Cable Operators

Selling a Sport

7/06/2009 11:25 AM Eastern

When UFC returned to pay-per-view in 2001 — after its years in television exile, due to its outrageous, anything-goes reputation — Lorenzo Fertitta had high hopes.

Fertitta, his brother Frank and friend Dana White had bought the floundering Ultimate Fighting Championship for just $2 million that year. They'd negotiated the sport's sanctioning in Nevada and gotten UFC 30 onto PPV.

“It was a big disaster,” said Fertitta, who turns 40 this year. “I'd hoped for 150,000 buys and figured we'd then be off to the races. Instead, we had just 25,000 buys. I kept looking at the reports in disbelief.”

How could the fight have fallen so far short of the numbers that UFC had put up in the 1990s? Fertitta finally figured it out.

“We had miscalculated,” he said. “We failed to understand that we were selling a different product — they were selling violence, we were selling a sport.”

With that vision firmly in place, Fertitta set about to reposition and rebuild the UFC brand. While White is the consummate UFC spokesman, those who work with the company said Fertitta was the perfect person to have running the show behind the scenes.


“He guided the brand carefully, taking it from the fringe to what it is today,” said Craig Piligian, whose company Pilgrim Films & Television produces The Ultimate Fighter for Spike TV.

“He is one of the smartest executives I've ever met,” said Spike senior vice president for sports and specials Brian Diamond. “He's a great listener and insightful.”

Marc Ratner, UFC's vice president of government and regulatory affairs, said Fertitta's strength lies in a combination of broad vision and knowing what he wants down to the “minute details.”

Those macro- and micro-level skills may come from the fact that the Las Vegas native, who has a master's degree in business administration degree from New York University's Leonard N. Stern School of Business, approaches UFC as a mom-and-pop enterprise.

“My father was a super influence on me,” he said. “He taught me that it was important to treat people the right way in order to gain respect. We still run the UFC with a family-business culture.” (Fertitta, who has two sons, aged 14 and 12, and an 8-year-old daughter, also interrupts work whenever he's not traveling to see his boys' football practices and games.)

Indeed, Diamond comments on how nice Lorenzo Fertitta is, while Ratner mentions how much people enjoy working with him. Compared to his brother Frank and White, everyone who works with the UFC says Lorenzo provides an essential low-key yin to their yang.

“We do complement each other,” said Lorenzo Fertitta. “It just plays out that way.”

Lorenzo Fertitta and his older brother first partnered on building up the Station Casino, the family business aimed at attracting Las Vegas locals away from the strip. Their father, Frank Fertitta Sr., had founded the business before handing over the reins to his two sons in 1993. Building the Station from a single casino to a highly successful string not only made Lorenzo Fertitta millions, it also taught him a valuable lesson that would help in his new career.

“I learned to build and manage a company and to establish an infrastructure,” he said.

In 1994 Fertitta first encountered UFC. “Someone showed me a video of UFC 2 — I had never heard of it before,” he said, adding that while he was intrigued by the competition, he thought it “shocking” and “fairly brutal.”

He would later serve on the Nevada State Athletic Commission during the years the sport was still banned there. But gradually, rules and regulations came to UFC and by 2001, Fertitta felt “passionate it could be turned around and made into a legitimate sport. We felt it could become something big.”


Still, even after the epiphany following the UFC 30 pay-per-view fiasco, the company faced “an uphill battle” because the stigma remained so strong. While he never lost his faith in mixed martial arts, he began to question whether the timing was right and in 2004 — after pouring tens of millions into “a huge black hole” — he called White and told him to find a buyer so they could cut their losses.

But when White came back with an offer in the $5 million range, Fertitta couldn't pull the trigger and instead renewed his efforts to get the sport on television. When The Ultimate Fighter hit Spike TV, it “changed perceptions” and launched the sport toward mainstream success.

Last year, Fertitta stepped back from his role as president of Station Casinos to devote more time to his job as chairman and CEO of Zuffa, the parent company of UFC. (He remains vice chairman at Station, with his brother Frank taking over as president.)

On the job, Fertitta said he “thrives on the new technologies” — UFC has recently released its first video game and expanded into video-on-demand.

“I like digging down and understanding where we are going,” he said.

But at the end of the day, he also remains a fan.

“It's still pretty exciting when Dana and I are just watching the fight and everything is out of our control,” he said. “We are just spectators then. But we get really good seats.”

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