Why are USA investors buying English clubs?

[Tony Currie]

It always surprises me why a venture capitalist would buy a football club. As an investment it is dire, that's why owners used to be local business men who are were real supporters with an expensive hobby.

However, the influx of USA owners is because they are hoping to repeat what happened in the NFL. There are teams in other major US professional leagues that lose money in a given year, and if you asked this question of the NFL 40 years ago, the answer would be yes they loose money. However, in the 21st century, every team in the NFL is solidly profitable and has been for some time. Forbes recently estimated that the least profitable team in the NFL, Tampa Bay, still made about $60 million in 2022, and most teams made $100 million or more, with some, like Dallas, making multiples of that.

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[Cappy]

It’s what concerns me most about the takeover. If the ‘investment’ is with a long-term view with the hope they fall on the profitable side of a change in the football model, that removes relegation and the jeopardy, then I worry what happens if that doesn’t come to fruition. They may then look to liquidise the assets they’ve bought.

I’d have much preferred a business person who has us as a hobby, who simply values the financial cost less than the enjoyment
of ownership.

It’s all a bit shit either way when you think about it.

 

[The Crab]

If I’m honest I have no idea.

If I was wealthy and looking to invest I’d steer clear of football as it just seems like a bad idea.

But these consortiums are all about the bottom line, so there must be something in it for them?

 

[ben1987]

They see the clubs as undervalued versus their potential TV revenue and hope with enough American owners they can restructure football finances towards the NFL model. NFL has fewer global viewers but the clubs are all worth billions.

They also hope that buying a £100m club, spending £100m they can establish as a mid table prem side worth £400m in the short-mid term.

 

[jim2007]

They see the clubs as undervalued versus their potential TV revenue and hope with enough American owners they can restructure football finances towards the NFL model. NFL has fewer global viewers but the clubs are all worth billions.

They also hope that buying a £100m club, spending £100m they can establish as a mid table prem side worth £400m in the short-mid term.

Exactly this.

 

[Klaatu Barada Nikto]

If I’m honest I have no idea.

If I was wealthy and looking to invest I’d steer clear of football as it just seems like a bad idea.

But these consortiums are all about the bottom line, so there must be something in it for them?

I guess the end game is to have enough American owners in the premier league to vote to remove relegation, and hope that your club is in the top flight when that happens.

 

[Cappy]

They see the clubs as undervalued versus their potential TV revenue and hope with enough American owners they can restructure football finances towards the NFL model. NFL has fewer global viewers but the clubs are all worth billions.

They also hope that buying a £100m club, spending £100m they can establish as a mid table prem side worth £400m in the short-mid term.

Which required removal of the relegation jeopardy. It’s a big if, though I feel it will constantly be attempted until successful.

That’s one of the reasons the ‘NFL model’ works. One of the other reasons the nfl model works is its monopoly over talent. There’s nowhere else for the talent to go. League appeal to paying viewers in football will always have that risk as there are many top leagues that could be the most popular globally if enough changes.

 

[The Crab]

I guess the end game is to have enough American owners in the premier league to vote to remove relegation, and hope that your club is in the top flight when that happens.

I feel like I should be ok with that it we are in it.

But I’m not

 

[Berkshire Blade]

The NFL makes a fraction of the overseas tv rights the premier league does. The premier league is only going to grow in markets like the US and China.

It's much cheaper to buy an English football club than even a US one these days. There's a brand new MLS 'expansion' club that was brought for hundreds more million that our asking price.

When you see the global success of the premier league it's not a surprise whatsoever

 

[Klaatu Barada Nikto]

I feel like I should be ok with that it we are in it.

But I’m not

You would have to wonder what UEFA and FIFA would have to say about a closed league in Europe. FIFA can hardly object to it given the existence of the MLS.

 

[Mumbo]

I guess the end game is to have enough American owners in the premier league to vote to remove relegation, and hope that your club is in the top flight when that happens.

I’m just trying to imagine football without relegation or promotion…..its a truly horrifying thought.

 

[Overthehills]

Apparently the attraction has started to fade a little bit, however it is a no brainier as to why the Yankee’s want a piece of the Premier League pie in particular.

Ordinarily, English clubs tend to have a better valuation that anything within American sports which makes it more attractive.

But owning a PL club is where everything becomes fruitful… with top flight TV rights worth a ridiculous £2b and sponsorship levels being the second highest in the world. It’s a no brainer… if you get it right, it pays.

The only problem being that it is all considered as short term, high impact investment. They all hope to cash it and show quick profit…..

We don’t want to be a toy or a gamble to investors and me need someone who is willing to play a longer game so to speak, therefore we have to hope that our impending yanks are just that.

 

[YorkBlade]

They see the clubs as undervalued versus their potential TV revenue and hope with enough American owners they can restructure football finances towards the NFL model. NFL has fewer global viewers but the clubs are all worth billions.

They also hope that buying a £100m club, spending £100m they can establish as a mid table prem side worth £400m in the short-mid term.

This

 

[Enigmatic]

This article provides a decent view of this topic.

 

[mancunianblade]

Americans own 50% of Serie A now, soon to be a majority.

 

[dexter101]

I do feel nervous about the unknown. However (and I might be slightly biased...) I do think we are are attractive offering to someone.

1)recent premier league exposure

2) good track record academy which bow has the basic requirements for cat 1

3) a club in a major city that doesn't have any other major sports teams (by this I mean there is no top flight sports sides in South Yorkshire, we are the most recent. Correct me if I am wrong on this one)

Sheffield as a brand is likely to be recognised in USA due to steel

With over 300 million residents, if they can establish a fan base in the US, they could get their money back easily just on merch.

The bigger concern is these things take time and only happen with significant change to the blades brand and success on the pitch.

 

[Sithblade]

I’m just trying to imagine football without relegation or promotion…..its a truly horrifying thought.

There was some kick back against the County Cricket Championship splitting into two divisions in 2000. Despite the benefits of giving teams more competive games with promotion and relegation now at stake.

 

[Kev Gee]

Many people claim that English football clubs are under valued in terms of 'potential" for growth.

Thats the reason apparently.

 

[Working Class Hero]

If all Premier League clubs are to be bought out by billionaires eventually, then statistically speaking around a third of them would be American anyway.

It's clearly more than that though, and whatever the reasons for them buying up Premier League clubs, the end result is likely to be the same. They'll look to reform it somehow, to resemble how they do things over there.

I'd like to think that fans over here would not stand for that though, the Premier League would kill itself if it was allowed to be a closed shop. I'd be first in line to vote for a place in the EFL instead, if we had a say.

 

[Bennyand the Blades]

I think it could well be the means to go much bigger than just little old England,

 

[Danny_Blade]

If the Premier League was reformed to having no relegation, would that still be viable if a European Super League came into being beforehand?

 

[relish]

Their hope as mentioned above is definitely to remove relegation from the prem (which would need 14 votes, they are close). That will make the 20 ‘franchises’ in the Prem at that time much more valuable.

The unknown is whether government (or the independent regulator, if that gets up and running) would step in to stop that. I suspect, given sufficient outcry from fans, they would.

 

[toledo]

I've lived in the US for over 40 years and the growth of soccer is enormous.

The one aspect that is driving this is that soccer (football) can be played by all kids, and not those kids that can play the 3 big American based or heavily influenced sports of baseball, basketball, and American Football. These are sports heavily restrictive to most kids.

It started in 1999 when the US Women won the World Cup. There was a feeling that started then that your average kid had an outlet to play a sport

At that time, you could not find soccer fields anywhere, now they are all over the place, either as single fields or as community parks housing many fields of all sizes.

Gradually, as soccer continued to build a foundation, the sport opened up to multi millions of kids whose parents were more than happy to pay the yearly club fee to get their kids out onto a field and enjoy themselves.

So, the term 'Soccer Mom' developed as mom's took their kids to practice and saw how happy their kids were and, at the same time, the number of kids playing and developing their skills increased enormously.

I speak from experience here as I was coaching club soccer GK's when I met an American Soccer Mom whose child I was coaching. We've been married now for 10 years.

Spring forward to today and, in my view, because of its availability to all kids of all ages from 4 years onwards, and soccer is now the most popular sport in the US and is heavily branded.

Now, today, you can get almost every game from Europe, South America, Saudi Arabia, Central America, live on TV. For example, through ESPN, Paramount +, Fox, NBC, CBS, I can watch every EPL and EFL game live.

American investment has seen this growth and potential, especially with the EPL.

In the US, therefore, its about two things:

a) Soccer is now the most popular sport in the US and therefore there is money to be made
b) Where these is money, there is American investment and it will not go away. American investment is very strong and now is linked with two dynamics to create an unbreakable triangle: Soccer availabilility to all kids, TV and Streaming money, and a major influence in the most popular sport in world.

Americans now know that they cannot continue to be insular in sports investment, it now has to be worldwide.

toledo

 

[jt64]

things

To add to what toledo said, which I think wasn't mentioned, there is somewhat of a turn away from (American) football at youth level, there's a few reasons for this, be it simple costs to be able to play the sports, fear of concussions or other longer term injuries etc, which is naturally leading to a growth in (our) football. We've not seen the true fruits of it at international level in terms of the US being truly competitive (at least in the men's game), but I don't think it's unrealistic that in the medium term the USMNT will progress to a point where they have legitimate World Cup equity. And let's not forget they're hosting the next one

 

[Houston_Blade]

To add to what toledo said, which I think wasn't mentioned, there is somewhat of a turn away from (American) football at youth level, there's a few reasons for this, be it simple costs to be able to play the sports, fear of concussions or other longer term injuries etc, which is naturally leading to a growth in (our) football. We've not seen the true fruits of it at international level in terms of the US being truly competitive (at least in the men's game), but I don't think it's unrealistic that in the medium term the USMNT will progress to a point where they have legitimate World Cup equity. And let's not forget they're hosting the next one

I have much less experience of ‘soccer’ in the US than Toledo, however the US National team will never do anything while ever it costs $3000 a year for kids to play competitive football. It’s a money making scam and it’s run as such. The emphasis is firmly on winning rather than development and parents are spun a yarn about college scholarships, this is what they want to hear and what they pay money for.

I’d put the top Sheffield kids teams ant any age group ahead of anything in the US, the problem would be that the rules here are different, the refs are fannies and ref it like a fannies game. In the UK kids don’t tend to get booked at a young age unless it’s a genuine booking (something dangerous), the refs here book 6 and 7 year olds for any little thing and show no common sense in refereeing.

It’s miles away from European football and won’t ever catch up until the model changes.

 

[toledo]

Agreed Houston.

Even at $3000 a year for club, it’s far more available than traditional American sports that restricts access to all kids.

toledo

 

[Houston_Blade]

Agreed Houston.

Even at $3000 a year for club, it’s far more available than traditional American sports that restricts access to all kids.

toledo

The one thing the US has in its favour in all sports is that the school offering (for the chosen few) is good. In the UK grassroots clubs are the main focus and school teams are supplementary, it’s the opposite here.

My kids aren’t in the US public school system though so it’s not the same for them.

 

[DifferentClass]

Ryan Reynolds is technically Canadian

 

[Charlieblade]

America and England are very different countries. They play Soccer, and England play Association Football.
America has soccer moms. England have obese single women producing sprogs and a benefit mentality.

America has a World Series where Americans are the only competitors. The MLS is a retirement home for old players who are past it.

What will Americans make of clubs that like Man Utd, or Man City, who have few players who identify as English?

Will the EU produce legislation that prevents Americans taking jobs in the PL?

Different countries, different people, different expectations.

 

[Klaatu Barada Nikto]

Will the EU produce legislation that prevents Americans taking jobs in the PL?