Making big bets on untested ideas isn't new to the owner of the NFL's Carolina Panthers, hedge fund billionaire David Tepper.
In 2006, he bought a big chunk of shares in bankrupt Dana Corp., leaving some asking why? The Toledo Blade at the time chalked it up to his nature as a "well-known risk taker."
In 2009, while everyone on Wall Street was averting their eyes from big banks, Tepper's Appaloosa Management hedge fund bought into a bunch of them. The firm made a cool $7.5 billion on that, and Tepper, a former Goldman Sachs trader, got more than half that.
So the $70 million bet Tepper is making now on a new coach for the Panthers, who is almost completely untested at the top level of the game, is par for Tepper's very gutsy course.
Taking Another Chance
Tepper and the Panthers are hiring coach Matt Rhule away from Baylor University, where Rhule drew tons of attention for turning a 1-11 team into a 11-3 team over the course of three seasons. It's the first major move as owner of the team for Tepper, who paid a record $2.2 billion for the Panthers last year.
Tepper, whose current net worth is pegged by Forbes at $12 billion, but is rarely written about without mention of his blue collar Pittsburgh roots, said in a story on the Panthers website he identifies with Rhule's humble beginnings and bootstrap rise.
"I was a short-order cook, he was a short-order cook," Tepper said. "Nobody gave him anything, nobody gave me anything. He had to work hard for everything he got."
The Panthers fired Ron Rivera, who coached the team from 2011-2019, went 76-63 and reached the Super Bowl during the 2015 season.
Big Risk On College Coach
ESPN reported the Panthers offered Rhule a seven-year deal that with incentives could be worth $70 million, plus $6 million to buy out Rhule's contract at Baylor. That's a big bet on a guy whose only coaching experience in the NFL was a brief stint as an offensive line assistant almost a decade ago with the Giants.
An average salary of $10 million a year would put Rhule not too far off the salary of the most successful NFL coach of the last several years; New England's Bill Belichick, and other recently-successful pedigree coaches like Seattle's Pete Carroll and the Saints' Sean Payton, and in line with another successful NFL head man, the Ravens' John Harbaugh.
Tepper said Rhule can be a guy to turn the franchise into a regular contender.
"He's a program builder," Tepper said.
Photo credit: James Willamor, Flickr