Explaining the NFL's New Ownership Rule

NFL ownership has always been a bit confusing, but it's about to get even more complicated.

On Tuesday, it was reported that the NFL will now be allowing private equity firms to obtain part-time ownership of franchises:

Now, if you don't quite understand what the vagueness of that statement really means, you're not alone. Let's break it down.

The most notable rule is that a private equity firm can only own up to 10% of a team, so they won't be able to become anything more than a minority owner. With that in mind, the rule won't be changing things in the league too much.

That 10% includes all private equity firms involved in ownership. For example, three firms won't each be able to own their individual 10%, which would add up to 30% of the team. There can be multiple firms involved, but their combined ownership cannot be more than 10%.

In addition, sovereign wealth funds and pension funds are not allowed to be direct investors. The NFL also requires each majority owner to control at least 30% of their franchise, and a team can have no more than 25 total owners.

Essentially, these private equity firms can only possess minority ownership, and they really won't be involved in any decision-making regarding the franchise.

While at first glance this can seem like a rather big move by the league, they've actually been the most conservative of all North American professional sports leagues.

The NBA, MLB, NHL, MLS and NWSL all allow their teams to be up to 30% controlled by these firms, so the NFL's 10% is actually pretty small in comparison.

With NFL teams becoming more and more valuable , this rule expands the list of potential buyers for each franchise, making the process of selling a team easier than it has been before.

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