{"version":"1.0","provider_name":"MRKT Insights - Football Consultancy Services","provider_url":"https:\/\/mrktinsights.com","title":"Building multi-club networks the scientific way. - MRKT Insights - Football Consultancy Services","type":"rich","width":600,"height":338,"html":"<blockquote class=\"wp-embedded-content\" data-secret=\"0RbXPVO5Q9\"><a href=\"https:\/\/mrktinsights.com\/index.php\/2021\/02\/03\/building-multi-club-networks-the-scientific-way\/\">Building multi-club networks the scientific way.<\/a><\/blockquote><iframe sandbox=\"allow-scripts\" security=\"restricted\" src=\"https:\/\/mrktinsights.com\/index.php\/2021\/02\/03\/building-multi-club-networks-the-scientific-way\/embed\/#?secret=0RbXPVO5Q9\" width=\"600\" height=\"338\" title=\"&#8220;Building multi-club networks the scientific way.&#8221; &#8212; MRKT Insights - Football Consultancy Services\" data-secret=\"0RbXPVO5Q9\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\" class=\"wp-embedded-content\"><\/iframe><script type=\"text\/javascript\">\n\/* <![CDATA[ *\/\n\/**\n * WordPress inline HTML embed\n *\n * @since 4.4.0\n * @output wp-includes\/js\/wp-embed.js\n *\n * Single line comments should not be used since they will break\n * the script when inlined in get_post_embed_html(), specifically\n * when the comments are not stripped out due to SCRIPT_DEBUG\n * being turned on.\n *\/\n(function ( window, document ) {\n\t'use strict';\n\n\t\/* Abort for ancient browsers. *\/\n\tif ( ! document.querySelector || ! window.addEventListener || typeof URL === 'undefined' ) {\n\t\treturn;\n\t}\n\n\t\/** @namespace wp *\/\n\twindow.wp = window.wp || {};\n\n\t\/* Abort if script was already executed. *\/\n\tif ( !! window.wp.receiveEmbedMessage ) {\n\t\treturn;\n\t}\n\n\t\/**\n\t * Receive embed message.\n\t *\n\t * @param {MessageEvent} e\n\t *\/\n\twindow.wp.receiveEmbedMessage = function( e ) {\n\t\tvar data = e.data;\n\n\t\t\/* Verify shape of message. *\/\n\t\tif (\n\t\t\t! 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There are many more groups. and while they can be controversial they aren&#8217;t going away. In the UK alone Leicester, Brighton, Brentford, Cardiff, Barnsley, Sheffield United, Watford, and others, already have partnerships with teams around Europe. Given the new work permit requirements (GBE) for footballers teams are going to be faced with a dilemma. Pay premium prices to recruit established starters from the biggest leagues or get creative and try and recruit the talent earlier. If you recruit early you are going to need to find loans for the players in suitable leagues to ensure the player qualifies for a permit. But loans give you no control, the success rate is low. What if you gained control by taking a stake in a club in one of the GBE favoured leagues? As a simple example many clubs in France, Belgium, and Portugal can be purchased outright for far less than \u00a320m. If you run the club at a loss of &lt;\u00a35m a year you have effectively purchased a club for the cost of recruiting a single average Premier League player. Economies of scale Economies of scale are the cost savings an organisation can make by getting bigger. We do see this in some of the groups. The City Group for example has a large central expert group in scouting, analytics, coaching. They effectively aim to have a programme they can roll out quickly to any club that joins their network. Or as we&#8217;ve seen with their recent partnership with a team in Bolivia they believe these services can be packaged off and sold as a solution. But what is the major cost centre of a football club? Playing staff. By far. But how many groups are actually taking full advantage of economies of scale in that area? Blank slate or established? It is almost inevitable when walking into any new business, in a sector you lack experience in, that mistakes will be made. Most of the time when entering a new market as an investor you would ideally buy a business that is already functioning well, and have a period of time where you assessed the capabilities of the existing staff, and look at how you could improve things. You could do this by phased purchases of the business, a minor stake, then moving to take a majority over time. We have seen this with the investment in Leeds United by the San Francisco 49ers. They have invested in a business, liked what they&#8217;ve seen, and increased their stake. However, in football the majority of investments seem to be taking the majority stake and replacing almost all the key staff. There can be very good reasons for this. Often you are buying a very poorly run business. The main issue is you don&#8217;t get time off, football is almost uniquely time-pressured, there is no scaling back production to retool a factory and launch a new product. Even a theatre or concert venue can just cancel performances while major issues are sorted out. It took a global pandemic to introduce some slack into the sporting calendar and all that has happened is that even more games are being played with even less time to think strategically. Most new ownership groups attempt to solve this by buying in football expertise at the start of their process. The problem is although there is much experience on the market of people running a single club successfully this is not necessarily the same skill-set as required to create a network of clubs. In fact, some practices that work really well in a single club may actually inhibit the success of a network. That brilliant, charismatic leader, who creates an &#8220;us against the world&#8221; bond, who gathers together the best in their fields and jealously guards their ideas might be perfect for a single club structure. But where collaboration and sharing of best practice is fundamental this can be a problem. Aims of ownership I often say the football investment model is too often: Buy a club ? Profit In a rising market sometimes just buying into an asset class and running it adequately is enough to make a huge profit. Looking at house prices in my city just buying a house 20 years ago would have been an excellent investment. Buying multiple houses was an even better investment and there is a school of thought that, when compared to valuations of US teams, that European sport is undervalued. Just coming in and buying clubs, run them adequately, and this may be enough of a return to justify the risk. Certainly most sports teams in Europe under exploit the fact they have a huge social reach. No other business has a 5 minute slot on the TV news every night, no other business can get 10 pages written about them every day in the local press. As someone who started their career trying to get a barcoding equipment manufacture mentioned in trade magazines I&#8217;m amazed at how little club owners leverage this inherent interest in what they do. On the sporting side the best thing you can do to increase the value of the club is to build up the capacity to identify good players, to improve the ones you have, and to win games and trophies. And the single biggest advantage a multi-club group has in the quest to perfect the identify and improve functions is the ability to experiment. The Scientific Method In football the word &#8220;experiment&#8221; is misunderstood. It should not be taken to mean &#8220;just try crazy stuff and hope it works&#8221;. We are talking about using the scientific method. Every coach who runs a training session does so with the aim of improving the players he has. Every scout who watches a game does"}