What's a Club Worth

The DMN continued its' series on youth sport today with the following financial information regarding local clubs:

Dallas Texans: Revenue $5.3 million ($4 million in dues). Income $269,409. Net assets $804,695.

Andromeda: Revenue $1.2 million ($1.1 million in dues). Income $111,173. Net assets $135,460

Solar: Revenue $1.3 million ($1.2 million in dues). Income $7,798. Net assets $-107,298.  

Remember the Dark Lord and colleagues are getting paid BEFORE that income.


Solar could be purchasing something...equipment, fields, etc. that would make them have negative assets at the moment.

Could you link the article for those of us that don't subscribe to the DMN? Thanks!

With the dues the Texans are charging, no wonder ... . Where is the other $1.3M coming from, selling merchandise, camps, tournaments?

Andromeda seems to be solid, especially compared to Solar. Is Solar the next one going down (pretty much break-even income, negative assets)? Depending on what they may be buying, it should show up in the net assets as well. Looks like debt to me (first sight, not knowing details).

On the surface, it seems the Texans are almost 4x their closest competition in terms of revenue.

However, this is only a snap shot at a particular point in time. Would be interesting to see these numbers over a 5 year period. My gut tells me these numbers are not at their peak.

The gorilla in the room is FC Dallas and every year the beast gets bigger and bigger. The heyday of the independent clubs is behind us...

finish1 wrote:On the surface, it seems the Texans are almost 4x their closest competition in terms of revenue.

However, this is only a snap shot at a particular point in time. Would be interesting to see these numbers over a 5 year period. My gut tells me these numbers are not at their peak.

The gorilla in the room is FC Dallas and every year the beast gets bigger and bigger. The heyday of the independent clubs is behind us...

The other gorilla is Liverpool. I suspect the DMN reporter focused on these 3 clubs because they are legally structured as non-profits and thus their annual statements are available for public consumption. FCD and Liverpool... not so much. I suspect both of those clubs would have annual revenue closer to Texans than Andro and Solar.

Here is a bit more historical data for Dallas Texans. Revenue and Net Assets seem to be growing nicely over the past couple years. As someone mentioned, the Profit/(Loss) is meaningless for this club because of their legal structure. They pay a 3rd party company for 'coaching and administrative services' and said company is "more than 35% owned by Hassan" so it's impossible to tell how much he is paid for his DOC role.

Year Revenue Profit/(Loss) Net Assets
2012 5,334,229 269,409 804,695
2011 5,237,602 75,958 535,286
2010 4,739,981 86,961 459,328
2009 4,252,235 (17,332) 375,367
2008 4,809,792 407,804 392,699
2007 4,433,268 N/A N/A
2006 4,419,035 N/A N/A
2005 3,839,227 N/A N/A

Thanks for the numbers, Debit. The Texans are arguably the largest of the Independent clubs. We can also throw Liverpool into the Independent category because that is exactly what they are. FC Dallas is in a category of their own because they are the only pro club in this market. Everyone else is an independent.


Looking at the Texans' revenue, I would say they are relatively flat over the past few years.

Agree that 2012 was pretty flat, but 2011 and 2010 were a nice bounceback from the economic dip in 2009.

I don't think this market will grow significantly in the future which is why you see growth strategies primarily focused on merger/acquisition, geographic expansion, new product offerings (tournaments, camps, spiritwear, etc). Texans, FCD, Sting, Liverpool have made huge pushes into South Texas, East Texas, West Texas, Louisiana and some even reach further (North Carolina, Florida, Canada, etc.) Will one of these ever get big enough to rival the Rush model? What will be the next innovative product offering? Will anyone get in trouble legally with legal/business/tax structures or are they just effectively using loopholes?

finish1 wrote:Thanks for the numbers, Debit. The Texans are arguably the largest of the Independent clubs. We can also throw Liverpool into the Independent category because that is exactly what they are. FC Dallas is in a category of their own because they are the only pro club in this market. Everyone else is an independent.


Looking at the Texans' revenue, I would say they are relatively flat over the past few years.

yes! if $500,000 is something to sneeze at, Flat, is correct lol

Interesting regarding the expansion model, Debit. In terms of Rush, I was very surprised at their early exit in NTX. I somewhat expected them to buy up one of our larger independent clubs to reach economies of scale in this market. Maybe their business model is based on franchisee vs company owned.

Um, regarding the $500,000. Some folks have trouble interpreting large numbers. Better to keep things in single digits...

finish1 wrote:Interesting regarding the expansion model, Debit. In terms of Rush, I was very surprised at their early exit in NTX. I somewhat expected them to buy up one of our larger independent clubs to reach economies of scale in this market. Maybe their business model is based on franchisee vs company owned.

Um, regarding the $500,000. Some folks have trouble interpreting large numbers. Better to keep things in single digits...

Rush is still around in NTX, small but around. As many new clubs they started with a lot of hope but faced reality soon when the money wasn't coming. I think it is a franchise model. You can buy a license for 10k or so and than you pay a small amount for every player to corporate.

caatffm wrote:With the dues the Texans are charging, no wonder ... . Where is the other $1.3M coming from, selling merchandise, camps, tournaments?

I wonder how much of that $1.3 come from the corporate sponsorships with Windows Phone, Nike, Gatorade, etc.

I would have thought the Texans assets would be higher with the multiple training facilities.

I doubt they make much on the tournaments. I have been a part of hosting tournaments in the past and traditionally they were not the windfall you would expect after you pay NTSSA, Gotsoccer, fields, refs, trophies/medals, supplies etc.

According to the filing the additional revenue is:

$714K - Academy and Camp income
$414K - Tournament income
$159K - Gross income from fundraising events
$36K - Other contributions, gifts, grants

My understanding is they don't own the training facilities--long term lease--I believe Ross Stewart is owned by the City of Farmers Branch.

Regarding tournaments, remember the $414K figure quoted above is gross income--not net. The fall festival has 250+ teams paying $600 each generating $150K in revenue. Add in other tournaments, tournament sponsors, etc.

Regarding the profitability of tournaments, according to their filing the tournament expenses were $248K so they made $166K profit on revenue of $414K for a 40% profit margin on their tournaments. That might explain why there are so many tournaments to choose from each weekend.

Well, if you remember they cancelled last year's event due to ice for teh most part. They did not have the normal ref expenses, medical staff expenses etc that they normally would. They returned back very little of the registration fees. Last year may be a bit misleading from a profit standpoint.

To clarify, the data I'm referencing is from their public tax filing for the 2012 tax year, and based on that, I'm assuming it was the 2012 fall festival tournament not the 2013 ice bowl. I also looked it up on GotSoccer this morning and that tournament actually had 370 teams in 2012 which is HUGE and probably achieved a scale that provided higher margins than many smaller tournaments.

Kudos to Dallas Texans for running a successful tournament. In my opinion, there is money to be made or the market wouldn't be so oversaturated with tournaments. The challenge is one of product differentiation. What make your tournament special and can draw the numbers to be financially viable year after year. History certainly plays a huge part like in the case of Plano Labor Day. Prestige can play a part like Dallas Cup, Surf Cup, Disney, etc. GotSoccer ranking, Auto-quali for other tournaments, vacation destinations, time of year, etc. are important as well. Tournaments can be a valuable addition to a club's revenue stream that potentially could fund scholarships, DA, etc. but maybe now I'm just being naive.

Let's turn the spotlight away from Dallas Texans and look at a smaller organization that runs a tournament or two--Texas Lightning. According to their most recent filing which would have included the 2012 Puma Cup (I think it was still somewhat relevant that year though King Tut was certainly becoming the King), they took in $163K in gross revenues for tournaments against $104K of expenses for a profit of $59K a 36% margin. Still not too shabby and definitely worth running a couple of weekend events IMO. Their total revenue for the year was $636K and they received $163K of that from tournaments. Over 25% of their revenue is from tournaments.

Is that helping keep dues down? Again, I don't want to be naive, and I'm certainly no economist, but I'll keep dreaming that this is helping ensure my dues don't creep over $3,000 before my kids are done with select soccer.

While Texans had the Ice Bowl last year, Lightning had the Sprinkle Bowl. So, 2013 numbers will be off for them. Still, would like to know what they made off the Puma Cup in 2013.

snjn1ab wrote:While Texans had the Ice Bowl last year, Lightning had the Sprinkle Bowl.  So, 2013 numbers will be off for them.  Still, would like to know what they made off the Puma Cup in 2013.

Yes that whole Puma Cup situation was pretty lame.     Thats just my 2 cents though...

Curious as to if anyone has ever tried to rank the 5 largest NTX clubs by the % of time they produce top 5 teams in each age group over say the last 3 - 5 years. A daunting task, but the results might be interesting. One would expect a high percentage considering the talent pool they likely have to pull from. More impressive to me would be independents that are consistently in the top 10 or even 20, as they have far less resources to work with. Is anyone feeling ambitious? Big $ should = top performance, right? (yes, I'm aware the team turn-over might make this difficult...but that also would be an interesting statistic.)

Not sure the results would still be available for 4 to 5 years ago. Would be interesting though.

So are we talking top 5 teams in D1 Classic at the end of a soccer year? Or top 5 teams in GotSoccer? How should we handle the PA/DA situation? Ignore it?

debit wrote:So are we talking top 5 teams in D1 Classic at the end of a soccer year?  Or top 5 teams in GotSoccer?  How should we handle the PA/DA situation?  Ignore it?

Ignore it because that will show you the impact of DA/PA better. Also the merger of top teams to super teams will be difficult to measure.

I was thinking CL only, both girls and boys. Yes, if we can go back at least a few years before DA/PA, then maybe we can see what impact that has had. Here is ling for boys CL from last year. Not sure how to get prior years or for girls. Assumption is that each of the 5 big clubs (DT, Solar, Andro, FCD, and LP) should have at least one team in each age group within CL (Top 30). There are 8 possible age groups for boys. So as an example for 2013/2014, Dallas Texas were top 5 in 6 of the possible 8 age groups (75%). The age groups they failed to produce top 5 teams were U16 & U19. In these age groups I think there were teams from Solar and FCD in top 5, so not sure of the PA/DA impact. This data of course would be most easily viewed in spreadsheet format..which I don't have enough energy to produce..but I am sure someone out there does.
http://events.gotsport.com/events/default.aspx?EventID=33026

I don't believe it matters which club has the most teams in CL. What matters is what type of return are parents receiving on their extremely large investment. IE, scholarship money vs money paid to the club. My bet is the parents are at a very large disadvantage.

Not the most in CL...just the most consistently in the top 5 of every single age group (U11 - U19). The thinking is that a top 5 team in classic represents the club turning out a good product that is more apt to get the attention from college recruiters, scouts etc. A top 5 team likely plays in the biggest tournaments where the type of exposure exists that may result in the ROI that parents are looking for. BTW....LP was 50% for 2013/2014 boys, and FCD is 75%, just like DT. Need prior years though to make this more meaningful.

I would consider not only club performance in CL, but club teams that make it to RPL and NL, regional and national championships, etc.