One billion from the investor – what the DFL plans to do with the money

An investor is to invest one billion euros in the DFL in order to improve the marketing of the Bundesliga. The sports show has the plan for investments.

The 36 clubs in the Bundesliga and the 2nd Bundesliga agreed on Monday (December 11, 2023) to investor entry into the DFL with the necessary two-thirds majority. The managing directors Marc Lenz and Steffen Merkel can now enter into negotiations with potential donors and submit a final offer to the executive committee.

But what exactly should happen with the money when the deal comes to a close? The Sportschau has an internal investment plan from the DFL on how the money should be used.

Sponsor name for the league, foreign activities, digital platform

Of the billion that the DFL is hoping for from the investor from the private equity industry, 600 million euros are planned for the core projects of digitalization and internationalization. The most important items:

164 million euros are planned for its own digital platform: Video content is to be presented here and sometimes sold directly to fans via subscriptions. The clubs should also participate and provide content. Such a platform can also be useful if, in the opinion of the DFL, a broadcaster or streaming service at home or abroad offers too little or is not available at all. Then the DFL can contact the fans directly and sell subscriptions – as is the case, for example NBA does in basketball. An international fan shop will be part of the platform.

183 million euros are earmarked for driving marketing abroad: This is, for example, about supporting clubs in planning and carrying out trips abroad. The Premier League In the summer, for example, organized the “Premier League Summer Series” in the USA. The German clubs’ foreign activities should also be organized in a more coordinated manner so that they can retain fans abroad in the long term. In addition, videos should be created specifically for certain markets abroad. The DFL also wants to open more offices, so far there are some in New York and Singapore. In addition, more should be invested in lobbying abroad – through more direct contacts with broadcasting channels and services.

126 million euros are to be spent on measures for the German market: This is about the fight against illegal streaming of Bundesliga games, but also about further developing the broadcasts. There are many measures in place: videos from the locker room and from the team bus, short interviews immediately before kick-off and more access for broadcasters to the teams during the week for more content outside of the games. Spain’s league, which has already completed a similar investor deal, is now giving the audience a look into the dressing rooms of many teams. For example, it was recently seen on television how the Athletic Bilbao team prayed the “Our Father” in the dressing room. This is not without conflict. “I don’t like it, I don’t feel comfortable”said goalkeeper Unai Simon. “This is our sacred moment.”

One is specifically mentioned in the DFL paper “League-Wide Documentation”. Formula 1 succeeded via the Netflix documentary “Drive to survive“, to get a lot of attention. Other sports such as golf, tennis, cycling and athletics followed the trend, and the DFL will probably do the same now.

65 million euros are estimated for advertising partners: Most of it is for “virtual advertising” planned so that, for example, perimeter advertising can be digitally changed and adapted – depending on which country a game is being broadcast in. Not as a cost item, but as part of the plan it is literally spoken of: “Bundesliga naming rights: implementation of partnership” – which means that the Bundesliga could soon have a sponsor in its name.

Eight million euros will go towards expanding the “Virtual Bundesliga”: This could strengthen the league’s e-sports track.

54 million euros remain as “strategic reserves”.

DFL – the bet on the future begins

Of the remaining 400 million euros, 100 million euros are intended to directly support the clubs with money for their trips abroad. This allows the clubs to cover travel costs, for example to travel to the USA or Asia to promote the Bundesliga.

The additional 300 million euros are planned to plug the hole left by the deal for at least four years. In return for the billion, the clubs now have to give up around eight percent of their income in the long term – in return for the billion, this goes to the investor for 20 years. The DFL is expected to put the media rights for the four seasons 2025/26 to 2028/29 out to tender in the second quarter of 2024 and wants to have concluded a deal with an investor beforehand.

Critics and fans fear “red lines”

Then the bet on the future begins: With the permanent deduction of eight percent of revenue, the DFL is dependent on an increase in revenue overall in order to offset this obligation to the investor.

And the concern of many critics remains: will the “red lines” promised by the two DFL managing directors Lenz and Merkel hold? The investor should therefore have no influence on the design of the game plan; he cannot move games abroad or introduce playoffs in the Bundesliga against the wishes of the clubs. All of this remains in the hands of the clubs and the DFL, says the management. However, 1. FC Cologne and many active fan scenes criticize that private equity companies, with their high return expectations, could at least have indirect influence.

Negotiations with investors are already underway

The DFL management is already negotiating with several bidders; according to information from the Sportschau, three offers are considered promising. Another is below the DFL’s expectations.

A supporter among the club representatives asked the Sportschau that the critics should not follow suit if possible. “Because now every negative statement costs money.”he said, referring to the negotiations.

Investor yes or no? Debate once again divided the clubs

There was broad consensus among the 36 clubs in the Bundesliga and 2nd Bundesliga that the digitalization and internationalization measures make sense. However, there were discussions about whether the desired measures should be implemented with the addition of an investor. While a large proportion of the clubs, such as the DFL leadership, consider the deal to be economically sensible, there was also opposition. 1. FC Köln and SC Freiburg demanded that the clubs raise the money themselves without having to make payments to a third party for 20 years.

VfL Osnabrück criticized that the strengthening of foreign marketing primarily benefits the large clubs, which receive an even greater share of the income from abroad than the income from marketing in Germany. This time too, the debate turned into threatening scenarios when Bayer Leverkusen’s managing director openly threatened a break between the Bundesliga and the 2nd Bundesliga. In May, as today, much of the opposition came from the House of Commons.