This post is about HRJ Capital, an investment firm with both Private Equity and Venture Capital arms. No, this isn’t another Wall Street story. It’s a sports story, because HRJ was started by ex-49ers Ronnie Lott, Joe Montana and Harris Barton in order to invest money from big-name athletes, including Andre Agassi and Oscar de la Hoya.
I caught wind of their troubles via Deuce. Aparently HRJ planned to raise $250m but only got to around $130m — but they went ahead and invested $250m anyway.
HRJ now owes $69 million to Silicon Valley Bank, which is now negotiating to take over the firm. So what does this mean?
First it means a lot of athletes are going to lose the money they put in. Andre Agassi, Jerry Rice, and De La Hoya can kiss their initial investments goodbye.
Second, HRJ proves us right again. Athlete-run and athlete-backed ventures are just doomed to fail. We covered a lot of the previous failures here.
Third, it means the companies that HRJ invested in will now have a new owner to deal with — Silicon Valley Bank. So who does this affect? I know for sure that a fantasy football site called YouBeQB.com raised venture money from HRJ. It’s also possible that Yardbarker took money from them as well.
As a member of the YardBarker Network, let’s hope that Ronnie Lott’s misfortunes doesn’t affect YardBarker, as they’re the only reason we can pay our heating bill this winter!