Why Real Madrid Needs A New Strategy 🧠
Plus: Ronaldo beats Messi, New Balance sues Roma, and is Cadillac going to join F1?
Welcome to Athletic Interest.
When football clubs need money, no idea is off the table.
Newcastle once tried to raise funds by selling a club-branded superhero costume, then there is Barcelona who tried selling the family silver just to pay their wage bill.
Not even global giants Real Madrid are immune. Florentino Perez once considered moving the club away from the Santiago Bernabeu and into a Real Madrid theme park, complete with a Zinedine Zidane Rollercoaster.
Perez is not shy about getting creative when it comes to securing Real Madrid’s finances.
In the early 2000s, he transformed Real Madrid from a hollow shell flirting with bankruptcy into the most valuable sports club in the world.
How did he do this? In this week’s video, we break down how Perez used a clause buried deep in the contracts of the Galacticos like Beckham and Figo to open up millions in extra revenues - and why the recent actions of Mbappé, Ronaldo and Haaland could spell the end for this strategy.
Florentino Perez isn’t the only one with a side hustle. Creating an online business has become very popular among the world’s top athletes.
We have even done an entire series of videos that explain how several of the biggest names in sports have expanded their income and influence by pivoting into the world of business.
This phenomenon would not have been possible a few years ago when most of the tools needed to build an online business were reserved for large corporations.
Many athletes have turned to Shopify’s easy-to-use all-in-one commerce platform to help grow their businesses. For millions of entrepreneurs in 175 countries, Shopify is reducing the barriers to business ownership to make commerce better for everyone.
So if you have a business, and want to scale and sell online on all major social platforms: check out Shopify.
🍎 Sports Business Bites
📸 One man who has already maximised his revenues is Cristiano Ronaldo.
With his recent move to Saudi side Al-Nassr, Ronaldo will earn about €200M per year. But even if he feels like buying an extra Buggati one month he can always fall back on his Instagram for some extra revenue.
According to a list published by Hooper, Ronaldo now earns a staggering $2.4M per post. Messi is the second athlete on the list at $1.7M per post.
This was calculated before Ronaldo and Messi received their huge follower bumps during the World Cup. Ronaldo is now on 532M with Messi on 417M.
The rest of the top athletes are as follows:
Virat Kohli - $1M
Neymar - $0.9M
Lebron James - $0.7M
David Beckham - $0.4M
Ronaldinho - $0.3M
Zlatan Ibrahimovic - $0.3M
Mohamed Salah - $0.3M
Gareth Bale - $0.25M
🏎 Cadillac could be entering F1, and not everyone is happy!
The iconic American car brand has just announced a partnership with the Andretti racing team (owned by former F1 driver Michael Andretti) that will look to have a car on the F1 grid by around 2026.
This comes after FIA chief Mohammed Ben Sulayem called for new teams to make bids to enter F1.
The only problem that awaits Andretti Cadillac, and any other potential entrants, is the other F1 teams.
The announcement of Andretti Cadillac’s bid was met with a muted response from the likes of Mercedes and Ferrari, and there appears to be one main reason.
“It’s all about money,” explained Andretti owner Michael Andretti to Forbes. “First, they think they are going to get diluted one-tenth of their prize money, but they also get very greedy thinking we will take all the American sponsors as well.”
While some would argue that the inclusion of an American team and manufacturer in a sport that is exploding in popularity in the U.S. is a sensible idea, it’s not clear if the teams will see it that way right now.
🤬 Talking of difficult relationships…
When New Balance announced a kit sponsorship deal with Roma in 2021, it seemed like happy families.
Fast forward just two years, and New Balance has initiated legal proceedings against Roma for breach of contract.
So, what went wrong?
The deal between New Balance and Roma was set to expire at the end of this season, this allowed Adidas to jump in and agree to a deal to become the kit sponsor going forward (or so it seemed).
It’s interesting to note that the head of marketing for Roma, who joined before the club started negotiations for a new kit deal, worked at Adidas for almost 16 years…
The only problem is that New Balance insists it has a clause in its contract with Roma that gives it the right to match any competitor’s offer. If the offer is matched, Roma must stick with New Balance.
While the exact figures are not public, New Balance is adamant that it matched the Adidas offer exactly.
Roma’s counterclaim is that New Balance DID NOT match the offer presented by Adidas.
Ironically, this is not the first time that New Balance has sued one of its teams.
In 2019, it took legal action against Liverpool after they agreed to a deal with Nike and ignored an offer from New Balance.
If you want to know the details, we broke down the story in the first video we ever made.
Been a big fan of your work on YT! Enjoying these posts as well, despite the popularity and size of sports, some times feel there's not enough off the pitch sports biz news despite it being super interesting. Plenty of news on the pitch of course :)