Soccerstoriesbook's Blog


FOR WHAT THEY’RE WORTH: $157 MILLION PER MLS TEAM

The average worth of Major League Soccer clubs reached $157 million in 2014, up 52 percent from the previous year, according to a valuation by Forbes magazine.

Topping the list were the Seattle Sounders at $245 million, while the Colorado Rapids, worth $105 million, brought up the rear.  The biggest mover was DC United, whose value increased 97 percent, from $71 million in ’13 to $140 million last year.  Average team worth was $103 million in 2013, nearly triple what Forbes valued the teams five years earlier.

Eight of MLS’ then-18 clubs turned a profit in 2014, led by Seattle’s $10 million.  The biggest loser was the New York Red Bulls at $9 million.

2014 valuation of MLS clubs, plus revenue and operating income*:

1.  Seattle Sounders — $245 million, $50 million, $10 million.

2.  Los Angeles Galaxy — $240 million, $44 million, $4 million.

3.  Houston Dynamo — $200 million, $26 million, $5 million.

4.  Portland Timbers — $185 million, $35 million, $4 million.

5.  Toronto FC — $175 million, $32 million, -$7 million.

6.  Sporting Kansas City — $165 million, $29 million, $4 million.

7.  Chicago Fire — $160 million, $21 million, -$6 million.

8.  New England Revolution — $158 million, $25 million, $7 million.

9.  FC Dallas — $148 million, $25 million, -$3 million.

10.  San Jose Earthquakes — $146 million, $13 million, -$1 million.

11.  Philadelphia Union — $145 million, $25 million, $2 million.

12.  New York Red Bulls — $144 million, $22 million, -$9 million.

13.  D.C. United — $140 million, $21 million, -$1 million.

14.  Montreal Impact — $128 million, $22 million, -$3 million.

15.  Vancouver Whitecaps — $125 million, $21 million, -$6 million.

16.  Columbus Crew — $112 million, $18 million, -$4 million.

17.  Real Salt Lake — $108 million, $17 million, $1 million.

18.  Colorado Rapids — $105 million, $15 million, -$3 million.

*Operating income before interest, taxes, depreciation, amortization.

Forbes cited a number of reasons for the league’s surging team valuation, including:

o  Growing attendance, which through July averaged 21,000, as MLS continued to widen the gap with the NBA (17,800) and NHL (17,500) in that department.  That average projects to total attendance of 7.2 million in 2015, thanks in part to the addition of new teams in New York and Orlando.   The 2013 total was 6 million.

o  An influx of overseas talent that picked up in 2015 with the arrival of the likes of Kaka, Andrea Pirlo, Steven Gerrard, Frank Lampard, David Villa and Didier Drogba–a clear indication that owners are willing to spend to enhance the product on the field.

o  More soccer-specific stadiums throughout MLS.  The latest was San Jose’s Avaya Stadium, which opened in March, and DC United plans be in new digs by 2018.  Like United, the Earthquakes’ value has doubled since ’13.

o  The end of a TV deal with ESPN, NBC and Univision that paid MLS an average $30 million per year.  The new deal, in which Fox replaced NBC, pays $90 million a year.  Hardly NFL figures, or even NHL figures, and average viewship of 232,000 this year on Fox Sports 1 trails even the WNBA, but that represents a 65 percent improvement over NBCSN’s average audience of 141,000.  [September 19]

Comment I:  Total team worth of more than $2.8 billion for a league that as recently as 2002 nearly went under.  No wonder there were no signs of panic when MLS Commissioner Don Garber, during his “State of the League” address in December, revealed that the league was losing more than $100 million a year.

Comment II:  Being part of MLS is still far from being a license to print money, but no wonder the owners of LAFC, which won’t begin play until 2018, paid a league-record expansion fee of $110 million to try to succeed where it predecessor, the ill-fated Chivas USA, failed.  By comparison, the Miami Fusion, one of the league’s first two expansion teams, paid $20 million in 1997 to join MLS.

 

 

 



WOMEN’S PRO SOCCER LEAGUE NO. 3: SMARTER IS BETTER

A new eight-team women’s pro soccer league will kick off next spring, two years after the demise of Women’s Professional Soccer (2009-11) and a decade after the Women’s United Soccer Association (2001-03) folded.

The league will have teams in Boston, Chicago, Kansas City, New Jersey, Portland, Seattle, western New York and Washington DC.

It reportedly has a handshake agreement with one national sponsor; television coverage is a question mark.  [November 21]

Comment:  After Women’s Professional Soccer went under last January, the reaction in this space was, please don’t come back with another women’s pro soccer league unless there’s a new, inventive approach behind the effort.  Otherwise, the notion of a high-profile women’s pro circuit might be killed off for the foreseeable future.  (To see the original admonishment, go to May 28.)

Thankfully, on the eve of Thanksgiving, the powers that be have chosen not to exercise that classic example of insanity, in which the patient, happily doing the same thing over and over, expects a different result.

In this incarnation, the league will get considerable support from the U.S., Mexican and Canadian soccer federations, whose national team players will benefit from the week-in, week-out competition the league will provide from March-April to September-October.  In a women’s sports sense, the outside help recalls the launch of the WNBA, which would not have been possible without all of its original teams being owned by NBA franchises.

While the clubs in this currently unnamed league will be privately owned, the U.S. Soccer Federation will not only pay the salaries of up to 24 of the league’s American players but fund the league’s front office as well.   The Mexican and Canadian soccer federations, with an eye toward the 2015 FIFA Women’s World Cup in Canada, will pay the salaries of some of their players who play in the league.  As a result, each club will be off the hook for the salaries of up to seven of its most valuable players.

Most of the players will be semipros, and gone will be high-priced talent from beyond North America, like Brazil’s Marta and Japan’s Homare Sawa, but  U.S. mainstays like Abby Wambach, Alex Morgan and Megan Rapinoe won’t be faced with the prospect of plying their trade in leagues overseas.

As USSF President Sunil Gulati put it, “What we need is a sustainable model:  less hype, better performance.  The hype will come if we have the performance.”

Major League Soccer wouldn’t have gotten off the ground without turning sports management on its ear with the single-entity concept.  Give League Jane Doe credit for trying to turn it on its other ear.