Football team owners call for change

The increasingly intertwined worlds of football and finance came together this week in London for our annual Business of Football Summit. Over two days we heard from agents, fans, clubs, broadcasters, regulators, leagues, owners and investors about where they think the game is heading, what’s going right and what needs to improve.

One thing stood out through it all: calls for change are growing louder.

People across the game pointed to cracks in the foundations that underpin the status quo. Football’s financial model is not working, too many clubs lose too much money. On the pitch, the issue of competitive balance is becoming more acute, with a tiny group of teams winning their domestic leagues far too often. Young people are beginning to switch off, posing a long term challenge for broadcasters. Fans feel increasingly alienated and exploited by the push to make money from football. And regulation is struggling to keep up.

As the gap between the haves and the have nots gets bigger, something will have to give. The failed European Super League project may have been the opening salvo in a longer-term battle over the future of football.

What real, lasting change across the game might look like will be hotly contested in the coming years by the various forces now looking to shape it. For now, do read on — Josh Noble, sport editor

Cardinale: Club valuations are based on ‘pure laziness’

Gerry Cardinale, founder of AC Milan owner RedBird Capital Partners, said that professional investors should be ashamed of the financial state of play in European football. Speaking alongside legendary Swedish forward and new RedBird partner Zlatan Ibrahimović, Cardinale said clubs needed to break the cycle and that AC Milan would be a “change agent”.

“We have to be more self-sufficient, we have to be able to run these things more professionally,” he said. Calls for new competitions, such as the European Super League, were a “distraction” from years of mismanagement across the game, he added.

“Let’s own ourselves better. The fact that these things trade on a multiple of revenue is pure laziness. Shame on all of us. These things should trade on a multiple of cash flow. Deficit financing yourself, and blowing your brains out in the transfer market, all this stuff has to change.”

Like many on stage, Cardinale warned that football needs to be wary of letting leagues and competitions settle into a situation where the outcome is a foregone conclusion at the start of every season.

“The whole point of sports is the unpredictably of the human element,” he said. “If it’s the same three or four teams every year that wins everything, I personally think long-term — when you look at the health of the ecosystem and you look at valuations — they are just going to be less valuable.”

Cardinale also confirmed that AC Milan will build a new “American-style” stadium in the city. A lack of infrastructure investment since the 1990 World Cup has been a major drag on Italian football, something a handful of foreign owners hope to change.

Textor: Let rich owners spend what they want

While Cardinale urged clubs to rein in spending, some put forward the opposite view. John Textor called for the Premier League spending rules to be relaxed — or ditched altogether — so that rich owners can pump their own money into clubs and cut the gap with the top teams.

Textor’s Eagle Football Group owns Olympique Lyonnais, RWD Molenbeek, Botafogo and is the largest shareholder in Crystal Palace. Textor said spending limits stopped ambitious clubs from upgrading their squads in the transfer market and amounted to “anti-competitive behaviour”. He cited the example of Nottingham Forest’s billionaire owner Evangelos Marinakis. Forest were charged by the Premier League earlier this year for breaching spending rules.

“Has this really been a problem, that everyone is going bankrupt? The sustainability issue is a fraudulent issue. Somebody shows up and tells Marinakis, an incredible guy in terms of resources and assets . . . and says we know you have [the money], but we’re worried about you Mr Marinakis. Don’t spend it.”

He went on to say that linking spending to revenue would merely make the Premier League less and less competitive and people would lose interest.

“I’ve got to somehow find a way to put Crystal Palace against Erling Haaland [of Manchester City]”, he said. “If you get an injury you don’t get to pull a £15mn player off the bench you’ve got to take somebody from your academy because you can’t afford to have that player on your bench. That’s not sport. Is anyone really having fun with this?”

He added: “Don’t tell me if Leicester City can do it, anybody can do it. It’s broken.”

Kang: Women’s teams should split from men’s

Michele Kang is a US investor pioneering the idea of bringing multiclub ownership to women’s football. After being introduced to football initially during the 2019 women’s World Cup, Kang said she quickly saw a “significant business potential” and “jumped right in”.

Kang, who bought the Washington Spirit in 2022, recently acquired the London City Lionesses. Last year she also struck a groundbreaking deal to take control of the Olympique Lyonnais women’s team.

“Initially I had no intention of buying or investing, but as I understood more about soccer and especially women’s sport, I not only became passionate, I became a believer”, she said. “With the right level of investment and focus, there is no reason why this can’t grow.”

Her deal to take control of OL Feminin was a first for the industry. She said her plan to build a multiclub group relied on having an elite, high profile team at the heart of it.

“One of the biggest issues in women’s sports is awareness. A lot of people don’t even know there is a professional league”, she said. “OL Feminin is probably the team in women’s football. I think they are trailblazers.”

While the deal has proven controversial in France, Kang believes that the long-term health of women’s football will rely on teams being able to stand alone and grow on their own terms.

“Women’s teams have been viewed around the world as a sort charity, or somebody’s pet project, or ESG or DEI depending on which country you live in,” she said. “I think for a women’s team to be successful and achieve commercial viability, it should have a separate and dedicated focus.”

Although that change in mindset was a “hard transition” for those in the game to make — revenue from men’s teams typically underwrite the costs of running a women’s side — Kang is confident that hiving off women’s teams will help improve their prospects.

“When you’re trying to do something for the first time that people never imagined, it takes time,” the healthcare entrepreneur said.

De Laurentiis: private equity doesn’t understand football

Several private equity and other investment firms spoke on stage at the event, including Ares, Arctos and Knighthead Capital. However, Napoli president Aurelio De Laurentiis had some harsh words for those bringing institutional capital into European football.

“What’s the problem with private equity funds? Do they know anything about football? In my view, they don’t”, he said. Clubs should simply go to a bank if they need money, he added.

“When a private equity fund comes to me, I say: ‘Sorry, but why do you come to me? Because you want to make money, because your investors must bring home a significant percentage of profitability within three, four, five years maximum’,” he said.

Taking money from private equity funds amounted to handing over a slice of a club’s future success to an outsider who had not contributed to it, De Laurentiis suggested.

“I am a fool for letting you take away an income that belongs to me for which I made investments”, he said. “I supported my fans, I took risks, I bought footballers, I sold footballers, I get bothered by managers. In other words, I do everything, but just because you gave me money you want to be the one who earns. No, I want to earn.”

More from the Summit . . . 

• Saudi clubs will return to the transfer market this summer, with a new batch of clubs set to be infused with cash, according to the vice chair of the country’s domestic league.

• Lucy Frazer, the UK’s culture secretary, promised to bring in legislation for a new independent football regulator before the next election. English football has been eagerly awaiting details of what the new body will look like, how it will operate and what it will do.

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