🇪🇸 The Desperate Business Deals Keeping FC Barcelona Afloat

At the time of writing this newsletter FC Barcelona sit rather comfortably at the top of La Liga:

Lamine Yamal is considered the most valuable young talent in Europe. The timeless Robert Lewandowski has found a way to extend his mercurial goalscoring prowess and the signing of Raphinha from Leeds has proven a masterstroke.

It’s amazing to see how on-the-pitch success stops the media vultures from swirling because off-the-pitch they have been in dire straits for many seasons.

Last week, Barcelona announced a very lucrative kit deal with Nike. This is quite a seminal moment for both parties as Barcelona continue to need alot of money to stay afloat and Nike are in the middle of the companies’ worst performance in decades.

The numbers on the deal are rather staggering.

Its worth noting that Barcelona themselves have not released these figures but publications close to the deal suggest Barcelona will receive:

• €1.7 billion from Nike over 14 seasons at an average of €121 million per year

This therefore becomes the most lucrative kit deal in football history.

That’s quite a stark amount of money, especially as earlier this year several reports were released into the mainstream media suggesting that the Nike relationship had soured and that Barcelona were exploring making their own jerseys instead of partnering with a major brand. Perhaps some savvy media work at play from Laporta!

This deal with Nike is the latest in a long line of negotiations engineered by Laporta and external parties aimed at restoring financial stability to the famous club. In 2021 Laporta returned to the helm as President of Barcelona following the tumultuous rule of Josep Maria Bartomeu.

The table below gives you a timeline of some of his work:

As you can see, Laporta has been working fast in an attempt to capitalise the business.

His work has meant:

• Selling future FCB revenues

• Selling chunks of FCB commercial business entities

• Borrowing large sums of money in a high-interest rate economy

Even with all of this, Laporta’s efforts still aren’t enough.

Mundo Deportivo report that the new Nike deal still doesn’t get them out of Financial Fair Play trouble. Their new signing Dani Olmo was only play this season due to Andreas’ Christensen’s injury at the time allowing them to register another player. In January, when registration returns they may have to sell players or find another sponsor to enable both Christensen and Olmo to be registered for the second half of the season.

It’s a sad state of affairs at Barcelona, especially considering their arch rivals Real Madrid seem to be having the opposite fortunes.

Real are Champions League winners and have reported club record revenues year-on-year for the last 2 seasons. That whilst continuing to be able to attract and sign the best players in the world.

In Laporta they have a man determined to see Barcelona back on top of the footballing world.

As you can see, he still has some way to go!

I leave you this week with a great conversation with Alex Tunbridge.

Tunbridge is CEO of Cambridge United Football Club and he recently sat with Charlie and Harry Stebbings where they discussed:

1. The value of a club crest

2. Why values are critical in a football club

3. The model of parachute payments to lower leagues

4. The revenue streams of a football club

+ more.

Great stuff from all involved.

As always, I’ll see you next week where we will be discussing English Cricket.

Salud.