Eric David & Sons Interview
With Dan Meisenheimer
Of United States Basketball League

Eric David & Sons:  How do the teams look for the 2005 season?

Dan Meisenheimer: Well, 2005 should be the best season we have ever had. We have stronger teams financially, and also with great talent, and coaching. We are growing in a couple of new cities, which should add to the excitement for the 2005 season. This will be our 20th season, so we are proud of our accomplishments, so we are looking forward to this season.

EDS: There have been many former USBL players signed to NBA teams. How will you use their success to draw attention to the league?

DM: The most unique, desirable and hopefully the most profitable will be to generate interest in our former USBL players to become potential franchisees. They may own the team, but maybe own a part of the team with additional investors. We are in dialogues with two former USBL players, one of who has retired from the NBA and the other who is probably playing his last year in the NBA.  Both of these players have expressed interest in purchasing an expansion team. Not only will those two individuals be wonderful additions to the USBL, but I believe that it could start a trend, which would be successful in not only adding expansion teams, but in bringing our alumni back into the USBL.  In addition to our former USBL players coming into the league as potential owners, they may invite and hopefully encourage other NBA players, when they retire, to become involved. They can continue their career in basketball, by owning a franchise, and possibly being a head coach or a general man!
ager.

EDS: What type of advertising, if any, does the league do for its teams?

DM:  The league does advertising and marketing in general, not only on the Internet on basketball sites, but also in different markets, the individual markets where the teams play.  Now there are ten teams in the USBL and in each of those cities we do some advertising on radio and with print ads in newspapers. In addition to that, we try to bring our sponsors on board so that we can share their advertising in those markets. As the league grows from the current ten to twenty or hopefully thirty teams in the next two years, the advertising will increase. Not only the advertising done by the league, but also the advertising done by the individual teams and the ones that we coattail with our sponsors.

EDS: Do you expect that the NBA riot will have an effect on attendance for the 2005 season?

DM: Yes, I think that it will have a beneficial effect on the USBL this season, not only on the attendance, but also on the media exposure. The main reason for this is that basketball fans and sports fans in general think that the major league athletes are making too much money, they are prima donnas when they start ‘rioting.’ Our players make much less money, obviously. The average player is making about $500 per week, maybe in some cases they are making $1000 per week if they are super players, but they are not the ‘prima-donnas.’ They are not the celebrities who are getting into trouble here, there and everywhere. They are all trying to do the best and improve while in the USBL. We call ourselves a showcase league, but we are a developmental league. By virtue of playing well and by being good citizens in our league, they are certainly more attractive to a NBA team, especially in light of what has happened in Detroit recently. So I think that what occurred there would only!
  be beneficial to us and attract fans to us because they will see that our players come into the stands, yes, but to sign autographs.

EDS: What other methods do you plan to use to draw attention to the league?

DM: We have considered doing a little marketing in general, not only our sponsors, but independently. I think that will enhance, the attractiveness of our tickets to fans, but also will allow us to sell more merchandise: hats, t-shirts, etc. We are marketing expansion teams to investors, who may be somewhat familiar with the league, but had not contemplated the possibility of purchasing and running an expansion team themselves in their individual cities and markets. So the way I look at it, the USBL will benefit tremendously from additional advertising and marketing, not only with regard to tickets, but also with sponsors, expansion teams and hopefully more awareness for our publicly traded stock. 

EDS: What was the attendance like in previous years and what do you anticipate for 2005?

DM: Every year the attendance has been growing. In some years it has been great and increasing in double digits and in some cases it has been a little slower. That is twofold. I think that the economy has something to do with that and then the individual markets. When we add a new team to a market the excitement and enthusiasm is at a high for that individual city and we do draw well. Then we have to continue our marketing, focus and advertising so that the teams are able to not only build on that first year, but also even exceed it. We try to increase our marketing early in the season and increase advertising so we get back into the double-digit increase that we are looking for. We are expecting to exceed 1.5 million fans this year in total. Every year the USBL attendance has increased. New teams bring new fans and new faces and hopefully more awareness for the league.


EDS: How do the teams find their players?





DM: Each team selects players in a variety of ways, but there is a draft.  Our draft is held the week after the NCAA Final Four. That also happens to be the biggest day for visitors to our website. We get probably one million hits to the website on draft day because all our fans and even the media goes to our website to see who is being drafted and in what round.  We are not on television, on TNT or ESPN I wish we were, but we do have it broadcast over the Internet. Hopefully, a million fans will be watching again this year. More importantly, the draft is the key to getting fresh talent. In addition to that, the teams hold tryouts. There is a dialogue between USBL teams and the ‘sister’ NBA teams, which allows coaches and general managers to offer suggestions to the USBL teams on the type of player they should recruit and the type of players they would like to scout.

EDS: Do the NBA scouts ever attend the USBL games?

DM: Only every one! Every game that we have had there has been a minimum of one NBA scout and NBA head coaches, general managers and owners. Having an NBA scout at our games is routine, but often we go beyond the scouts and get the head coaches, GMs and owners. That is tremendous exposure for the players. The USBL has 150 players from our league “graduate” into the NBA and I am sure that, at the conclusion of 2005, there will be another ten to fifteen players making the NBA. Many of the players who are cut from the NBA come back to our league to show that they have the talent to get there a second time. There are numerous reasons why players want to play in the USBL. One reason is we are the only basketball league playing in the summer, we play from April to June.  This offers scouts from all these leagues and the European Leagues as well, a chance to see these players in top form. We have the second best basketball talent in the world. The NBA is number one and we are numbe!
r two. European players, our USBL players and NBA players and coaches agree that the USBL has the second best talent in the world.

EDS: Are you currently seeking finance for the league?

DM: Not at this time. The USBL is doing fine. We are generating revenue from our additional franchises, and we are generating revenue from our sponsorships and advertising.  We are not planning to do any additional financing. Down the road, that might be appropriate, but I do not foresee anything within the next six months to a year.

EDS: Does the league provide financial assistance to its franchised teams?

DM: Yes, we have done that in the past when a team might need a loan. We are not in the business of loaning money to teams, but if a team were weak for a period of time, then we might offer assistance and then look to be repaid at the conclusion of the season.

EDS: How does the league make profit from its teams?  What is the approximate profit the league makes from each team?



DM: The league makes a profit in a variety of ways. The revenues generated from franchise sales, sponsorship sales, advertising and merchandising. Many companies want to advertise either on the website or at the arenas, and merchandise their products and services. Fans do not realize how strong merchandise is hats, t-shirts etc. When you add all these together, the sales that the USBL generates constantly increases with every expansion team.  In addition there is annual dues. In the franchise business it is called a royalty, but in a professional basketball league, we called it dues. The dues are paid every year and they are allocated for referees, marketing and advertising. So there are a variety of ways to generate revenue. Last year, I think we lost a penny or two a share. For 2005 we are looking for a better year, not only profitable, but exceeding expectations.

EDS: How many shares are outstanding and how many are in the public trade-able float? What percentage of stock do company insiders hold?

DM: There are 3.5 million shares outstanding. Of that, approximately 500,000 is in the float. Management, that is my father, brother and myself, own 3 million and we are long-term shareholders. The stock, in our opinion, is under-valued. We believe it is worth more and hopefully over time the market will recognize the value of the USBL and the shares will reach the level they deserve.

EDS: Is there anything else that you would like to say about the league?

DM: I would encourage people to visit our website. The website will be restructured for the 2005 season. The site that they see now if they visit www.usbl.com is our old site, which will be overhauled in another month or two. We will have a new site to start off our 20th season. We are looking forward to that. We will have a new online store and offer merchandise to our fans. Also, if there is anyone who is interested in either an expansion team or the stock there will be an opportunity for them to email or call the league office for information on both the expansion teams and the publicly traded shares.

Please view the disclaimer for USBL here

2004 © Eric, David & Sons, Inc. All Rights Reserved.

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