There are topics that you talk about in polite company, and there is the topic of money. No one typically likes to talk about money, especially how much their team has available to spend.
When Toronto FC purchased Jozy Altidore and Giovinco, the collected fans of Major League Soccer teams should not have been surprised. Toronto's ownership group is absolutely loaded financially. It came to mind that we don't always understand the owners of this expanding league. Here is the best that I could currently do with the information sources that I found on each team, notated.
In researching this piece, the most shocking item that I found is the sheer number of billionaires that own a stake in an Major League Soccer club. Plucky underdog in MLS is a multimillionaire. The norm is to be a billionaire.
There a 22 different ownership groups with AEG owning a share in both the Galaxy and the Dynamo, and Atlanta/LAFC accepted but fielding a team in a few years.
Out of these 22 different ownership groups 14 are backed financially by finances over a billion dollars. By that I mean that either the main financial backer, a partner in the ownership group, or the combined fortunes of those enlisted in the ownership group as listed in the official ownership list on MLSSoccer.com are over a billion dollars. (You can find that list here, http://pressbox.mlssoccer.com/content/about-major-league-soccer)
More than that, there are other ownership groups that are more than likely billionaires; but unverifiable, currently, by my own research. Ownership groups like DC United and Real Salt Lake both look to tick the boxes of those in the upper echelon of finance. However the facts that I could find were inconclusive and thus they cannot officially be said as to whether they belong in the billionaires club of MLS.
In each section you will find a link to the best information that I could find. While I attempted to rely on verifiable trade magazines or newspapers, there were other online publications that I used.
The Billionaire Who Stands Alone:
New York City FC
Ownership Group: City Football Group
Sheikh Mansour bin Zayed Al Nahyan has a lot of money. His family has even more. With the Sheikh having a supposed 30 billion dollars and 600 billion in assets, that is all small potatoes compared to his family net worth of over 1 trillion dollars. Of course, it must be remembered that the 1 trillion dollar mark (or $1,000,000,000,000 if you wanted to see that written out) valuation was performed in 2008. One can imagine that the fortunes of the family have only increased in the past seven years.
Side Note: Yes, the Daily Mail.
Family Net Worth from 2008 -- The Telegraph
Sheik Mansour Financial Valuation -- The Daily Mail 2013
Forbes (whom I use extensively for their financials) do not include royals on their lists of soccer owning billionaires stating,
"Sheik Mansour bin Zayed Al Nahyan, Manchester City owner, and Nasser Al-Khelaifi, PSG president, are not included in the list of the richest soccer club owners because Forbes does not value families or royal fortunes unless we can clearly see who owns the fortunes. For instance, the Qatari royal family is not on our list." -- Forbes 2013
Ownership Group: Anschutz Entertainment Group (AEG)
Anschutz Entertainment Group owns a lot of things. They own so many things that they appear in this list twice, as sole owners of the LA Galaxy and partial owners of the Houston Dynamo. They also own a stake in the Stanley Cup Winning Los Angeles Kings, a stake in the Los Angeles Lakers, the building that the Lakers actually play in (The Staples Center), the stadium that the Galaxy play in (The Stub Hub Center), the Hammarby football team and a various consortium of different sporting, entertainment and property opportunities the world over.
In 2012, at a point when Anschutz was potentially looking to divest Anschutz Entertainment, the valuation of the company was two to four billion dollars. This was considered a low estimate by the New York Times. The Forbes real time valuation of the finances of Phil Anschutz are currently stated as 10.3 billion dollars.
AEG Valuation - NY Times -- 2012
Anschutz Valuation - Forbes -- 2015
New England Revolution
Ownership Group: Kraft Soccer, LLC
Robert Kraft and the Kraft Group are most known in North America for the New England Patriots, and being confused with Kraft foods which are not the same company. The Kraft Group are a conglomerate with vested interests from Foxborough to Tel Aviv.
The current valuation of Robert Kraft is set at 4.0 billion dollars. The Kraft Group reparted income is 3.55 billion per year.
Kraft Group Valuation - Forbes
Robert Kraft personal - Forbes
Ownership Group: Kroenke Sports Enterprises
Stan Kroenke has a lot of money. You typically don't make a lot of money by spending more money than you make. By not spending a lot of money and owning sports teams you get Stan Kroenke. Kroenke's group, KSE, owns the St Louis Rams, The Colorado Avalanche, The Colorado Rapids, The Denver Nuggets, as well as the largest share in Arsenal Football Club.
Stan Kroenke's personal fortune is set at the current value of 5.8 billion dollars.
Stan Kroenke's Financials - Forbes
New York Red Bull
Ownership Group: Red Bull Company Limited
Red Bull is going through a downturn, or at least a disinterest in their New York franchise. That seems to be the jist of the information that I read from the fans that write on the club utilizing the ever shady "sources" and "a person closely linked with the club". As it stands, while things may not be on the upswing for Red Bull New York, they still have quite a bit of money.
Co-Owner Dietrich Mateschitz is himself a billionaire at 9.8 billion dollars while the Yoovidhya family has assets in excess of 9.9 billion. Meanwhile the company valuation is set at $7.5 billion dollars with global sales of $6.7 billion dollars.
Dietrich Mateschitz Financials - Forbes
Yoovidhya Family Financials - Forbes
Red Bull Financials - Forbes
Ownership Group: Joe Roth, Adrian Hanauer, Drew Carey and Paul Allen (Vulcan Sports and Entertainment)
The Sounders ownership group has a lot of money. With the backing of Vulcan Sports and Paul Allen, they exist as one of the richest ownership groups in the league only being surpassed by New York City FC and possibly Toronto FC.
Paul Allen is worth a cool 17 billion. Joe Roth is worth 700 million by himself and even minority business owner Drew Carey is worth at least 165 million dollars. This doesn't include the finances of Adrian Hanauer which are probably not enough to substantially move the needle of this ownership group upwards.
Paul Allen Financials - Forbes
Joe Roth Financials - The Richest
Drew Carey Financials - Business Insider - 2012
Ownership Group: Maple Leaf Sports & Entertainmet
Maple Leaf Sports and Entertainment isn't a new face on the block as they've been around as a company since 1931. The organization was founded by Conn Smythe which, if you happen to follow hockey, is kinda a big name in the game.
Eventually MLSE was taken private from being public and is now owned by two of the largest media companies in Canada in Rogers Communication and Bell Canada (as well as other shareholders since the two companies own 79.53% of the company). MLSE owns the Maple Leafs, the Toronto Raptors, Toronto FC, The Air Canada Centre, as well as managing BMO Field.
The equity value of MLSE is $1.2 billion dollars. The enterprise value is $1.6 billion dollars
I will say that the simple numbers alone of MLSE don't tell the tale as you must consider the financial power of Rogers Communication and Bell Canada that exists behind the company. Rogers alone had revenues of 12.42 billion (CAD) in 2011 with a net income of 1.56 billion (CAD). Bell Canada had revenues of $19.49 billion in 2011 and a net income of 2.159 billion in 2010 (CAD). These are major corporations with major financial clout at their disposal.
MLSE Financials - The Globe And Mail - 2011
Ownership Group: Greg Kerfoot, Jeff Mallett, Steve Luczo and Steve Nash
Vancouver mark a group ownership eclipsing of a billion dollars. While it is sometimes difficult to pin down financials of people under the billion dollar mark, The Province was able to make an educated guess on the financials. Owner Jeff Mallet is already the principal owner of the San Francisco Giants, the principal investor in Derby County, and was part owner of the WPS (Women's Professional Soccer).
According to a Globe and Mail article, Mallet had a net worth of $805 million dollars in 2000 before the dot-com meltdown.
As the article says,
"One of his first post-Yahoo moves was buying a stake in the San Francisco Giants, then in the midst of a 48-year World Series drought. (Mallett had stashed away most of his money in "safe investments," but set aside a chunk to put into sports ventures and high-tech plays.) He'd also been keeping tabs on MLS from Silicon Valley since its debut in 1996; Yahoo had signed on as a league sponsor." - The Globe and Mail
Greg Kerfoot has been referenced as " the Bigfoot of the Pacific Northwest because nobody has seen him" by a Southsiders president in a Globe and Mail article. Luczo made over $19 million dollars a year in 2013 just in his compensation package for Seagate, while Steve Nash chugs along with a rumored net worth of $95 million dollars.
Group Financials - The Province via Canada.com
Steve Nash Financials - Celebrity Net Worth
Steve Luczo Financials - Forbes
Jeff Mallett Net Worth from 2000 - The Globe and Mail
Ownership Group: Hunt Sports Group
Hunt Sports Group is one of the grandaddies in American Sports. Lamar Hunt single-handedly did more to spread the gospel of soccer in the United states than most people will ever actually know. He owned three Major League Soccer teams at the same time and financed the construction of Columbus Crew Stadium. He brought the Dallas Burn (now FC Dallas) into the league.
He owned the Dallas Tornados through multiple leagues during the NASL days. Hunt founded the Kansas City Chiefs in the NFL. With Hunt Sports Group now divested of the Columbus Crew and Sporting KC, they still own a portion of the Chicago Bulls and the Kansas City Chiefs. Hunt Sports Group sold the Crew for $68 million dollars to Anthony Precourt in 2013.
Hunt Sports Group was valued at 1.3 billion in 2013.
Hunt Sports Group Financials - Dallas Morning News
San Jose Earthquakes
Ownership Group: John Fisher and Lew Wolff
Not much is known about how much money Lew Wolff has in his possession. There is plenty of speculation out there but no hard facts.
It is much easier when we come to John Fisher who is currently estimated to have $2.8 billion dollars.
However, the two run their sports franchises like a business as Wolff stated about the Oakland A's in 2014,
"Our business is run like any other business. We have very strict budgeting. The budget emanates from major league salary. That’s our major expense and we try to keep it at or below 50 percent of our projected revenue. Everything else flows from that." - Comcast Sports Net California
John Fisher Financials - Forbes
Ownership Group: AEG, Golden Boy Productions and Brener International Group
Oscar De La Hoya and Gabriel Brener together invested in the Houston Dynamo and now own 50 percent of the club. AEG owns the other half. Brener and De La Hoya certainly contribute a hefty amount in the realm of a $350 to $500 million dollar investment, but it is, again, the 50% of the club owned by $2 to $4 billion dollar AEG that elevates this often financially overlooked franchise to super power status. They may not always get the love from AEG that the LA Galaxy do, but they do have all the possibilities of hefty financial backing.
AEG Valuation - NY Times -- 2012
Anschutz Valuation - Forbes -- 2015
Gabriel Brener Valuation - Celebrity Net Worth
Ownership Group: AMB Group
Self made man Arthur Blank is the new kid on the block in Major League Soccer. The owner of the Atlanta Falcons and the co-founder of Home Depot has purchased a stake in Major League Soccer for a "Coming Soon" project. Blank's recent financial evaluation puts him at $2.4 billion dollars.
Arthur Blank - Forbes
Los Angeles Football Club
Ownership Group: 24 people
There's quite a few owners in Los Angeles Football Club. 24, at least as currently announced via their website. You have people such as Mia Hamm, Nomar Garciapara, Vincent Tan, Magic Johnson and Peter Guber. It's hard to try to aggregate all this information, I mean Vincent Tan alone has a net worth of $1.4 billion dollars and a really neat collection of high waist pants.
Howler Magazine (via writer Jake Cohen) attempted to put a handle on how much money the group would have available. At a base value we can estimate it as $4.5 billion dollars, but this is probably a very conservative estimate. Also, this original total was estimated when there were 22 partners, and there are now 24.
LAFC Financials - Howler Magazine via Forbes
Sporting Kansas City
Ownership Group: OnGoal, LLC
Sporting Kansas City completed one of the most remarkable turnarounds in regards to community relevance under the watchful eye of OnGoal LLC, recently. On Goal purchased the franchise from Hunt Sports Groups and proceeded to build them into an MLS Cup champion and perennial sell out in a gorgeous new facility. In regards to their financials, I was able to find information on Neal Patterson and Cliff Illig.
Patterson's current net worth is valued at $1.7 billion dollars
Illig's current net worth is valued around $1 billion dollars.
Neal Patterson Financials - Forbes
Cliff Illig Financials - Forbes
Orlando City SC
Ownership Group: Orlando Sports Holdings, LLC
Brazilian Flavio Augusto da Silva, Stoke native Phil Rawlins and John Bonner run the new MLS team on the block, Orlando City SC. Augusto da Silva has his current wealth estimated at $446 million dollars while Rawlins is set at $40 to 60 million.
Flavio Agusuto da Silva Financials - Forbes
Phil Rawlins Financials Best Guess - SBNation Blog
The Unverifiable Rich:
Ownership Group: DC United Holdings
DC United's ownership financial capabilities are a bit tricky to pin down. There are articles that indicate that Thohir is a billionaire and then there are those that indicate no such thing. An article by Il Gionro (linked here) indicates that Thohir has a value of $25 billion dollars. Bloomberg refers to him as "billionaire Erick Thohir" in an article on financials and Inter Milan.
Blog BlackandRedUnited.com attempted to put this information together on Thohir with the same difficulty. It's tough to pin down exactly how much Thohir has, but it does appear that he very likely has enough capital between him and the other owners of DC United (Jason Levien and William Chang) to say that they belong in the billionaire category.
DC United Financial guesses - Black and Red United
Ownership Group: Free 2 Play Holdings
The Saputo's themselves are an immensely wealthy Canadian family. How much money of that Joey has access to is the major question.
Joey Saputo is the principal Investor-Operator of the Montreal Impact. The Saputo Family is the founder of Saputo, a major international dairy products company. Their current valuation is a $3.5 billion dollars (US) or $4.3 billion Canadian. Another article published on Gianluca Di Marzio indicated that Saputo's net worth is between $4 and 9 billion Euros however no indication is given whether or not that is just "lifted" from the financial worth of the Saputo Family Fortune.
As it is, the Saputo Family, Joey Saputo and the Montreal Impact are definitely linked as the Saputo family donated $7.5 million for the building of Saputo Stadium.
Saputo Family Financials - CTV Montreal News
Joey Saputo Rumored Financials - Gianluca Di Marizio.com
Ownership Group: Keystone Sports and Entertainment, LLC
It can be a bit difficult to attempt to pin down Keystone Sports and Entertainment in the realm of finances. You have Jay Sugarman, whose personal fortune is seemingly tied into his stock holdings with iStar Financial. You have the Buccini borthers and Dave Pollin who run a property development company which includes major international properties and real estate holdings in excess of 3 billion dollars. And you have more other shareholders such as Weston Solutions and YSC-Graham Investments, as well as Joseph Greco and David Seltzer
In the end, it seems likely that Philadelphia Union is backed by possibly hundreds of million of dollars up to billions of dollars. Since none of the financial information on the web hit the required mark to indicate exactly what the Union has, their true financial state remains a mystery.
Information and guesses on the state of the Philadelphia Union Finances - Brotherly Game.com
Real Salt Lake
Ownership Group: Dell Loy Hansen
Not much can be said about the finances and business of Dell Loy Hansen other than he definitely has SOME money, but it is anyone's guess as to how much. A partner in Salt Lake for quite a while, Hansen eventually bought out owner Dave Checketts to be the sole owner of Real Salt Lake. It's anyone's guess as to how this will translate in the long run for RSL, but this quote from the Salt Lake Tribune, "Hansen, a man whose soccer knowledge once came almost entirely from the book Soccernomics," shows the level of Hansen's knowledge when purchasing the full shares of Real Salt Lake.
As well, we know that recently
The one thing that we are able to find is that Hansen's company, Wasatch Property Management, has a real estate portfolio of over 1.2 billion dollars.
Wasatch Property Management Financials - Salt Lake Tribune
The Unverifiable "Other":
Ownership Group: Andell Holdings, LLC
Well, this is what I found out about Andell Holdings.
Andell Holdings, LLC is a private equity firm specializing in growth capital, acquisitions, and mezzanine financings. It invests in middle markets and mature companies. The firm primarily invests in branded businesses; luxury goods; leisure or lifestyle; hospitality and travel; media and entertainment; marketing and distribution; food processing or manufacturing; wine and spirits; sports and promotion; and real estate. It generally makes investments in United States and Canada.
Meanwhile searches for Andrew Hauptman vary between the irate blog posts about the owner of the Fire to an article in Architectural Digest talking about their 20,000 square foot house outside of Los Angeles. Hauptman's wife is Ellen Bronfman Hauptman, the daughter of Canadian billionaire Charles Bronfman and is an active partner in Andell Holdings.
I think it can clearly be said that Hauptman is wealthy. As to how much wealth? It is anyone's guess.
Charles Bronfman Finances - Forbes
Ownership Group: Precourt Sports Ventures LLC
Much like Andrew Hauptman, Anthony Precourt's finances are extremely hard to pin down. His father was a successful businessman and was the CEO of Tejas Gas Corporation as well as serving on the board of Halliburton. Meanwhile J. Anthony Precourt Jr's extremely limited bio says that he is a successful business man as well.
As to what Precourt Sports Ventures and Precourt Capital Management DO, how much they make and where Anthony Precourt made his money? Who knows. Precourt Capital Management is typically listed as " an investment management and private equity investment firm based in San Francisco" in almost every description that the company receives.
The only thing I could really find is that Mr. J Anthony Precourt of Precourt Capital Management donated 5000 dollars to the Wyoming Refining Company Political Action Committee in 2009.
Ownership Group: Peregrine, LLC
Merrit Paulson is the son of former U.S. Treasury Secretary and former CEO of Goldman Sachs, Hank Paulson. The acquisition of the Timbers and the Portland Beavers happened in 2007 for the reported amount of $16 million dollars. The actual amount was undisclosed, it should be noted, however this $16 million number appears repeatedly in articles and magazines on the deal.
The acquisition was characterized thusly in a long form article on MLS Soccer.com written by Nick Firchau
"As Paulson’s business acumen grew he was also well aware he had a golden ticket in the form of his father’s fortune and faith, and that it would lead to something larger in the sports world. He says he was offered a “one-bullet deal,” where his father would financially back one large investment in a professional sports franchise, and that eventually led to a foray into Major League Soccer in 2005." - Nick Firchau, MLS Soccer.com
It's plain to see that if we evaluate the overall finances of the Timbers that we must take into account the backing of Hank Paulson, while understanding that as Merrit Paulson indicated, "He was offered a 'one-bullet deal' where his father would financially back one large investment in a professional sports franchise". If we look at it in that light, it is likely that while Hank Pauslon has backed Merrrit Paulson that Merrit is not able to just freely utilize the full amount that Hank has available, much like Joey Saputo and the Saputo family billions.
As said at the beginning, there are 22 ownership groups in Major League Soccer and out of these 22 different ownership groups 14 are backed financially by finances over a billion dollars. For the eight teams that are difficult to verify, four are certainly backed by a decent amount of money (Montreal, DC United, Real Salt Lake, and Philadelphia) which leaves four teams (Portland, Chicago, Columbus, Orlando) that are towards the lower part of the financial spectrum in Major League Soccer.
However, this information above doesn't take into account current value for money and the ability of a team to make a profit against their current expenditures.
When Forbes ran an article on Major League Soccer's most valuable teams, the veil was lifted (at least with information from the 2012 season) on overall revenue and operating income for the teams. Based purely on the 2012 season, 10 clubs made a profit in 2012.
#2 LA Galaxy
#3 Portland Timbers
#4 Houston Dynamo
#5 Toronto FC
#6 Sporting Kansas City
#7 FC Dallas
#8 Montreal Impact
#9 Philadelphia Union
#10 New England Revolution
MLS Team Valuations - Forbes - 2013
Out of these 10 clubs, Seattle showed their earning potential making 18.2 million dollars for the 2012 season in profit. Portland was the next closest in terms of operating income with 9.4 million dollars. This information is taking into money after expenditures but before interest, taxes, depreciation and amortization.
What's interesting with these numbers is that if you believe the players union salary numbers that come from the MLS Players Union (which is in and of itself a contentious point) then the Portland Timbers in 2014 spent less money (roughly 5.2 million) in total base salary than they made in profit during the 2012 season. With ticket prices being raised and more seats added between the 2012 and 2015 season, the Timbers likely increased their revenue stream. As well, they added the Simple bank sponsorship for their warm up kits and signed a new sponsorship deal with Providence Health Care for the naming rights to the stadium. They, as well, renewed the Alaska Airlines sponsorship for the front of the Timbers uniform.
So while certainly Portland is one of the least financially backed teams in Major League Soccer, they are also simultaneously one of the few teams in Major League Soccer making a rather nice amount of profit off of the team.
At the end of the 2014 season, the Timbers base salary was 5.2 million dollars. This was during a season in which the Timbers had large amounts of allocation money for making the CONCACAF Champions league and a legitimate reason to run a larger squad.
Based on the finances above and the fact that the team will not be competing in the CCL, I would expect that the overall squad costs to decrease from the end of 2014, even if the Collective Bargaining Agreement allows for an increase to the MLS Salary cap.
Portland Timbers base salary totals for the beginning of the season for each season they played in Major League Soccer.
2014 - 3.7 million
2013 - 3.2 million
2012 - 4.16 million
2011 - 2.6 million
These numbers can change dramatically based upon the needs of the season as they did during 2015 when the Timbers desperately needed to fix their defense and they spent 1.5 million dollars on Liam Ridgewell.
So the Timbers sit in a very weird position. On one hand, the marquee name players are simply out of their reach, for the most part. They almost certainly cannot outbid Toronto FC, LA Galaxy, NYCFC for a certain type of player which, despite the best intentions of Major League Soccer, is seemingly how name brand marquee players are assigned in the league. As well, despite the love that a fan might have for their city, Portland is not New York City or Los Angeles in the eyes of the international player.
On the other hand, the Timbers are turning a profit after expenditures and have the ability to increase player spending when the total amount of their profit from 2012 ($9.4 million dollars) almost exceeded the total players salaries from the start of the 2011, 2012 and 2013 season combined (9.96 million dollars).
How do the Timbers move forward into a league that is fighting against the players for control of Free Agency?
If we look at the idea of Southampton FC as an example. The academy of Southampton has allowed the team to be financially relevant and competitive, in recent times, in the hyper-moneyed Barclay's Premier League despite Southampton not being a destination city or club.
While servicing a tiny area of England, the academy has turned out players such as Gareth Bale, Wayne Bridge, Calum Chambers, Theo Walcott, Luke Shaw, Alex Oxlade-Chamerblain, and Adam Lallana. The sale of Shaw, Lallana and Chambers brought in over $45 million dollars. As well, with creative scouting and appropriate player acquisitions, the club has been able to acquire value at needed positions with players that aren't necessarily name brand. They utilize these players (see: Dejan Lovren) and sell them on with great value to other teams ( see: Liverpool).
The way forward for the Timbers, given their league financial standing, is extremely careful scouting, avoiding rash decisions with front office moves. and creating talent from within to generate both good play and financial stability with the club. Certainly the implementation of the T2 USL side will allow the team to see the talent they have available at a lower level, however it is from the academy system that the Timbers must excel. They must find a way to identify and develop young soccer talent that can be then brought up to the senior squad..
The short and long term view of the Timbers finances indicates that unless Merritt Paulson takes on an additional financial backer, that the Timbers have already been lapped many times over in the financial "space race" of Major League Soccer. As of right now, the Timbers (as shown above) are very clearly behind at least 14 other teams in the league in terms of financial backing.
However, they are also one of the most valuable clubs due to the patronage of their fanbase and their current sponsorship appeal. The worry for Timbers fans is that the team has yet to develop a player from the ground up that has made an impact on the senior team. The counter argument to that is that the Timbers Academy has only recently been active.
However you see the academy argument the Timbers currently do not have a single homegrown player on their roster for the 2015 season. The Timbers must be better at building talent from within if they expect to have a source of income and talent to challenge the upper echelon of MLS.
Before Major League Soccer transitions even further into the inevitable free for all that is is trending towards, the Portland Timbers must have a plan of attack that allows them to win.