The University of Utah is carving a path to college athletics sustainability that no other university has tried.

On Dec. 9, the trustees authorized the University Foundation to create a new, for-profit company, Utah Brand Initiatives LLC (changed from Utah Brands & Entertainment), that will manage the business side of university brand building and commercialization, leading with University Athletics) in partnership with Otro Capital over the next five to seven years.

The deal, which is expected to be finalized early in 2026, sets up a platform to raise potentially hundreds of millions of dollars in funding to close a widening gap in operating expenses for Utah Athletics, while protecting the university’s core education, research and healthcare missions. At the same time, the agreement’s novelty has raised questions about how a public university can enter into a partnership with a private capital firm, even one with extensive operating experience in sports, entertainment and media management.

The status quo—or doing nothing—was not an option, leaders say.

“We have to maintain our vision of the University of Utah—what it is. It is a place that is inspiring to students. It accelerates discovery. It serves communities. Our core missions revolve around those ideas,” said President Taylor Randall.

“We also recognize that within that innovative spirit and entrepreneurial tradition we have an elite athletic tradition that we have to preserve. This brings an exciting solution and new future to University of Utah Athletics.”

Higher education, and college athletics, are at a turning point. Financial headwinds are swirling, including: athletics conference realignment and resulting disparities in media revenue, unlimited student-athlete transfers, the NCAA’s House settlement, which puts universities on the hook to pay $2.8 billion in damages to student-athletes as of July 1, 2025, and revenue sharing with those athletes.

The University of Utah’s share of the settlement is $1 million annually for 10 years. The U’s regular revenue-sharing payments this year add up to $20.5 million, with each year’s total growing by 4% over the next decade.

On top of that, U.S. universities face increasing financial pressures from federal research funding cuts, state workforce development initiatives and commitments to keep the costs of tuition and fees down to improve student access and answer the charge that higher education is too expensive.

The problem is pervasive across U.S. colleges and universities. At the end of 2025, the University of Colorado at Boulder announced a $27 million deficit and Ohio State detailed a $38 million difference. West Virginia University recently raised student fees to help cover the gap. Some schools are considering cutting less profitable athletics programs, sacrificing their Division 1 status.

Starting with the premise that college athletics builds community, bolsters the university’s brand, enhances reputation and strengthens local and state economies, university administrators decided on a different path to preserve all Utah Athletics programs. U leaders project a short-term equity investment of cash from Otro can fill the immediate gaps, including student-athlete revenue-sharing, and that Utah Brand Initiatives will be able to fund Utah Athletics in coming years.

University Athletics Director Mark Harlan notes Otro’s deep expertise in professional athletics. While the company was formed in 2023, Otro’s executives have worked in senior leadership capacities for the Cleveland Browns and Cavaliers, Dallas Cowboys, San Diego Padres, Tampa Bay Lightning and Memphis Grizzlies, in addition to roles creating and managing other sports marketing companies. The U will be Otro’s first college athletics partner.

Other colleges and universities have explored unique models of private financing to fill the divide. The University of Kentucky and Clemson both used loans to shore up their athletics programs. Late last year, Michigan State University announced a $400 million donation to its athletics program from prominent donors.

With the new company, the university will have the chance to earn and reinvest its share of a potentially growing revenue stream back into the core missions of the institution. Over the long term, stabilizing funding for University Athletics reverses the prospect of growing debt and broader risks to the institution as a whole, eliminates the need to consider cutting less-profitable Athletics programs, and actually shores up women’s and Olympic sports. At the same time, university financial managers and attorneys are dedicated to protecting the institution’s non-profit status and walling off public funding sources—including tuition, tax dollars and state-approved bonding dollars—from co-mingling in the new company.

The new company will report annually to the foundation and the Board of Trustees.

“The university will be in a position to ensure that the activities of this new joint venture follow established business, finance and auditing practices,” said Tony Wagner, chief financial officer. “While the university is not actually putting at risk capital, and neither it nor the state will ever have any financial obligation of support, it must be sure that its IP and brand are being built and developed and accounted for with best practices.”

The university will work with the foundation to ensure that the board has directors who have the university’s interests at heart and who bring appropriate expertise. The foundation, whose sole purpose is to benefit and advance the interests of the university, will retain majority ownership in the new company and a majority of all the board seats. The university’s athletics director, Mark Harlan, will chair the board.

Managing coaches, recruitment, supporting student-athletes, and private fund-raising will remain with University Athletics. Commercial operations—including managing stadiums and arenas, branding, licensing and sponsorships, ticketing, and scheduling—will be Utah Brand Initiatives’ responsibility. Approximately 50 university employees will have the chance to transfer to the new company. In all, the new company is expected to grow to around 70 employees.

“[Otro executives] understand that the job is not to do some sort of financial architecture. The job is to build something,” said David Anderson, CEO of the university’s foundation (University of Utah Capital Growth Partners Foundation). “When the going gets difficult and tough, we were not interested in a partner who could analyze the heck out of the financial statements.  This group has a history of rolling up their sleeves and getting in there to solve problems and create opportunities. They say, ‘How do we figure this out? How do we make this better?’”

Harlan predicts support for student-athletes and the fan experience will improve under the new partnership.

“Hospitality and how we treat our fans are among the most critical things we do. People don’t come back if they don’t have a good experience,” the Athletics director told the trustees. The new company will be “laser-focused on this change, assisting greatly in our customer experience.”

The deal is now making its way through routine higher education review processes:

• University trustees adopted a detailed resolution at their Dec. 9 meeting outlining parameters for the upcoming agreement.
• At the Jan. 5 Academic Senate meeting, President Randall noted every business venture comes with risk, but the status quo poses guaranteed, known risks. Randall assured faculty the negotiations, and the final agreement, will limit the institution’s exposure as much as possible.
• On Jan. 9, the president presented to the Utah Board of Higher Education. Board members and Commissioner Geoff Landward called the university’s new approach “innovative” and “pioneering.” Board Chair Amanda Covington credited the university’s thoughtfulness, strategic thinking and the “courage to be first.”

U leaders and Otro executives are expected to finalize the partnership early in 2026. More details of the agreement will be released then.

“This will require hard work from every one of us,” Randall said. “What does success look like? Success looks like in five to seven years, we have a thriving athletics franchise that’s also fed everything else at this university. It has lifted the brand. It has brought more people into this university as students and teachers and researchers and healthcare providers. That is success.”