Business Breakdowns
Episode 126 The Business of Football
Business Breakdowns

Episode 126: The Business of Football

Business Breakdowns

Episode 126

The Business of Football

Dr. Rob Wilson is a department head at Sheffield Hallam University. We cover why football clubs are attractive assets for investors, the connection between on-field and financial success, and how owners are growing revenues in an age of ballooning transfer costs.

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(00:03:16) - (First question) - Defining the European football market, its size and scope compared with other sports

(00:05:12) - The growth of the Premier League and how it defined itself as the world’s best league

(00:08:16) - The delegation of funds based on a team’s final position in the league

(00:11:19) - A brief introduction to the breakaway European Super League

(00:12:53) - The sale of Manchester United and how it affects the scope of the footballing world

(00:18:34) - The role emotion plays when it comes to buying and selling of football clubs

(00:20:47) - The makeup of a well run football club

(00:23:54) - The four-pillar model and exploring new revenue streams in football

(00:25:59) - The utilization of ‘access all areas’ type documentaries as a source of revenue

(00:28:40) - Breaking down the return on investment for football clubs building new stadiums 

(00:31:07) - The development of commercial and sponsorship revenue in football and potential opportunities for football clubs to increase this revenue

(00:33:51) - Financial regulations in football and a brief history of UEFA’s Financial Fair Play

(00:40:41) - The correlation between sporting and financial performance

(00:42:23) - The different types of football club ownership profiles   

(00:44:51) - Reasons why investors choose to enter the football market

(00:46:54) - As costs in football rise with player wages and transfer fees, the focus for owners is on driving revenue value 

(00:48:12) - Changes to the football landscape since sovereign wealth funds have entered the market

(00:51:36) - The importance of the transfer market to football clubs

(00:53:03) - How the fans fit into the sport moving forward

(00:55:52) - Potential opportunities for TV revenue streams by entering new market places 

(00:56:55) - The relationship between the clubs and the leagues with regards to the expansion of the football business

(00:58:20) - The lessons learned from researching the football industry

 

The Business of Football

Introduction

Dom
This is Dom Cooke, and today, we're breaking down the business behind the most popular sports in the world, football or soccer. It's a vast market, 3 billion people around the world watch the sport and more than EUR 30 billion are spent within the football ecosystem in Europe alone every single year. But aside from this, a huge addressable market, reasonable revenue, is it actually a good business?

Why do investors keep buying football clubs? Is there any economic rationale behind that? Is there a link between sporting and financial success? Has Middle Eastern money distorted the transfer market for good? Just some of the questions I posed to our guest, Dr. Rob Wilson, who is a football finance expert and Head of the Finance, Accounting and Business Systems Department at Sheffield Hallam University. I really hope you enjoy this business breakdown of the business of football.

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