The Political Economy of Football V2

Four Four Two has a special feature on celebrity involvement in football.  We all know about Wrexham, but I was surprised at the extent and breadth of the involvement.   Who would have thought that tennis Naumi Osaka (she of kimono fame) would have a stake in North Carolina Courage? Harry Redknapp recalls that when he joined West Ham as a player the chairman was a Mr Pratt who owned the wood yard over in Wanstead.   Redknapp admits that he does not know who Snoop Dogg is.   I am from an analog age, but even I know that. The rapper turned up for Swansea's match against Preston in February.  The marvelously named Prestgon gaffer Paul Heckingbottom commented, 'Just the smell of weed in the tunnel is the only thing where we realised something was different.' Quite a few of the investors are celebrity footballers or at least retired footballers with money to splash.  They include Lionel Messi and Kylian Mbappe.   I'm not sure that Hector...

Swansea City have announced a loss of £21.6m in their latest accounts:  https://www.walesonline.co.uk/sport/football/football-news/swansea-city-announce-216m-loss-33700867 Such losses are not unusual in the highly competitive Championship with the Abertawe club keen to return to the Premier League. The increase in operating costs has been seen at many clubs, reflecting such factors as higher energy prices.

Snoop Dog’s appearance at the Swansea v. Preston North End midweek match is one of the most surprising, if not bizarre, events of the Championship season. Indeed, the only thing that surprised me more was when one of my granddaughters told me she had discovered her inner Welsh woman and was moving to Swansea (Abertawe) despite not speaking a word of Cymraeg.    Swansea City do not seem to particularly emphasise their Welshness as much as Wrexham.   Paradoxically, I did some consultancy for a Swansea client.   They were happy with what I did, and asked me to do more, but I didn’t get paid until I got one of my Welsh speaking nephews to draft an email in Cymraeg. In some ways, it’s hard to make sense of the Swansea and Snoop Dogg story. But maybe this is just how the Championship rolls these days. Wrexham have their Hollywood owners Ryan Reynolds and Rob Mac, the seven-time Super Bowl winner Tom Brady is a minority investor in Birmingham City, and if Snoop had hu...

The New York Times has taken an in depth and interesting look at why apparently solid mid-table clubs like Wolves eventually fall out of the Premier League. My view is that they tell half the story.   Statistical analysis shows that there is a strong correlation between spend on players and success.    You can fit a reasonable linear two variable regression lin to the data. Of course, there are outliers, clubs that punch below or above their weight: at the moment, Brentford on the positive side and Tottenham Hotspur on the downside. However, I think the Premier League is essentially an oligopoly, i.e., competition is controlled for the benefit of a few producers.    The big six or maybe seven ensure that they remain at the top financially and in other terms.    Insurgents are tolerated to an extent because they make the competition look more competitive than it actually is, but are eventually sent packing. In 2018, Stoke City and West Bromwich ...

American rapper Snoop Dogg is the latest celebrity to join the ownership group of an English Football League (EFL) club by investing in Championship side Swansea City.   The Abertawe club confirmed the 53-year-old’s investment on Thursday. Snoop Dogg was involved with Swansea’s kit launch earlier this week, appearing in a social media post wearing the team’s home jersey for the 2025-26 season. “My love of football is well known, but it feels special to me that I make my move into club ownership with Swansea City,” he said in a club statement.   The story of the club and the area really struck a chord with me. This is a proud, working class city and club. An underdog that bites back, just like me.   I’m proud to be part of Swansea City.” Swanseaare owned by Americans Andy Coleman, Brett Cravatt and Jason Cohen through Swansea Football LLC. The ownership group added: “Snoop has openly shared his love of football and his desire to be involved in the game, a...

Luka Modric, the former Ballon d’Or holder, World Cup finalist, and six-times Champions League winner, has become a minority owner at mid-table Championship club Swansea City. The Real Madrid and Croatia midfielder, 39, has been planning for a career after he retires and has agreed to buy a small but unstated stake in the south Wales (Abertawe) side, who are 12th in the second tier, but have been a Premier League club. “This is an exciting opportunity. Swansea has a strong identity, an incredible fan base, and the ambition to compete at the highest level,” Modric told The Times. “Playing at the highest level, I believe I can provide my experience to the club. My goal is to support the club’s growth in a positive way and to help to build an exciting future.” Modric’s link with Swansea or their new owners is unclear. The club have been through a turbulent time since the highs of winning promotion to the Premier League in 2011, lifting the Carabao Cup in 2013 and reaching the last 3...

New owners at Swansea appear to have injected £20m into the club, but there appears to be some confusion surrounding the money, or at least there is in this local report which is not written by football finance experts:  https://www.fansnetwork.co.uk/football/swanseacity/news/63514/

An example of some bad business in football: the 2016 takeover of Swansea City (Dinas Abertawe) by a group of U.S. investors led by Steve Kaplan, who owns a minority stake in the NBA’s Memphis Grizzlies, and Jason Levien, the co-chairman and CEO of MLS side D.C. United. Swansea were nearing the end of their fifth consecutive season in the Premier League when Kaplan and Levien bought a majority stake in the Welsh club at a valuation of £110million. Unfortunately, they were relegated to the Championship in 2018 and have haemorrhaged money in that division ever since. But now — for Kaplan and Levien, at least — the bleeding has stopped, as they have sold their 65 per cent stake in Swansea to three investors they first introduced to the club last year: Andy Coleman, Brett Cravatt and Nigel Morris. A shareholder at D.C. United, Coleman has been Swansea’s chairman since May 2023, while private-equity firm boss Cravatt and Welsh-American fintech entrepreneur Morris have be...

As part of a shake-up of the domestic game in Wales, plans are afoot for Cardiff, Swansea, Wrexham and Newport to enter the Welsh League Cup, alongside the current Cymru Premier (Welsh Premier League) clubs. The winners, if the proposal is agreed by the Football Association (FA), Football Association of Wales (FAW) and UEFA, the European game’s governing body, would compete at continental level in the following season’s Conference League. For Phil Parkinson, the Wrexham manager, the prospect is an exciting one. “To bring European football back to Wrexham would be amazing,” he says. “Great to test yourself against teams from different countries around Europe. Be fantastic to have that opportunity.” Speak to those pushing for change and there’s a sense it could be given the go-ahead before the end of this calendar year, meaning Cardiff, Swansea, Wrexham and Newport would enter next season’s Welsh League Cup, and its winners would enter the 2026-27  Conference League, UEFA’s ...

Swansea have been owned by an American consortium since July 2016, when Jason Levien and Stephen Kaplan bought a controlling interest in the club. They were joined in August 2020 by Jake Silverstein. Coleman, an investor in MLS team DC United (where Levien is also involved), was appointed Swansea’s chairman, having acquired “a significant shareholding” and taking over day-to-day responsibility for the running of the club, leading to the departure of chief executive Julian Winter. Only last month, there was another change to the ownership, when the club announced that Nigel Morris, a British businessman (with Welsh heritage), had made an investment into the club and joined the board of directors. Following this investment, the largest shareholders are now: Swansea LLC (Coleman, Kaplan, Levien and Silverstein) – 74.95% Nigel Morris – 12.59% Swansea City Supporters Trust – 9.42% Swansea have lost money in four of the five sets of accounts published in the C...

Swansea City have published their 2022/23 accounts, reports Kieran Maguire.  Revenue was £22m up 10%. Wages were £27m down 4%.  Underlying loss £22m down 9%. Player purchases £7m Player sales £6m Borrowings £11m down 68%. More here:  https://www.swanseacity.com/news/swansea-city-confirm-latest-accounts-3

Swansea have been owned by an American consortium since July 2016, when Jason Levien and Stephen Kaplan bought a controlling interest in the club. They were joined in August 2020 by Jake Silverstein. According to the club’s website, they owned around 80% between them.  Following the conversion of some debt into equity, the Supporters Trust stake was diluted to around 13%, including a protected 5% ownership position. Last month Andy Coleman, an investor in MLS team DC United (where Levien is also involved), was appointed Swansea’s chairman, having acquired “a significant shareholding”.    This week Nigel Morris, the managing partner of QED Investors, also made an investment into the club and joined the board of directors. Swansea’s pre-tax loss in 2021/22 nearly tripled from £4.6m to £13.2m, mainly due to the ending of parachute payments in the fourth year after relegation from the Premier League, which contributed to revenue falling £7.9m (29%) from £27.6m to £19.7m. ...

Swansea City publish 21/22 accounts when club finished 15th in Championship, reports Kieran Maguire. Income was down 27% as parachute payments come to an end. Wages were down 3% but still £137 for every £100 income.  Day by day losses were up 20% to £24m.  Player sale profits £11m.  Player purchases £7m. Borrowings up 68% to £35m.   Swansea owners lent club money in 21/22 to help cover the operating losses. Maguire: ‘Overall Swansea's final league position about where you would expect the club to be given the resources available.’

A trio of US-based investors are set to invest in Welsh football club Swansea City, according to people familiar with the situation, reports Bloomberg. Nigel Morris, co-founder and managing partner of QED Investors, alongside Andy Coleman, an investor in the US soccer team DC United, and Brett Cravatt, co-founder of Centerfield, a digital customer acquisition company, will invest an initial £10 million ($12.5 million) in the club, the people said, who asked not to be named discussing ongoing discussions.  The trio will join a group of majority owners including Steve Kaplan, co-founder of Oaktree Capital Management, who currently own 80 per cent   of the club.

The authoritative Swiss Ramble reviews Swansea City’s 2020/21 accounts, when they swung from £2.7m pre-tax profit to £4.6m loss. Revenue fell £22m to £28m (lower parachute payment & COVID impact) and profit on player sales down £5m to £12m, largely offset by big cost reduction. They swung from a pre-tax profit of £2.7m to a loss of £4.6m, as revenue fell £22m (45%) from £50m to £28m and profit from player sales dropped £5m (30%) to £12m, partly offset by total expenses reducing by £17m (26%) and £3.3m insurance claim. Loss after tax was £4.1m. The main reason for the £22m revenue decrease was broadcasting, which dropped £17m (44%) from £39m to £22m, mainly due to lower parachute payment, though COVID also drove reductions in match day, down £3.0m (63%) to £1.8m, and commercial, down £1.8m (31%) to £4.1m. Although a loss is rarely good news, the £4.6m deficit was one of the better results in 2020/21 with five clubs posting losses above £20m. As chief executive Julian Winter sa...

The Swiss Ramble has been applying his forensic financial skills to the latest set of Swansea City accounts from his Zurich base. Swansea swung from a pre-tax loss of £7m to a profit of £2.7m, despite revenue falling £18m (27%) from £68m to £50m and profit from player sales dropping £12m (41%) from £30m to £18m, as total expenses were reduced by £40m (38%). Profit after tax was £1.7m. The fact that Swans managed to make a £3m profit is a noteworthy achievement. Only one other Championship club is also profitable in 2019/20 to date (Hull City £3m), while some have reported huge losses, including Leeds United £62m, Reading £42m, Middlesbrough £36m and WBA £23m. Swansea have now been profitable six times in the last nine years. In the seven seasons in the Premier League (between 2012 and 2018), profits amounted to £36m. Even the last two seasons in the Championship have only resulted in a small net loss of £4m. The main reason for the £18m revenue reduction was broadcasting, which d...

The sale of Oli McBurnie to Sheffield United allowed Swansea City to turn a substantial loss into what the club described as a 'very pleasing' pre-tax profit of £2.7m for the 2019/20 financial year.   (The sale of Joe Rodon last October is not included in the figures). Chief executive Julian Winter commented: 'Naturally, the club is still adapting to relegation from the Premier League, balancing the tricky conundrum of being competitive on the pitch and financially prudent off it.  But an overall profit on the back of a loss the previous year shows a great deal of progress on the road to our overall business model of being financially stable.' Swansea announced before tax losses of £7m and £3.2m in 2019 and 2020.   Turnover was down to £50m compared to £68m for the previous year, largely because of the reduction of parachute payments in the second year in the Championship.

The authoritative @SwissRamble is posting two page financial fact sheets on each Premier League club in response to requests from fans. As an example, promotion to the Premier League in 2019 saw £100m increase in Fulham revenue, but not enough for a profit, due to higher wages and player amortisation plus low player sales. Huge transfer spend (£120m, 4th highest in Premier League). Debt-free after Shahid Khan converted £155m loans to equity. More detail is available online. The Swiss Ramble has also produced a fact sheet for Everton. His summary is: 'Everton have had significant investment from owner Farhad Moshiri, driving large increases in debt, transfer spend, wages and player amortisation. Revenue relatively flat in last 3 years, leading to highest loss in the Premier League in 2019 (2018 benefited from high player sales). The Swiss Ramble has also summarised Swansea City in the following terms, two page fact sheet on his twitter feed: 'Revenue has fallen by nearly 50...

The authoritative Swiss Ramble has reviewed the 2018/19 accounts of Swansea City. He notes that the Abertawe club's loss before tax widened from £3.2m to £7.0m, as revenue almost halved following relegation from £127m to £68m, despite parachute payments, and profit on player sales fell £16m to £30m, largely offset by cutting costs by £72m. After tax, loss increased from £2.9m to £6.0m. The main reason for Swans £59m (46%) revenue reduction was broadcasting, which more than halved in the Championship from £105m to £52m, though commercial was also down £6m (45%) to £8m and match day fell £0.8m (11%) to £6.6m. Player loans up £1.7m to £2.0m. To offset the steep revenue reduction, Swans cut the wage bill by £43m (47%) from £91m to £48m, applying relegation clauses, although apparently some wages are close to Premier League levels. Despite the decrease, Swans £48m wage bill is still third highest reported to date in the 2018/19 Championship, only beaten by Stoke City £56m and Norwich...

All revenue streams were down at Swansea City following relegation, although the club made a substantial profit on player trading. Next year we will see a further fall in income as parachute payments are cut in their final year: Club uses bank loans Swansea made an operating loss of £34 million which was offset largely by player sales profits of £30 million. Swansea wage bill was down £40m and over 60 jobs lost following relegation. Swansea player sales since the end of the accounting period in July 2019 were £15m (Dan James) and purchases £746k. Swansea have sold some transfer fees due to the club to a bank for £2.4 million.