A Quick Look at Purse Bids in Professional Boxing in Light of Triller’s Winning Purse Bid for the Rights to Teofimo Lopez’s Lightweight Title Defense Against George Kambosos, Jr.
Triller, an upstart tech company that recently staged the exhibition between retired boxing legends Roy Jones, Jr. and “Iron” Mike Tyson, sent shockwaves through the professional boxing community this week with news that it won the promotional rights to stage unified lightweight champion Teofimo (The Takeover) Lopez’s title defense against the undefeated George Kambosos, Jr. Triller’s winning bid for the bout was a reported $6+ million, palpably more than the two more established promoters who also bid on it, Matchroom and Top Rank. Triller promotes neither Lopez or Kambosos, so some might wonder how exactly it came to pass that it won the rights, and/or was even in position to bid on the bout to begin with. A quick look at what a purse bid is, what goes into them, and what Triller had to do to succeed in the Lopez-Kambosos purse bid, follows.
What is a Purse Bid?
A purse bid can generally be defined as a monetary bid, open to all registered promoters in good standing of a given professional boxing sanctioning body, to stage a world championship bout which arises only if the promoters of its anticipated contestants cannot reach a private agreement as to the staging of the bout and the purses for same within a given amount of time designated by the sanctioning body. Each of boxing’s major sanctioning bodies, the IBF, WBO, WBA, and WBC, have meticulous regulations governing what gives rise to a purse bid and the parameters, time frame, and methods of same. Each bidding promoter does not know beforehand what another promoter may be bidding on a given bout. In some instances, such as what the boxing world saw this week with Lopez-Kambosos, one would-be promoter’s purse bid far outstrips those of other promoters resulting in a promoter, such a Triller, that otherwise has no interest in either contestant, staging the contest.
How Does a Promoter Get to Make a Purse Bid?
The rules vary slightly between the sanctioning bodies, but generally, any promoter that is both registered, and in good standing, with a sanctioning body at the time bids are sought is permitted to make a bid on a world championship bout that goes to a purse bid. The purse bid is publicly announced by the sanctioning body which specifies the date, time, and place for the purse bid and the period of time before during which bids are to be submitted. Multiple sanctioning bodies require an additional non-refundable fee, payable to the sanctioning body, to participate. The contents of a bid, which must be sealed, may include the purse amount (the total amount of each boxers’ purse), the date of the bout, the site of the bout, all projected expenses for the participants and their corners, and/or a representation that the winning promoter will furnish a given amount of transportation accommodations for the contestants and their teams. An initial deposit, equal to a percentage of the total purse bid, generally must also accompany the bid. Certain sanctioning bodies provide for minimum bids, such that any bids that come in under those minimums would not be considered. The sanctioning bodies themselves generally dictate how the winning purse bid is split between the contestants.
What Happens if a Boxer’s Promoter Does Not Win the Purse Bid?
One might generally expect that whoever the champion or challenger’s promoter is would promote/co-promote the world championship bout involving them, but it does not always work out that way. To address the prospect that the promoter may not actually be the promoter or co-promoter of a given world championship bout, there is generally a section in boxing promotional agreements specifically addressing purse bids. A typical purse bid provision, such as this one which recently featured in a promotional agreement that I negotiated, reads as follows:
“If Promoter’s bid…is unsuccessful in a purse bid situation, then Promoter agrees to release Fighter from this Agreement for the limited purpose of permitting Fighter to participate in the Purse Bid Bout. In consideration for Promoter and Fighter, and in consideration of Promoter’s good faith bid for the Purse Bid Bout, Fighter agrees to pay Promoter and Promoter agrees to accept [a percentage to be negotiated, generally 20 to 35%] of the amount Fighter receives for his participation in the Purse Bid Bout pursuant to the terms of the winning bid.”
In sum, in the event that a world champion or world title challenger’s promoter of record fails to secure the rights to promote a bout after a good faith purse bid, the promoter will nonetheless be contractually entitled to a certain percentage of what their boxer is guaranteed in exchange for allowing boxer to compete in a bout in which the promoter is not involved. Here, Top Rank and DiBella Entertainment, which promote Lopez and Kambosos respectively, would receive the percentage negotiated in their promotional agreements for stepping aside in favor of Triller.
Is Triller a Duly Registered Boxing Promoter?
While Triller Fight Club, the wing of Triller involved in staging Lopez-Kambosos, has largely staged exhibitions (such as Jones-Tyson) and thus not world championship bouts, virtually all of the sanctioning bodies involved in Lopez-Kambosos require that a would-be promoter is both registered and in good standing with them before it would be permitted to make a bid. Accordingly, although Triller has no prior history of working with the involved sanctioning bodies, and notably the IBF, which apparently took the lead here although Lopez also has the WBA and WBO titles, it must be presumed that Triller paid the IBF’s required annual registration fee and $5,000 registration fee in a timely manner (as mandated by its “Rules Governing Championship Contests”) in order to be eligible to participate, and win, the rights to stage Lopez-Kambosos. Whether Triller continues to develop as a big-ticket player in top flight professional boxing contests or not, it played the game right this time and has secured an opportunity to help “The Takeover” continue his takeover of the hearts and minds of boxing fans worldwide.
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