It’s clear there’s a growing disconnect between football club owners and fans

The passion exhibited on the terraces does not extend to the boardroom, writes Chris Blackhurst

Billionaire Todd Boehly partnered US private equity firm Clearlake Capital to buy Chelsea for £4.25bn in May (AFP/Getty)

At Chelsea’s football ground they are closing the luxury gym. It’s part of the Stamford Bridge stadium complex and was used by players, management and, for a membership fee, by some outsiders.

Until he sold the club, Roman Abramovich is said to have liked to work out there. Its shutting is hardly a big deal, but does tell you something about the difference in approach between the Russian oligarch and Chelsea’s new owners. Abramovich treated Chelsea as an indulgence, not as a money-making enterprise.

That’s not how the new guard, led by US tycoon Todd Boehly, regard Chelsea. As the new Premier League season begins, it’s instructive to explore the mindset of Boehly and his ilk. Yet again, as the matches and months unfold, we will be treated to the usual angst and wailing from supporters up and down the land that their proprietor is hopeless, that not enough cash is being spent on the team, and that the passion exhibited on the terraces does not extend to the boardroom.

Inevitably, given the way the Premier League has changed, the target of the fans’ opprobrium will be the super-rich folks that have come in and taken over, what is still referred to as “the people’s game”. At Manchester United, a day does not go by without barbs being hurled at American owners the Glazers. At Arsenal and other clubs, too, there is similar, simmering discontent that can spill over to outright abuse and protest.

It's clear there is a growing disconnect, between the ordinary followers on one side and the new breed of owners on the other. What governs the thinking of the latter is not to be found in interviews on the sports pages or on the clubs’ TV channels and social media. If you want to know what determines their strategy you must enter their quite different world.

Each year, the biggest private equity get-together is the “SuperReturn International” conference. The 2022 gathering was in Berlin two months ago. Among the speakers was Boehly. Sebastian McCarthy, who reports for Private Equity News (not a title on many soccer must-read lists but, clearly, the way football ownership is developing, it perhaps should be) was in attendance.

Billionaire Boehly partnered US private equity firm Clearlake Capital to buy Chelsea for £4.25bn in May, after Abramovich was hit by sanctions following Russia’s invasion of Ukraine.

Clearlake joins the likes of CVC, Oaktree Capital and RedBird Capital Partners as private equity houses moving into football. Lest there be any doubt, they are not doing so out of a sense of philanthropy – they are very much investors seeking a handsome, make that super, return.

Former college wrestling star Boehly, who is 48, has amassed a $4.5bn fortune via his Connecticut-based investment group, Eldridge Industries. His specialities are media, entertainment and sports. Chelsea, which finished third in the Premier League last season, earning qualification for the lucrative European Champions League, now sits comfortably in his line-up.

One area ripe for the Boehly treatment is ‘loyalty points’, persuading supporters to spend more money in return for prizes and points which provides them with access to tickets

He’s done the math. European football is watched by an audience of four billion, compared with the 170 million who follow the NFL in the US. But the NFL produces $15bn in revenue from the networks, versus a “fraction” of that generated by football. “We think the Premier League itself is way undervalued. We think the approach with which those clubs go to market is years behind the US model.”

Take baseball’s LA Dodgers, which Boehly bought with a consortium a decade ago. He struck a deal with Time Warner to create a new regional network to broadcast all Dodgers games. “Everyone said we were nuts [for buying the LA Dodgers]. We paid $2.15bn, the largest price paid for a team, and the next year we sold the media rights for $9bn.”

Using phraseology that is normal for private equity but anathema to many football fans, Boehly describes Chelsea as a “portfolio” and says his analysts compile “investment memos” on every player.

Those players now include England international Raheem Sterling who joined from Manchester City for £47.5m this summer, and Napoli centre-back Kalidou Koulibaly, for £33m.

They were bought, not based on an old-fashioned hunch or a feeling, but according to hard data. Analytics were key to the LA Dodgers winning the 2020 World Series. “When we bought [US baseball player] Freddie Freeman this year, we thought we’d moved our probability of winning the World Series from 17 per cent to 19 per cent. We are constantly looking at how to continue to modify and adjust our probabilities to win.”

As well as the US major leagues, Boehly cited Formula One as a model to follow. “They’ve got the under-35-year-old demographic fully engaged, and they’ve got women fully engaged.”

One area ripe for the Boehly treatment is “loyalty points”, persuading supporters to spend more money in return for prizes and points which provides them with access to tickets. “We basically have 140,000 tickets a year we can sell to fans that aren’t season ticket holders. In order to get those seats, you become a member. If members engage in activities that make you more of a superfan, you get more points, and if you have more points, your odds of getting a ticket to Chelsea versus Liverpool go up. We’re just scratching the surface on that.”

Gambling also features large in his thinking. Eldridge holds a stake in DraftKings, the sports betting platform. “We are in the early days of sports betting,” Boehly informed SuperReturn.

Clearly, there was no room for the gym in his plans. Other parts of the Chelsea firmament can expect similar treatment. What was essentially a simple game, of 22 men chasing a ball for 90 minutes, has become something altogether far more complicated, and profitable.

Chris Blackhurst is author of The World’s Biggest Cash Machine: How the Glazers Made Billions from Manchester United, to be published by Macmillan.