BERKELEY — The roots of the $18 million deal Cal announced Thursday go back 12 years, to a classroom on campus and an engineering course called Venture Design.
It was in that class that a student named Michael Li created a business plan for a video-game company that has come to be known as Kabam. It’s about to become more well-known now that Li and company co-founder Kevin Chou, another Cal student, have struck a deal to put the Kabam name on the football field at Memorial Stadium for the next 15 years.
Li was not in attendance during the deal’s formal announcement Thursday during a news conference at Memorial Stadium. He manages the company’s Beijing office. But Chou was there, surrounded by 30 Kabam employees, all Cal grads, who sat on risers behind the dais.
“This is a great Cal story,” athletic director Sandy Barbour said. “This is business, but this is personal, too.”
For Chou, it’s a commitment made partly with his heart.
“I can’t imagine a closer tie that a CEO can have with the alma mater he loves,” Chou said.
Asked about aligning with a football team coming off a 1-11 season, Chou said he has confidence in first-year coach Sonny Dykes.
“It was a tough year, but true Cal fans are fans year-in and year-out,” he said. “He’s got a very young team with a lot of injuries. I think with the talent and strategy they have in place, I’m real excited to see where that goes.”
For Cal, the naming rights deal provides one more revenue source. The university has diversified its approach to paying down the combined $474 million debt on the Memorial Stadium renovation and retrofit and on the construction of the Simpson Center training facility.
Barbour said at no time did Cal consider selling naming rights to Memorial Stadium itself. That option “was never on the table.”
Field-only naming deals still are fairly rare in collegiate sports, and Cal’s is the richest on a per-year basis. Cal will earn about $1.2 million on average per year, more than Maryland’s Chevy Chase Bank Field at Byrd Stadium ($800,000) or Akron’s Summa Field and InfoCision Stadium ($250,000).
John Wilton, Cal’s vice chancellor for administration, said the money will be invested in the stadium endowment fund and should grow by 6 to 7 percent per year.
The agreement also involves initiatives that include Kabam offering scholarships to Cal students working in technology or innovation, internships to Cal students and student-athletes and creating an interactive technology zone at the stadium.
Kabam also pledged to bring 500 military veterans and their families to Cal football games each year.
Chou, 33, recalled his company’s fledgling days, operating out of a small office above a Hawaiian barbecue restaurant in Mountain View. When the firm grew and needed more space, it moved across the street … above a dim sum restaurant.
The seven-year-old company now has nearly 700 employees on three continents, half of them at Kabam’s San Francisco headquarters. The company’s earnings for 2013 will be more than $325 million, and Chou believes the exposure that will come from Kabam Field will help that figure grow.
Chou watched games from the Cal student section as an undergrad but said he is not a season-ticket holder.
“You are now,” Barbour said.
For more on Cal sports, see the Bear Talk blog at ibabuzz.com/beartalk. Follow Jeff Faraudo on Twitter at twitter.com/JeffFaraudo.
