Locked On Penguins - Daily Podcast On The Pittsburgh Penguins - SPECIAL EPISODE: How VC is impacting Pittsburgh youth hockey

Starting point is 00:00:00 The state of youth hockey across the United States is in flux, despite the success at the Olympics and on the international level for USA hockey. It's become a story of private equity monopolies and over professionalization. So why is this all happening to hockey in America and what can be done about it? On today's episode of the Locked-on Penguins podcast, we talk to Kenny Jacoby of the USA Today about just that. You're Locked-on Penguins, your daily podcast on the Pittsburgh Penguins,

Starting point is 00:00:42 part of the Locked-on Podcast Network, your team every day. Hello and welcome to the Wednesday edition of the Locked-on Penguins podcast. I'm one of your hosts, Patrick Damp. I'm flying solo on this one today. Hunter will be back for our regularly scheduled programming on Thursday.

Starting point is 00:01:01 But as I said in the introduction, this is a bit of a special episode today. I am joined by Kenny Jacoby of the USA Today. Kenny, I really appreciate you taking some time to be part of our show today. And for those who may not know, could you let our listeners know who you are, what your work is, and what you focus on mainly for the USA Today? Of course. Thanks for having me on, Patrick.

Starting point is 00:01:27 My name is Kenny Jacoby. I'm an investigative reporter for USA Today. I do a lot of sports investigations, and I've spent the last year and a half reporting on the business of youth hockey. A big chunk of that, the last nine months, I was investigating BlackBerry Sports Group, which is a private investment firm-backed company that has gobbled up a huge slice of the youth hockey market. So in an article I published earlier last month, I was explaining this company's business. practices and the impact that they've had on hockey families, especially in the Northeast and Midwest. Yeah, that is a really great piece. I was saying to you right before we hit record, I think I have read this thing front to back probably five times. It's incredibly well done for our listeners

Starting point is 00:02:20 who may not have read it. I'm going to have a link to it in the show notes on both YouTube and Spotify or wherever you're getting today's episode. You'll be able to find it there. But if you want to check it out mid-episode, just search it on USA Today.com. It's called Lord of the Rinks. Meet the hockey CEO cashing in on your kids team. Now, part of this investigation of yours did touch on the Pittsburgh area, but we're going to save that for a little bit later. I want to kind of start at the top of how this investigation, this article,

Starting point is 00:02:56 and everything around it came to be. could you kind of give us an idea of, you know, how this got on your radar, what you found out during the reporting, and just kind of the 10,000 foot view of how this investigation came to be? Absolutely. So my foray into reporting on youth hockey started with a series of stories I did on the Dallas Stars and the monopoly that they built over youth hockey in Texas and Oklahoma. So that reporting I published throughout 2025. And it described a lot of these kind of strong arm, you know, power moves that the stars have done to, you know, ensure that anybody who enters into youth hockey, you know, whether you're a four year old or, you know, a teenager or an adult, that you're going to be going through the stars channels and paying the stars. company. And they have, they had gained seats on the governing body that oversaw, tech or hockey in Texas and, you know, started all, they had owned most of the rinks and used public money to, to build and control them. But as I was publishing that reporting,

Starting point is 00:04:18 I got lots of reader responses, lots of emails and tips and people writing in. And the biggest, you know, feedback I got was you have to, you have to. look into this company called Black Bear Sports Group up in the Northeast, which was using, as I learned, a lot of the same tactics that the stars were using to control the youth hockey experience, but doing it on an even larger scale. Black Bear had accumulated in just a decade 47 rinks across 11 states. They own not only the rinks, but many, many of the teams inside them, the leagues that they played in, the tournaments and showcases that they compete in, even things like the streaming service that parents use to watch kids games, they have to pay Black Bear for that

Starting point is 00:05:08 too. So immediately that caught my attention. And it did not take that long to start getting people to talk to me about Black Bear because there was just so much widespread concern about the business practices that they were engaging in and the impact that they were having on families and kids. Yeah, I noticed that as well when I started reading it because full disclosure for our audience and for you, one of the arenas in rinks that Black Bear currently owns is Palmer Imaging Arena in Delmont, Pennsylvania. And that is the rink that I grew up playing in. That I played for the Allegheny Badgers for 12 years. That's now one of the organizations that Black Bear is deeply involved with. And I have seen firsthand both from a coaching perspective because I spent a couple of seasons coaching my former team

Starting point is 00:06:08 while Black Bear was in the process and then after acquiring that arena. And I've also seen it from the recreational side playing adult league hockey at that rink once a week several times throughout the year. So I have seen that change pretty firsthand. And it really does kind of put into perspective the over-corporatization, the over-professionalization of youth sports in the United States. And that's the other place that I want to take this. Because again, we will, for our listeners who are probably tuning in here to say, what's the Pittsburgh angle? This is locked on penguins. We want to talk about Pittsburgh. Promise you we're going to get to that.

Starting point is 00:06:54 But something that stood out to me here, and this kind of was almost the beginning of Black Bear, when it came out of Maryland with Murray Gunty, the guy who is, if you read the piece, kind of the now former brains behind Black Bear. And could you take me through, for those who may not have read it, what happened with him, his son, and the rinks in Maryland? Sure. So, yes, there was a rink in Maryland called Piney Orchard Ice Arena. It was owned by the county of Ann Arundle. And it had been this kind of run-down rink. It had run into some financial troubles with the previous ownership. And that was the first rink that Black Bear actually closed a deal on and started operating. It was about. in late 2015, early 2016. And essentially what happened there was Murray Gunti, he's a Maryland native. His son was playing for one of the two AAA organizations in the state called Team Maryland. And Murray was actually coaching his 12-U team. During that season, which was a really successful season for the team,

Starting point is 00:08:16 Murray went into business with the president of Team Maryland. Now, mind you, Team Maryland is a nonprofit organization. So it's not owned by anybody, but it has a board of directors. And the president made a series of business deals with Black Bear. And the first one was to buy Piney Orchard Ice Arena. As shortly after that happened, Black Bear made some investments into the ring to, you know, upgrade some of the facilities and take care of some maintenance issues. they also Black Bear and the president of Team Maryland expanded the program significantly by adding on a couple of Junior League franchises.

Starting point is 00:09:00 So they were creating this pipeline for Team Maryland players to advance from the team directly into junior ranks through these junior affiliates that they had. Then something else happened, which is where you start to get into the conflicts of interest here. And that is that this Piney Orchard Ice Arena, which Black Bear owned, along with Team President, or Team Maryland's president, started renting ice to Team Maryland. So this nonprofit hockey club was paying rent to this for-profit rink that had the same ownership, right? The same people in control. So they were working both sides of the deals, cutting deals for themselves.

Starting point is 00:09:43 This is problematic from a corporate. governance structure because there is no incentive for these people who are running the show to get the best deals for their members, right, who are they supposed to be representing. They can sort of dictate the terms on which, you know, Team Maryland uses this ice and set the prices. And parents, you know, who are on these teams don't really have any control or say over that. So over time, what you saw happening was Team Maryland. started paying more and more money directly to for-profit companies affiliated with Black Bear and affiliated with its president. To the tune of it got to about $600,000 in one year, which was about

Starting point is 00:10:29 half of Team Maryland's total expenses. So it creates this issue where you have a nonprofit, but it's sort of existing to subsidize a for-profit business. And you can really run into some issues there from a legal perspective, from a tax perspective there, because nonprofits are really supposed to be for the public benefit, not for the benefit of a private company. Yeah, that was also a big point of emphasis on this story that you posted. And one of the things that I want to get into because we're going to have to take a quick break here in just a sec. So make sure you're sticking with us. We're going to talk about how some of this has come for the Pittsburgh area. Kenny and I will get into that when we come back right after this.

Starting point is 00:11:24 We'll be right back with our conversation with Kenny Jacoby of the USA today. But before we get back to it, we have got a couple of sponsors. We got to get to starting with game time. There is nothing like playoff hockey live, the intensity, the rivalries, the crowd. It is just different when you're in the building. The Stanley Cup playoffs are something that every fan should. should get to experience and they should not have to struggle to get there. And game time makes it incredibly easy to find tickets, even for those high demand, hard to find Stanley Cup playoff games with just a few taps.

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Starting point is 00:15:13 It's a story about youth hockey, consolidation, venture capitalism, all of that good stuff. Like I said, in the opening segment, you can find that link down in the show notes. So you'll be able to read the whole thing. Make sure to block some time out for it because, again, I cannot say enough about how great it is. Now, let's get into a little bit here how this is touching the Pittsburgh Reef. in youth hockey. And again, I will say to our audience, I am not a totally and completely neutral observer of this. I am the son of a guy who coached in the Pittsburgh area for decades. I'm a former youth hockey player in Pittsburgh. So obviously this hit so home for me because I've watched

Starting point is 00:16:02 this happen over the past few years. And one of the hardest parts for me to read in this story was the story out of Pittsburgh Ice Arena in New Kensington with a team that I will say was one of my rivals growing up. The North Hills Vipers had so many battles with that organization. But even though I was a rival, I never wanted to see them eliminated, just eliminated from the playoffs, not from existence. And this was heartbreaking. Essentially, they tried to do a hostile takeover. I don't that's probably not the right word but they did try to take them over so what did you learn kenny about what happened between black bear and the north hills vipers so i'll start by saying

Starting point is 00:16:52 the key to black bear's business model is that if you can control the ice you can dictate the terms on which people use it and so that has been the the strategy that they've executed across the country right buy up the rings and then once you control the ice you can you know install your own programming and um you can kick out a team if if you think you can make more money by uh installing your own in-house team instead and that's exactly what happened uh at pittsburgh ice arena so in in 2021 black bear bought pittsburgh ice arena i believe it was their 24th rink acquisition um they the tenant in that rink was the North Hills Amateur Hockey Association. They'd been there for several years.

Starting point is 00:17:38 They'd run some pretty successful programs, the Vipers, the Stars. And when this company bought the rink, you know, I spoke with multiple parents of the Vipers, the North Hills Amateur Hockey Association's board, and they described to me kind of what happened the TikTok of after Black Bear took over. And what they told me was that initially Black Bear held a parent meeting where they said, you know, oh, don't worry, nothing's going to change. Everything's going to be, you know, basically the same. And it kind of was for the first year. But then in that second year, in 2022, BlackBair comes to the North Hills Amateur Hockey Association with a proposal to buy its teams,

Starting point is 00:18:24 to essentially take over its youth programs. And the price it offered to buy the teams was $1. And so this board, you know, receives this proposal. And to them, it's a non-starter. They're a nonprofit organization. They've been in the Pittsburgh area for literally almost 60 years at that point. They were the oldest youth hockey organization in the region. And Black Bear says, hey, we'll, we'd like to take you over and we're willing to pay, you know, $1 for that. So this board, you know, obviously rejects that proposal, but they sort of realize that they

Starting point is 00:19:00 don't hold the power here. Black Bear holds the power, right? And so they kind of try to work with Black Bear. They offer this counter proposal where essentially the nonprofit would maintain control of the teams, but they'd hire some Black Bear people onto their staff. That wasn't good enough for Black Bear. And by the end of 2022, Black Bear told told the vipers that they would no longer be welcome in the rink, that they would have to go find ice somewhere else. They allowed the stars, which were the AAA program, to stay. But most of the players who are on these lower level teams that were called the Vipers, we're going to have to either leave or join Black Bear's in-house teams.

Starting point is 00:19:43 And as you probably know from growing up in the area, there's just not that many other options for an entire hockey program to go. So this board spent the next year kind of scrambling to buy whatever ice slots they could find. at some nearby rings, including some really late at night. But it just wasn't sustainable for a kids, you know, organization. And after that one year of scrambling and doing whatever they could to stay alive, they decided it was really no longer sustainable. And they, the board made the difficult decision to vote,

Starting point is 00:20:18 to fold the vipers after 60 years. And what has happened since, Black Bear has installed its own in-house program to take their place. So all these kids, you know, who would have played for the Vipers, for many of them, the only realistic option is to now join the team that is owned by Black Bear and the Vipers do not exist anymore as a program. Which, again, you know, to me is incredibly heartbreaking because as a member of this community, as somebody who has been a part of it for essentially my entire life, the vipers were a staple in the Pittsburgh community. They were genuinely one of maybe two legitimate elite level teams,

Starting point is 00:21:05 where if you made them or if you made the Pittsburgh Hornets, you were on a team that at the time, when I was growing up, that meant you had an opportunity to go further in the sport. And if you were on one of those two teams, even if it didn't mean that you were going, to go further with the sport it meant for western pennsylvania and most of the northeast you were one of the best players in the region and this kind of helps me transition into the next part of this that i wanted to also talk to you about kenny is kind of the over professionalization

Starting point is 00:21:45 of youth sports and the role that companies like black bear play in it because i know that being here in Pittsburgh and I you know for our audience you may not know you definitely don't know Kenny is I'm in my mid 30s so I am fully in Sydney Crosby generation of Pittsburgh hockey and Pittsburgh became a legitimate hockey town thanks to Sydney Crosby and the penguins in their rise so the interest went through the roof but so did a lot of the greed to the point where it seemed like Every youth program when I was growing up had AAA, had juniors, had whatever elite classification they wanted to call themselves. But it really came down to, did the parents have the money to pay the check to get on that team? And now it does feel like between Black Bear and the stuff that you did with the Dallas Stars organization, that that has just exploded across youth sports, especially hockey.

Starting point is 00:22:51 where teams are sprouting up and saying, hey, this is a chance for your kid to get noticed, for your kid to go further. And there was a part of that in this investigation where these Black Bear teams are essentially promising kids, hey, if you play on this team for Black Bear, your kid's going to get noticed for college. So would you be able to expound on that a little bit here?

Starting point is 00:23:15 Yeah. So I think this is what you sort of lose when youth sports goes from a community-driven activity to something that is controlled by people whose sole reason for existing is to make a profit, right? And so when you are a Black Bear run or owned organization,

Starting point is 00:23:38 something starts to happen where you get steered into these leagues and tournaments and showcases that Black Bear owns, and that they set the prices for. And pretty soon, you know, a lot of your entire youth hockey experience is going to be owned and controlled by this one company. So that means, you know, a 60 roughly game season

Starting point is 00:24:04 that takes place over six or seven months, multiple Black Bear tournaments and showcases a year. Each of those come with state of play, hotel requirements where they force you to book hotel rooms that you don't necessarily want, even if you can get a better rate elsewhere. And a lot of it is kind of rooted in this, like, elitism, right? Where they tell you, like, this is what you need to do to make it to the next level.

Starting point is 00:24:32 Like, if you want to go to college hockey or to the NHL, you kind of have to do these steps along the way. It may be attending this one camp or this one, you know, showcase series, or this academy team, or taking private lessons, you know, with this particular coach. And all those costs just really add up over time. And I think there's another dynamic that you spoke to, which is just that there aren't that many other options, you know, for these people to go. So the more and more that these programs, these rings and teams, get bought up by for-profit interests, just the fewer alternatives there are going to be.

Starting point is 00:25:15 Hockey is a unique sport in that ice rinks are the gatekeeper to the sport, and there just aren't that many of them. There's not an ice rink in every public park and at every school, like there are soccer fields and baseball fields. And that is, I think, the dynamic that these companies have capitalized on is that even if you only control, say, 10%, 20% or 30% of the ice in a given market, there's so much more demand. for ICE, then there is supply, that you know you're going to have basically a guaranteed customer base no matter what because so many people really want to play. And because these companies are run by people who are there to make a profit, not necessarily to look out for what's best for your kids' development or just, you know, his, his, you know, wholesome, you know, youth sports experience, they're going to keep steering you into these programs that cost more

Starting point is 00:26:14 and more money and ultimately results in parents and families playing in some cases over $10,000 a year for a kid's single season. And that is just not the youth sports that I grew up with, certainly. I would love to say it's not the youth sports that I grew up with. But again, I played hockey growing up. It's been an expensive sport since pretty much its inception just because you need a whole slew of equipment in ice slots to play. So I will agree though in the sense that I did play a lot. of rec league baseball and I remember it was a hat a shirt and you went out and played at your local field so it is definitely kind this whole story is kind of indicative of the way youth sports have changed but there is some progress in pushing back against this and that is how Kenny and I are

Starting point is 00:27:05 going to close out today's episode of locked on penguins we will talk about that when we come back right after this. We'll be back to finish up the Wednesday edition of the Locked-on Penguins podcast, but we've got one more sponsor to get to, and that is Hymns. ED is way more common than most guys think. Millions of guys deal with it at some point in their lives, and that is exactly why Hymns offers you a straightforward way to handle it. Hymns connects you with licensed healthcare providers online,

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Starting point is 00:28:26 Hems.com slash locked on NHL for your free online visit. One more time, that is hymns.com slash locked on NHL. Prescription required. See website details and important safety information. Slodentafil is the generic version of Viagra, and Viagra is a registered trademark of Vietris Specialty LLC. Hymns is not affiliated with or endorsed by Vietris. We're closing out the Wednesday edition of the Locked-on Penguins podcast. I am Patrick Damp. I'm flying solo without my co-pilot Hunter Hodes today. He will be back on Thursday. But again, this is a special edition of locked on penguins. Once again, I'm joined by Kenny Jacoby of USA Today, the author of of Lord of the Rinks, a great investigation that is very much worth your time. Now, let's pick up

Starting point is 00:29:25 where we left off our middle segment here. And not long after your piece ran in the USA today, a group of lawmakers at the national level actually do appear to be taking this seriously introducing the Let Kids Play Act, which was introduced by Senator Chris Murphy, a Democrat from Connecticut and a local representative here in the House of Representatives, Representative Chris DeLuzio. They're kind of looking at this and kind of coming to the same conclusion that we are on this episode that there's become too much corporatization, too much over professionalization. So I know you have been focused on this.

Starting point is 00:30:10 So do you see any sort of progress or at the very least, is it encouraging to see that it's at least being acknowledged? Absolutely. Yeah. You know, when this bill, the Let Kids Play Act was introduced just a few days after our article published, one of the very first things that the lawmakers said in their press conference about this was take a look at what happened to the Pittsburgh Viper. It was within probably 60 seconds of this press conference starting. And their point was like, youth sports used to be this community-based activity. It used to be run at cost by local parents and people who had, you know, a stake in the outcome. And now it's running, it's being run largely by people from these out-of-state corporations that don't know you and don't know your kids personally and don't have any stake in their outcome.

Starting point is 00:31:04 So what this, Chris Murphy has a kid who plays in a Black Bear League, you know, rep Chris Deluzio. He is obviously based in Pittsburgh and he was very familiar with the Vipers situation. The bill that they introduced would really be, it would be huge if it was ever passed. And it would apply not just to hockey, but to every other sport that has been corporatized over the last few years. And it would do a number of things. One, it would require private equity companies and companies that operate in a similar structure to divest from their youth sports investments. It would ban them from further investments in youth sports. It would require them to compensate the local programs that they've harmed.

Starting point is 00:31:56 And it would also ban things like state of play and some of these other bundling tactics. that these companies do. And I think the idea behind this bill was that youth sports, you know, should sort of be sacred, right? This, you know, it's one thing if you want to, you know, get corporate corporations involved in adult sports and, you know, super high level competitive sport. But we're just talking about the lowest level, you know, activities for little kids. And, you know, I think this bill could face definitely an uphill battle in Congress. There aren't a lot of laws being passed in general right now. But absolutely, I think what we're seeing is progress here.

Starting point is 00:32:38 You have two high-profile national lawmakers taking an interest in this. And bills often take a long time to pass. It can take a while to build support. But just getting it introduced is the first step. And there will be hearings that will come and these issues will be discussed. And I think more and more lawmakers and just everyday Americans will become familiar. with what's happening. For sure.

Starting point is 00:33:03 And just to add one last thing from my perspective on it is just to make sure that everybody, our listeners are clear on this is, I've got no issue with the elite programs because there is a, there's a place for that. It is, you know, you never want to have, especially if you have a very talented child, to be playing in that rec league and kind of wasting their potential because I had played with several kids that I grew up with who now have, who had spent some time in the pros, who'd spent some time in college, had gone overseas and played. And, you know, there were opportunities for them.

Starting point is 00:33:39 But it wasn't the cannibalizing of the rest of us who understood that, you know, once we graduated high school, it was going to be Wednesday night beer league for us from there out. And there's not a darn thing wrong with any of that. It's the love of the game. It's the development. it's all the memories and lessons that you take from the sport. So just had to make sure I put that out there. But Kenny, I do think this is going to about finish up our conversation today.

Starting point is 00:34:09 I cannot thank you enough for joining the show. Like I said, I was a huge fan of this piece. Again, it'll be linked down in the show notes for anybody who wants to read it. I highly recommend it. But let our listeners know where they can find you. what you're working on and anything else you want to say to close out today's episode. Well, thanks so much for having me on. I appreciate the opportunity to talk about the story.

Starting point is 00:34:36 Anybody who's interested in reading more, I will be continuing to publish stories and investigating youth hockey. So you can find those at USA Today.com. You could also follow me on X at Kenny Jacoby or any of the other platforms I go by the same name. Well, again, I really, really appreciate it. I hope this conversation for all of you who hung out with us was informative. I hope you enjoyed it. If not, Hunter and I will be back on Thursday.

Starting point is 00:35:08 We will be talking about the baby penguins and their quest to advance in the Calder Cup playoffs, as well as continuing our season in review series for the rest of the Pittsburgh Penguins. But for now, thank you all so much for tuning in. Hunter and I will be back with a brand new episode for you all on Thursday.

Locked On Penguins - Daily Podcast On The Pittsburgh Penguins - SPECIAL EPISODE: How VC is impacting Pittsburgh youth hockey

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