Why is SMU in the ACC? Explaining the money behind Mustangs’ rapid rise in new conference | Sporting News

The 11-1 SMU Mustangs will play for an ACC Championship on Saturday night against the Clemson Tigers. In SMU’s very first season in the conference, head coach Rhett Lashlee has led the Mustangs to a conference title game. 

For a team that was predicted to finish seventh in the ACC this year, the surprise season has everyone talking about this SMU program. 

But what makes SMU’s move to the ACC unique is that the school won’t actually receive any of the financial benefits from the league for the next decade. Let’s run through SMU’s unique financial situation with its new conference and see what money is behind SMU’s rapid rise to the top of the ACC.

MORE: Revisiting SMU’s ‘death penalty’ that killed 1980s dynasty

Why is SMU in the ACC?

You’re probably wondering what a Southern Methodist University team from Dallas, Texas is doing in the Atlantic Coast Conference. In fact, the school lies just over 1,000 miles west of the ACC’s headquarters in Charlotte, N.C. 

The answer to this question is twofold. In 2023, amid rapid conference realignment between the Big Ten, Big 12, and SEC — in addition to the death of the Pac-12 — the ACC needed to keep up with the Joneses. The conference was also lagging severely in revenue compared to its other power-conference counterparts.  

Sure, adding the likes of Cal, SMU, and Stanford didn’t make a whole lot of geographic sense, but expansion meant, at least on the surface, that the league was just as capable of adding teams just like the other conferences around it were. 

SMU, meanwhile, was a former powerhouse college football program from the 1980s that dominated the sport’s landscape. But after receiving the NCAA’s first and only “death penalty” in 1987, the program never really recovered. 

After not being invited to join the new Big 12 in the mid-1990s, SMU joined the Western Athletic Conference from 1997-2004, then was with Conference USA from 2005-2012 before joining the American Athletic Conference in 2013. Inside the WAC and C-USA, SMU finished .500 or better just four times in that 18-year span. Although SMU rebounded from a rough few seasons in the AAC, it was still looking to make it back to the power-conference level.  

To do so, the Mustangs made an offer to the ACC that the conference really couldn’t refuse: It would forgo television revenue for the first nine years in the conference in order to join the ACC.

TSN ARCHIVES: NCAA ‘Death Penalty’ Effects Will Reach Far Beyond SMU Campus (March 3, 1987, issue)

SMU and ACC television revenue

Instead, SMU was comfortable raising that money themselves. As part of that television money, the Mustangs are expected to be forgoing around $24 million a year. The ACC’s 2023-24’s television revenue paid an average of $44.8 million per school. 

“I’m gonna leave some mystery around all that,” SMU athletic director Rick Hart told ESPN last fall of rejecting the TV money. I don’t think it’s as simple as people want to make it out to be. You can’t forgo something you don’t have. We’re not going to take a step back resource-wise, even from a conference perspective. So this is all positive. … We’ve got an underdog mentality. We’ve got a chip on our shoulder. We’ve had to do more with less for a long time.”

A small, private school in Dallas with an enrollment of just over 12,000 undergraduate and graduate students may not sound like it has the means to forgo that kind of money, but SMU’s unique donor base has helped it make up that money and then some. Here’s more from The Athletic on SMU’s fundraising efforts in September 2023, just one year prior to the school officially joining the ACC:  

• On Sept. 1, SMU accepted an invitation to join the ACC alongside Stanford and Cal, beginning next season. As part of that agreement, sources familiar with the arrangement said SMU will forgo nine years of ACC television money, around $24 million per year.
• SMU boosters told The Athletic they plan to give more than $200 million to offset the absent TV money.
• This $100 million was raised by a small group of 30 donors, according to the school.

In a release from June of this year, the school announced it raised $154 million during the 2023-34 fiscal year.

One of the people at the forefront of SMU’s fundraising efforts is David B. Miller. Miller, the chairman of SMU’s board of trustees, is a billionaire who founded an oil and gas private equity firm called EnCap. His name is also on SMU’s basketball court — just one of the few perks of being a billionaire.  

“It’s a couple hundred million dollars,” Miller told Yahoo Sports. “I’m not losing sleep over it.”

At halftime, SMU officially named the Moody Coliseum court for alumnus David B. Miller.#PonyUp #MoodyMagichttps://t.co/TgF2ZOwALp pic.twitter.com/ZQx2zNVALJ

— SMU Basketball (@SMUBasketball) December 6, 2018

In 2022, SMU launched Boulevard Collective, the NIL collective that assists in brokering NIL deals with Mustang athletes. According to On3Sports, the organization was set in 2022 to pay football and basketball teams $36,000 a year, which comes out to about $3.5 million annually, for NIL activity.  

The financial backing appears to be working — SMU’s 2025 recruiting class currently ranks fifth overall in the ACC, per 247Sports. It features four 4-star recruits, the fifth-most in the conference. 

Who are SMU’s biggest boosters?

We mentioned David Miller, who helped spearhead the SMU fundraising effort. David credits energy executive Ray Hunt for helping organize the fundraising efforts. David’s son, Kyle, is also on the NIL collective board. Kyle is the CEO of Silver Hill Energy Partners, which closed on a cool $1.13 billion earlier this year.  

Other boosters that helped launch the collective include Chris Kleinert, who is the CEO of Hunt Realty and has a reported net worth of $7.2 billion, and Opendorse CEO Blake Lawrence. Kleinart is also the son-in-law of oil tycoon R.L. Hunt.  

SMU has successfully reached the top of the ACC in its first year in the conference. Helped by a massive fundraising effort and an untraditional way of getting back into a power conference, we’ll see if it can pay off with an ACC title victory and CFP bid. Even if it doesn’t, Year One in the conference can be considered a triumphant success for the Mustangs.