholarship funds are up, academics are up, football keeps winning (or losing in national-championships), and the school is on a great trajectory.
More than 40 percent of UA's 7,559-member freshman class scored 30 or higher on the ACT, up from last year's record 36 percent.
so you can see the direct impact that Saban has really had on academics. There are several studies that show the football program has had a major impact on the schools academic success.
Going to another SEC school, I would certainly love my school to pay Saban $11 million a year, as he is worth every penny, and more.
Any thoughts on this? Anyone think $11 million is too high or not worth it? I know Bama won't become MF Harvard or anything, but is it implausible to think Bama could become a highly regarded business school? Right now they are listed as a top 50 public university.