to make money

You don't see Warren Buffet owning one, even though he can buy one easily.

@@cgasucks OK?

@@TiberianFiend He's agreeing with you lol

@@cgasucks If you aint rich, u poor - Warren Buffet

I don't know if you saw Professor Damodaran's lecture on this recently, but he goes over exactly this. Sports aren't an investment, they're trophy assets, as he called them; fancy toys for these billionaires to play with. That's it.

How much does the tax break the owner get? I doubt it would be greater than the net loss. Still, it doesn't make sense to me. And frankly I don't really believe the 'greatest fool' theory is applied here. Team performance, and by extension their valuation, is mostly depending to the players. And the players, like most human beings, are very unrealizable investments. On the other hands, Abramovic and other billionaires and even the private equities are no fool. There must be something missing here🤔

The ponzi schemer Allen Stanford bought a cricket club and seemed more interested in the players' wives and girlfriends than what was happening on the field.

International sports teams really need to look at the American professional leagues as an example of how to do it the right way. You go to a city and tell them that you would consider moving your team to their city if they would make it worth your while. You make the city to pay for absolutely everything from the sports arena to every little minor expense using tax dollars. But when it come to the revenue you get paid in full off of of anything and everything that makes any revenue what so ever before anyone else sees a single penny.

what this guy dosent understand is these billionaires arent purchasing sports franchises to turn a profit. Its a discretionary expense, its a luxury, its status and on the odd ocassion a purchase of passion 1st, business venture 2nd and a tax write off 3rd

Please please please do a video about local government and real estate developers/investors getting into deals with each other using your tax money to make these deals

People who intentionally vote taxes on themselves for hundred millionaires is total clownville.

@@tonycrabtree3416 For real. You reap what you sow.

I lived in Jacksonville and the corruption is historical and broad. But the St Johns River is incredibly wide, and it's sitting on the largest aquifer in the world. The flooding is never going to go away. Sports in general are for morons.

royalty is still the current day version of royalty

@@perfectallycromulentNowadays corporate lords have more power than remaining royals

That comes mainly from two things. One is the salaries for the players and the second is transfer fees (which is very predominant in soccer) Case in point. Lionel Messi. Wanted to go back to Barcelona but that club couldn't get the money together to pay his salary. Messi refused to go to Saudi Arabia (where they would have paid him somewhere between $300-500 million) and is now playing for Inter Miami in the MLS. His salary there? $50 million plus a cut from jersey sales and TV deal money, bringing his income to somewhere around $250 million. But lets just take the basic income of $50 million. A club has to bring in that money in the first place. And Messi isn't the only player. But over the past few decades, the Spanish and Italian clubs have outbid themselves regularly to get certain players. Amounts of 100-200 million Euros in transfer fees for a player became more and more the norm. Then these players earn a lot of money every year. So a club has to somehow recuperate that money through ticket sales, merchandise, tournament money and TV deals. The aforemenioned clubs accumulated massive debts. And now we see the Saudis spend billions on players. One exmaple: Neymar $100 million for Neymar in transfer fees that go to his former club. He got a two-year contract that nets him between 150-200 million per year(!). And he got some strange extra perks. Every time he does a social media post in which he advertises for Saudi Arabia, he gets €500,000. Winning a match: €80,000 bonus. And then the crazy extra stuff. He gets to use a private jet if he or his family needs to travel. Eight luxury cars. A driver to be there all the time. A 25-room villa with three saunas and a 400 m² pool. Five full-time employees (paid for by the club), one of whom is a sous-chef that helps Neymar's personal cook he brought from Brazil. I get the feeling, those last things were a kind of trolling on Neymar's part to see what the Saudi's would be willing to give and it got out of hand

Tax shields for assets that are meant to appreciate in value rather than generate profits

Yeah, nah. I’m pretty sure Jerry Jones and the Dallas Cowboys are printing money.

Tax em

yeah you’re spot on

@@FuxBoiGOAT they’d just move cities

I don’t think the benefits can offset the losses made

they rent the stadium for events (tax free) a stadium many are gifted and pay no profit tax on. that stadium is also normally sponsored. Covering it maintenance. The non profit also covers most of their licensed merchandise. Which is a huge point of profit. and that's just the non money laundering done. See tax code IRC 501c (1-7) googling (PRO Sports Act, which would close a loophole that gives special tax breaks to some pro sports)@@RavarsenBlogspot

They go to the city and say "yeah this stadium will bring in a ton of revenue to the city, ignore the fact that it makes every other metric for quality of life worse," and the city listens

he omitted some pretty important stuff though. like land how land and arena prices for many of the teams is what the bulk of the cost is for certain teams. like thats why golden state is evaluated so much higher than any team. it’s not because they’re just that much better it’s because they own their arena and the land around it right in san francisco which is a huge pricetag

If you base your knowledge of the worth of sports team off of this video then you’re either completely unintelligible or have no clue about the matter. This is one of the worse takes on sports owner ship I have ever seen. It’s not just about the value bought for, sold and spent in between. They’re much larger entities than that. I’d advise, the level of intellect the guy that makes these videos has is akin to a 19 year old college kid failing at an economics degree and having to take history instead.

Also, sports teams are artificially limited so as each league's revenue grows, the franchise value grows. It's also one of the areas where the ultra rich can flex. Having your team have success is something you can brag about at the next billionaire's party.

@@ThanhNguyen-pp2jn Correct. I find it strange that he's saying the billionaires flipping sports clubs are greater fools, yet not too long ago he was shilling that art investment fund that was sponsoring the channel.

@@Olm- Pretty sure the rise in Golden State's value can be tied directly to the team becoming a dynasty and Curry becoming one of the most popular players in the world. Their valuation shot up a lot even before they got their own arena. Besides, most teams don't own the land or stadium they play in.

I remember watching something similar awhile back with Benfica as an example. One issue brought up is that teams using those models get stuck in a groudhog day loop and stay mid table. The problem arises when the players start developing and want bigger salaries, the club gets put in a Catch 22 situation. Their main source of revenue is from selling players so as a result, they cannot afford the bigger salaries and have to sell them so they always remain a mid table team.

I also wonder this. Seems like a lot of work to complete daily.

I’m pretty it’s not one man team. Like there whole team and all, as voice has changed often throughout the year

Because these videos are basic to begin with. This video alone is laughable to say the least.

it's a bunch of stories and screenshots not a big deal really

@@Invin_cibles i didn't even notice till you mentioned it but yea you're right

hahaha dont see those much anymore. masterworks will be dust within 5 years. no doubt in my mind.

Arguably the best ownership is the local businessman who uses it for community pride, see Jack Walker at Blackburn Rovers, Sam Longson at Derby etc Community owned teams struggle financially to keep up

@@philthornton1382 Yep easy to pull a very small sample of success stories like Barcelona if you ignore all the struggling/borderline bankrupt clubs.

​@@philthornton1382Iran has a sports team owned by a tractor manufacturer. 'This team will harvest victory!' is what I imagine they could be saying.

Poor example given the financial black hole Barcelona have accrued.

@@arnoldvosloo220 isn't barcelona a bankrupt club?

The max contract only applies to like the top 20 players, u bid for the rest, and the salary cap moves up every year anyways

Well yeah I mean why else would the south fight so hard for those slaves

Bruh, before 1990, soccer and football were used interchangeably in English speaking countries. Then it suddenly became frowned upon to say soccer.

​@AZee112 Tbf, its just because people like hating other people. And everyone is confused on what the "Great Filter" is.

You do not have to be especially smart or talented to be rich. Most people who are, according to the Forbes richest people list, inherit their wealth. And Lol, yes, you would be a fool in most cases buying a Rolls or a Ferrari. Almost all cars lose value once you drive them off the lot. The only difference with the extremely wealthy is that they have rare editions/productions of expensive cars that actually retain value available to them. Mind you, those special editions are only available for purchase to people who have purchased other more common varieties of the Brand’s cars. Us normies do not, even if the car has a high price ticket or good name.

He talked about how it is not about making money for them. It is foolish from a monetary perspective.

@@killersberg1some people can only read or listen to any information at face value. They are clearly not fools but you, me, and most other logical people knew that already

@@michaellawilson3491 Not all non-rare edition cars will lose value, it also depends on the person who owned the car, for example if Messi or micheal Jordan or Lebron James bought a Toyota Camry back in 2008 for 25,000 and decided to sell it today and the public knew the car was owned by one of the people I mentioned, the car could fetch 100s of thousands and even millions at auction. For example Obama sold his 2004 Chrysler sedan for 2 million dollars

That's not entirely true. There are plenty of owners that are accused of being cheapskates. Heck, pretty much all of MLB is focused on profit.

Also money is one thing but that curve about Chelsea has to include championships. In the football world it seems championships come first. It’s not about being elite alone, it’s about winning.

A big part for the "smaller" clubs making money is 'growing/developing' talent. For example this summer alone Brighton and Hove Albion (small market team in the EPL) have made over 100m pounds profit on transfer fees. In fact for the last few years they have become known for their recruitment of relatively unknowns and developing them into (in wall street term) 5 and 10 xers. Jude Bellingham who started at Birmingham City for free was then transferred by Birmingham for 25m pounds to Borrusia Dortmund who then transferred him to Real Madrid for 103m Euro. Ajax is well known and regarded as having an excellent academy where it develops youngsters, they then sign these youngsters to their books, in the hopes these players get noticed by the big boys and thus command a hefty transfer fee. By far the most famous and most gifted home grown export Ajax had was Johan Cruyff who became one of the most gifted players of all time and was transferred to Barcelona for a then world record fee, but from an economic standpoint the golden generation of the 90's probably netted them the most cash. Ajax is well run club who know how to find/nurture talent and then know how to benefit both from performance and economically.

waterfall graph

Exactly. Owning a sports team is like buying an expensive car. Of course it is overpriced. Rich people do not buy these teams for business - they do this for ego, fun or marketing reasons. When you are rich, you cannot go around and yell "I am rich". Instead, you have to slap your name onto things in order to prove your wealth.

You're assuming there is ultimately profit in mind. Many of these rich guys are literally buying themselves a job on their favorite sports team, and that makes them happy. Like how that Israeli billionaire literally bought himself a job on the space station by funding the companies that needed the experiments done@@ForcefighterX2