Shane McMahon proposed buying the struggling UFC in the early 2000s, but his father Vince McMahon rejected the idea, leading to Zuffa purchasing and eventually selling it for $4 billion, while WWE and UFC later merged under Endeavor’s TKO Group Holdings.
The UFC is now one of the most profitable sports entities on the planet. But that wasn’t the case in the early 2000s when the promotion was bleeding money, most states banned MMA, and television networks wanted nothing to do with the sport.
The former owners at Semaphore Entertainment Group (SEG) were desperately trying to find a buyer. That’s when Shane McMahon — son of WWE founder Vince McMahon — was approached about taking over UFC.
“At the time, the UFC, they got in some financial problems and came to us and said ‘would you like to purchase the UFC?’” Shane revealed in the new Netflix documentary series Mr. McMahon. “I go this is cool.”
“I said ‘Dad, let’s just go for this one.’ I thought we could really grow that brand because it’s tailor-made for what we do. We have a production team, we have a live events team, we had a merchandising team, we have all of it just ready to go. So to me it was plug and play.”
Groomed as a potential successor to his father in the professional wrestling business, Shane reportedly saw the UFC as his chance to prove he had the acumen to take over an organization and turn it into a financial success. That could then set the stage for him to run WWE when his father was ready to step down.
But when Shane approached Vince with the idea to buy the UFC, the elder McMahon had no interest.
“When it was presented in terms of buying UFC, I didn’t like that business model,” Vince explained. “Because our business model, you can create characters much like Disney or someone else and we can use them forever.”
“As opposed to a boxer/UFC [fighter], once you’re beat, once you’re hurt or something, your career’s over. We’re in show business. That’s a sport.”
While WWE and UFC share a lot of similar DNA in terms of athletes and personalities helping to drive interest, professional wrestling is scripted drama while MMA is real fighting.
That was all Vince needed to justify his decision to pass on buying UFC and just sticking to his day-to-day business running WWE.
“So anyway, he thought about it and passed,” Shane said about his father’s decision. “Passed on the opportunity and that was that.”
Zuffa — a company started by brothers Lorenzo and Frank Fertitta along with longtime friend Dana White — ended up purchasing the UFC for $2 million in 2001. While the company struggled financially for several years, UFC eventually turned things around and the Fertittas sold the business to Endeavor for just over $4 billion in 2016.
“10 years later or something, UFC was sold for a lot of money and I think Shane wants to take credit for the idea of buying UFC,” Vince said. “Shane really thought that’s the way to go.”
“So Shane, you take your money and put it in, which didn’t work. It wouldn’t work. Because it would take a huge investment and Shane only had a little bit [of money] so that’s not a good investment.”
Obviously, Shane always saw the potential in the UFC. The $4 billion sale along with continued growth over the past few years proved the gamble would have paid off.
“Hindsight’s always 20/20,” Shane said. “I think it would have been an excellent investment.”
Funny enough, Endeavor ended up taking over WWE as well. Then merged the organization with UFC under the current company name TKO Group Holdings. The new combined company was valued at over $21 billion at the time of the merger.
As for Vince, he eventually resigned from his post as TKO Group Holdings executive chairman after an inflammatory lawsuit was filed against him by an ex-employee accusing him of sexual assault among other allegations. McMahon has since sold off a huge part of his stock in TKO Group Holdings. Although he still remains a sizable shareholder in the company.