In 2020, Hollywood duo Ryan Reynolds and Rob McElhenney were announced as the owners of National League side Wrexham and they’re not the only celebrities to have shown interest in investing in football clubs over the years. Natalie Portman spearheads a roster of A-list Hollywood actors as owners of the NWSL side Angel City FC, and Will Ferrell now co-owns one of the MLS’s recent expansion franchises – Los Angeles FC. Clearly, there is a growing trend of famous faces investing in the beautiful game.
Whether you are going all in, or simply buying a minority share, football clubs don’t come cheap. Therefore, why are those who have previously had no affinity with any particular club, or even a passion for the sport itself, now so willing to dip their toes into the world of football club ownership?
1. The financial benefits
The most obvious reason is a financial one. Whilst a football club is an expensive asset to obtain, if you can afford one and operate it sustainably, the value of your investment is likely to grow exponentially. A recent study published by Football Benchmark in 2022 listed the top 32 football clubs in Europe by estimated value[i]. Of the 32, 23 experienced a year-on-year increase in value (with 3 of the other 9 being new entries on the list, thus no data to compare them with from the previous year). The increase in value is not by a minimal figure either with the average year-on-year increase amongst those 23 clubs being 13.4%. A word of caution should be held on this figure’s weight given the vast majority of clubs experienced a substantial ‘bounce-back’ in revenue in 2022 from the past two Covid-affected seasons[ii]. Nevertheless, this was a trend seen before the pandemic, so the financial viability of such an investment is clear for all to see.
In the case of Angel City FC, the club’s multiple investors have seen the interest in women’s football grow consistently over the years which has resulted in increasingly valuable broadcasting rights deals and rising demand from streaming services[iii]. Women’s sport is no longer a passion-project investment that it might have been a few years ago.
This trend is down to the growing fan-base for women’s football. Female players are natural storytellers on social media. The women’s captain for the US national football team has twice as many social media followers as the captain of the men’s national team. This fan-base has led to increased ticket sales, higher TV ratings and more women’s football fans, which is exactly what investors are looking for.
2. A marketing strategy
There is a clear intersection where investors can reap sufficient financial returns whilst doing good for society. For example, Reynolds and McElhenney were passionate about using their cash to help bring success to a smaller, lesser-known team such as Wrexham whilst Natalie Portman wanted to promote awareness about the women’s game within the United States and wanted to inspire young girls to take up the sport. There is clearly a growing trend for celebrities using football clubs as a platform for their own values and making the change themselves.
The Wrexham duo have shown what can be achieved in a world where football and TV serve each other. The docuseries Welcome to Wrexham and other series alike offer a great opportunity for personal career enhancement with Reynolds and McElhenney appearing as executive producers of the docuseries. The good storytelling has drawn in new fans leading to Wrexham’s matches attracting larger TV audiences from the US than that of many MLS clubs and average attendances soaring to nearly 10,000 last season. The path taken by the pair has become something of a poster child for how sport can use entertainment programming to connect with both new and existing fans and there is now unprecedented interest in entertainment-based tie-ups (and not just around clubs - see for example the impressive viewership figures attained by YouTube influencers like the Sidemen in their sports programming).
What’s in it for the clubs and the fans?
A well-known public figure with no background in football or knowledge of how to run a football club coming in and taking over might set fans alight with concern. However, having a publicly conspicuous individual at the helm might prove to be the silver bullet fans of many clubs are searching for in the constant desire for sustainability and investment.
- Greater attractiveness for sponsors
One of the largest revenue streams for any club is undoubtedly sponsorship. The more appealing a club can make itself to sponsors, the more lucrative the deals are likely to be that it can strike. Having a famous face on board as the figurehead of the club could help with bringing in higher value brands. Celebrities are likely to have strong links with a variety of different companies they have gained from previous (or ongoing) personal sponsorship deals. Such connections could prove vital in bringing on board sponsors that a club otherwise may have found difficult to attract.
For more on how to strike the perfect sponsorship deal, please see our previous article here where we provide tips for sponsors and clubs alike when negotiating sponsorship agreements.
Due to the public profile of celebrity owners, fans and sponsors will hope that this will ensure clubs are run pragmatically and sustainably due to the optics which would be associated with that celebrity’s image from poor performance both on and off the field. This should make celebrity owners more accountable than other rich investors and consortiums who have amassed their wealth outside of the public eye.
- A greater competitive edge?
Cash is king. Therefore, surely having a mega-rich celebrity bankroll a club should ensure that club is able to financially compete with the very best. Perhaps, but due to the sheer amount of wealth required to compete at the higher echelons of world football, there may be a limit to how financially competitive a club can be with celebrity backing. Sure, clubs such as Wrexham and LAFC are great examples of where this model can pay dividends, but there are few individuals in the world who would have the required capital to compete with certain European clubs who can count on the wealth of nation state investment funds to finance their transfer kitty.
- Advocates for women’s sport
Angel City FC’s ownership model is shaping the future of women’s sport. Whilst emerging female football teams are entirely dependent on a model of top-down investment from a men’s club, Angel City FC is unique with a diverse group of young and savvy owners bringing their star power, reputation, and their own audience to the team. By doing so, the attention and awareness for women’s football is rising and in turn, investment is growing. Celebrity investors like those behind Angel City FC are advocating for women’s sports and challenging industry norms by giving their female players a cut of the money from ticket sales and offering training to help players find careers after football[iv].
As Wrexham re-joins League Two having been promoted as champions of the National League last season, their celebrity owners have brought unprecedent attention to the lower leagues of English football which will likely only grow as the team moves up the football ladder. However, a footnote should be added to Wrexham’s story in particular – given they are very much still in the honeymoon period. Football fans know all too well how quickly things can go south, and likewise, owners should be aware of how fans can soon become impatient when investment starts to dry up. Celebrities who are only in the game for a short-to-medium term gain should have an eye on an exit strategy so as to not encounter a messy divorce and leave a bad taste in the mouth of a club’s fanbase. A word of caution to those whom that applies – football clubs are not just for Christmas.
Nevertheless, there is a lot to be gained for fans, clubs and celebrities alike through the rich and famous investing their millions into the beautiful game. Good results on and off the field for these clubs will surely be turning the heads of other celebrities who are looking for their next big investment.