Undoubtedly, Liverpool Football Club is one of the biggest in world football. The Reds are one of the biggest regarding revenue, success on the field and worldwide branding.
In 2022, only six clubs in the football world made more money than Liverpool did, as the Reds raked in $654m, according to Forbes. The biggest revenue earner, English champions Manchester City only earned just over a hundred million more in revenue.
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Source: Forbes The Business of Soccer
Surely they would spend big with that revenue?
With all that money, the expectation would be that the Reds would splash the cash on bringing in players. This would likely produce a stronger team. However, Liverpool’s owners, the Fenway Group, who took charge in 2010, have not allowed the club to splash big money on players.
This strategy has not always been met with appreciation by the club’s supporters, who feel that more money should be spent on key areas of the team. The current owners are shrewd operators, though, who bought the club when it was in a poor financial state.
Through good decision-making and brilliant financial dealing, the Fenway Group have put Liverpool back on a healthy financial footing, which will likely safeguard the club’s future.
Choosing the right head coach
This aspect sounds obvious, but some clubs get into big messes due to poor recruitment of directors of football, board members, head coaches and players. Apart from FSG owner John W Henry, one of the other most important people in Liverpool’s astute decision-making has been FSG president Mike Gordon, who is a man that pulls the strings behind the scenes at the Merseyside club.
Gordon has more reason than most to want the club to be a success, as he is the second-largest shareholder at Liverpool, holding 12 per cent of the club’s shares.
One of the FSG’s biggest strengths, not just in football but in their other sporting ventures (see Boston Red Sox), is that they have the right people to do the right job.
Now that seems simple, but Gordon has done this expertly on Merseyside, with the appointment of a certain German head coach in October 2015 being the prime example. Jurgen Norbert Klopp has guided the Reds to every possible trophy available in the club game.
Under the German’s guidance, Liverpool has become European champions, World champions and, of course, for the first time in three decades, English top-flight champions. Many head coaches have come into Liverpool and floundered badly.
Klopp is now regarded as one of the best head coaches in world football and arguably one of the best to ever manage in the English top flight.
Gordon was impressed by Klopp. The FSG is quoted as saying about the German: “He’s a polymathematical guy. I spent the first 30 years as an investor speaking to some of the best CEOs in the world, and Jurgen is right up there with them. If he wasn’t managing a football club, he could be managing a Fortune 500 company.”
This statement shows how shrewd Liverpool was to hire Klopp and how the team has experienced success. Gordon’s quote suggests that, unlike head coaches at other clubs, Klopp has had a big say in the club’s transfer dealings, despite others being in charge of recruitment.
Gordon is reported to have built up a close friendship with Klopp and speaks to him on a daily basis, despite the FSG president residing in Boston. That good relationship has helped Liverpool off the pitch, as Gordon has provided a buffer between Klopp and the other members of the FSG.
Choosing the right sporting director
Like choosing the right head coach, FSG certainly got their decision right when selecting a sporting director or director of technical performance in the case of Michael Edwards before he became the sporting director in 2016.
Edwards and Klopp had a strong relationship too, which led to the clubs avoiding the same sorts of transfer missteps made during the reign of some of the club’s previous regimes. Klopp had vast experience working alongside sporting directors during his managerial career in his homeland, so he was comfortable with the relationship dynamic.
Edwards, Klopp and Gordon shared patience regarding transfers and were all realistic when it came to doing deals. No doubt Klopp wanted better players, but he was intelligent enough to know when the time was right.
The perfect example was Liverpool’s failed bid to sign Virgil van Dijk from Southampton in the summer of 2017. After the two clubs couldn’t agree on a fee, the trio decided not to panic and sign a stop-gap alternative. Instead, they waited and snapped in the Dutchman in the January 2018 winter window. The centre-back became one of the most crucial players in the club’s recent history.
Van Dijk’s signing was facilitated by the mammoth sale of Phillippe Coutinho to Barcelona for a fee that could have risen to £142m. The sale of the Brazilian and the lack of a replacement raised concerns among many Liverpool fans. However, the patience shown by Edwards, Klopp and Gordon paid dividends with the signing of first van Dijk, then in the summer of 2018, Brazilian goalkeeper Alisson, who, like Van Dijk, has played a key part in Klopp’s success at Liverpool.
In the summer of 2022, Edwards left the Merseyside giants after choosing not to extend his contract. He had been with Liverpool in various guises for a decade. His replacement was Julian Ward, who was the previous assistant sporting director after joining the club in 2012 from Manchester City.
Ward is highly rated within the game, and the early signs are that he will make the transition from Edwards a smooth one. One early feather in Ward’s cap may be securing the signing of the Netherlands World Cup star Cody Gakpo from PSV Eindhoven for a fee of around £35m that could rise to £44m with add-ons.
The fee is not a massive one by elite European standards, especially not for such an in-form and in-demand player. This deal is typical of the ones that the Reds have done in recent years, not necessarily spending fortunes but improving the team’s options with potential world stars.
FSG could sell Liverpool
According to recent media reports, FSG is looking to sell some of their shares in Liverpool or could even consider selling the club for the right price. For some Liverpool fans, this may be regarded as good news and that new owners.
However, this could be a case of being careful what you wish for when it comes to new owners. They only have to look across Stanley Park at neighbours Everton for an example of how badly things can go wrong when people not suitable for a football club have ultimate power over its destiny.
All you can ask of an owner is for their guardship to improve the club at every level. In the case of FSG, they have done that and more. Not only are the club in a tremendous position off the pitch, but the Reds squad is also full of quality players, many with significant sell-on values.
The way FSG has done business at Liverpool has been an example of how to do things right on and off the pitch. There is no guarantee that any new potential owners will do the same. All-in-all, FSG have been good for Liverpool Football Club, and some supporters may well realise that their period as the club’s custodians has been highly successful.