The All-Encompassing Pro/Rel Thread on Soccer in the USA

Discussion in 'Soccer in the USA' started by bigredfutbol, Mar 12, 2016.

  1. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    You mean the single-entity? Just wipe off $9 billion in equity?

    Anyone has the option to start a league and apply for D1 status.
     
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  2. HailtotheKing

    HailtotheKing Member+

    San Antonio FC
    United States
    Dec 1, 2008
    TEXAS
    Club:
    San Antonio Scorpions FC
    Nat'l Team:
    United States
    Why?

    It's an instant vetting process and provides the league (and thusly the fans etc) with a new franchise willing, able, and committed to being in the league (and solvent and not go bye bye in short order) and fielding a club at that level.

    It is clearly working and clearly not a barrier to entry for folks.

    So I'm not sure how getting rid of the cost for share (fixed your idiotic trolling line for you) would be taking the training wheels off in any fashion. If anything, it'd open the league up to more potential fly by nights ...
     
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  3. M

    M Member+

    Feb 18, 2000
    Via Ventisette
    Can't complain about owners not having extra spending money then.
     
  4. HailtotheKing

    HailtotheKing Member+

    San Antonio FC
    United States
    Dec 1, 2008
    TEXAS
    Club:
    San Antonio Scorpions FC
    Nat'l Team:
    United States
    Equity =/= cash FFS
     
  5. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    I don't and neither do they. If you're Toronto FC's owners your $10 million "cartel membership fee" is now worth at least $300 million.
     
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  6. M

    M Member+

    Feb 18, 2000
    Via Ventisette
    Hard to cry that you don't have any more spending money then. And, no, the answer isn't "that's equity".
     
  7. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    Well you can take that up with the people that complain that there's not enough spending money.

    As for TFC they're going to be spending $15 million a year on Isigne.

    Meanwhile across the league, $100 millions that could otherwise be spent on player salaries is being invested in long- term infrastructure.

    I think that's the better plan.
     
  8. HailtotheKing

    HailtotheKing Member+

    San Antonio FC
    United States
    Dec 1, 2008
    TEXAS
    Club:
    San Antonio Scorpions FC
    Nat'l Team:
    United States
    Yeah, it is
    It is literally what it is.
    That 10m that is now worth 300m is only cash to spend if they liquidate (sell). As it stands, it is equity as it is the value of the share they own.

    Again, cash =/= equity and vice versa
    Or perhaps you'd like to call it "asset value" ... But either way it's not cash to spend ...

    Money 101 .... Learn it
     
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  9. jaykoz3

    jaykoz3 Member+

    Dec 25, 2010
    Conshohocken, PA
    Club:
    Philadelphia Union
    Nat'l Team:
    United States
    A couple days old....Rich clubs getting richer and getting closer to cementing their places at the top of the table:



     
  10. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    Wow, the last part of that is very depressing, not for football but for humanity.
     
  11. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    After today's win Newcastle can finish 9th if they beat Burnley on Saturday.

    Leeds, Chelsea and West Ham need to win to make that happen.
     
  12. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    And on the subject of form, Notts play Grimsby at home (single leg) in the first round of the playoffs on Monday.
    Screenshot_20220516-171242_Chrome.jpg
     
  13. M

    M Member+

    Feb 18, 2000
    Via Ventisette
  14. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    So this has nothing to do with pro/rel.

    4 ways of squeezing money out of sports teams:

    1. asset stripping
    2. leveraged buyouts
    3. selling equity to investment firms
    4. borrowing against a % of equity

    I think 4 is the lesser of the 4 evils.
     
  15. M

    M Member+

    Feb 18, 2000
    Via Ventisette
    #34515 M, May 16, 2022
    Last edited: May 16, 2022
    Of course. However, this is in relation to claims made earlier on this page that franchise owners have no cash because their wealth is in the franchise's "asset value". Hard to claim that if you can borrow against said asset.
     
  16. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    I can't borrow against said asset as I'm not a NFL owner.
     
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  17. M

    M Member+

    Feb 18, 2000
    Via Ventisette
    Newcastle United are the first Premier League team to avoid relegation after failing to win any of their first 14 games.
     
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  18. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    They have the third best record over the last 18 games.
     
  19. HailtotheKing

    HailtotheKing Member+

    San Antonio FC
    United States
    Dec 1, 2008
    TEXAS
    Club:
    San Antonio Scorpions FC
    Nat'l Team:
    United States
    .... sigh

    If you're borrowing, you're liquidating said % or portion of the equity and REMOVING IT from your stake.

    Pretty sure I stated the only way to get cash was to "sell" ... which, is what you're doing when you do this. Why? Because the equity you take out (cash out btw) is no longer owned by you, but the bank. You've sold it off to a lender ... and you have to buy it back if you still want it. If you don't CASH OUT (ie-sell your equity) then you don't have cash, just asset value.

    So, AGAIN, for those that can't grasp concepts with more than one color ... equity =/= cash.
     
  20. M

    M Member+

    Feb 18, 2000
    Via Ventisette
    Sigh. Someone doesn't know what "borrowing against an asset" means. Nor understand what collateral is. Sigh.
     
  21. AlbertCamus

    AlbertCamus Member+

    Colorado Rapids
    Sep 2, 2005
    Colorado, USA
    Club:
    Colorado Rapids
    That's right. When you borrow against your house you are not selling any part of the asset to the bank.
     
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  22. HailtotheKing

    HailtotheKing Member+

    San Antonio FC
    United States
    Dec 1, 2008
    TEXAS
    Club:
    San Antonio Scorpions FC
    Nat'l Team:
    United States
    I do, which is how I know that equity =/= cash ... yes, it can be turned into cash, but it isn't, in of itself cash to spend (as you blatantly implied it is).

    Borrowing against an asset means you are literally giving the rights to the lender to SELL THE ASSET to recover anything you don't repay.

    You are giving up something for the cash, as opposed to having the cash yourself (as you implied they do, mistakenly thinking equity is the same as cash on hand).

    ... sigh, pesky facts

    When you put something up as collateral you are giving up rights/ownership/etc until the terms of your borrowing are repaid/met. So yeah, you are in reality. The lender can foreclose on your home and give ownership over to the bank if you don't repay the home equity loan soooooooooooo .....
     
  23. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    So anyway, the right to collateralize post a NFL investment is an option for someone who is not a primary owner.

    Let's take an average franchise like the Seahawks, worth $3.5 billion. Someone who owns 20% of equity, worth $700 million, would be able to secure a loan of $100 million.

    The chances are that he would pay that back, if not a bank gets 2.85% of shares in the Seahawks probably at a nice profit. The business risk to NFL is very low

    But the Seahawks are an independent business, so they're just doing what every business does.

    I can't see this happening in MLS because of the single-entity. I guess the league could issue fixed income securities or even sell a percentage of the company like they did at one point with SUM, or even issue a shareholder dividend.

    But I think there's a long way to go before we get to that point. The league is still a minnow in American sports terms and it's not making a profit, so all investments are still speculative and not particularly secure.

    Plus "value" is split between the leagues assets and the investor/operator's assets such as the stadium.

    On another issue not related to the thread, I still don't understand why MLS hasn't sold naming rights like "Ligue 1 - Uber Eats" or "Serie A TIM". Someone suggested Dude Wipes, I guess they're not a fan.
     
  24. HailtotheKing

    HailtotheKing Member+

    San Antonio FC
    United States
    Dec 1, 2008
    TEXAS
    Club:
    San Antonio Scorpions FC
    Nat'l Team:
    United States
    Major League Soccer
    Presented by Audi .... or something like that would be a very American way to go.
     
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  25. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    England
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    That's the TV coverage.
     
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