How 5 Cutthroat Rivals Created the NFL

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It’s Friday. Learn how the NFL's founding fathers teamed up with the competition and why your "enemies" might just be your ticket to the big leagues.

Who knew forming a league required more balls than the game itself?

In this edition:

• The NFL's humble beginnings

• How to turn competitors into collaborators

• Plus: winner of the 1-on-1 call with Jordan!

Read time: 4 minutes

STORY

🏈 The Birth of the NFL

The Big Idea: Fierce competitors can achieve greatness through strategic collaboration.

Why it Matters: The NFL's journey from struggling startup to $16 billion enterprise offers lessons for any industry facing growing pains.

In 1920, a group of men gathered in a Canton, Ohio auto showroom to form what would become the National Football League. Among them was George Halas, representing the Decatur Staleys (later the Chicago Bears). The league's early days were chaotic - teams folded regularly, players jumped contracts, and the sport struggled for respectability.

Tim Mara, a bookmaker with no football experience, bought the New York Giants franchise in 1925, for $500. His first season was nearly a financial disaster, but a fateful game against the Chicago Bears featuring the legendary Red Grange drew 70,000 fans to the Polo Grounds, saving Mara's investment and demonstrating the sport's potential in major markets.

George Preston Marshall, owner of the Washington Redskins (now, Washington the Commanders), was a marketing innovator. He introduced halftime shows, a team band, and cheerleaders. However, his resistance to racial integration tarnished his legacy and highlighted the complex social issues the league would face.

Bert Bell, once owner of the Philadelphia Eagles, became NFL Commissioner in 1946. He introduced the "draft" concept, where the lowest-ranking teams got first pick of college players, helping to ensure competitive balance. This revolutionary idea would become a cornerstone of the league's success.

Art Rooney, known as "The Chief," founded the Pittsburgh Steelers in 1933. The team struggled for decades, but Rooney's patience and commitment to the league never wavered. His persistence paid off in the 1970s when the Steelers became one of the most successful franchises in NFL history.

These five men, along with others, implemented crucial changes that transformed the league. They standardized rules, expanded into new markets, and innovated in areas like television broadcasts. Their efforts, often involving heated debates and compromise, laid the foundation for the NFL's eventual dominance of the American sports landscape.

The key elements to the NFL's collaborative success:

• Rule Standardization: George Halas pushed for a uniform rulebook across all teams. Introduced film study for game preparation and strategy

• Market Expansion: Tim Mara's success with NY Giants proved viability in major cities. Mara pioneered radio broadcasts of games. George Preston Marshall drove expansion into southern U.S.

• Marketing Innovations: Marshall introduced division structure and championship game concept. Created team bands, cheerleaders, and halftime shows

• Competitive Balance: Bert Bell implemented the draft system in 1936. Allowed smaller market teams to compete for top talent

• Media Rights: Bell negotiated the first national TV contract in the 1950s. Set foundation for NFL's future as a TV powerhouse

• League Governance: Art Rooney often mediated disputes among owners. Advocated for revenue sharing between teams

• Collaborative Problem-Solving: Owners debated draft implementation, TV contracts, and team relocations. AFL-NFL merger discussions in the 1960s built on their groundwork

• Long-term Vision: Despite rivalries, owners prioritized league stability over individual interests. Recognized strong league would ultimately benefit all teams

The impact of their work is evident today in the NFL's massive popularity and financial success. What started as a loose association of teams is now a global sports and entertainment powerhouse.

Key takeaway: Even fierce competitors can achieve extraordinary results through strategic collaboration and shared vision.

Go Deeper: Read John Eisenberg's book The League to uncover the whole story.

SPECIAL ANNOUNCEMENT

INSIGHT

💰 From $500 Franchises to $16 Billion Empire

Let's break down the NFL's journey from struggling startup to financial powerhouse:

1. 1920s - Initial franchise cost: Tim Mara bought the New York Giants for $500 (about $7,000 in 2024 dollars).

2. 1960s - First TV contract: CBS paid $4.65 million per year for NFL broadcasting rights.

3. 2024 - Current TV deals: The NFL's media rights deals are worth approximately $110 billion over 11 years.

Let's examine the NFL's current revenue streams:

• a) Media Rights: $10 billion annually

• b) Sponsorships: $2 billion annually

• c) Ticket Sales: $2 billion annually

• d) Merchandise: $1.5 billion annually

• e) Licensing and other revenue: $500 million annually

Total estimated annual revenue: $16 billion 🤯🤯🤯

Now, compare that to the early days:

• 1920s annual revenue (estimated): $100,000

• 1960s annual revenue: $20 million

• 2024 annual revenue: $16 billion

In this rough estimation, the NFL's annual revenue has increased by about 160,000 times since its early days, and by 800 times since the 1960s.

Key factors in this growth:

1. Rule Standardization: Created a consistent, marketable product.

2. Competitive Balance: Draft system ensured league-wide interest.

3. Media Rights: Leveraged television's growth for massive revenue.

4. Marketing Innovations: Halftime shows, cheerleaders, etc., enhanced fan experience.

5. Market Expansion: Grew from regional to national, then international appeal.

6. Long-term Vision: Owners prioritized league stability over short-term gains.

7. Adaptability: Embraced new technologies and viewing habits.

The NFL's financial success demonstrates how strategic collaboration, innovation, and adaptability can transform an industry. From a $500 investment to a $16 billion annual revenue, the NFL's growth offers valuable lessons for any business looking to scale and dominate its market.

Go Deeper: How NFL Teams and Owners Make Their Money.

ACTION

💰 The “Rising Tide” Principle for Growth

Here’s a strategy where industry-wide collaboration lifts all participants, as in: "a rising tide lifts all boats."

1. Identify Industry-Wide Challenge

   • Action: Survey top 5 competitors about their biggest industry challenges

   • Example: GSMA addressing need for global mobile standards

2. Form Unified Coalition

   • Action: Invite 3-5 leading competitors to form initial working group

   • Example: R3 Consortium bringing together 200+ financial firms

3. Define Shared Goal

   • Action: Collaboratively draft a clear, measurable objective to benefit all

   • Example: USB Implementers Forum standardizing connection interfaces

4. Pool Resources Together

   • Action: Set up shared research fund with equal contributions

   • Example: OGCI's joint investments in low-carbon technologies

5. Implement Pilot Programs

   • Action: Launch 2-3 pilot programs to test developed solutions

   • Example: Innovative Medicines Initiative's joint research projects

Key Principle: Focus on pre-competitive collaboration that raises industry standards without compromising individual competitive advantages. Then create quarterly reports on the initiative’s impact on industry metrics.

One Funny Thing 🤣 

Publisher: Jordan Belfort

Editors in Chief: Brock Swinson and Davis Richardson

DISCLAIMER: None of this is financial advice. This newsletter is strictly for educational purposes and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.