Modern football is more than just a game - it’s a place of business.
Recent controversies at FIFA have led to major sponsors threatening to walk, which in turn catalysed long-overdue action against the likes of Sepp Blatter. This alone demonstrates the power of money in the game very palpably.
Brand marketing and advertisement, although sometimes subliminal, never escape the attention of us - the consumers. In England, the Premier League itself was established in 1992, with the main goal of bringing more money into the game and opening up new business opportunities. What a success it has been.
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Take kits for example. Manchester United are receiving £750 million over the next ten years; just to wear Adidas shirts. On top of this, they also have a seven-year deal, worth £361 million, with General Motors for sponsorship rights.
Even stadiums are now the subject of bids from brands for naming rights. Every major competition has a sponsor and the most recent contest for television rights yielded historic levels of spending by the major service providers.
The value of the European football market is estimated to be around £14 billion and, unsurprisingly, this has attracted businessmen and investors for two main reasons.
The first: to run and own a football club to make money. The likes of Mike Ashley and Thomas Werner, of Newcastle United and Liverpool respectively, part with their cash in the hope of making a sustainable return. This is perhaps nothing new or surprising - successful businessmen are good at making money.
The second reason for purchasing a football club is a newer phenomenon. The likes of Roman Abramovich and Sheikh Mansour fall into an elite category of businessmen, to whom making a profit is perhaps less of a priority. Their purchases of Chelsea and Manchester City respectively have come to represent the most recent history of the Premier League. Both sides have risen to overtake the traditionally more dominant clubs such as Liverpool in terms of competitiveness.
Their main incentive for doing so? Either demonstrate their financial power further and more publicly, or perhaps for their own recreational purposes.
Many clubs are subject to rumours of a takeover, but some more recent examples have not delivered the success fans might have hoped. Take Queens Park Rangers and Cardiff: Both have wealthy investors, but the reality of owning a football club soon took its toll on both investors.
Tony Fernandes invested millions into the first team squad of QPR, paying huge wages to players who were past it or taking advantage of the situation.
Another issue is the infrastructure at the R's. Loftus Road has a capacity of just 18,000 spectators - hardly enough to generate a decent amount of revenue, even in the Premier League.
Vincent Tan, at Cardiff City, has made a catalogue of errors ultimately ruining his relationship with fans. He shockingly changed the kit of Cardiff from blue to red, with the belief it would create a marketable brand across the world. Both QPR and Cardiff were unable to sustain Premier League status; undoubtedly a huge financial blow for both owners.
So what should a wealthy investor consider when purchasing a club? First of all, they have to be willing to sacrifice profits. Investment in football should be a long term and seemingly bottomless financial commitment.
Secondly, investors need to really understand the culture of not only the club they are buying, but the city it represents. This is the only way to truly know what fans want and deliver accordingly.
Finally, an investor must assess the current infrastructure at a club. The ground, youth setup and training facilities need as much investment as the squad itself.
Taking this into consideration here are five potential investments for perspective football investors:
The Tyne-side club are crying out for investment. Newcastle have a rich history and, more importantly, a dedicated and passionate fan base. Traditionally one of the bigger clubs in the top flight, recent times have seen a gradual decline in their competitiveness.
Perhaps the biggest complaint fans have regards the intentions of infamous owner Mike Ashley. It would seem his priorities lie firmly with promoting his main business, Sports Direct.
In 2011, Ashley, without fan consultation and with little warning, renamed the historic St. James’ Park to promote his business. The relative lack of investment into the first team squad they have seen in recent years has angered the fans further.
Rich history, a passionate fan base, huge stadium and Premier League status surely make Newcastle a club with huge investment potential.
Aston Villa are another example of a club with some great assets and selling points, lacking financial input. Birmingham is the second city of the United Kingdom and boasts great travel links nationally and internationally.
The Villains are one of only five English clubs to have won a European Cup on top of seven first division titles and seven FA Cups. The club boasts a 42,000 seater stadium in Villa Park, as well as a loyal and committed fan base.
To round it off, Villa have Royal approval, courtesy of lifelong supporter Prince William.
Current owner Randy Lerner took over the club in 2006. Despite initial investment, the club has hired and fired a number of managers, making significant financial losses in recent seasons. Lerner publicly put the club up for sale in 2012, estimating it’s worth at £200 million. Nothing has materialised.
London is obviously saturated with football clubs of varying size. Despite this, one club sticks out.
Big names Chelsea, Arsenal and Tottenham are all based north of the Thames. Crystal Palace are one of only a few sides south of the river and are certainly the most successful. As such, they have a large, accessible fan base with little competition.
Under Alan Pardew, the club are enjoying a decent start to this season and are seemingly establishing themselves as a good Premier League side.
Attracting Yohan Cabaye and keeping Yannick Bolasie in the summer prove the club is attractive to some of the better players. Their only drawback is the relatively small ground.
Selhurst Park can accommodate around 26,000 fans, something a new investor may want to change. However, the owner would be getting a relatively stable club with a solid side and decent manager. The fans make a decent amount of noise too.
The combined counties of Yorkshire cover the largest geographic area of any county in England.
Large, economically important cities such as Sheffield, Hull and Leeds can all be found within Yorkshire’s borders. This area of the country has a great infrastructure and transport links, as well as passionate sport fanatics.
Leeds were once a huge club, but suffered huge financial problems during the early 2000’s. As a result, they suffered a profound plummet from the Premier League and Champions League football right down to League One.
The club has a historic, large stadium in Elland Road and a fan base desperate to get back to the traditional winning ways. Currently in the Championship, Leeds are stable but stagnant, never threatening promotion or threatened by relegation.
Yorkshire needs a dominant football team. Hull have been the most promising side recently, but Leeds could be a potential gem for a willing investor.
Forest, again, fit the same bill as most teams in the list. Once a dominant force, they are waiting to be rediscovered and given a chance. Forest, are best known for their successes under the legendary and charismatic Brian Clough.
Clough famously guided them to back-to-back European championships as well as a Division One title, four league cups and a European Super Cup during his tenure.
The club did not profoundly slump from the top, like Leeds, but fizzled out gradually. They too find themselves stuck in the Championship. Forest also have a good-sized stadium in the City ground and are situated in a large city with good transport links.
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