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Why EleastXC Fell

Written by Tom Ngo
October 22nd, 2008
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ProElite, the parent company of EliteXC and perhaps the biggest threat to the UFC’s dominance, will be shutting down its operation by the end of the week.  How did the only MMA organization that was able to secure a deal with a major network (CBS) and a broadcast deal with Showtime find itself on the road to failure? 5thRound.com breaks down three key factors to their demise.

Acquisitions:

For being in business for just two years, they spent a lot of time and money trying to cut into the UFC’s monopoly.  Perhaps it was the constant potshotting that EliteXC V.P. Jared Shaw and UFC President Dana White took at each other that fueled EliteXC’s drive to become a major competitor in the U.S. market.

In just 24 months, ProElite has spent millions of dollars acquiring smaller organizations such as ICON Sports, Cage Rage and King of the Cage, in their attempts to get bigger, faster.

The UFC has the luxury of a “farm system” in which they are able to develop their own talent with the popular “The Ultimate Fighter” reality series. Perhaps ProElite thought that the only way that they could catch up to them was to hoard all of the other fighters available.

This aggressive thinking got the company the growth that they were seeking, however they acquired unknown and less talented fighters, while accumulating massive debt in the process. Since EliteXC signs non-exclusive contracts with their fighters, they should have used that as a selling point to acquire the multitude of talented fighters that are not interested in the UFC’s strict exclusivity policy.  That way, the fans would be able to recognize the fighters, and the company would be putting better overall talent in the cage.

Kimbo Slice:

The term “Don’t put all of your eggs in one basket” certainly comes to mind. ProElite’s most recognized fighter was an unproven street brawler. With only one “professional” MMA bout under his belt when ProElite brought him on, they used Kimbo to draw in the casual fans, while he created a false sense of success. This gimmick worked the two times that they showcased him on their CBS events, drawing fantastic primetime ratings each time, but it was short-lived.

Entering their last CBS event, “Heat,” Kimbo had a prefect 3-0 record. As long as he maintained this aura of invincibility, ProElite could stay afloat on their flagship fighter’s broad shoulders. However, in a blink of an eye, last minute replacement Seth Petruzelli took down the the company’s crown jewel, and ProElite’s future in the process.

The loss was so significant, Shaw could be seen yelling at the referee just outside the cage to give Kimbo time to recover due to what he perceived was an illegal blow.

“I was there cageside and watched the whole thing happen…watching Jared Shaw jumping up and down and screaming as a representative of the company. I think that was disgusting and embarrassing,” former owner of ICON Sports, T.J. Thompson, told MMAWeekly.com

After the loss, not recognizing or understanding its magnitude, all Kimbo had to say was, “It’s all good!”

Apparently not.

Seth Pertuzelli:

Perhaps the final nail in the coffin was when Petruzelli went on a local radio show two days after the shocking upset, telling the station that EliteXC management, including Shaw, offered him more money if he kept his fight against Kimbo a stand up battle.

“The promoters kind of hinted to me, and they gave me the money to stand and trade with him. They didn’t want me to take him down, let’s just put it that way,” Petruzelli told 104.1 FM in Orlando, Florida.

EliteXC brass vehemently denied these allegations, stating that all they offered Petruzelli were the typical fight bonuses that they offer to all of their fighters, on all of their events.

Later that same day, it seemed as though EliteXC management got a hold of Petruzelli, asking the fighter to say that he “misunderstood” what EliteXC had offered him.

“What was meant to be said was that I wanted to keep the fight standing for myself because I knew that was what the crowd, the promoters, and everyone wanted to see because that’s more exciting than just taking someone to the ground,” Petruzelli told FiveOuncesofPain.

This has now prompted the Florida Department of Business and Professional Regulation, which oversees the Florida State Boxing Commission, to investigate Petruzelli’s initial statements of foul play. Thompson believes what Petruzelli originally said on the radio.

“I don’t have a smoking gun,” said Thompson, “(but) I’ve been around long enough, I’ve talked to enough people that were there, I won’t name names of executives in the company that I know—Seth was paid to stand up. I’m confident of that. If the commission wants to talk to me, I’ll tell them what I know.”

Even if the investigation comes up empty, which seems highly unlikely, there is still a stain on EliteXC’s brand that they will never be able to escape. Perhaps ProElite knew that once the FDBP started digging, they would eventually uncover the truth, and that is why they decided to fold the tent.

There is one common denominator in all three of these points. JARED SHAW. He was too much of an egomaniac to realize that EliteXC isn’t the UFC, and he should have stayed away from the verbal battles with White. He was acting more on emotion than on intelligence, costing the company millions.

He was too focused on the short term success that Kimbo offered them to realize that you can’t be a one trick pony if you want to achieve longevity. And finally, he was the genius that decided to taint MMA’s purity, trying to influence the outcome of a fight.

What’s done is done, and now ProElite is done. Thanks Jared.

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