Bellator's Business Plan and Why It Won't End Up in the MMA Graveyard

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Bellator's Business Plan and Why It Won't End Up in the MMA Graveyard
courtesy of Bellator MMA

Free agency in MMA is a much different animal than in most other professional sports.

Rarely does a prizefighter reach free agency with the ability to sign with a new promotion while currently riding a winning streak or being highly ranked among the best in his weight class.

It's happened a few times, such as when Fedor Emelianenko, Dan Henderson and Hector Lombard hit the open market, but traditionally the MMA free-agent pool is made up of former UFC fighters who have been released by the promotion for one reason or another.

The UFC holds a deeper roster than any other promotion in the sport, so it stands to reason that occasionally it has to trim down the list of fighters under contract.

In the last few months, the UFC has parted ways with several notable names but maybe none bigger than former UFC light heavyweight champion Quinton "Rampage" Jackson (who finished his contract and was not re-signed) and former UFC welterweight title contender Jon Fitch (who was released following a loss to Demian Maia at UFC 156).

Immediately the buzz began about the possibility of the No. 2 promotion in MMA picking up the two veteran fighters.  Almost as quickly as the fighters were free agents, however, Bellator Fighting Championships seemed to decline signing them.

It's a business decision that had some MMA purists curious why Bellator would choose not to sign two viable names like Jackson and Fitch.  To hear Bellator CEO Bjorn Rebney explain it, the decision was made by watching almost every other major MMA promotion crumble and die after spending copious amounts of money on UFC veterans in an attempt to make a quick buck on the sport.

"Listen one of the reasons you and I are talking and Bellator isn't in that same bucket where elephants go to die like the IFL and Strikeforce and Elite XC and Bodog and Affliction and the WEC and the list goes on and on is because that analysis—that hardcore mathematical Excel spreadsheet analysis—goes into every decision we make," Rebney explained when speaking to MMA's Great Debate Radio.  "We are in the business of mixed martial arts and it is not a business that can be driven by emotion.  It's not a business that can be driven by fandom.  It's a business that has to be driven by strong, well thought out, objectively analyzed business decisions and that is a big part of it."

In the case of a fighter like Rampage, who is well known throughout the industry and has a large fanbase, the questions to ask are: How much will it cost to get him in the cage and how much will the promotion get in return on the investment?

Rebney explains that Bellator does this same analysis on every single fighter it signs. If it doesn't make fiscal sense to pay a fighter exorbitant amounts of money without much of a chance of an equal or greater return, he is unlikely to end up on the Bellator roster.

"If we sign a fighter and a fighter comes with a huge price tag are we as a company going to be able to monetize that price tag?" Rebney asked.  "Are we going to be able to ultimately benefit the company from an economic standpoint from signing that fighter from an economic perspective? That is a big part of the consideration."

While Viacom now owns a majority stake in Bellator, the company is still in the market of being successful based on building talent from within while signing the right kinds of free agents.

Rebney believes that this kind of strategy will keep Bellator in business for many years to come and not just be another tombstone in the graveyard of MMA promotions.

"When you look at any free agent whether it's The Janitor (Vladimir Matyushenko) you go through that analysis," Rebney stated.  "Where will we be able to go with him?  Can we give him the money that he wants to be able to perform on Spike and inside the Bellator cage?  Can we monetize that? Can we make money out of that situation and keep moving this company forward?  It goes into every single analysis we do.

"Or like Affliction and everybody else I just named on that list I just mentioned we would have just signed everybody and we would have been out of business three years ago.  We would be another of the Titanic-esque failures in the MMA space."

So far, so good for Bellator, which kicks off its next series of fights on June 19 when lightweight champion Michael Chandler gets back in the cage against Dave Jansen. In addition, former Strikeforce champion "King Mo" Muhammed Lawal hopes to rebound from his last loss when he takes on Seth Petruzelli in the opening round of the Bellator light heavyweight tournament.

Damon Martin is a Featured Columnist for Bleacher Report, and all quotes were obtained firsthand unless otherwise noted.

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