Welcome to the private equity era of lower-league soccer.
Over the last eight months, the USL has sold stakes in the league to both BellTower Partners and Weatherford Capital. Now, MLS Next Pro is going further and, in doing so, reshaping the future of the American pyramid.
Last week, MLS Next Pro and KKR – the world’s largest private equity firm in terms of assets under management – announced a joint venture that would allow MLS-affiliated clubs to outsource their business operations. Under the nearly $200 million deal, the new “Hometown Soccer Holdings” (as the joint venture is named) would oversee stadium operations, marketing, ticketing, and other such activities for any organization that opts in. MLS-owned teams would still retain complete control over coaching staffs, player contracts, and other sporting decisions.
As part of the announcement, the parties expressed their desire to move affiliates out of their MLS parent’s home market into nearby cities with more financial upside. There’s precedent for that model. When Nashville SC founded their MLS Next Pro side, they opted to locate it in Huntsville, Alabama – a city of 230,000 people. Additionally, North Texas SC, FC Dallas’ affiliate, is in the process of moving out of Arlington and into further-flung Mansfield.
