American celebrities have been investing in British football clubs — but why? - video Dailymotion

CGTN Europe

CGTN Europe interviewed Tom Bason, Assistant Professor of Sport Management at Coventry University.

Transcript

00:00Tom Basin is Assistant Professor in Sport Management at Coventry University.

00:04Tom, welcome. So this wave of American celebs, actors, musicians, athletes,

00:09all investing in British football clubs, why? What do you think is driving it?

00:15I think we need to think about the two different types of investors that you get.

00:20You get the likes of Ryan Reynolds and Rob McElhenney and Elton John, for example,

00:24who you mentioned, who are taking over clubs.

00:26And they're probably taking over the clubs to try and get some of those returns that you mentioned previously.

00:30They buy a club for relatively cheaply and hopefully the club progresses up the league

00:35and then they can potentially sell it on at a later date for much more.

00:39Some of the other investors that we just mentioned, the likes of Michael B. Jordan, JJ Watts,

00:44they're typically minority shareholders. They typically own a couple of percent.

00:48And their role is really to be the front person, to try and enhance the club's marketing and global appeal,

00:54to try and add a degree of legitimacy to the project.

00:57We saw this in the last month or so with Tom Brady's TV show, Brady in the Blues.

01:03Tom Brady only owns a couple of percent of Birmingham City,

01:05but the series was very much about his role at the club.

01:08Well, you're shocking us. Are you really suggesting that this isn't about a genuine passion for the sport?

01:13It's really about strategic business?

01:16I think it's probably a bit of both. I suspect it's more the latter.

01:19But it probably depends on the individual. I can't imagine that Stormzy invests in a non-league football club,

01:25hoping to become rich on it.

01:27I think the nice thing for the minority investing of the celebrity owners is that it limits their risk.

01:35Football clubs make a loss on a day-to-day business, on a day-to-day basis,

01:41and it's going to be the responsibility of the owners to fund this.

01:43That's not going to be someone who owns 1%, 2% of a football club.

01:47Those losses are going to be funded by the person who owns 60%, 70% of a football club.

01:52So the celebrity owner buys a small amount.

01:55They don't have to necessarily invest on a day-to-day basis,

01:58but then they might get the benefits, if the club is promoted,

02:02of being able to sell that state for a lot more money later in the day.

02:05Speaking as a Welshman, this enthusiasm for Swansea and Wrexham is, of course,

02:09obviously understandable and rational.

02:11They are the two world's greatest football clubs.

02:14How does the investment of American investors affect the identity and the traditions of British clubs?

02:22I think from what I can tell, the way that the Maclehead and Reynolds have gone into Wrexham,

02:27they've really tried to embrace the local community.

02:29They haven't tried to necessarily make Wrexham into a US-style sports organisation.

02:35They've really tried to embrace the tradition at the club.

02:38And you can see, for example, that Birmingham City's owners are kind of trying to do the same thing,

02:43but with more of a commercial angle.

02:45So a lot of their marketing has been connected to Peaky Blinders,

02:49a TV programme set in Birmingham and created by a Birmingham City fan.

02:53But as soon as you bring in this more commercial angle, it becomes very difficult.

02:57It's so difficult to both increase the club's international reputation and brand

03:01and keep the local fan base happy.

03:03I'm sure this isn't just an issue for clubs with celebrity owners.

03:08All clubs are fighting this battle.

03:10At the moment, for example, it's just been announced that Spanish football games

03:14are going to be played in USA later in the year.

03:17I'm sure commercially and financially that's brilliant for those clubs involved,

03:20but it really risks alienating the local fans.

03:23Could we eventually see perhaps similar trends in other British sports,

03:28things like rugby clubs or cricket clubs?

03:32So these sports already have a bit of investment coming from abroad, from America.

03:37So the owners of Birmingham City own 49% of Birmingham Phoenix.

03:41The likes of London Spirit and Welsh Fire are part-owned by US-based investors in cricket.

03:47Red Bull this week took over Newcastle Falcons.

03:49But these are from investment firms rather than celebrity owners.

03:53And I think it's more difficult in rugby and cricket.

03:56Rugby and cricket has a lot less money, particularly at the top end.

03:59And one of the key reasons to get these celebrity owners involved

04:03is to bring a global audience to the club.

04:05This works well for football, where football already has an interest all over the world.

04:10If you get Ryan Reynolds and Rob McElhenney,

04:13they're going to be in front of viewers all over the world.

04:17That isn't quite the same for sports like cricket and rugby,

04:20where the potential audience and commercial opportunities

04:22are really limited to a handful of countries.

04:25Tom, good to see you. Thank you for that.

04:26Tom Basin, Assistant Professor in Sport Management at Coventry University.

American celebrities have been investing in British football clubs — but why?

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