Is Laporta the right man for Barça?

Primer, el Barça (Barca comes first). This promise made by the in-coming president provided the Barcelona faithful with much-needed reassurance at a rather tumultuous time for the club. Fast forward 18 years and, following the most recent Presidency election on the 7th March 2021, Joan Laporta is back – again, much to the relief of Barcelona’s fans across the globe. But is this faith ill-placed? I will be taking a look at the impact Laporta had on the performances of the club during his first stint at the club, both on the pitch and the boardroom, and if a return is indeed the best move for both parties.

The Years before Laporta

To understand the impact that Laporta had upon his arrival in 2003, you must first remember the sombre state of a club that Barcelona had become. Trophy-less since 1999, what was most worrying was that the desire of senior management to end this drought seemed to be lacking. As supporters of the Blaugrana gaped at their arch-rivals Real Madrid loosening their purse strings to spend €335 million between 1999-2003, their own club could only conjure up €230 million in the same time frame.

The problem didn't stop there - not only were they not spending as near as much money as Madrid, but the money they did spend was mis-managed, leaving the manager with players who weren’t up to the lofty standards set by Johan Cruyff’s bedazzling ‘Dream Team’, assembled less than a decade prior. Looking once again at the period 1999 to 2003, the 17 players that Barcelona had brought in on permanent deals made a total of 701 appearances for the first team, an average of 41 games per player. In stark contrast, their nemesis in the capital had brought in 16 players who each made an average of 92 total games for the club. Combine these two sets of figures together and you will find that Barcelona spent €0.33m for every appearance made by their new signings – yet for Real Madrid, only €0.23m.

Whilst the number of appearances made by the new signings does not necessarily dictate how successful a club will be, the two La Liga and Champions League titles for Los Blancos in these four years only further supports the issues found above.

Ronaldo, Zidane, McManaman, Anelka – the list of Real Madrid’s star-studded signings goes on. But if the numbers presented above fail to demonstrate the balance of power in Spain at the time, the purchase of another Galactico by money-man Florentino Perez (Real Madrid’s seemingly immortal president) should paint a clearer picture.

Luis Figo had played for Barcelona for 5 years and captained the side on numerous occasions; but in the summer of 2000, the Portuguese midfielder made the permanent switch from the Nou Camp to the Santiago Bernabeu, much to the dismay of the Barcelona supporters. Driven by his lack of trust in the incoming President Joan Gaspart, the transfer was symbolic of the direction the two clubs were heading at that time.

The Laporta era begins

It was clear that change was needed at the club, and armed with a promise to bring in global superstar David Beckham, lawyer Joan Laporta (who represented Johan Cruyff no less) was soon elected as president in 2003. Laporta was definitely no stranger to the club having previously co-founded ‘L’Efefant Blau’ - an opposition group created in 1997 who opposed the direction that the then-President Jose Luis Nunez was taking the club.

Once elected, Laporta wasted no time in his effort to get the sleeping giant going again, calling up a meeting with his newly formed board of directors to draw up a plan of action asserting the following four key points (Hamil and Walters, 2010):

1) Restore sporting competitiveness

2) Re-assert member democracy and improve the transparency of club governance

3) Improved financial performance, led by increasing revenue from off-the-pitch activities

4) Addressing wider issues of corporate social responsibility.

While David Beckham may have opted to join Real Madrid shortly after Laporta was elected, the Spaniard moved quickly in order to sign Brazilian star Ronaldinho – the perfect poster-boy to symbolise a new era for Barcelona.

Despite a poor start to his tenure, during which time Laporta had received numerous insults and death threats from the Boixos Nois (translated to Mad Boys – a radical group of Barcelona ultras), the club set off on a remarkable run of form which culminated in two La Liga titles as well as a Champions League trophy in 2006 - their first European Cup since 1992. Barcelona had clearly spent their money wisely; shrewd investments in Ronaldinho, Samuel Eto’o, Deco and Rafael Marquez were supplemented with graduates from La Masia (Barcelona’s esteemed youth academy), hence restoring the club’s sporting competitiveness.

So, the on-pitch performances clearly improved drastically since the Laporta era began, but what about off the pitch? For a club that sat 13th in the Deloitte Money League by the end of the 2002/03 campaign, what was most concerning of all was the fact that a whopping 89% of their revenue in that year was spent towards the wages of the playing staff. To put that into context, Chelsea (who placed 10th in the Money League of the same year) spent just 46% of their income towards their playing wages.

And so Laporta’s demand for improved financial performance began. The president recognised the commercial earning potential of the club on an international stage, helping to grow revenue by 37% from 2003 to 2004, the largest single year percentage increase recorded by Barcelona to date. Additionally, as a result of the performance related pay scheme that was introduced at the club, the wages/turnover percentage was significantly reduced to a more reasonable 50%. The following graph (Figure 1) demonstrates the significant reduction in the wages/turnover ratio, its stable nature during his Presidency (2003-2010), as well as the increase in turnover since Laporta was elected.

Figure 1: Total revenue, wages (of the playing staff), as well the Wages/Turnover ratio for each year

The increase in revenue reported by the club was equally as impressive when stacked up against their rivals from across Europe, with Barcelona’s incoming soaring year on year, when others may have stagnated.

Figure 2: The rise in revenue received by 10 clubs who have consistently appeared in the top 10 of the Deloitte Money League since 2003.

Post 2006, Barcelona continued to make their mark in the continent. Frank Rijkaard was swapped for Pep Guardiola in the manager’s seat. Ronaldinho was swapped for Thierry Henry in the electric frontline. And, to top it off, a certain Lionel Messi began to make his mark in the Camp Nou. The club’s third Champions League title was combined with a league title and four other trophies to accomplish an unprecedented sextuple in 2009 -and so it appeared that Laporta’s work was done.

Cracks beginning to appear?

Behind this glossy, trophy-laden exterior however, Barcelona’s finances were taking a substantial hit. Following the conclusion of the 2009/10 season, Laporta’s final year at the helm after two 4-year terms as president, it was uncovered that the club had lost €77.1m - leaving their total debt balance to be more than €440m, not that Laporta would have let us hear it. It was only after an audit conducted by Deloitte, preceding the arrival of new President Sandro Rosell, were these figures revealed to the public – with Laporta and his team previously announcing that the club had made a profit of €11m upon their departure.

Barcelona's commitment to being ‘mes que un club’ (more than a club) was clearly evident back in 2006 when, despite all their major European rivals securing multi-million pound deals in shirt sponsorships, they chose their first partnership to be with children’s charity UNICEF - committing €1.5m each year to promote the cause instead of being paid themselves.

Yet, having been left to deal with a financial situation so dire, Rosell felt obliged to abandon this tradition in order to generate additional funds for the club. In 2010, he decided to cash in on the club’s worldwide reputation - signing a record €150m, five-year deal with Qatar Foundation.

As if this wasn’t enough, Laporta’s reign also ended in the club being unable to pay the player’s salaries at the end of June 2010, meaning Rosell also had to take out a loan of €150m from several Spanish banks.

Perhaps they are more like a club than we previously gave them credit for.

Post-Laporta Barcelona

The club continued their on-field successes in the years following the end of Laporta’s Presidency – winning six league titles as well as two Champions Leagues. It also started to look up for the club off the field, as demonstrated in my graph below (see Figure 3): Barcelona’s impressive ability to generate commercial revenue eventually led the club to first position in the Deloitte Money League, overtaking Real Madrid following the 2018/19 season.

Figure 3: The rise in revenue received by 10 clubs who have consistently appeared in the top 10 of the Deloitte Money League from 2010 to present day.

However, in recent years the club’s shortcomings in the Champions League have left many supporters bewildered by their transfer policy. Big-money signings such as Antoine Griezmann, Ousmane Dembele and Philippe Coutinho have failed to meet the standards set by the stalwart La Masia contingency – with a series of questionable managerial appointments causing supporters to vent their frustrations at the President Josep Bartomeu (who was elected in 2014 following Rosell’s four year term).

Rosell and Bartomeu embracing after the 2014 presidential election

Looking back at Figure 1, you can see the impact that these transfers have had on the wage bill at the club - with the 2017/18 season a particularly concerning year for financial reasons. The total spend on the playing staffs’ salaries reached a club-record €481m that year (only to be surpassed in the following year), constituting a rise of 37% compared to the last Champions League winning season, 2014/15. These wages also formed 70% of total yearly turnover earnt by the club, the highest percentage recorded by the club since the disastrous 2002/03 season.

To add to the problems the Catalan side are facing, the latest annual report for the 2019-20 season has revealed the club have a total debt payable of more than €1.2bn, after suffering a loss (after tax) of €97.3m in the year. ‘¡Ay Caramba!’ doesn’t quite do the situation justice.

Changes needed – again

“Messi stay! Bartomeu resign!” Following the dismal conclusion of the 2019/20 season, these words reverberated through the streets of Barcelona during a protest when supporters unleashed their anger towards the president and his board of directors. And they got their wish – well, for now at least. Bartomeu resigned in August 2020, with the next presidential elections taking place in March 2021.

Unfortunately for Bartomeu the story doesn’t end there. The Spaniard was subsequently arrested by Catalan police in March 2021, amid allegations of using social media during his reign at the club to defame the reputation of those who publicly spoke up against him – which constituted a rather long, glamorous list including the likes of Lionel Messi, Pep Guardiola and Xavi. With scandals like these, football appears to have taken a back seat at the club (if Amazon are not offering top dollar to film an All or Nothing documentary at the Nou Camp they are definitely doing something wrong).

Cue: Joan Laporta returns to the scene. A club with an ageing squad, inflated salaries, extortionate debt, and a global superstar in Lionel Messi who reportedly wants out. Tricky as it may seem, with Laporta’s track record, Barcelona fans are optimistic with the direction the club seems to be heading, and I believe this faith is rightly placed. With a few gems peaking out of the academy as they did in 2004, if Laporta sticks to the four objectives that he outlined 18 years ago, it should not be long until the club returns back to pinnacle status within European football.

A balance needs to be struck between the finances and the football, and if Laporta can do so, he can turn FC Barcelona into more than a club again for all the right reasons.

References:

Hamil, S., Walters, G., Watson, L. (2010) 'The model of governance at FC Barcelona: balancing member democracy, commercial strategy, corporate social responsibility and sporting performance', Soccer & Society, 11 (4), pp. 475-504.