Stanford isn't like other football powers. It can't generate as much cash from its fans, since it doesn't have nearly as many. Stanford Stadium seats about 50,000—half the size of some venues in the Southeastern and Big Ten conferences.
The school accounted for $9.7 million in football ticket sales on its 2012 annual report. The four teams ranked above Stanford in the latest Bowl Championship Series standings averaged $27 million, with Ohio State topping the list at $41 million. In merchandise sales, Stanford ranked 42nd this year on the Collegiate Licensing Company's list of top-selling schools, well behind not just Texas but also Texas Tech.
The normal revenues Stanford receives from football are so low, in fact, that its 36 varsity sports teams depend on something no other school has, or would dare rely so heavily on: an athletics-only endowment worth between $450 million and $500 million that pays out at 5.5% each year, people familiar with the matter said.
To put Stanford's secretive half-billion dollar sports stash in perspective (Stanford's overall endowment is $17 billion), here are the entire endowments of some large colleges:
Penn State $1,780 million
Tulane U. $961 million
Rutgers ($694 million)
U. of Arizona $563 million
Arizona St. (the largest university in the country) $500 million
Florida St. $498 million
The way Stanford keeps up in the college-football arms race is to lean on private donations. As a result, almost everything the football program touches is endowed, from each of the school's 85 football scholarships to David Shaw's head-coaching position. Stanford's offensive coordinator is even known as the Andrew Luck Director of Offense in honor of an anonymous gift in 2012.