Build it like Beckham - The Cost of a Football Club

For the majority of us, David Beckham’s piggy bank is far bigger than ours ever will be. Yet - oddly enough - he might share this same sentiment regarding some of the other football club owners whom his side compete against in the MLS (Major League Soccer).

With a comparatively measly net worth of just $450 million, how did Becks manage to create a brand-new football club, admit it into the American ‘soccer’ league structure – and all the while still managing to convince Posh Spice that it was a good idea? In the following article, I explore the ins and outs of his football venture, and why most American billionaires choose to purchase European clubs instead of building those in their home nation.

The costs involved to create a club

As you might imagine, it is a huge undertaking to start a football club; in the UK, aside from the initial fees paid to the FA and the respective league in order to register the club, regular outgoings such as the costs incurred to hire a pitch on a regular basis, paying salaries as well as all the costs associated with matchday can set the entrepreneur back a pretty penny. And this is just to create a club at a grassroots level; these costs will undoubtedly multiply should the club progress up the leagues – let alone for a club set to start in the highest possible division in the country, which was what David Beckham decided to do.

When the English Galactico decided to make the move to the MLS from Real Madrid back in 2007, he took the eyes of the nation with him. The hero that sent the Three Lions to the 2002 World Cup became the first major import to the American ‘soccer’ scene when he joined LA Galaxy, elevating the league’s reputation instantly.

Whilst he was accused of “going to Hollywood to be half a film star” by then-President Ramon Calderon, Beckham knew that, playing at a level far less intense, he would be subject to less public scrutiny – giving him time to leverage a lucrative business deal in the country later on.

Included within the details of the contract that he signed with LA Galaxy in 2007 was a purchase option granted by the MLS; this was to allow Beckham to purchase an expansion team for a mere $25 million, versus the typical fee at the time of $150 million. This gateway to establish a new franchise was taken up by Beckham in February of 2014, just 9 months after the Englishman had retired.

Of course, Beckham couldn’t foot the bill entirely himself, and so wealthy entrepreneurs Simon Fuller and Marcelo Claure formed part of his initial investment group (initially called Miami Beckham United and later changed to Miami Freedom Park LLC) that led the proposal for the expansion franchise to be based in Miami.

Despite an initial struggle to obtain approval for a new stadium plan in their desired location leading to a delay in plans, Club Internacional de Fútbol Miami (Inter Miami CF, for short) was granted entry into the new 26-team MLS franchise in January 2018 – with the side set to play their first competitive game in the 2020/21 season (along with fellow debutants Nashville SC).

(Global superstars Blaise Matuidi (left) and Gonzalo Higuain (right) now play for Beckham's side in the MLS)

A new stadium is also on the way for Beckham’s side, with the completion of Miami Freedom Park costing the club approximately $1 billion.

The ownership team has altered since its inception, with billionaires Masayoshi Son and brothers Jorge and Jose Mas introduced in 2017, and Beckham buying out Simon Fuller in May 2019.

Why did Beckham choose the MLS?

The first reason is a simple one – it was on offer. As mentioned earlier, thanks to the Englishman’s natural pull of international viewers to the MLS, he was granted the option of purchasing a new franchise in the MLS for just $25 million. At that time the fee for anyone else looking to enter the league was closer to $150 million.

This price has increased significantly in recent years, as the MLS continue their expansion with the aim of becoming one of the best leagues in the world. The 28th and 29th team of the MLS (who will be inducted in the 2022 and 2023 seasons) will each be required to pay a $200 million entrance fee, increasing again to $325 million when the 30th team is introduced.

For many wealthy American entrepreneurs, it is entry fees like this that deter them from investing in their own country’s sport – opting instead for the British and other European football clubs. Here, with each club already established within their respective leagues, the only fee to pay is the price of the club itself – whereas in the MLS, after paying the initial entrance fee, they must also consider the costs of building a stadium from scratch and recruiting both players and management fit enough to handle a domestic campaign. One other cost unique to newly established football clubs will also need to be considered: its supporters. Generating interest in a brand-new club, in a country where ‘soccer’ is watched by just 7% of the population (only the fifth biggest sport in the US), will certainly not come cheap to the club owners.

With West Bromwich Albion and Newcastle United - who are regular competitors in the Premier League - available for sale at around $200 million and $350 million respectively, (the price of the MLS entrance fee alone!) - it should come as little surprise that 8 of the club owners in the Premier League are American – choosing the English game ahead of creating a new franchise in the States.

(Stan Kroenke, John Henry and Joel Glazer are just three of the many American-owned football clubs in English football)

Another reason why the Englishman would have chosen the MLS was the instant guarantee of revenue. Given that the MLS is a league with no promotion or relegation, there are no consequences should the club’s on-field performances not live up to expectations – as Inter Miami would ultimately continue to line up against the best teams in the country season after season. Thanks to the collapse of the European Super League earlier this year, purchasing or founding a club in any other country will bring with it meritocracy (how dare they!) that could potentially threaten revenues and in turn, profits earned by a club each year.

Given that Beckham wanted to design and tailor his new football club according to his own vision, doing so outside of the United States would have meant starting at grassroots level – with no easy way up to the top. Acknowledging that it would take a considerable number of years to monetise the club, he made this more of a ‘side-project’ - in the form of Salford City, of which he became a joint owner in 2019, joining his Class of 92 teammates: Gary Neville, Phil Neville, Ryan Giggs, Paul Scholes and Nicky Butt.

Why Miami?

Miami’s population is extremely diverse, with many of its immigrants coming from areas where football fever is rich – namely both Central and South America, as well as a whole host of countries in Europe. And thus, with no MLS team in the region, the city is perfectly set up for a ‘soccer’ team to get behind.

Miami residents have also been deprived of sports success in recent years: the Dolphins and Marlins have struggled in the NFL and MLB respectively, and Miami Heat have failed to win an NBA championship since the highs of 2012 and 2013 – providing a pathway for David Beckham and his Inter Miami side to get the party going once again.

David Beckham will never shy away from the cameras – and building Inter Miami CF is just another example of that. He can enjoy all the benefits of being a football club owner, hardly scratching his bank account in the process, and not having to endure #BeckhamOut protests every time his team nears relegation.

How does the man just keep on winning?