Pyrex’s Downfall and NFL’s Private Equity Concerns

Have you come across Pyrex? You know, that glassware that’s almost unbreakable? It’s likely hiding somewhere in your cupboard. Pyrex has been around for over a century, generating jobs in western Pennsylvania, becoming a household name for many. No one’s doing glass heat-resistant dishes quite like Pyrex.

From 1908 to 2023, Pyrex enjoyed more than 115 years of leading the market. However, it all came crashing down in just a few months due to private equity missteps. The company’s major blunder was merging with the maker of Instant Pot back in 2019. This decision ultimately led to a bankruptcy filing, and in 2023, private equity firm Center Lane Partners acquired Pyrex. For a brief moment, there was hope for its salvation, but then it was revealed that Center Lane also owned Pyrex’s biggest competitor, Anchor Hocking. They announced plans to close the Charleroi, Pennsylvania, factory, which had operated for a century, in 2024—this became a reality the following year.

All of this happened because, well, it’s a little ridiculous that a private equity firm could own two competing companies. So why is Pyrex on our radar? Because a similar situation is emerging in the National Football League as well.

On Tuesday, the private equity firm Arctos announced its intention to acquire a 3% stake in the Cleveland Browns—pending approval from NFL owners, which seems likely since they’re part of the NFL community. It seems they want the flexibility to sell pieces of their businesses to private equity as they see fit. The problem? Arctos already owns parts of the league, including 8% of the Los Angeles Chargers and 10% of the Buffalo Bills.

This situation is concerning. One private equity group now has stakes in three different NFL teams, all within the same conference. Sure, these percentages might look small, but they give an undue influence at a decision-making table that wasn’t there before. This is an organization that seems indifferent to the welfare of the teams, their fans, or their cities, focusing solely on profits.

This trend in the NFL, where private equity is gaining traction, raises eyebrows and should be a significant concern for fans.

Why Did the NFL Allow Private Equity Ownership?

There was a time when the NFL’s ownership landscape prioritized responsibility. Prior to 2021, only individuals or small groups of investors were permitted to acquire minority shares in NFL teams, leading to some transparency in decision-making.

However, as the league became wealthier and teams’ values soared, there weren’t enough individuals with deep pockets who could contribute. This created challenges for team owners who wanted to convert their valuable assets into cash. Most investors sought stakes greater than 10% since having even a small share didn’t guarantee a say in decisions. Moreover, these minority shareholders could only invest in one team at a time, which constrained their options.

The NFL made a pivotal change in 2021, allowing private equity firms to purchase up to 10% of a team’s shares. This opened the door for investors to sell small slices of their teams for significant sums. It was a win-win for NFL owners, who now had an endless stream of buyers uninterested in the teams’ performances or playoff chances, focused instead on maximizing values.

For the first time, ownership became more about transactions rather than individuals. In Arctos’s case, if you want to discuss any issues with ownership, you’re dealing with a sprawling network of managers and anonymous partners rather than actual people you can hold accountable.

Allowing private equity ownership of just one team is troubling enough, but extending that to multiple teams feels rather concerning.

What Are the Concerns About Private Equity Ownership?

When a group like Arctos holds stakes in several teams, crucial decisions arise about where to allocate resources. If you’re involved with the Chargers, Bills, and Browns, and the need for funding arises, why would a faceless entity like Arctos choose to invest in smaller markets like Buffalo or Cleveland over a major market like Los Angeles?

If those three franchises are negotiating with an ownership group about funding for stadium renovations, would profit-driven representatives really prioritize a city with just 350,000 residents over one with a population of 4 million?

Previously, with private ownership, these dilemmas rarely occurred. The vested interest in team performance meant owners were incentivized to strive for success on the field, as profits were closely tied to winning.

Private equity, on the other hand, doesn’t share that concern. With interests spread across various sectors, these firms view the league as a whole, focusing only on the next big media deal or overall profitability. Who knows what might happen if these firms gain even more influence?

Isn’t This Just a Slippery Argument?

Maybe, but the worries are legitimate. If you examine the current media landscape and monopolization of live events, it feels as if sensible oversight is being neglected. We see huge corporations thriving as common sense is overshadowed by greed. It’s almost absurd that most news organizations are controlled by just a handful of companies, yet here we are. There’s a palpable concern that all ticket sales might soon funnel through a single vendor.

What’s particularly troubling isn’t just figuring out how private equity firms operate with 10% stakes in several teams but what might happen if owners, driven by profit motives, push for higher ownership thresholds. What could the NFL look like in five or ten years if certain private equity firms gain as much say in decision-making as the 32 primary owners do?

What’s more unsettling is the current NFL commissioner’s alignment with the idea of maximizing profits in the present while leaving the future to be dealt with later. For fans, the passion for football remains constant across generations, and it won’t fade even if the commissioner changes or steps down. The choices Roger Goodell makes now will have lasting effects.

Seeing Arctos gain influence over a third NFL team is more than just a minor worry; it’s a sign of potential trouble ahead. We might be witnessing the beginning of a bigger issue.