Banking on Johny Hendricks pays off for Team Takedown
They called it "an educated lottery" and Team Takedown hit the jackpot combination last Saturday when its client, Johny Hendricks, captured the UFC welterweight championship in Dallas.
Team Takedown was a simple, if not ambitious, concept when it launched in March 2007: fund and manage an aspiring fighter's journey from day one all the way up to a UFC title, with a 50-50 split in profits.
"Our thought process was we could take a high-level wrestler and give them a place to live, a car allowance, health and dental insurance, a weekly paycheck so they could train -- and then they'd have a really good shot of getting to the top," said Team Takedown founder Ted Ehrhardt.
Ehrhardt started the management company with his brother Doug and close friend and business partner, Tim McBride. The trio have funded the venture for seven years with revenue from a fire sprinkler company they own together.
In addition to living expenses, Team Takedown also foots for the smaller things, like flying trainers and relatives to fight events. The company also owns the Velociti Fitness gym in Pantego, Texas, providing a homebase for the Team Takedown fighters. All together, Ehrhardt estimates that funding each fighter (and his family) costs the company around $100,000 a year.
Thus far, Team Takedown's seven-year investment has been upwards of $4 million. Ehrhardt said the company breaks even with an individual fighter when the yearly intake from purses, sponsorships and other revenues reaches $200,000. And probably most appealing to the fighter is that he doesn't have to retroactively pay back what Team Takedown invested before it started hitting that profit mark.
Of course, the real profit comes if and when a Team Takedown fighter can win a UFC championship.
"[Former champion] Georges St-Pierre has gone public saying he makes $20 million-$30 million a year with all his sponsorships," said Ted. "Without getting to the top, it's nearly impossible to get back all of the money we've invested."
A 50-50 split might sound too harsh for some fighters, but not with the 30-year-old Hendricks, a father of three.
"Who wouldn't want to get paid to train and that's all you have to focus on? Look how my fighting has developed in the last five years," Hendricks said last November prior to his first title fight with St-Pierre, for which he earned $50,000, not including discretionary bonuses and sponsorship money. "I can train twice a day and go as hard as I want to because I know I have nothing to do in-between. I am truly blessed to be in a situation like this."
An ingredient to Team Takedown's success might be that its foundation grew organically out of the sport. Ted, Doug and Tim aren't among the school of Hollywood sports agents who circled the sport like sharks circa 2008. These Midwestern childhood friends were high school wrestlers, youth wrestling coaches and devout MMA fans who saw an opportunity to become a bigger part of the sport they loved. It began in 2006, when Ted hired four-time All-America wrestler Jake Rosholt to relieve him of his coaching duties for a local wrestling club. The more the Ehrhardts and McBride watched Rosholt train their sons, the more they became convinced he could make a run in the UFC.
"We started getting in Jake's ear that he could do this. You fight and we'll manage. We'll get you training," said McBride.
By the end of his first year of coaching, Rosholt was ready to give MMA a try. He was sent to train in Las Vegas with fellow Oklahoma State University alumnus Randy Couture and his Xtreme Couture gym. He stayed for a week and loved it.
Team Takedown signed two-time NCAA champion and OSU grad Hendricks about two months later, while other wrestlers like Eric Bradley, Shane Roller, and Jared Rosholt, Jake's brother, were also added. At its most robust, Team Takedown had eight members. Currently, it has five.
Jake ended his MMA career in 2012 to take a job with one of the Ehrhardt's companies in Oklahoma. Injuries, stacked weight classes and the luck of the draw in getting heavy opponents early on has affected other Team Takedown fighters' progress. At any given time in the last seven years, different fighters have looked like their champion, Ehrhardt said, but Oklahoman Hendricks pulled away from the pack about two years ago.
Why only wrestlers? "They have probably the hardest work ethic of any athlete," said Ehrhardt. But that's not the only deciding factor. In candidates, Ehrhardt says the management team looks for fighters with a certain set of values.
"It has to be the right guy," Ehrhardt said. "One, he has to be a great athlete, but more important to us, is character. My partners and I wouldn't have somebody around our families and kids unless they were positive roles models with strong morals and character."
With Hendricks, Team Takedown began to reap financial benefits even before he stepped into the Octagon against former welterweight champion Georges St. Pierre last November. In October, Hendricks signed a two-year, incentive-based sponsorship deal with Reebok. With last Saturday's victory, Hendricks was paid an undisclosed bonus by the footwear company.
It's smoother sailing now, but was there worry at any point that the gamble wouldn't pay off, that a champion would never materialize?
"Only every day up until last week," said McBride, with a laugh. "We're seeing our business plan work now. This is what we needed to make this company profitable."
What's next for Team Takedown? They're eyeing a couple more wrestlers to add to their stable, and Hendricks must continue to successfully defend his title to keep the money rolling in.
"We have other fighters -- two are in the UFC right now," said McBride. "The plan is to rinse and repeat."