In the previous part I talked about how certain investors and club owners want to change the very structure of football for their benefit.

Why Are Clubs Scared Of The Second Wave Of American Investors?

Well, because those investors aren't targeting their clubs. They're not interested in a piece of Manchester United and Liverpool as much they're interested in smaller clubs. They seek what they perceive as underrated clubs with a lot of room to grow.

They're the kind of clubs that are run poorly. The kind that once it is run better, it will perform better, become more popular, and the valuation of its sponsorship deals will increase. Within a few years, those clubs will rise in their value.

That Easy?

Not exactly. It is not that easy in general. But, compared to how much growth and profit are possible, it is relatively easy. There's something amazing about football as an industry.

Stupidty In Football.

There isn't an industry or a sport in the world that has so much money and yet run as randomly and stupidly as football. It would cost billions to buy a team in the NBA or the NFL, the market is full. When it comes to marketing and advertisement, American sports are lightyears ahead of football. There's room to make a lot of profit.

Football, on the other hand, is run by idiots. Chinese multinational conglomerate holding company, Fosun International, bought Wolverhampton Wanderers F.C. for 45 million in 2016. Counting the salary, Fosun brought the Wolves for half the price of Maguire. The club is currently valued at around 10 times the buying price.

Similar stories behind Brighton and Brentford. When something like this happens so frequently, you can attribute it to the new owners being smart as much as past owners being idiots. Either way, such profit can never happen in American sports.

Why Is It Easy In European Football?

In my opinion, this is the result of two intertwined reasons.

1- Chaos And Management Failure

In 2018 for example, an American investment group bought shares in the Italian club Venezia F.C. The most notable of the group was Duncan L. Niederauer who became the majority shareholder in 2020. Within the last 4 years, only the club started using modern methods to market.

Niederauer and co. changed everything in the club with simple ideas and silly amounts of money. The total money they spent between purchasing the club and the changes was 35 million. The result was going from Serie C to Serie A in 4 years. They still technically have a chance to stay in Serie A, but even if they don't it would still be quite the accomplishment.

What's So Special Venezia?

Even though it would take a miracle for them to stay in the Serie A, Venezia still ranks in the top 10 Italian clubs in terms of selling merchandise, they expect to sell 5 times what they sold the previous year. 95% of merchandise sold wasn't even in Italy.

Venezia did all of that while having the youngest squad in the league led by the youngest coach in the league.

The club's chief marketing officer Ted Philipakos said that when they started social media marketing with 0 followers. They didn't hire a firm of any kind to raise the number of followers because they simply didn't have money. Now, the club's English Twitter account has 35 thousand followers.

With such simple steps, the club's money value doubled more than once in the last 4 years. That's the most subtle example, I already mentioned clubs like Wolves, Brighton, and Brentford who had similar success but on a bigger scale with simple ideas.

Chaos, failure, randomness, and lack of qualifications create golden investment opportunities for smart people.

Back To Venezia

The whole background of the story of Venezia was that Niederauer and his wife liked the city a lot which led him to buy the club.

Niederauer said that you don't need to be a genius to do what he did to outdo other clubs with such ease. That's what happens when you're competing with unqualified people. You could surprise yourself by how well you'd do as a club owner who knows business basics.

Niederauer also said that he was helped by the fact that the lack of a concrete way to value players helped him a lot. He was able to purchase talented players and sell them way over the price they should be sold for.

In Conclusion

In my opinion, if football wasn't such a popular sport, it would have been long gone as a sport with the way it has been run. While the first wave of the Americanization of football threatens the structure of football by changing the rules, the second and third waves seem to organize it and make more sense out of it.

That however threatens the first wave, specifically when you consider the second reason it is easier to invest in European football: inflation, or more specifically, football inflation.

But, more on that and the war between the first wave against the second and third wave in the final part of this series.

Thank You For Reading