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The Strategies of Multi-Club Ownership

Cooperations acquiring smaller companies and expanding a portfolio or companies merging together is a common practice in business, but the concept is something that has been met with opposition from football fans. However, from a business perspective, the practice is proven and makes sense. Perhaps the two most popular examples are Red Bull's Global Football Operations and City Football Group. The two organisations collectively operate 16 clubs, but what individuals may not realise is just the extent to which multi-club ownership (MCOs) is occurring in football. Perhaps some lesser-known examples include the likes of Monaco and Cercle Brugge or the King Power International Group's ownership of Leicester City and Oud-Heverlee Leuven. An analysis by CIES Sports Intelligence found 88 clubs were under an umbrella of multi-club ownership, with 61 clubs located in Europe. In this article, I would like to examine a selection of multi-club ownerships and how each operates.

Red Bull GmbH Global Football Operations

Much like the energy drink's dedication to creating a high octane culture, the global football operations have created a high octane expansion strategy. Starting with the acquisition of SV Austria Salzburg (becoming RB Salzburg) in 2005, the organisation quickly expanded its portfolio to include RB New York (2006), RB Ghana and RB Brasil (2008), RB Leipzig (2009), and RB Bragantino (2019). In addition to these clubs, Red Bull acquired FC Liefering in 2012 to serve as a more direct feeder club to RB Salzburg (although Leipzig has sent players to the club). In terms of project failures, the 2008 acquisition duo of Ghana and Brasilian-based clubs failed to take off, with RB Brasil still an active project but not yet in the top flight and transitioned to a more feeder role for RB Bragantino. Red Bull Ghana ceased operations in 2014, but we have still seen a Red Bull presence in Africa thanks to a relationship with the agency 12 Management and the JMG Academies of Mali.

In terms of management, Red Bull benefits from a centralised platform under the leadership of Oliver Mintzlaff. The platform results in a shared knowledge with departments such as finances and marketing in the same location. With this centralised management, Red Bull can utilize a common playing philosophy (high energy and intense pressing, fitting the marketing of the energy drink's high octane culture) and create a pathway for player and staff development. Technical staff follow these tactics and have a true understanding of the Red Bull identity, while players can evolve their play in different levels of pressure to perform.

Player trading is a major condition of success for the Red Bull group. To look at the European-based clubs, Liefering identifies as the first step to senior-level European football, offering the physical demands that reserve and youth leagues cannot, without the pressure to win titles. In this role, Liefering has assisted in the development of 88 players from Salzburg, 6 from Leipzig, and 2 from the Ghana program. Salzburg has taken the role as the "move before the big one", creating a high demand of playing success in both the senior and youth levels, but still not at the highest level of play. In this role, the club has brought in 7 players from Leipzig, 31 from Liefering, 11 from the Brasilian clubs, and 1 from New York. The trading within the two Austrian clubs ideally leads to the player (or technical staff member) moving to Leipzig, which has seen 18 players arrive from Salzburg and 1 from New York. The player trading approach allows for players to have a faster adjustment to playing in a new squad and the clubs can save money, with transfer fees often being much lower thanks to being in-house.

To summarize, Red Bull's Football Operations demands success in a dynamic way that allows player development to be refined and player recruitment to be precise. The players are young and often have high potential thanks to a shared scouting network that has found a way to perfect youth scouting. Red Bull's approach has caused traditional fans to feel excluded from the game due to the removal of individual branding, but they bring results across the globe.

How City Football Group is Different from Red Bull

City Football Group is perhaps the other "super" multi-club ownership group, but they operate in a very different system to Red Bull. Since their founding in 2013, the immediate goal was to take over three super-markets: The United States, India, and China. This has allowed direct access to three massive populations that pioneer technology, which ties into streamlining the operations of the group. The ownership group integrates technology as a key supporting method of efficient operations worldwide. City Football Group's website describes a business goal of providing the largest presence in football across the globe, providing clubs with ideology on how to succeed in performance and development. In addition to providing owned clubs with ideas, the organisation offers properties in media, marketing, and fan engagement to support the growth of clubs. This creates an approach that isn't about growing a brand and culture (like Red Bull), but rather creating a system whereas many clubs can achieve as much success as possible, both commercially and in sporting performance.

While the 10 clubs across the globe share common ownership, they often manage to retain their identity and have the option to operate in a more "independent" feeling. For example, Girona has access to the same commercial and sporting tools that ESTAC Troyes and Mumbai City have. Girona can see the same players that Montevideo City has found in scouting, but there is no central power sending them players. The acquisition is not linked directly. City Football Group still aims for sporting success, but the focus can feel more on creating unrivaled commercial success in football.

Matthew Benham's Ownership of Brentford and Midtjylland

Armed with a physics degree from Oxford and a more efficient application of data than other clubs, Matthew Benham has become a household name in the analytics community alongside Rasmus Ankersen for the sporting successes of Danish club FC Midtjylland and Brentford. The shared ownership approach brought by Matthew Benham is perhaps the most successful example of the most common approach to shared ownership. Without creating the feeling of a "feeder club", the two clubs share knowledge without directly competing. Benham's clubs have emerged as set play masters and transfer market gurus, but you won't necessarily see many players moving directly between the two. A (relatively) less successful version of this type of affiliation is Vincent Tan's ownership in Cardiff City and KV Kortrijk. Tan also owned FC Sarajevo and had a stake in LAFC, but he has since sold Sarajevo and looked to sell all of his stake in LAFC to keep focus on Cardiff City and KV Kortrijk. This multi-club ownership model purely looks to create an open network of knowledge, but does not influence the level that City Football Group does with central marketing or create a common identity like Red Bull.

Future Structures of Multi-Club Ownership

Thanks to the successes of City Football Group and Red Bull, it is unlikely that we will see multi-club ownership disappear anytime soon. The only question that remains is how will it be further implemented? As City Football Group matures, will we see more player movement within the umbrella? When will Red Bull expand into other nations, such as England? What will future partnerships look like? Potential owners may recognise the backlash that came in the early days of Red Bull and may try to keep individual identities with the club in a way similar to City Football Group's operations, but they also may see the financial value in creating a common player pathway and shared game model. Smaller-scale operations could aim to recreate the feeder club approach of assisting a primary focus club in their development, or they could allow the clubs to operate independently with shared knowledge in similar capacities as Matthew Benham allows. If you had the opportunity to operate a portfolio of clubs, what would you view as your most ideal method of management?


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