Grand Prix Sports & Entertainment, which holds an exclusive USARFU sanction that underpins the startup's business strategy, is soliciting multimillion-dollar investments in a Las Vegas 7s competition looking to kick off next fall. Its prospectus presents Melville as if he were a director of the offering, raising the question whether the union is formally involved in the unannounced capital raising.
Gambling, a second major selling point of the GPSE prospectus, creates additional difficulties for the union executive. Many of Boulder's members are minors who may not legally wager, while the pastime is generally disdained by the USOC and the NCAA, from whom USARFU has been struggling to win varsity status for women's rugby.
Melville did not responded to requests for comment.
At minimum, Melville's relationship with GPSE, described by the latter's founder as 'totally awesome and supportive' in a January American Rugby interview, suggests a nonchalant attitude toward those players and coaches, educators and parents who prefer the sports education system to sports entertainment industry. Following rugby's inclusion in the Olympic Games, there have never been more opportunities to access varsity resources for participant, institutional, and commercial growth.
In the business world, investors frequently take seats on a startup's board in order to monitor affairs. Business objectives are complementary and the investor's financial motive is explicit. Straddling nonprofit and for-profit organizations can be more complicated when organizational goals are not clearly aligned or the nonprofit's members have no visibility into the private company's affairs.
'Our exclusive agreement with USA Rugby means that Grand Prix Sports & Entertainment will be the only media company with the rights to create, produce, and broadcast fully sanctioned rugby sevens content,' reads the company's investment offering. 7s matches will 'instantly connect with the coveted 18- to 34-year-old male demo while providing gambling and sports-betting audiences off-the-charts gaming action,' it adds elsewhere.
GPSE purchased rights to USARFU-sanctioned commercial 7s competition in 2005, at a time when previous chief executive Doug Arnot was in desperate need of cash. Three years later, Melville extended GPSE's license to the union's long-established club and territorial national championships as well as a new collegiate 7s championship.
GPSE had been in arrears in making payments, however, and it is not known whether the rights granted in 2008 have lapsed. Melville had not responded to a query, underlining the point that a private company's director may not wish to discuss its business affairs, though they are of interest to the member-supported union.
Simultaneously, USARFU holds an equity position in and receives annual licensing fees from the USA 7s, and Melville also serves on the advisory board of that competition. The USA 7s and the yet-to-launch GPSE competition are commercial rivals.
Interestingly, GPSE and USARFU itself may end up competing for scarce sponsor dollars, as both are looking to sell advertising packages. Pat Guthrie, the longtime congressman from Southern California, is chief revenue officer and president of the American Rugby Football League, the GPSE entity which will govern domestic 7s competitions. (American RFL is different from conventional, 13-a-side rugby league in America, whose governing body is known as American National Rugby League, or AMRNL.)
Guthrie and Southern California officials did not respond to requests for comment.
Related: 7s: Did USARFU sell too cheaply?