Seven seconds. That’s how much time is left in the University of Virginia (UVA) vs. Furman University basketball game when a Furman player steals the ball and passes it to his teammate. In order for them to win, Furman must overcome a two-point deficit. The seconds tick down as the Furman player takes the three pointer. As the ball hangs in the air, so does the fate of millions of dollars. The ball goes in the net, and the potential to earn up to 1.7 million dollars goes down the drain for UVA.
This game was a part of March Madness, an annual college basketball tournament where Division 1 men and women’s teams play for a National Championship title. It’s a term associated with much more than just basketball; brackets, bets, watch-parties and die-hard fan loyalty are all key parts of the magic.
With all the engagement and hype surrounding the mayhem, it’s no surprise that money plays a key role in March Madness.
That streak of great 3-point shooting in the Sweet 16? Worth 5 million dollars. That last-second layup to advance to the Final Four? That’s 8.3 million dollars.
The way teams are paid is in units. Last year, a unit was worth an estimated $339,000. Each game a team plays is worth one unit, which is paid over six years. This means that one unit earned now is worth 2.03 million dollars overall. For smaller schools especially, just advancing to one more round can yield a significant impact on their basketball program and school overall.
But where does all this money come from? The money the National Collegiate Athletic Association (NCAA) earns is largely due to broadcasting and license revenues. According to NCAA financial statements, 90% of the 1.4 billion dollars they earned from college basketball in 2022 came from the tournament. 90% of this money is allotted to the member schools.
It’s not just the NCAA that has money riding on the tournament. Office pools and informal bets have always been popular, but the recent legalization of sports betting in dozens of states and the District of Columbia has led to unprecedented levels of wagering. According to the American Gaming Association, 1 in 4 Americans, or 68 million people, bet on the March Madness tournament this year, accounting for 15.5 billion dollars.
March Madness is well loved by fans and not without good reason. Long-honored traditions, like winning teams cutting down the net or rooting for the most recent Cinderella story, are what keep so many of us coming back to watch the tournament every year. At times it can feel like much more than a game, and for many, with all of the money at stake, it is.
