Football is changing as a result of multi-club ownership models. This business strategy, in which several clubs are owned by a single entity in different leagues or countries, is revolutionizing the game. Red Bull and City Football Group have made these business models a worldwide phenomenon. Its benefits are obvious: infrastructure, distribution of players, and investments. But how does it work? What does it mean for the future of the sport? Let’s discuss interesting facts in this article.
What is Driving Multi-Club Ownership?
The motive behind acquiring several clubs at once alludes to growth, efficiency, and profitability. Owning multiple clubs enables relevant stakeholders to maximize multiple revenue streams. Such an example is City Football Group, which owns 13 associations around the world and is said to earn about 1 billion dollars a year from the sale of common advertising.
These models are also a solution for young talent development. Players are transferred between clubs owned by the same owner to gain experience in lower-tier teams and then are escalated to better teams. For instance, RB Leipzig walks hand in hand with Red Bull Salzburg, as 70 percent of Leipzig's first-team members have played for Salzburg earlier. This way, transfer fees are reduced, and competitive teams are formed. Well, by visiting Mel Bet, you can place bets on the games of all these clubs at the best odds. After all, almost all world events are collected there, and you can even place live bets on some of them. In the meantime, we will move on to the advantages of owning many clubs at once.
The Benefits of Multi-Club Ownership
Let’s break down the key advantages:
- Creating Stars Efficiently: The sharing of academies, as well as the lending of players among the clubs, forms an efficient way of nurturing stars.
- Boosted Earnings Centralization: Centralized sponsorships and broadcasting rights increase revenue across the network.
- Branding on a Global Scale: Clubs across the world help increase brand recognition and attract international fandom.
- Lowered Financial Risks: The negative earnings from one club will be covered by the earnings of other clubs, providing support to the finances as a group.
These merits render the multi-club model the most appealing business approach to investors intent on transforming the football industry.
The Financial Engine Behind Multi-Club Ownership
Owning multiple clubs isn’t simply a tactic. It’s a monetizing machine, and by owning several clubs, investors create a single operating revenue structure. Sponsorships, such as Puma’s $65 million per year contract with City Football Group that distributed earnings among all the teams, are among them. Broadcasting rights allow for even more income. In 2021, the football empire controlled by Red Bull earned $500 million in revenue from their clubs taking part in domestic and European competitions.
Furthermore, the model cuts down on the transfer fees. Within the same group, clubs exchange players, which circumvents the need to pay high transfer fees. This method allowed the City Football Group to avoid transfers costing them around $150 million between 2018 and 2022.
Key Challenges of Multi-Club Ownership
Here are the issues that need urgent attention:
- Concerns About Competitive Integrity: If international tournaments are shared, the concept of ownership can be compromised.
- Large Set-Up Costs: The development and maintenance of a club network require huge capital.
- Regulatory Risks: There are new models sprouting up, which, under the close scrutiny of UEFA and FIFA, are being evaluated and may face restrictions in the future.
- Cultural Disconnects: Trying to bridge multinational clubs and their local cultures can be a hurdle, thereby antagonizing their fan base.
These are the problems and risks in the management of multi-club ownership.
How Multi-Club Ownership Shapes Global Talent
The ability to nurture global talent is by far the greatest advantage of multi-club ownership. Now, players from underprivileged regions have access to pathways that were previously unavailable. For example, through the purchase of Mumbai City FC by City Football Group, Indian players were offered a chance to learn and shift to European football. Also, Red Bull Bragantino in Brazil serves as a launchpad for talented South Americans switching to RB Leipzig.
Statistics indicate that 65% of players who are part of multi-club systems start their careers in low-division clubs and gradually progress to higher leagues. This talent funnel not only ensures good returns on players but saves on investment costs, making this model a win-win for both clubs and the players.
Why Multi-Club Ownership is Here to Stay
The multi-club model has been specified as a challenge in its own right, but it has started a new revolution in the way football is seen in the world. It guarantees financial security, international scope, and unsurpassed chances to raise new talent. The old club structure is very quickly being outrun as more players join the game. Already in 2023, over 180 clubs from different regions of the world belonged to the system of multi-club networks, and this figure is on the rise.
This movement is not only changing football as we know it. It is changing the entire course of the game. The way the sport is expanding globally and, with the right business model of management, will also last for many years to come. If you are a supporter or a shareholder, this shift is irreversible. Multi-club ownership is essential. It is the future of the sport, and the revolution has only just started.
