X
Skip to content
left arrowBack right arrow Soccer right arrow How a Retirement Plan Turned Into a Billion-Dollar Business

Soccer | Mar 21

How a Retirement Plan Turned Into a Billion-Dollar Business

David Beckham Pulled Off One of the Greatest Sports Business Deals in History

How a Retirement Plan Turned Into a Billion-Dollar Business
David Beckham, president and co-owner of Inter Miami, | Patrick T. Fallon / AFP

Becks Is Quite the Businessman

Ownership is always better than an endorsement deal…

The devil is in the details and a little-known clause in a contract has David Beckham’s net worth growing (an estimated $450 million). Beckham turned heads with his decision to bolt Europe for the MLS in 2007, and now it has really paid off.

Ready for uncensored sports banter? Join us on Telegram! 🤠

The league has undergone incredible growth in the last two decades, but Beckham took a chance which has paid off. Turns out Beckham had a clause in his contract with the LA Galaxy that gave the star the option of purchasing any non-New York City MLS expansion team.

Not only that but Beckham’s price would remain at a fixed cost of $25 million whenever the legend opted to purchase a team. Now, this is a lot of money for most of us, but consider that Inter Miami CF (the team Beckham later purchased) is now valued at more than $1 billion.

Seems like that math is mathing.

 

Inter Miami Is Projected to Be Worth More Than $1B

For context, sports guru Joe Pompliano noted that most MLS clubs are worth about $500 million, still a great bit higher than Beckham’s initial deal. How much has Leo Messi impacted the club’s bag?

Prior to Messi, Inter Miami was worth a respectable $600 million, like most of us. The addition of Messi has the club soaring past $1 billion.

Beckham reminds athletes and celebrities of a valuable lesson: ownership is always better than an endorsement deal. Rapper 50 cent made an estimated $100 million from insisting that his endorsement of Vitamin Water hinged on having a stake in the company.

That’s a lot more loot than 50 Cent would have earned from doing a commercial. By the way, Beckham signed a five-year, $250 million deal with the Galaxy.

Beckham’s gamble on the growth of soccer in the United States turned out to be profitable. Business mogul Tim Leiweke was one of the executives of the deal that brought Beckham to the States. The longtime sports exec believes Messi benefitted from the risk Beckham took in 2007.

“It’s different ownership today,” Leiweke told The Athletic’s Paul Tenorio for a July 10, 2023 feature. “Remember there are 30 teams now, the owners are much more entrepreneurial. There are a lot of very young, self-starting entrepreneurs that own franchises.

“Teams are going for $500 million. There is wind in the sails on Messi that was not there on Beckham. When Beckham came, we were struggling and figuring out how to make the league survive and prosper in the long-term. The league is doing phenomenally now and the value of assets is huge… There’s just a different economic upside.”

 

Messi Also Has the Option to Purchase an MLS Team

The Inter Miami standings show the squad is winning on the field as well. Through the team’s first matches, Inter Miami is tied for the most points in the league with 10. Beckham is hoping that the Messi Inter Miami marriage can lead to trophies just as it has led to added commas in his bank account.

Turns out, Messi landed an MLS deal that was ultimately made possible by what Beckham negotiated when he joined the league. Messi has profit-sharing agreements with MLS partners such as Apple and Adidas. Like Beckham, Messi also has a deal in place that allows him to purchase a team after his playing contract expires.

“All told, Messi’s contract is reportedly worth $150 million over two-and-a-half years,” Fast Company’s Paul Mueller detailed on February 17. “This includes something rarely seen in American sports: a future equity stake in the team. This option, exercisable after his contract expires, will allow Messi to collect ongoing dividends forever from his ownership stake, which is an asset that can be passed down through generations.”

Related Articles

Cristiano Ronaldo Loses It Over a Red Card Cristiano Ronaldo Loses It Over a Red Card
USWNT Previews USA’s Summer of Soccer With SheBelieves Cup USWNT Previews USA’s Summer of Soccer With SheBelieves Cup
Neymar Transfer Rumors: Is He Headed to Inter Miami? Neymar Transfer Rumors: Is He Headed to Inter Miami?

Comments (0)