Read on another thread that hearn loses big on each show he promotes and only the profitability of the other matchroom sports make it viable... So I ask why do they do it?? Don't believe for a second someone would promote to lose thousands of pounds just for the love of the sport. Heard before that ****** also loses big on each of his shows and I know hatton promotions also lost on each show as well.
They still got the love for the game. Why does that Russian dude fund The Independent newspaper when it loses money every day...
Losses to an organization like Matchroom, can also be written off against tax for the more profitable bits...
They're only making a loss on what they make public. I hardly think Hearn or the others are laying awake at night worrying about money.
There's a big difference between a company making a loss and individuals losing money. Loss making business are often viable because of their growth prospects or other strategic reasons. The next big thing (Naz, Hatton) could be just around the corner for these companies, which could be a gold mine, especially with the rumoured return to PPV by Sky.
They will still pay themselves a salary. So if Matchroom lose £500k after tax in a year, but Barry & Eddie have paid themselves £3mil each, it's not really an issue. A private business will also bill everything through the business. Company cars, Petrol allowence, lunches, clothes. Pretty much everything you think off can be written off as a business expence these days. In saying that, Hearns long term goal is to get rid of his competition so that he can pay fighters and win purse bids at a lower price, and therefore make a higher profit from shows. So there may be a period of time where those shows are not making good margians to propel the company into that position. But Hearn still seems to be cautious with the cash, he turned down DeGale as he wanted £100k a fight, and he hasn't signed any of the Olympians who will want big money.
In most cases a combination of 3 or more of these: 1) Have money to burn 2) Funded by tax write-off(s) 3) Dirty money 4) Hope will one day get Sky deal 5) Hope one of their fighters wins world titles and can be in big fights, ideally promoted by them 6) Love of the game 7) Deluded
Don't starbucks apparently lose money every year in the UK for tax reasons? The boxing promoters probably do the same thing, big salaries, invest in premises etc.
Matchroom might be starting off in boxing and making early losses, but there's no way Eddie isn't at least breaking even. That would be bad business. Sky fees likely cover the purses for the main event, so Eddie needs ticket sellers to cover the costs down the card.
