naivety

The plan to sell a stake in the World Cup came crashing down as many expected. Some friends and family wondered what the brouhaha was all about - sharing here what I’ve shared with them in the past week.

• Football is the world’s biggest sport and bigger than any religion

• Modern football was created in England. Europe’s top leagues (the Premier League, La Liga, Bundesliga, Serie A and Ligue 1) are the most dominant leagues in the world

• >95% of football stars play in these leagues

• For generations, European and South American footballing entities have invested billions into grassroots football and academies, giving free opportunities to learn, play and excel at the game. These pathways produced the best players in the world

• These leagues have a promotion/relegation structure that requires fiscal responsibility, player development and mid-long term planning for clubs to survive

• The World Cup is dominated by European and South American teams

• Here in the US, families have to pay $1k to $10k a season for the kids to play. The US Football Association does not want to change pay to play

• Sports teams are considered “franchises” in the US - an asset class

• Because there is no relegation/promotion in the MLS, there is no incentive structure to develop the game meaningfully

• The Europeans, South Americans and Asians are underwriting world football and its infrastructure. The US contributes nothing to the development of the global game

So when American investors tried to buy a stake in what many people see as the sport’s most sacred competition, the backlash was predictable.

[Edit: The visceral global reaction would have been the same if Asia, South American, European based investors attempted the same]

For their naivety and misjudgment, I hope the people involved in this deal get hung out to dry in the court of public opinion.