Why are foreign soccer stars buying up lower league teams in the US? | Football

Why are foreign soccer stars buying up lower league teams in the US? | Football

For years, the foreign soccer star was a fleeting sight on American soil: they came, they partied, they played a few games and then ... they left. Now though, they’re not just passing through on an offseason Las Vegas binge or seeing out their careers in MLS. A new wave of stars are putting down roots by investing in America’s professional game.

But it’s not the top league â€" MLS â€" that they’re interested in. They’re throwing themselves into second-tier competitions such as the North American Soccer League and United Soccer League. They’re either joining fledgling, ambitious outfits, as Didier Drogba has done as a co-owner and player at Phoenix Rising FC, or creating new clubs altogether: Paolo Maldini co-founded Miami FC in 2015, while Demba Ba, Eden Hazard, Yohan Cabaye and Moussa Sow recently co-founded a San Diego club that will start play in 2018.

Many American fans, to the extent that they think about the lower rungs of professional soccer at all, imagine ropey matches played in front of sparse crowds at small-college stadiums. The reality is that the experience varies widely: FC Cincinnati, for example, regularly pull in more than 20,000 fans. Still: for stars used to playing in massive stadiums to a worldwide audience, why start so small (Drogba’s Phoenix Rising play in a stadium with a capacity of 6,200)? The answer lies not only in the game’s potential in America, but also the idiosyncrasies of Stateside soccer.

For starters, MLS is a single-entity structure. It’s centrally owned and shares revenue among its teams. This business model, created from lessons learned in the aftermath of the supernova-like collapse of the Pelé and Johan Cruyff-era NASL, has ensured the long-term health of the league. Its critics, however, say that “owning” an MLS team really means owning the rights to a team: owners essentially buy membership into the league, and agree to its terms. Likewise, every MLS player technically has a contract with the league, not with his club. For European-based players who’ve spent their lives in the system used by the rest of the world, where branding, commercialization and player transfers are the revenue-generating engines of clubs, this can all seem especially â€" yes â€" foreign.

And then there’s the cost: the franchise fee to join MLS is $150m. In addition to that, the league demands that expansion teams play in a soccer-specific stadium. In other words, to simply get a meeting with Major League Soccer requires proof you have over $100m at your disposal; the ability to build or renovate a stadium; and the full cooperation of a city government. And that’s before you put together a team of players technically owned by someone else.

Now compare that with the second-tier. For less than $10m and an agreement to rent a stadium, you’re in business. The most vivid real-world juxtaposition between MLS and the lower leagues is David Beckham’s ongoing struggle to launch an MLS team in Miami, while across town, Italian billionaire Riccardo Silva and Paolo Maldini launched Miami FC in the NASL within one year. The club plays at Florida International University’s stadium, employs Alessandro Nesta as its coach, and recently won the league’s first-half championship in only its second season.

But it is in player acquisition and development that the differences are starkest. In transfers involving an MLS player to an outside league, the league office has a seat at the bargaining table â€" and it’s hard to imagine it wants its best players to leave. The league also gets a third of the transfer fee, while the selling club gets two-thirds (this proportion rises in favor of the club if the player is “homegrown”). But of the club’s takeaway, anything beyond $650,000 must go toward team operations.

In nearly every other league around the world, player movement is one of the main drivers of revenue, since players are contracted to their teams. And in America’s lower leagues, the reality is if a club sells two or three players they’ve developed, they can pay their bills for two years. And it just so happens that places like San Diego, Phoenix and Miami are not only great cities to retire for a moneyed professional athlete â€" Drogba is said to love life in Arizona, and has brought his family out to live with him â€" they’re also among the most fertile soccer regions in the country.

“You’ve got Demba Ba and Eden Hazard looking at this and going, OK, where’s the most talent in America?” says Eric Wynalda, the TV analyst and former US international. “Well, it might be the Hispanic kids living right next to the border. OK, let’s move there.”

Teams such as FC Cincinnati play in front of big crowds. Photograph: University of Cincinnati

In fact, Ba’s San Diego team arose from an initial attempt to create a youth academy in southern California. In 2013, Alexis Gallice, the son of former France international Jean Gallice, started the French Soccer Institute in San Clemente. According to his associate, Pascal Soares, finding the money was a challenge â€" as was convincing local youth clubs that they wanted to work with their coaches and players, not steal them. Eventually the group realized that, for developing talent, a professional team was the way to go. For that, they needed stars with name recognition and money to invest.

They contacted an acquaintance, Alex Gontran, Demba Ba’s adviser. Ba in turn recruited his friends Hazard, Cabaye, Sow and Vagno Chandara, a French futsal player. San Diego’s strong viewership of televised soccer, intricate network of youth clubs, and a huge hole in the city’s professional sports scene â€" the NFL’s Chargers recently relocated to LA â€" made the choice simple. Soares put Ba’s group in touch with local entrepreneur Bob Watkins, who has been involved with developing rugby in the US but was unfamiliar with soccer. He quickly saw an opportunity.

“The day I met Demba, I took them out to a soccer complex [nearby] in Del Mar,” Watkins said. “We pulled up to the field unannounced, and as we walked across the fields there were about 1,000 children playing soccer in ages from 10 to 15. As we walked closer, they all stopped playing soccer and they said, ‘That’s Demba Ba!’ They ran over and basically smothered him, while the coaches were saying, ‘Hey, you gotta go back and play!’ and the referees were blowing their whistles, and parents were saying, ‘Who is this guy?’ I said to myself, ‘There’s something magical about this.’”

After learning about the entrepreneurial limitations of MLS, Watkins said his group agreed that NASL was a better fit for their ambitions. That league, though, teetered on the brink in late 2016. Several clubs left, the league parted ways with the troubled Traffic Sports and reorganized as an owner-run operation. It currently has eight teams, with at least two (San Diego, Orange County, and possibly more to come) scheduled to start next year. The league needs to get back up to 12 teams, and be in three time zones, to have waivers removed by US Soccer that officially recognize NASL as the nation’s second-tier league. From this perspective, it’s hardly a safe investment. Ronaldo certainly couldn’t save the troubled Fort Lauderdale Strikers he had a minority ownership stake in.

“It was an entrepreneurial risk,” Watkins said of his San Diego project. “And Demba is a very entrepreneurial fellow.” He says Ba and his group saw an untapped market: Americans are good athletes for the most part, and soccer in the US is becoming more organized. What could they accomplish if they applied the French approach to player development to the US?

While Drogba’s and Maldini’s shares of their clubs aren’t public, sources speculate that their ownership stakes are more symbolic than material â€" the value they bring is in their technical expertise and marketability. But according to Watkins, Ba is actually the lead investor in the San Diego team. He owns the mandated 35% minimum for a lead owner, and Ba and together, the players are majority owners of the team.

But of all the ways for an athlete to spend their wealth, why put it into soccer? Peter Wilt is a longtime soccer executive who’s currently managing director of Club 9 Sports, an investment bank and advisory organization who assisted Ba’s group with its application. He says that investing in second-tier soccer is a long-term strategy.

“There’s opportunity, whether it’s as a business or a challenge,” Wilt says. “They recognize that pro soccer in the US is not a mature industry yet, and there’s an opportunity to invest in it at a relatively low level and build it. To a certain extent, MLS is becoming a mature property, but when you look at lower division soccer in America, there’s tremendous room for growth. And I think these guys recognize that.”

So will any of these player-owned, lower-tier clubs make the leap to MLS, as many of the league’s clubs, such as Minnesota, Orlando, Portland and Vancouver did? That’s exactly what Drogba’s Phoenix side are aiming to do. MLS has visited with the team, and Phoenix is now a fixture on the shortlist of rumored expansion teams. Silva has said elsewhere that he’d consider MLS for his Miami club if the league would change some of its rules.

At the very heart of it though, owning your own soccer team is for enjoyment. Be honest: every fan has dreamed about it at some point. “To these players, the idea of owning a football club just sounds fun,” Wynalda says. “We all chip in a little bit, and we have our own team. We play games. We find talent. We create a culture. And it’s ours. It’s our club. You can’t really say that if you go the MLS route. It’s a franchise that’s part of a bigger plan, but it’s not yours, really.

“Even if you’re not part of the big show, it doesn’t mean you can’t be a show.”

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