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- [00:02]
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- [01:39]
Ayo Akimolere
Welcome to the Athletic FC Podcast with me, Ayo Akimolere. This is the third and final part of our Multi Club Ownership series. We've learned how multi club operations work and provided some practical examples from the world of football. Today we answer your questions on the effectiveness and and future of MCOs. So can we say for certain multi club ownership is here to stay. Right? We've got Matt Slater with us for the third and final time in the series. Matt, stellar effort so far. Thank you so much for joining us. Now we've got questions from the listeners on mcos. We'll also be hearing from a fan of a club which is part of a multi club ownership model a little later on. So Matt, if you don't mind, let's just dive straight in. We've got one here from Adam's one is around Leicester. He says Leicester fan here can't see any positive from our multi club model. Our youth players go to oh Louven which is the Belgian club owned by the King Power International Group and they Never get played equally. Some highly talented players are there who are coveted by Premier league teams but Leicester haven't leveraged the relationship to sign them. So what's the point? I mean this touches on some of the stuff we've already talked about in the last two episodes. What is the point Matt?
- [03:00]
Matt Slater
Well, I think it's really interesting. You know you said, someone said stellar, you said stellar efforts. Leuven of course is famous for being the home of Stella Artois and a big university and then their football team. Now I think it's a great question because there was an absolute like trend a few years ago of loads of clubs just buying a Belgian team, buying a Belgian or a Dutch or French second division team and going yeah, we've ticked the multi club box. We're thinking about Brexit, we're thinking about, you know, where players are. So, so there's been loads of studies if you look at kind of hotbeds of football talents, London, Paris, Brussels, these are the places that come up. Brazil. So to be in these places sort of made sense. But when I look at that Leicester relationship, it's right. I mean what have Lester got out of it? You know very little evidence I can see of, of, of a kind of coherent strategy of any real attempt to kind of maximize that footprint in the Belgian league. Do they play similar styles? Have they exchanged coaches? What's the relationship like between sporting directors? I can't see it now. There have been players that have gone, they're on loan. So I think in 2020 I think there were three or four Leicester players that went there. One was a guy called Kamel Soa. I remember at the time people who had high haps. I think he's Ghanaian forward but you know it didn't come to anything and last time I looked he's playing somewhere else. I think in, in Belgium or, or, or the Netherlands. It just, just hasn't scored any goals. I think he's got one, one international cap. I think he went to Bruga on, on a decent fee but didn't score any goals for them so just, just wasn't, wasn't good enough. Now that happens. You know this is the problem. Recruitment's hard but it's almost like well that. Is that it? Is that the closest you've got now there's a good player now, Ezekiel Benzouzi, a midfielder, high hopes for him. Dutch international but west hammer in for him. So is he, is, is it Leicester sort of thinking the group or we need the, we need the fee, we need to cover the losses we've, we've been bearing at both clubs. Does he fit with Leicester City? Leicester City going down? I mean, I'm not seeing any sort of sense of strategy, which is what we heard from AJ Sboda1, I think he said something really, really intriguing to me, that a really, really good network, a really, really good multi club model is probably only getting one transfer in the network per season. And he said more averagely, you know, it's kind of once every other year, which if you think about it, that's almost what really good clubs expect from their academy. So we go to all this effort of creating these networks thinking you're going to improve that ratio and you don't really, you know, we heard, I think we heard from Larry Berg, we asked him about the LAFC network, which is smart. They're sort of sharing some of the costs of some of the strain, if you like, with Bayern, a kind of a, you know, a bigger club. And he admitted, he said, look, it puts a real strain on my management, you know, we shall see. Right. He's talking about Flywheel. He was talking about kind of that virtuous circle and a thesis that hasn't been proven yet. And then of course we got Tim Bezbachenko whose job it is to make the network work. That is what he does for Black Knight. And I just think when I, when I look at Leicester City and Leuven, I think about Vincent Tan. Cardiff City, they had a club, United World Group, which was the Sheffield United Group. They had, you know, they had clubs. They did nothing. It did nothing. And I just wonder if they did. I don't think they had put enough resource in, enough thoughts. City Football Group. You know, one of the reasons it kind of works, I'm sure we're going to get into that, is they've thrown people and money at it. So it's hard.
- [06:53]
Ayo Akimolere
No, you're spot on. I'm just thinking where Leicester currently are in the league and, you know, second from bottom, really. So, you know, it's a really tricky time for that club at this moment in time. Right, let's move on. We've got a double header one from Nathaniel. Let's start with the first one, Matt. This one is on the profitability of MCOs. Nathaniel states, when you factor in the initial purchase cost and the ongoing yearly profits or losses, do multi club networks actually make money? Even if they don't turn a profit in the short term, would their potential sale value end up being higher than they cost? Sale value's interesting on this One, Matt?
- [07:30]
Matt Slater
Yeah, very. I mean again, this is something we've heard in the series. I've not had a chance to really sort of dig into all of them because there are so many of these groups now of all kinds of sizes. I think recent UEFA estimates something like 350 Club in Europe are part of networks and it's been growing. So this, it's. There may well be one that I just can't think of right now that is actually turning an annual profit. I'll be surprised though, and I suspect it's more likely that they at best are breaking even. So that shouldn't surprise people, right, because running football clubs is hard. Very few of them are profitable, you know, consistently. They might have a kind of great year or two of transfer fees or an amazing run in Europe or a lot of success, but it's very hard to be consistently profitable, particularly post Covid. You know, the whole industry had a real shock through Covid and hasn't really got back well to profitability but you know, kind of sustainability really. So the fact that you might have two, three, four loss making clubs, the losses add up. So that's hard. Right, So I think let's park that one for a bit. What we heard from Larry in particular is ideally he's a money guy, doesn't want to lose money, none of these people do. We want them to be as sustainable as possible. We want to be successful because being successful on the pitch means we earn more money, you know, full houses, better sponsors, more prize money. It's all good, more eyeballs and on and on it goes. They are thinking of the profit on the way out. These are, you know, now considered to be assets in the same way that you might own property or a company or gold or whatever. And they are a scarce asset. There's only so many of them, particularly in North America. There's only so many sports franchises in Europe, there's only so many really good ones or only so many teams in the good leagues. And people want them. Trophy assets, they're fun. You know, we've talked about a lot of this stuff. So the, the, the actual value of the teams continues to rise and that has been consistent for 30, 40 years. They are going up. So that's where the profitability is. So a really good example here would be City Football Group. They're the most famous, they've got 13 clubs and they have been spending a fortune on their clubs. The total combined losses of the group is now basically a billion pounds. A billion pounds. And that doesn't Include the costs of acquiring some of these franchises. Well, you know, Man City is the obvious one. I think they spent 200 million on there. I think they paid a franchise fee at NYC FC of about $100 million. The others would be pretty small because they're smaller clubs, you know, tiny to be honest. So you're thinking, right, so they've spent all this money to acquire these assets. They're losing money. The total group loses lots of money. You know, what's the plan here? But then you look at how much the value of those assets has risen. So Man City is worth, I don't, you know, 3, 4 billion. Now NYCFC is really interesting, so $100 million franchise fee to buy this new franchise in MLS. I think the last estimate I saw for it was just under a billion dollars. So 10x10x in was it 2017? Now important to factor in, they have not yet built their stadium so there's going to be another big expense there. So again big capital expense. But MLS team with the connection, City Football Group, they've already won the MLS year awards so they've had success and an amazing soccer specific stadium that's going to be worth a lot of money. So that is where the investment thesis is, that's where the return is now just City Football Group, have they sold any of their clubs yet? They had a relationship with Breda and then they pulled out. They've sold stakes though and I think they would continue to sell stakes. So that's interesting. That is where you can start to sort of generate a return on investment across this whole podcast series. I want listeners and viewers to understand multi club ownership. MCO as an idea has been around for sort of 25, 30 years, particularly in other sports, particularly in North America. It has become the big idea in European football for over the last five to 10 years, but it still feels unproven. We've talked about the different reasons that people do it, Thor, and it all sounds quite good, but I don't think anyone has really proven it can work. The one sort of exception I would say to that there's always a caveats for these things is I think Red Bull could probably say it's worked for them. But remember that Red Bull are selling us fizzy drinks. So part of their expense on the football teams, on the sports teams is marketing budget and they are getting a return on investment. You've got to sort of work out why are these people doing it. They're losing money because football's expensive. You don't really make much Money, but the value of the assets keeps rising. If they get it right, they can make money on the way up.
- [12:42]
Ayo Akimolere
Yeah. And I think it's really important when you put it that way, think of it as assets. But then I don't know which football fan would like to think their club an asset.
- [12:49]
Matt Slater
No, no, no.
- [12:51]
Ayo Akimolere
All right, let's move on to the second part of Nathaniel's question. Says this is actually about City. Says we all know cfg. City football group is led by some of the brightest minds in both football and business. So why is it that most of their teams aren't as successful as Manchester City? Is it because all the clubs are focused on supporting Manchester City's global dominance? This is fascinating because are we feeding the club at the top of the pyramid? Fundamentally, because no one at the bottom of the pyramid wants to think that they're going to lose their best players just so that top team can make their billions.
- [13:27]
Matt Slater
Yeah, this is a, this is a good question. There's a. There's a bit of a. I suppose it's about perception. Right, so Man City are. Have just been brilliant. Right, I've lost count. Is it four in a row? Pep's won six. They've been amazing for 10 years. So have the other clubs been as successful as Man City? No, they haven't, but they have been quite successful. I think 2021 in particular was an amazing year. They. That was the year that NYCFC won their mls. Mumbai City, their Indian team have won a couple of trophies. I think one was in 21, one in 23. The Team Torque and Montevideo, the Uruguayan team, they got promoted that year. Girona got promoted. You know, they're. They're sort of historically good for them. They got a partnership with Yokohama in the J League I. They won in 21, 2021. Rings is particular in that I think they won four teams in the CFG group won a title. Now it hasn't been as good for the other teams since. That's true if you look at some of the investments they've made. So Trois and Lommel, for example, are very clearly bought as feeder teams. Feeder clubs, like kind of in baseball terms, they'd be your sort of single 18. That is where they expect to park 18, 19, 20 year olds to get playing time in, in a European league and just to see if they can, if they're good enough. Melbourne City, of course, are the other teams. Melbourne City have had a bit. Have had some success in Australia in terms of. It's. It's almost like they haven't bought other genuinely good teams. MyFC is probably the exception to the rule and I think they probably would like NYFC to be better. And I think once they get their stadium it's, you know, MLS is a quite a very. Is a flat league like a lot of the North American. It's very hard to have dynasties there. So we'll have to sort of track that one. But I understand where the question's coming from. I think that one, they may have forgotten that 2021 was quite a good year for the group. Two, that they probably aren't trying to win everywhere because they haven't chosen as clubs with the capability of winning with as big as capability of winning as Man City. And I think the sort of underlying inference is that yes, the group is channeled to make Man City good. You know, if you have someone good enough in the group, a Savio for example, yeah they will get funneled up the. And, and sent to the center. The first team. It's a bit like kind of, I don't know, kind of the first 15 at school or something. Everyone is, everyone is sort of building towards that. And then again, I like my answer for Red Bull. What, what is it that the Abu Dhabi based owners are trying to do here? They're trying to be in strategic markets. They've got a team in China, they've got a team in India, they've got a team in New York, they're in South America, you know, they're out Europe, they're in Brazil. Now it is all very strategic.
- [16:26]
Ayo Akimolere
Is this a slightly different model though? If we spoke to the Black Knight football group, you know, with Bournemouth and Auckland FC and obviously minority stake in Hibernian and FC Laurian, you look across the board, all those teams seem to be in a really interesting position in their league. Some at the top, some looking at promotion and obviously Bournemouth looking at European football next season?
- [16:44]
Matt Slater
Well, I, I chose Black Knight on purpose. I was thinking about all the groups that are doing well and I thought Black Knight are just having a really, really good 12 to 18 months and they're relatively new. They are clearly really thinking about it. They have a clear top of the tree but they're quite honest about it. It's because it's their Premier League team and they think that the Premier League is the best league and that's where players want to go. And I think we'd agree that's that, you know, we're not saying anything controversial there. We're not being unnecessarily parochial about it. Players in global players want to be in the Champions League and they'd like to be in the Premier League if they can or a handful of other teams in, you know, the other big five leagues, the other big leagues in Europe. So that's not a controversial thing to say. They bought Bournemouth, got a great price as you noted, the smallest stadium in the top flight here. They've got plans to do something about 11,000. Yeah, it's tiny and they rent it. You know, it's, you know, Bournemouth were a third tier team for most of their history. You know, I've still get annoyed. I've. The day I met my wife, I was coming home from Bournemouth versus South End United. We bumped into each other at a trade station. So this, this is where I.
- [17:59]
Ayo Akimolere
One of those days, mate.
- [18:00]
Matt Slater
Bournemouth of this is how I view Bournemouth, you know, so well done. Black Knight, you know, I think lafc another interesting one. But they are their models. They're kind of clearly kind of investment guys that sort of see entertainment industry. Football, football's exciting. It's the global game. There's upside. I think we can do it better. A little bit of that kind of North American can do. Some people might say arrogance, whatever, okay, they can do it better. And they are about winning and they're. And they think that winning equals return on investment. You as a fan, how you feel about that is totally up to you. But at least it's. At least they want to win.
- [18:41]
Ayo Akimolere
Next we'll hear from a fan of an MCO club, Olympique Lyonnais.
- [18:48]
Matt Slater
You're listening to the Athletic FC podcast with IO Akamwalere.
- [18:52]
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- [20:52]
Ayo Akimolere
All right. Hi everyone. Quick one for me. Just want to say this. We'd love to hear from you. We're asking you to fill out a quick survey about you and your podcast habits by going to theathletic.com athletic survey25. Three lucky entries will win $100 or pounds worth of Amazon vouchers as well. So whether you're a longtime listener or a new one, we want your feedback. Go to theathletic.com athletic survey25. The link is also in our episode description. Thank you so much. Let's get back to the podcast. Okay, now we're joined by Leon fan Malik for some background on Olympique Lyonnais. Now, they're owned by Eagle Football holding limited, a multi club group who also own Premier League team Crystal Palace, Brazilian side Botafogo and Belgian side Molenbeek. Now, Lyon have been handed a provisional relegation to Ligue 2, the second division of French football, and will observe a transfer ban following an audit of their finances. Malik, so good to have you with us. And yeah, very interesting. Interesting times ahead for Olympic Lyone. Firstly, tell us as a fan, how you feel about being part of a club that's owned by a multi club ownership.
- [22:11]
Malik
So first guy, thank you for welcoming me. Happy to share these these thoughts. So of course it's going to be my personal opinion, but it's really hard to be part of a group. It's always a matter of you being fan of your club, being a supporter of your club. So when I'm asked am I an Eagle or an olympicone fan, of course I am an Olympic Leone fan. I don't feel like having brotherhood with Marlen Beck or Botafogo. My only material is Olympic Lione and of course I'm sometimes I'm fearing what are Eagles plan because these plans have definitely an impact on Lyon finance, but also Leon, I would say football project. As you mentioned, the DNC has given a transfer ban. We having issues with the local regulatory, financial regulatory, the dncg and this is definitely linked with Eagle's plan.
- [23:12]
Matt Slater
Yeah, Malik. So just for our listeners that perhaps don't know that much about Eagle football, the main owner there is John Texter, who I think we've talked about on this podcast. We've actually had him on this podcast many, many years ago. We've mentioned the clubs involved. It's an ownership group. He has investors. He borrowed a lot of money from Ares, which is a big private equity firm that's very involved in the sports world, to basically buy Olympic Lyonnais, which are by far the biggest club, I would say in his group. Crystal palace might Disagree. He owns 45% of Crystal Palace. He owns pretty much all of Olympic Lyonnet now. Is it about 80? How much does he own of Lyonnais now?
- [23:49]
Malik
It's around 97.
- [23:50]
Matt Slater
The complexity at Lyonnais is that they were a listed company, they were on the French stock market. So there are rules that he has had to follow when he made this takeover. Now if we think about the impact on oel, he has bought you with borrowed money and then he started to sell your assets. So let's just go from there. What has he sold so far?
- [24:14]
Malik
I just wanted to have a quick word regarding Crystal Palace. It's really important to remind everybody that Eagles only hold 40% of Crystal Palace. So is it the main club? Of course Cristal palace is a big club and having a Premier League club is really important. But Eagles doesn't have a Premier League club, which is to me really tricky if you want to handle nicely and with ambition. MCO structure agreed between brackets. So as far as Hana Piclonier is concerned, I Think Olympic Clone was targeted for this. It was of course a target because former president Jean Michaelas wanted to sell Olympic Clonet. I would just some of the assets. The main one is the stadium still owned by olympicone by OL Group now Eagle Football Group but they've pledged some assets. So the stadium is part of the financial burden of Eagle. Beside that olympicone Eagle Football Group used to have Oil Group. I'm going to call it Oil Group just because it's easier because I don't want people to be lost between Eagle Football Holding. Eagle Football Holding. It's complicated, not that much and I'm happy that you say it that way because I think there's a tendency to complicating things to try to make it in a complexity that it has not. But I don't have my structure chart on me so unfortunately show you the figures. So as for the asset, Olympic Tenet used to have an arena called LDLC arena in which you could do concerts, mainly basketball games from the local team as well, which is really well known, owned by Tony Parker. This arena, the company holding this arena has been sold to Jean Michelas. So Jean Michelas has taken back his baby, we call it that way. Also the women Olympic clone has been sold.
- [26:08]
Matt Slater
Very famous women's football team.
- [26:09]
Malik
Yes, one of the, maybe the best European team several times actually has been sold to Michel Kong which is a business partner of John Tech Store. And finally OL Reign which was a club in the us the women club has been sold as well for around 50 million euros. Mentioned it it was 70 for the arena. It's really hard for the women's section of ONP since it is sold part.
- [26:36]
Matt Slater
Yeah, he sold about half of it, hasn't he?
- [26:38]
Malik
Yeah, more than half right now. So yeah, all these three assets have been sold and this is part of more wider strategy of rescaling to man football. It was I think mentioned at the last agm, last annual general meeting of Eagle Football Group of Oil Group that they wanted to refocus on men.
- [27:01]
Matt Slater
So Malik, my follow up question is, you know, as a, as a OL fan, you know, a few years ago you were part of a football club or you were a fan of a football club that had a really good women's football team, had an offshoot in the States, had done the clever thing, had diversified your revenue stream by having an arena where you could do concerts. You, you looked and sounded like a very clever football team. You then have an investor that comes in, fine, he's spotted that you're a clever football team and then to fund his acquisition of your club, he starts selling the assets. How does that feel?
- [27:36]
Malik
You're killing me right now, Matt.
- [27:38]
Ayo Akimolere
That was what I was going to ask because it's true, it's true. You know, the football fan, you know, and we've seen it before, Matt. An investor comes along and you're. Were you happy that when the investor was coming along or did you want it the old way as well?
- [27:51]
Malik
Yeah, that's a, that's a nice question. As you know, Jean Michelas, the former owner, was there for 30 years and he has done an amaz trying to first rise with this club and then diversify its activity to make it a real company, real sports company, I would say, or I would call it an entertainment company. More than a football club. Yeah, of course, yeah, it was able to do this. And when the John Techstar took over, that was the main question. Is he going to go in that thing in that vein? Sorry, or is it. Yeah, maybe restructure the whole thing. Yeah, it has been restructured, of course is, I would say risky. Risky from one standpoint because of course we are pledging all our knowledge or all our strategy on man football on. Yeah, man. I will call it that way. I'm sorry, it's not, it's not that English, but pardon my French, but we have this RS depth, we have also this Olympic unit debt. So there's these two layers depth which is critical to understand. If you don't have this in mind, you think, oh, that's fine, we just have this RS debt. But at ol level you have huge, huge debts that have been increasing for TechStarton more than 30% while the assets have been going down. So the club is put at risk. Of course the risk is I would say moderated because we have the IPO and we want this to succeed.
- [29:18]
Matt Slater
Well, I was going to get answer that, Malik. So just to be fair to John Sexton, because he's not on the call, so he would say, okay, right, I've bought ol, I have borrowed some money and I've therefore sold some assets. But okay, but now OL are part of a network. So this is part of a series of multi club podcasts and we've heard very much the benefits, the positives of why you try to do this. So he's saying, oh well, I've joined this network, they have a connection with a Premier League team, we've got a team in Belgium and very sort of excitingly he would say we have a relationship with Botafogo and look how well Botafogo have done? How has he done so well at Botafogo?
- [29:57]
Malik
You're kidding me again. No, of course he has done. But I need to highlight this. I think that the South American football industry is way different from what you can have in European football. And if you pledge some money, if you pledge some assets and you do a nice thing, and I must say the strategy was nicely done, but it was done for a year. And I'm eager to see what Botafugo is going to do this year, since they had some trouble funding their activity because the money from Botafogo needed to go back to Lyon, since at the first place, Lyon funded Botafogo. Another thing that I want to mention is the fact that olympicone was very well known for homegrown players. And this is really important because. And homegrown player costs nothing. Zero, close to zero. And you can sell it with a benefit, maximum benefit. And the Olympic Lyonnais board has taken this liberty of trying to restructure the training center, which is part of the Olympic lion entity, but also part of the business plan for me that it has brought huge amount of money.
- [31:07]
Matt Slater
Yeah, so many players. Ray and Shirky right now, for example.
- [31:10]
Malik
Karim Benzema, if I just quote the best, maybe Karim Benzema also, I could quote many of them, but yeah, it brings money. And now they've decided just to do some kind of synergy between clubs. Of course you can definitely try to do this, but at some point you need to create players, you need to grow players if you want to grow money.
- [31:30]
Ayo Akimolere
Very quickly, before we wrap up, let's go back to you as a football fan. This is your boyhood club. What is your relationship with Olympique Lyonnais right now? Especially what we've talked about. Do you want to go to football matches? Do you want to see your team play?
- [31:46]
Malik
You know, I'm always joking with one of my guys saying that I'll be. If we get relegated or, I don't know, maybe if we have financial issues, I'd be happy to play for Lyon just for free. And you know, that's. That's the relationship I have with the club. I love the club. I love. I love following it. I still love my Olympic Lyonette, as many fans do. And I watch each game. To me, it's really important. That's kind of my ritual on the weekend. I watch my Olympic unit game. So of course I'm following them, of course I'm supporting them, of course I'm following. If I'm following the financials is because I love the club also and if I'm sometimes and Matt has highlighted it, if I'm too much of a critic on olympicone, it's because I love Olympic lion at the end and I would be eager to maybe once speak to John Textile tell him I love my club. I know what you're doing. You have an ambition that might not match my interest as an olympicone fan, but I upload what you're trying to do. Multi club ownership is something really interesting. I'm not sure it is perfectly done at EAG level. As I mentioned, we need a premier league club if we want to take it to the next level. But as far as I'm concerned for I still enjoy it.
- [32:58]
Matt Slater
Good, good.
- [32:58]
Malik
All right.
- [32:59]
Matt Slater
Well look excellent Malik. Thanks very much. Good to talk and let's let's you know fingers crossed that you guys are not provisionally or you know, technically relegated or whatever it is.
- [33:08]
Malik
Thank you guys.
- [33:17]
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- [33:48]
Malik
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- [34:19]
Ayo Akimolere
Times have me doing this week? Preparing a strawberry pretzel pie solving spelling bee with no hints? Planning a trip to one of the 52 best places to go?
- [34:30]
Malik
Getting to the bottom of the big pants trend.
- [34:33]
Ayo Akimolere
And I'm finally replacing my vacuum with a recommendation I can trust. What will your subscription to the Times have you do? Why not find out with our best offer? Go to nytimes.com subscribe.
- [34:49]
Matt Slater
This is the Athletic FC podcast with IO Acemolare.
- [34:56]
Ayo Akimolere
That was such an interesting chat with Malik and and the topic we covered ties in Perfectly. To the question from David S. Now David doesn't hold back to prepare yourself. Get ready for this one. It's quite, it's quite a long question. A bit like my question sometimes. All right, let's do this. Or let's try, let's try and keep it succinct. The very concept of multi club ownership is an abomination and the antithesis of what football should be about. We all reluctantly accept that the days of being earned by your local millionaire are done. But legislation should restrict owners or shareholders to take a stake, take in a single football club across all levels of professional and semi professional football. Multi club ownership throws up potential for conflicts of interest, asset stripping to prop up the most profitable club in a group and the prospect of sheer neglect towards the smaller clubs in a portfolio. It's disturbing, if not surprising that UEFA and FIFA have been so slow to act on this. Now this alludes to some of the conversations we'd had with Lisa Nandy in a previous podcast about an independent regulator coming to the Premier League. What are your thoughts on this one, Matt?
- [36:07]
Matt Slater
Well, it's a good question because it, it kind of sums up all the fears. So for me, like I said several times, unproven thesis, we kind of, it feels like an experiment we're living through. So I, how many times have I said running football clubs is, is hard, right? They're loss making. So you, if you hone several, you're making it even harder. So that's a concern for me. And if you have a failure at one, you have that kind of contagion risk. So Triple seven is probably the poster boy for oh my word when it goes wrong. So that was this American investment firm based in Miami that started accumulating football clubs for a completely bizarre reason. I mean they thought again they were arrogant and they thought they could do it better. Player trading and back office sales, savings. But the main guy there was a guy called Josh Wander who gave a notorious interview to the Financial Times where he talked about football fans being eager to be monetized and that this network of clubs was a kind of a great big shopping window for sponsors and for you know, credit cards and insurance firms to, to sign up fans and you'd, you'd be a fan of the, of the group. Complete nonsense. And it all fell apart and they've been accused of fraud and we shall, and that, and that playing it playing out in the States. But you know, the contagion risk was huge there. You know, they owned Standard Liege, Herta Berlin, they nearly Bought Everton, thank God they didn't got a stake in Sevilla Vasco in Brazil, Red Star, Paris Club in Melbourne. I mean, Genoa, they're all for sale and some of them have been bought and changed hands. So that, that, that's a risk. I think the question rightly points out the competitive integrity risk. And, you know, UEFA have, have acted eventually, like trying to protect their competitions. You know, it's gonna be basic stuff, isn't it? You know, one person having control over more than one club in the same competition. Yeah, that, that's. That doesn't sound great, does it? And then as. As Malik talks about that feeling, and I think that kind of underpins that, that runs through the question, doesn't it? That it just doesn't feel quite right. You know, I. It's not, it's. It's. It's new. So change is always a bit odd for us, but it just. Just doesn't feel right. You know, if you think about the. Where this all started, it was my town versus your town, that city versus that city. You know, our badge, our shirt versus your badge, your shirt. And if it's all. If we're all part of networks, what are we doing here? You know, this just doesn't. This just doesn't. We're not talking about brands of clothing or coffee. This is sport. You know, this is supposed to be, get it right down to its brass tax. It's my school versus your school. And we want our owner to really care about our club because he wants to beat that club and that owner. So I totally understand where the question's coming from. The reason this is happening is the industry isn't quite working. So this runs through so much of what we talk about. Why are we having a regulator? Why do we have rails about financial distribution? Why do we do podcasts about. About Barry and Macclesfield and other clubs in administration? It's because it's an industry that doesn't quite function that well. You know, are they businesses? There's. Sometimes we talk about them like they're businesses, they act like they're businesses, they use business language, but they don't make any money. You know, businesses that don't make money normally fail. You shut them down and you don't mourn them unless, you know, sometimes you do mourn them, but often they just go grow. But football clubs, no, we. They're more important. They are cherished community assets and towns that lose their clubs, communities that lose their clubs, that really hurts. So this is a response to that. This is a Kind of, if you like coherent, logical, business minded response to an industry that isn't quite functioning. So I'm going to consolidate, I'm going to try and do the player trading better. A phrase that we haven't actually heard in this podcast series. I did wonder if one of our guests would use it is, is leakage often. I often hear people talk about leakage that if you have a football team, you know, losing players is, is a form of leakage. It's like, oh, you know, how's that person? I used to have them under control. So if you think about Trent Alexander, Arnold, that's a classic case of a highly paid, really precious asset that they have allowed to go for nothing by sort of their own failures. You know, if you can somehow keep that within a group loop, you can sort of mitigate some of that risk. So I totally understand, I completely understand. And I often, when people ask me about this stuff, you know, would you want it for your club? And I'll sort of usually say no, I don't think I would. But then it wasn't that long ago that my club very nearly shut, you know, padlocks the lot. And you're thinking, well, if you know the choice between nothing and carrying on, yeah, okay. And if maybe we've been bought by a multi club group that a bit like Black Knight, would I have been upset if someone, if someone like Tim had come along and said, we want to win, right. We want to get to know you guys. We're not going to have favorites here. Okay. Just understand that there is a club at the top of this, but we want you guys to win. We're going to do something about your ground and your training ground and you're going to get better players. I'd have probably gone, all right, well, I'm willing to give this a go. Go. It's not what I would have chosen. And this is, I think the reality of where we've got. So I understand the question, I have sympathy with large parts of it, but I'm afraid sitting on a fence here because I can see where the multi clubbers are coming from too. And I can look at the entire industry and I can see failing businesses, I can see businesses, distressed assets, jobs at risk, losses. And I'm thinking, well, I'm not kind of surprised that people are trying to look at this and thinking, well, let's consolidate, let's, let's, let's create groups, let's try and, let's try and try and be sustainable.
- [42:22]
Ayo Akimolere
Yeah. Very quickly, Matt, you Know you're talking about your club there. How much say does the average fan or average fan group have? I mean, I feel fans are powerless to a certain degree about the people that do take over their club. You know, because if you've got a club, for instance, that hasn't been doing so well, looking at administration not too long ago, many people are thinking, okay, yes, please. But then very few of us looked down the line to see whether or not this is a legitimate group or whether or not they do indeed have the right ethos for our club.
- [42:52]
Matt Slater
Oh, I mean, this is, this is, this is, this is so big. So as fans, you can get organized and you can make it uncomfortable for someone to leave, right? You can, it depends how stubborn and thick skinned that person is. But ultimately it's a bit like going on strike. You can withdraw your labor, you can withdraw your company custom. Now that does require things to get to have got quite bad because you are. No, you know that you're making things worse in the short term. So there are so many clubs right now that are facing that dilemma. Fan bases, Reading, Swindon, Morecambe. My heart goes out to all those guys. My team was there not that long ago. There are loads more. You know, Macclesfield, where I'm talking to you from, I live in Macclesfield. They, they lost their club. They have a Phoenix club that's coming back great. But it was very, it was horrible for a year or two that this town sort of lost its club, lost its, you know, its EFL place. And yeah, there was a, there was a sense of loss. So as fans groups, you, you can get organized to, to create change. You can get someone out. What, what you can't really do is do the vetting and do the choosing. You can't. Now if there's an administration, you might have a bit more control. You might have a sort of an opportunity to maybe get organized. Depending on the size of the club, maybe you can have some influence. Try and find a group, try and find a group of maybe wealthy fans. You can sort of congregate around them. You can control it. It can happen. But ultimately it is. You can sort of tell, you can tell your owner, we don't want you anymore, we want you out. But it's still really up for that owner to sort of choose their successor. This is the situation at Reading, situation at Swindon, this is situation at Morecambe. And, and it's really hard. You feel powerless. So, you know, I haven't got a great answer because there isn't a Great answer. And this hasn't changed for as long as I've been doing this job. And, you know, I keep thinking things are gonna get better. And then I look around and any one time there are five or six clubs going through this and it's depressing.
- [44:58]
Ayo Akimolere
All right, Matt, let's finish on this one. This one is a question from Michael H. Which is actually probably a really good way to wrap this up. Michael says the first two podC episodes have been really interesting. Thanks, Matt. IO and guest. Appreciate you, Michael. Keep those compliments coming in. But the question's actually fascinating because he says to me, it feels like previously when this has been spoken about on the Athletic FC podcast, it's been negative and MCOs have been viewed as an existential threat to football. Has that view changed? Is there an acceptance that MCOs are here to stay and maybe even that benefit outweigh the cons? I guess. After talking to Black Knight Group, I don't know. I have a much more interesting thought about MCOs based on the fact that all their teams seem to be punching at a good rate at this moment in time. But what are your thoughts on that, Matt?
- [45:51]
Matt Slater
Look, yes, it's here for. Yes, it's here. It's not going away. The game has got to, I think, have a clearer idea around separation and how we police this. Cause it does seem a bit ad hoc at the moment. Case by case. We have been talking for three days now about proof of concept. Is anyone really making money yet? Not yet. Is anyone getting sustainable? Yeah, I think probably some are getting sustainable. Are any starting to really kind of hit their own goals? Black Knight appear to be getting close to hitting their goals. There's a few others out there that, you know, City Football Group will probably say, yeah, our goals, our goals are about one or two of our teams being really successful, being in all the right places. We are long term investors. Red Bull will be like, yeah, look at the sales. They're really. We do all well. We do well in the key market.
- [46:40]
Ayo Akimolere
So yeah, I was going to say even Marinakis Group.
- [46:43]
Malik
Look at that.
- [46:44]
Ayo Akimolere
I mean, Forest and Olympiacos. Olympiacos, top of the Super League in Greece. I mean, think about that.
- [46:49]
Matt Slater
No, exactly.
- [46:50]
Ayo Akimolere
All right, let's end it there. Thank you so much to Matt, firstly for all his hard work behind the scenes, your expert journalism as well. And also thank you to our contributors for their questions and our listeners and readers. And also Malik, once more, thanks for your contribution on today's podcast. That's it for now. We'll catch you you soon.
- [47:09]
Malik
The Athletic FC Podcast Network.