Unofficial Partner Podcast
Unofficial Partner Podcast
UP500 What Just Happened: McLaren's valuation; New Newcastle CEO; Ryder Cup future
Richard is joined by David Cushnan and James Emmett of Leaders.
Three stories from this week in the sports business.
What happened, why do we care and where's it going?
What does McLaren F1's valuation say about F1?
Who is David 'Dave' Hopkinson and what's the job of Premier League CEO today?
What's the role of the Ryder Cup in the LIV era?
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Hello, it's Richard Gillis here from Unofficial Partner. Welcome. And we've got a show we're calling it What Just Happened and it's about the news. And we've got two people from leaders and let's introduce them. David, you, you go first.
David Cushnan:Hello. I am David Cushman from Leaders. Uh, I'm the content director over there and Leaders Week. London is coming soon.
James Emmett:Uh, and, hello, uh, my name's James Emmett, also from Leaders. I'm the editorial director there, and, uh, I'm also concerned with how close we are to Leaders week. It's four weeks away. Hello, Richard. Nice to be back with you.
Richard Gillis, UP:And you where should we start? And I'm calling this what just happened? To give it a sort of exciting news related, aspect to give it a oh, oh, what's just happened in a slightly camp voice.
James Emmett:Oh, did something just me. What
Richard Gillis, UP:Oh, what just happened? Um, we've got three things that just happened and, uh, we're gonna go around, we've got a McLaren story I find your formula one stuff, David. Very good. I must say, I'm gonna start with that. I think your analysis of the, uh, business of Formula One, obviously from the days of the F1 business and I remember F1 Business magazine
David Cushnan:Yeah. Yeah.
Richard Gillis, UP:yeah. So we've got McLaren and we've got Newcastle and we've got Ryder Cup. Those are the three subjects. Where should we start? I think McLaren, let's start with McLaren.
David Cushnan:Okay. So
Richard Gillis, UP:the setup is you, you give us a story and.
David Cushnan:oh yeah, what is this?
Richard Gillis, UP:The, the setup is,
James Emmett:has happened?
Richard Gillis, UP:oh da, so David Kushman, what just happened? This is not gonna work. But anyway, we'll work with it. I like it as a, as a thing. I like creating new things. It irritates the audience.
David Cushnan:So what just happened is, uh, McLaren, uh, has this week been valued at around 3.5 billion pounds, um, which is a sixfold increase on, um, its value in 2020. Just five years ago, what happened this week, MSP Capital who bought a 30, we think a 33% stake in McLaren in 2020 was bought out by McLaren's majority shareholder, um, ALCAT and an Abu Dhabi based minority shareholder. So in 2020, MSP bought that stake for 185 million pounds, and that was to help shore up the team during COVID. At that point, the team was valued at five 60 million pounds. So a big. Increase a big leap in value. I think it's a pretty remarkable sports investment success story that hasn't really been fully talked about or probably appreciated actually. Obviously in sporting terms, McLaren has also gone virtually from the back of the grid to now dominating the world championship, and one of their drivers will be world championed this year. So there's, there's a, there's a couple of things there. One, some great leadership, Zach Brown as the CEO, Andrea, Stella as the team principal, Paul Walsh. Also a critical figure X, uh, Diageo, uh, as the chairman. Uh, there's I think a case study here for F1 and F1 teams in terms of minority investments and what that can be and do. And you have several of those, whether that's atos with Aston Martin. Uh, the Qataris have invested in Salba, which will become Audi next season. I think Redbird and TRO capital have a stake in Alpine, along with Ryan Reynolds Iios as well, owns a third of, uh, the Mercedes team. For the sports industry more widely. Also, I think an example of the art of the elegant and clearly very profitable exit, which I think is gonna continue to be a talking point as we see some of these investments mature.
Richard Gillis, UP:Right. Brilliant summary. James, what'd you think?
James Emmett:I think that it is a real big old pat on the back with Watts of cash for, um, for Zach Brown, who has done a terrific job leading, um, that team for the last five or six years, um, from the doldrums back to the top. Um, and I think it's also, well, when any team sort of changes hands in Formula One, it's partly about the team and partly a vote of confidence in Formula One itself, isn't it? Um, there, there is no value in any of these teams unless Formula One is giving them a platform to reach people and to perform. Uh, and clearly there's a lot of momentum behind Formula One at the moment, and this is a sign of that. I do, I do have a, a question, um, for David. This valuation, is that simply the Formula One racing team, or are there other bits of the business that they are, um, ascribing value to?
David Cushnan:Yeah, so they have done a bit of corporate shuffling, um, over the last few years and they've effectively split out McLaren racing, which is what this transaction is all about. And that is the F1 team primarily, but also McLaren now have quite a thriving indie car team. Uh, they had a formula ete, they've now stopped that program. They're going into the World Endurance Championship to try and win Lamont in 2027. So it's the racing bit here, the automotive side, the road car side has now been carved off into a separate, uh, separate entity. So this is the racing, the racing bit.
Richard Gillis, UP:MSP, let's just talk about them for a second. So that was, was that COVID when they came in, or was it,
David Cushnan:Yes. Yeah, it was during COVID 2020. Yeah,
Richard Gillis, UP:so they bought 15% at 185 million and they've then exited at, what number do we know that?
David Cushnan:we don't know. We, we know the overall valuation of the team is 3.5 billion pounds now, so
James Emmett:Who can do that maths?
David Cushnan:you could probably work it
James Emmett:15% of 3.5 billion?
Richard Gillis, UP:Oh God. This is like countdown.
David Cushnan:it's, but it's a big, you know, it's big. The BBC sport website, Andrew Benson, who's really good on this stuff, is calling it a sixfold, uh, a sixfold increase in the overall valuation so you can, you know, I think it's, you know, whatever the final number, it seems like it's a, it's been a pretty good deal for MSP.
Richard Gillis, UP:So as ever all these things, it's really interesting to, you've got the various bits of what constitutes value in a sports team and you've identified there a couple of things and James, you've got Formula one, I think you've got the American story, you've got that going on, which has sort of excited, the investment community. Very interesting point you made there about minority partnerships, David.'cause I think in the ether we are seeing over the last, you know, one of the things we could have talked about was Apollo coming out with a new sports fund and you know, of which there are now a growing number and presumably, and one of the rationales for that is the liquidity within the minority partnership market across. N-F-L-N-B-A, but also now into Formula One. And you are looking at other places. So our focus a lot of the time is on, you know, football clubs, but actually there are better and more interesting financial investments, particularly, you know, at minority state levels. So I, you can sort of see that marketplace developing quite at a pace, and that's why that's taken the attention of, of people like Apollo. And it's a tiny fraction of what Apollo do. I think they've got under eight, 840 billion quid under, under management. But there's a, it's a exci. Interesting. For all the reasons we always talk about in terms of sport and money. It, it ta takes people's attention. It's very high profile. So you've got this thing going on and In another bit of the jungle, Murray Barnett, who obviously used to work for Formula One, has a working theory that, you know, the American story and it's been a very well cultivated story via, you know, from drive to survive through the whole race, Vegas, Miami stories. You've got a whole load of things going on there, which talk to, um, just very smart work in terms of broadening the audience into America from what was a very small base. Then you've got the TV rights, you've got Apple going on there, you've got loads of people talking about what, you know, the, the, the US Rights market. Murray's view is that at that point, you know, when do Liberty sell and then who do they sell to? And you might then say, oh, well Saudi, you've got a leader who is very keen on Formula One and you've got some, you know, they're building cities out of the desert and. Will host races and you can start to join the dots. Complete supposition. But again, it's an interesting theory. And then if you jump to this story, you start to say, well, what happens to the valuations of the teams at that point? so it's, it's, there's a load of interesting strands to this, isn't there?
David Cushnan:Yeah. And, and what in terms of what F1 and Liberty have done over the past few years to, I suppose, create certainty and confidence for investors and therefore allow the teams to be valued much more highly, is they have put in place a series of, you know, ultimately quite boring regulations around financial controls. And that has worked and the teams have come to believe, largely speaking from a political side. And come to understand that they can achieve better things by working with F1 and together to sort of raise the whole, raise the whole thing. And you see that even in small things like them all coming together to promote the movie and do all that sort of stuff. Where in the Bernie Eckel stone days, you know, you had Ron Innocent McLaren and Luca de Monte ate Ferrari, you know, trying to kill each other at every possible opportunity you had Max Mosley in there sort of circling as well. So it's a completely different environment. It's a much more corporate environment. You've got Stefano Ali in charge of F1. Again, he's not a guy who is really sort of spoken about that much in general sports industry terms, but he is, he is doing a job and he's a, it's a very specific role where he understands the racing side because he is been there and done it. He's been in all the roles. He's been a team principal, he is been an engineer. But he's also able to play the corporate, the corporate game and work with, uh, ultimately people like, um, Derek Chang now at, um, Liberty. The other piece from Liberty's point of view, and yes, you're completely right Richard, they've got to be thinking about long, medium, long term who, who might buy this or who might buy into this. Um, they've also just got full clearance and have now taken full ownership and control of Moto gp. And I do think with the American story, there are probably some things that can be done, some cross pollination that can. Clearly help Moto gp, which is a, a completely different level of F1 in terms of recognition, but it can probably also help F1 in certain, in certain areas as well. F1 has definitely excited corporate America, and you can see that from the sponsors that are coming in and MasterCard signing a title sponsorship with McLaren and Cadillac coming into F1 next year with their own team. You know, that is definitely happening. Let's see what happens with the Apple thing. I, my sense is that the, on the broadcast side, the rights haven't necessarily stimulated the kind of interest that F1 might ideally have wanted. So, you know, we'll see how that plays out. It's, it's being watched by more people. It's still not being watched by a lot of people in the grand scheme of things in America.
Richard Gillis, UP:Yeah.
James Emmett:I would say on the, um, on the sort of liberty horizon front as well, they're what, they're seven, seven or eight years now into the, their Formula One ownership. It strikes me that they're in sort of operation phase rather than. Sell phase at this point. I know, I, I dunno whether they've a 10 year, 15 year, 20 year on the investment Probably.
Richard Gillis, UP:Depends on where they want to get out. I mean, they, they've done a lot of the work. That you need to leave presumably a, a, an exciting future. You don't want to, you know, take all of the money'cause no one's gonna then buy it other than a sort of irrational buyer. Maybe a Saudi might do that., Yeah, I think there's a sort of the timing bit we don't know, but I think it's quite, it's fun to,
James Emmett:They, they did, they did make a little, um, sort of relatively under the radar, significant move last year at the top sort of corporate level. They changed their CEO. Um, so replace John Malone was in on an interim basis, obviously the, uh, the, the big boss, but Derek Chang came in as CEO. He's been here, there and everywhere. Um, he is a, a bundle of fun. Derek Chang, but he's very much a globalist. So he's a American Chinese, speaks all sorts of different languages, um, replacing predecessors who were very much American folks in an American organization.
Richard Gillis, UP:I bet he's never been described as a bundle of fun before.
James Emmett:He is good fun.
Richard Gillis, UP:I wanna get in the IKEA ball pond with Derek Chang and we were gonna have a right old, right old
James Emmett:Yeah. So he was CEO of NBA China for a little while, um, and is very adept at navigating, um, the sometimes challenging waters between sort of globalizing sports entities and big politics in scary foreign lands. Um, so he's a bundle of fun and also a very smart operator, but could be, could be a a, a sort of move towards sounding out different potential buyers in all sorts of different markets.
Richard Gillis, UP:There's a, one of the, again, one of the sort of themes is within this, there are echoes here of CBC's New Sports Co. Where you are putting together, it's a sort of multi league, operator rather than a multi club thing. You are sort of, you, you're putting together under one roof a series of things. And then the idea being obviously to David's point, there is crosspollination, there is back office, there's centralization. You can start to see cost efficiencies and all of the things that, that, um, accountants talk about. But there's a question there of. How real those are and how culturally they, whether they fit together again, that's something they'll, they'll have to work through. But it feels like there's, that's the direction, the travel, we, I mean the other bit that I throw in, which again, is, is much less about the money and more about sort of the intangible is, I went to the, there's a neon did an event who, A sponsor in McLaren in Central London. It was the day of the, the, it must have been the livery launch at Trafalgar Square and. I was taken aback. I'm not a Formula One fan, as I always say. I was taken aback by the level of just the fandom and the excitement around the team and the drivers and the, the sort of the identity, the orange all, you know, you're on the train and suddenly you're surrounded by orange shirts. I and you sort of, it took me by surprise'cause I've been to Italian Grand Prix with Ferrari. You know, you get that in in spades. It's ma, it's massive and really exciting. But I'd never really appreciated that around McLaren, which I've always felt was a bit of a drier brand. But it feels, you know, that opened my eyes to that.
David Cushnan:Yeah, I think they've done a, they've, that's a very deliberate thing and they've done it really well. And, uh, Lou McEwen is the CMO at McLaren, who I think has, has, uh, driven a lot of that. And frankly, to fill Trafalgar Square One team, you know, the point was made at the time that I think F1 did something in Trafalgar Square, maybe 10 years ago. And, you know, the whole sport just about Phil Square, now you've got one team doing it. Uh, so that, that, that's progress. And you are right. The drivers do have this pop star appeal, you know, ever so slightly in some cases scary fan bases online. Um, but they have reached a level now of the very, very elite sports people in the world. I think the top ones. And, um, you know, it brings a new demographic, which is, which is the drive to the true drive to survive effect. You know, people I think, try and apply drive to survive to any conversation about F1 I, it's a bit more complicated than that, but uh, in terms of that new demographic, I think you can make that link pretty closely. And McLaren probably more than most, and it helps that they're winning, of course. Um, and they have a British driver that, um, you know, I think they've done. They've clearly invested a lot in that, and it's clearly, you know, uh, then bringing rewards in terms of fandom and all the stuff that that brings with merchandise and things you can do with, what is an incredible list of partners that, uh, Zach Brown has put together as well?
Richard Gillis, UP:Yeah, it was all again, just before we move on to the next one, it's interesting McLaren, even when they, you know, and, and there's a sort of before and after aspect to this, isn't there, but even 10 years ago they were very good with sponsors. I remember taking sponsors into, or potential split into McLaren and they're really, they told that tech story in the early days, particularly very well. And that resonated, you know, where it gave us sort of just a, another dimension that particular sponsors wanted to, to get into.'cause it gave them a whole thing that they could do around the base and, you know, all of that.
David Cushnan:Yeah, and they have had for must be, well over 15 years now, this incredible facility. I mean really it's got the sort of, it's almost the sort of bond villain style there. It was Ron Denis's absolute mission to make every detail of that as perfect as possible. It was, I think Norman Foster designed the whole thing and it, it is perfect for telling that tech story. What they haven't had until the last two or three years is the results on the track to match.
Richard Gillis, UP:Yeah. Yeah,
James Emmett:Just on that, just on that sponsor side, I was chatting with a, um, former senior comms, um, chap from football who had gone into Formula One and was in the process of getting outta Formula One, uh, when I was chatting to him because he was so shocked. By the difference between football, comms and Formula One comms in terms of the focus, the laser focus on telling commercial, corporate stories and hardly anything on, on what he perceived to be sport, uh, and sports stories.
Richard Gillis, UP:Well, it is the sign of the sign of the times.
James Emmett:Also, I've done the maths, Richard, you'd be pleased to hear. And, um, Jeff Moran's, uh, stake MSPs, uh, McLaren stake, uh, is worth five$25 million according to this new valuation.
Richard Gillis, UP:Right. Well, that's not a bad. five. Is it five years?
David Cushnan:Yeah, it's good work. It's good work.
Richard Gillis, UP:Yeah. Yeah. It's almost, it's almost sort of Unofficial Partner levels of, uh, valuation over five years. Extraordinary. Let's,
James Emmett:do you think I should take my 15% out now?
Richard Gillis, UP:if only you'd have got in at the beginning. That's what they always say.
David Cushnan:Find a buyer, James. Find a buyer.
Richard Gillis, UP:uh, let's go to Newcastle. James, tell us about this. What's going on there?
James Emmett:so Newcastle United, uh, am me two weeks into the start of the Premier League season, have appointed a new CEO, um, to replace Darren Eels, um, who is, uh, battling with cancer and has had to step down, although I hear he's doing very well, which is cheering news. Um, Newcastle have appointed Dave Hopkinson, um, to the role of CEO, Dave Hopkinson, Canadian man. I'd also describe him as a bundle of fun. Richard. Um, he.
Richard Gillis, UP:a bit of a tucker for a sort of nor a, a smooth talking North American, aren't you? James? You like, you, you, I remember talking on this podcast about Jerry Cardinal and you, there was almost a sort of sexual tension the way you, uh, talked about his voice. His, his and I. I'm, I'm putting Dave, I like the way you called him Dave and not David. That's a nice sort of homely touch.
David Cushnan:It was David in the press release, Richard.
Richard Gillis, UP:David in the press release, but James has gone straight to Dave. Dave, no,
James Emmett:Well, for those of us, for those of us who are Instagram friends with him, we'll know him as Team Hop, of course. Um, but, uh, yeah, Dave Hopkins. Dave Hopkinson is the new CEO at Newcastle. Um, he is a Canadian man. He, his, he's got a glittering resume. Um, his latest role, which he left, uh, around about a year ago. He was president of Madison Square Garden, New York Knicks, et cetera. Um, the world's most famous, but probably, um, not so good anymore. Uh, arena, uh, he was there for three and a half years. Uh, before that he was at Real Madrid as Global Head of Partnerships for two and a half years. And then he spent a good sort of 25 years building his career from the start at Maple Leaf Sports and Entertainment where he finished as Chief Commercial Officer. He's got the resume, um, as the sort of global, uh, sports leader. He's got wider. Bonafides as well. I do know him a little bit, Richard. Uh, as you will have, as you, as you would have noticed. I wouldn't describe him as caramel tongue like, uh, Jerry Cardinal. But he is, um, he is a really great commercial storyteller in the sort of classic North American mold. I'd describe him as a, a sort of sales architect. He likes talking about big deals. He likes talking about building sales team structures to get towards those, um, big deals. Uh, and he is a lot of fun as well. Um, it's an interesting appointment, I think, uh, in that it's, uh, I mean in a very basic level, it's a foreign bloke coming into, uh, to run, uh, a very English, uh, organization in Newcastle, obviously. There are lots of skills that you need that any leader needs, uh, in this kind of position management, communication strategy. Um, an idea of how much change, how much of a change agent you're gonna be. Then there's also the sort of. Uh, specific Premier League CEO skills that you need. Managing up weird stakeholder environment, the politics of football. And then Newcastle itself, uh, obviously has its own unique set of dynamics. A fervent fan base in the city dominated by one football club. Uh, a big sense of place there, which is sort of, uh, probably challenging for a, um, a foreigner to come into, uh, uh, a unique ownership environment. Obviously still the scars of Mike Ash there, but now you've got PIF, the Saudis and the Ruben Brothers, um, in charge there. That's a challenge to manage upwards with those folks. Um, and then they're off the back of a really tricky summer leadership transition. Obviously, they've brought in
Richard Gillis, UP:Losing their best player.
James Emmett:Yeah, well they've just at the very end, um, lost, uh, Alexander Isaac. Yeah. Uh, and struggling with PSR regulations, uh, new sporting director, which I'm not sure whether he is announced yet, but that all the indications are, they're going with Ross Wilson from Nottingham Forest. Would've been great to have him in earlier to deal with all of this stuff. So, yeah, it is stepping into an interesting job.
Richard Gillis, UP:loads. So, okay. So loads of questions as ever, and good luck to him. the path that he's, he's taken, which is again, one that we've seen repeated, which is the commercial guy gets the big job and, and you know, so you've gone from director partnerships at Real Madrid, which is a very, very different job to CEO and you've, he was the commercial guy in the state, so he's got to, the questions will be, can he make that shift?'cause it is a massive shift but it's, it's a well worn route. But you've got Ingham at the fa, you've got masters at Premier League, you had Richard Arnold at Man United. It's quite often the root because they're, they, you know, they come with the credibility of the commercial. Bit, and I'm sure you know it, it sounds like he's, he's, um, got that bit covered. The, the question I, I was reading, the, in the athletic, and the guy's name is, I should quote him Chris War, who is the athletics Newcastle guy. And he makes a very interesting point down the bottom of his piece. A very long piece as ever in the, uh, athletic, you've got a way through a lot of words, good words, but a lot of words. Um, he makes a point about the, he has one of the jobs is to ensure the process driven approach of PIF, Saudi Arabia's Public Investment Fund. The club's majority owner can be sped up keen due diligence must remain, but there have been suggestions that a meticulous approach, excuses indecision. So I, which I think is a really nice question in terms of that. The madness of football, the transfer market, the movement of people juxtaposed with a sovereign wealth fund and a financial sort of body, which moves at a much slower, much more considered pace. And so that is, is a tricky bit. You've just identified the, you know, the Newcastle is a brilliant story and it's a, you know, in terms of the fans and the locality, and I've, you know, if you've ever been to a Newcastle game, it's fantastic. It's a really great experience. It's in the middle of the city and the whole city just walks up towards it. It's a, it's a quite a, a thing to, to be a part of. And then it's great that, you know, they're, they're having success. And one of the stories running in around the, um, the League Cup or the, whatever it's called now, the Caribou Cup was. You know, the, oh, great, you know, Newcastle fans have something to celebrate. But then you've got this juxtaposition with the ownership team and what they want and their ambition. So I think this is a really difficult job and I think all of the things that we, that you've suggested there, North American approach to sport comes in with a PIF ownership and let's see how that goes.'cause both of those are coded words. And obviously he was, they say he was their number one pick, and they're very pleased to have him. And he sounds like a very capable bloke.
James Emmett:Yeah, I agree with you. I think it is a unique challenge at Newcastle and I think the. If, if you get it right, the rewards are probably massive for the, the leader who can, uh, establish Newcastle as a giant of the game, um, which is surely what the ownership wants, then that will be absolutely the work of a career. That'll be a defining legacy. But if you can't do that and you get bogged down in, in exactly the scenario and the various dynamics that you've described, Richard, then it's only a matter of time right before you are, um, uh, you're off and they're trying someone new. I do think to, um, uh, Chris Wars. Is it Chris War? Um, the, the athletic piece, uh, and the question over. Speeding up PS processes. I do think with sort of, and I appreciate the athletic is long read stuff, it's still mainstream football writing and I do think there is an over uh, over-indexing towards transfer business and I think that's a lot about transfer business, right? Which, uh,
Richard Gillis, UP:Yeah, yeah, you're right. Yeah, I, I think you're right. There's, there's also the, and I'll get David a minute, but you've got the, the, question of where they sit, and again, it is an interesting sort of gap between Newcastle and what they would, you know, you'd call the big six. So you've got an, and I like this phrase'cause it includes Tottenham, but just in terms of turnover levels, you've got Man City, 715 million. As of 20, 23, 24. So the last time the accounts, and that goes through Man United 6, 6, 1, arsenal 60, they're all in the sixties. Liverpool, 600 million, Tottenham 528 million, and Chelsea 468 million. Then there's a drop. Newcastle are the seventh number there at 320. So it's quite a, gap. All of those things. I, I completely agree with you about the, the obsession with football transfers, which is sort of idiotic and, you know, is a, is a small part of the job and the way football clubs are evolving. You've got these football departments, but he will get the blame. That's the, the, the caveat that comes with the CEO job that doesn't come with the chief commercial officer's job is, whether it's merited or not, he will get the blame if it's not. change and they're not responding and they don't buy the right players and all, you know, if they start and if results on the field, it's a complete attribution error. It's, it's complete nonsense. But it will be on the back pages, his face appears on the back pages, it's him that is gonna have a,, take the stick.'Cause that job, the manager's job has almost evolved into the CEO's job in terms of the public face and the blame. And we're seeing it over the last few days with Daniel Levy and Spurs. You know, you're seeing, well actually people are projecting onto, he's gone. It's a new beginning and the manager is, he neither here nor there, you know, it's like a sort of, it's just a pawn in the game. He's been devolved and that would never have taken place under, you know, a sort of previous in, in, you know, 20 years ago.
James Emmett:Just very quickly before we let David, um, have, have a say on this, um, uh, I do think, uh, that the relationship between. I think there are two, well, there are three key relationships, right? There's Dave Hopkinson and the owners above him. There's Dave Hopkinson and Ross Wilson, um, the sporting director and how that works. Obviously, that decision making structure wasn't there throughout the summer. This is why Newcastle in the position that they're in, um. Perhaps PIF could and should have acted earlier to get that decision making structure in place. Uh, and then there's Dave Hopkinson and Peter Silverstone, who is the Chief Commercial Officer at Newcastle. And to bridge that gap that you're talking about, Richard from, you know, revenues of 300 million-ish to revenues of 600 million ish, right? To establish themselves in the top order of the Premier League. It's partly about sustained success on the pitch and European, uh, prize and participation, um, money. But it's a lot about putting the commercial structures in place that make it, um, efficient and legal. Uh, and, uh, you know, particularly in this era of PSR and increased scrutiny on, um, sponsorship that comes attached to ownership. These are smart guys with, uh, you know, a lot of experience at big organizations, working commercial structures. You get deals from all sorts of different places and you have to funnel them into, um, legitimate, appropriate partnership revenue. And I think in tandem how Dave and Peter work that will be critical to Newcastle's success.
David Cushnan:And just, just to add on that organizational point, I was just, as I was listening to you two there, I was just sort of trying to tot up sort of from memory, so don't take this as gospel, but I think there's probably 13 or 14 Premier League teams who have had a new, or replaced their top executive over the past three, four years. We could top top that up, but it's, it's a sizable number. Um, a new breed of top people coming into, uh,
James Emmett:many did you say it was Dave?
David Cushnan:I'm gonna say it's 13 or 14.
James Emmett:got 15. I've
David Cushnan:Have
James Emmett:I've got 15 Premier League teams with new CEOs or no CEOs.
David Cushnan:Yes. Okay. Um, so it's a lot, you know, it's most of the league and I, I'm wondering is that. Usual. And am I comparing that with an era that has now gone where you effectively had a chairman, um, who might seemingly be there for decades? Are we in that sort of executive chairman? By the way, the same thing is happening with F1 team principles as well, much shorter, short, um, shelf life than, um, historically has been the case. Uh, so I think there's, um, uh, you know, there's maybe something, something in that and, and it probably speaks a little bit, Richard, to your point around blame. These, these figures do now get coverage in the athletic and in more mainstream, um, uh, you know, mainstream
Richard Gillis, UP:they're talked about in pubs, you know, and, and you know, they, they are because,
David Cushnan:They're figurehead, but they're semi-public figures.
Richard Gillis, UP:yeah. And they have become, as I say, I think they've become the new managers and they have be, and that makes complete sense. It's a really interesting stat that, and, and it's worth tracking that, isn't it, over time, in terms of, because that, it just talks, I think to the, the, the elevation and the way in which the, just the job. The, the, in a way, I mean, these are very highly paid, capable people. We don't need to feel sorry, but there is a level of empathy because they don't have control over their own destiny in terms of, you know, the, they're, they can do everything right and get the sack.
David Cushnan:Yeah. And, and on the, on the, uh, I'm gonna call him David, David Hopkinson points. Um, I wonder, given his career and his, uh, very clear skillsets and where he's been previously, one of the reasons he's been, uh, effectively sort of headhunted and, and picked out for this role is because there still is, in addition to all the stuff that James was talking about, uh. An evaluation, a prospect potential of some kind of new or heavily refurbished stadium project in the medium, longer term at Newcastle, which is obviously to the point you made Richard, about, you know, where that, where St. James Park is located and how that, how that works in terms of the city seem like it's traveling as one en masse to that stadium that's very sensitive and emotional topic in a one, uh, one club city. But I wonder whether he, uh, you know, his experience of, you know, activating venues, um, and conceptualizing how you commercialize a venue could be something there. And as we know from the Daniel Levy case, if you. Prioritize or are seen to be prioritizing a new stadium, it can leave you open to accusations that you are somehow neglecting the football site. And so that then becomes another potential headache. So these things are really difficult and complex and and long term, but I wonder whether that's another,
Richard Gillis, UP:The other, the, the other bit is that, yeah, you're, I completely agree. And the other bit is that we are living in a world where you ha, you know, the, the sort of sports football accountants are. Now sort of social media stars. So you know, the sort of Swiss rambles, Kira McGuires of this world where the accounts are the thing that they're talking about. And so they club every club, the man that's above the manager's pay grade or it's not something that they can talk to the manager about. So you need someone who can articulate that. Now the question is, and without meeting him, I'm going on and Dave's recommendation of Dave, I, I like Dave rather than David like the informality of Dave. But um, of James's recommendation rather, you've got this issue of the front face. It's like politicians, they, they have to be capable but they also need to be able to handle the media. They have to have the comms bit and they have to do that in a way.'cause you've got these different audiences. You've got the football media, which is just a 24 hour circus, transfers, injuries. Teams up and down, winning, losing, blah blah, blah. That's just normal stuff, but really intensive. That's the manager's, the face for that. You've got this other media circus, which is now building around the business, and we're partly responsible and, or part of it is part of the business conversation around football and everyone is talking about, you know, what's the, the salary per revenue and all of the, the, the sort of Deloitte type conversation that we used to talk about and, and it used to be a business conference type thing that's now on the back pages and you've now got that going on. You need a club needs someone to face up on that. The owners don't wanna do it. So part of the role of Dave Hopkinson is that he's gonna answer those questions and he's gonna be the face of that and carry the can or get the credit. For that. Meanwhile, I would suggest that the ownership level, the sort of one percenters, the, the PIFs, the, the, you know, the Reubens, they are not gonna get involved. You won't get hold of them in a way that, you know, most owners don't show up. You won't get Stan Croker on a podcast anytime soon. You won't get, the Glas. All of that is just noises off. That's for small people to work out. You are employed to do that. You carry that out. We are the ownership class. So I think sport, you know, and we see that happening all over the place and I think it's not a very healthy environment, but I think, you know, and it makes the job. I'm sure you'll get enormously well paid and well rewarded, but it's, I think it's quite a difficult job. But I'm gonna jump from here to my story because it brings together very cleverly and I was sort of planning this all along. Many of the themes that we've talked
David Cushnan:Can I just, can I just say, Richard, before you do this, I was thinking about how you've really quite skillfully turned the, um, presumably the notes, you all prep for the bundle into another piece of content to be able to send out to people. And I was just flicking through our WhatsApp chat to prep, uh, this, and I'm not sure you've got the same raw materials.
Richard Gillis, UP:Are you talking about yourself?
David Cushnan:I'm talking about the three of us.
Richard Gillis, UP:No, I don't see it in that way at all, actually. I think it's a completely different product, but I will, uh, I take your, take your notes on board. so my, my story is the Rider Cup. So this week the Ryder Cup teams were announced. The Captains, Keegan, Bradley, Luke, Donald, on either side said who their, uh, six picks were. And now we don't need to worry about who the teams were and what they did. But there's a few things that I just wanted, points that I wanted to make. Obviously, like this company, I've, I've written a book on this, so, and I'm not, this is not me plugging a book I have, and it's, it's now, uh, still available on Amazon. But the reason I wrote that book was one of the conversations that we were having at the moment, which is that I was, I went around and talked to loads of Ryder Cup captains and they all just told stories about previous Ryder cups, and it became obvious that actually the conversation about leadership is so silly. And it's so quite often infantile. It's quite often it's full of, attribution error. So once you realize that you can't unsee it, and we talk about our business leaders, we talk about politicians in the same way sport is at the forefront of this. And I was the rider Cup. Captaincy is probably the Dafts case study of leadership in sport that you can find because it's three days every two years. The captain's job is to carry the story through the vacuum that nothing is happening for two years. So the only two certainties are the venue and the captain. And until that, you know, until last week, they start to fill in the gaps of who's gonna actually be playing on the three days in New York at the end of the month. So you've got this, this challenge that doesn't stop us entirely waiting credit and blame on. The shoulders of the captain. So if you win, you are the good captain and if you lose, you are the bad captain. Now, from those two basic myths, stories come, we start to then project. We're incredibly clever at projecting other stories on top of it. And one of the questions that is interesting about last week is that they both had six picks. Now that when I spoke to people like Arnold Palmer and Jack Nicholas and Tom Watson, they hated picks the American lens on picks. You know, so people who are um, not, haven't played their way into the top 12 on the, uh, money list, they are the captain's selections. That's very un-American. It's almost like socialized healthcare it is not the American dream. You should play onto the team. And that's what the Americans always did for, for since 1927. Up to about the sort of mid eighties when they started losing. It was the just 12 players who were on the list and you picked them. It only was only in 1981 when they Europe said, well, we need Savvy Ballero in the team that they started inventing picks. And then since then, then they had one and two and three, and now we've got six. But all of that gives greater focus on the captaincy. So one of the questions, um, at the moment about the Ryder Cup is its future. It's an odd thing. And I always, there's a sort of analogy with British and Irish Lions tours where they are very popular despite not quite fitting into what the money wants the sport to be. And it's, it's a historical anomaly. It's always been resented by the Americans'cause they don't get paid for it. The American players, the PGA tour doesn't like it'cause it didn't ha didn't own it. PGA of America owns it. So there's a clash there. Tim Finchem always hated it. Created the President's Cup to try and rival it, which is crap. Now we, at a moment. In the cycle, which is very interesting. And, and about live golf. So you've got this live golf moment and I'll just recall a sort of, there's a, I was at the open this year at Royal Portas Rush and I had, um, a chat with people. I see someone you both know is Lara Toscani Weems, who is Liv Golf's new head of comms. And so she used to work with Scott O'Neill, as you know, and Scott O'Neill is now in charge of, Liv Golf. And we were at the side of the green on a practice down the Wednesday. And we had a good like, sort of 45 minutes of a very nice chat. And she was asking me, give me your honest explanation of why you don't like Liv. And there's lots of reasons I don't like Liv, but. I don't like the golf, I don't think the product's very good. And I told you all these things, but actually when you are standing there amongst the, you know what, obviously were mainly Irish golf fans of a, you know, they were wandering around and they were sort of milling around. Some of my, uh, antipathy to live is about the Ryder Cup, and I think that's quite a generalized thing as well, because I think live, it's sort of ruining, could ruin, could undermine this thing that we've been invested in. I've been invested in the Ryder Cup story since 1980, so that's, you know, my whole entire adult life and including some of my childhood. So it's, and a lot of people have grown up with the Ryder Cup as their central thing into golf, and it's be, you know, and this is probably quite a UK lens because I don't think the Americans feel it in the same way. They've always sort of seen it as slightly lesser than we do. I remember talking to Curtis Strange and said that, you know, when they go to schools to talk about, he has to explain what the Rider Cup is. Whereas Sam Torrens used to take the trophy and, and you know, he would be mobbed at the gates. So it was a di there's a difference in terms of where it fits in the, in the sort of culture. But when I was talking to Lara, it was, it was, it was interesting. I sort of hadn't really thought about that before. So you've got this moment and I am quite worried for the future of Thery Cup.'cause I think it's, it could easily just lose relevance and sometimes you think, well, that's okay. Sometimes. Sports events like the Lions tour, just have this, just a bit of luck that puts them into the sort of culture at a particular time of mass television in a 40 year period between sort of 1970 and 22,000 or whatever. And they are still, they've been milking that ever since. And we see a lot of the sports that we, we talk about as premium sort of grew in that era and then have been, you know, are now responding to it. And you know, and actually some will fall away. If you don't care about them, you don't care. But if you do care about, no, I do care about the right cut, that's what I worry about.
David Cushnan:But who Richard, do you think it's the, your fear is the players will lose their love interest in the riding
James Emmett:or is it that Liv trying to pinch the format with the team? With the team thing?
Richard Gillis, UP:So it relies on the best players playing. And if the best players aren't. getting onto the team again. So that's a question, will they be allowed on? They are. But will that continue? You've got the question of on both sides. And I think the, it used to be, it's always been that America has been absolutely dominant in golf and part of the charm of the Ryder Cup was a sort of, them against us aspect to it. And that's always been central to its sort of brand, particularly over here. Whereas now everyone plays in America and it feels much more artificial in terms of, it's the antipathy between the two teams.'cause they're all living on the same, you know, in the same state in Florida. So it it that those real differences have been tapered away. And I think that adding Liv into it, and you've got people saying, right, okay, how do we just, what do we do about golf? Because Liv. exists because of the problems that it exposed. And I think last week's player announcement talked quite a lot about the problems of the tour product.'cause the Ryder Cup is a, is the thing that pops for most people. If they're interested in golf, they will watch it. They won't watch the diet of the the tours. The tours are the problem. The majors are in robust health. They don't need any help. They, everyone wants to play in them. The problem is the tour and the more player picks you, you give the captain, the less relevance the tour has. And so the players who, you know, so someone like Matt Wallace didn't get onto the team because he knew he wasn't gonna be one of the six players that Luke Donald played. Previous generations he'd have walked on the team. So you've got a whole load of people. The message to the tour players themselves is you ain't getting in, you know, there's only been one change from one to the, from last time to this time. So it's almost like become a a, a sort of unit. It becomes less, uh, an emblem of the European tour playing staff as it is just a, just a sort of Harlem Globetrotters of European golf and they're gonna go and play at a venue, against the Americans. And that, that feels like that's a shift. And I think that's not a good shift.
David Cushnan:I think that's all very fair. How much a, a sort of casual average golf fan is thinking about all of that though. And surely, I mean, all the numbers from the last few Rider cups suggest that when you get to it, the three days are, you know, a hugely well attended. And, you know, there's always, wherever it is, you know, can be different types of atmosphere as I think we'll find in New York. But, you know, there's always a unique atmosphere, um, created. You know, the, the broadcast numbers are, I think, are robust corporately. I think it's still very strong and I think as somebody who likes golf, doesn't love golf, but I love the Ryder Cup because it's the. Perfect format as far as I can see for golf. And it's, you know, it's teams, it's, you know, you are, you are completely invested. It's actually why I think probably the most, uh, undervalued sports event maybe in the world might be the Solheim Cup actually, because it's the same, and it should be, it should be sort of raised up to a Ryder Cup style level in terms of interest and excitement because it, I think format wise, it just works. I think in terms of, you know, the, the, the medium long-term future of it, who, whoever you are, whether you are live, whether you are PIF, whether you are, you know, the, uh, you know, Brian Rollup at the PGA tour coming in, whether you are Guy Kennings, I mean, you'd have to be a very, very brave executive to, decide that the ride a cup. I.
Richard Gillis, UP:I don't think that would be, that's, that is not what would happen., One theory would be that, um, the PGA tour and Liv Golf is where the antipathy is, and therefore, you know, a team event that replicates instead of the President's Cup, you have that every other year. You start to see, okay, well there is real beef there, but then again, that's predicated on Liv carrying on it's current model. And there's, there's question marks about that.
James Emmett:I am, I'm sort of with Dave on this in that I, uh, or I'm always with Dave Hopkinson, but in this instance I'm with you Dave Kushner. Um, I'm not sure if, uh, Dave Hopkinson has a view on, uh, on this, but I'll, I'll text him and find out. Um, I feel like your concern, Richard, is. Born out of being very much inside this sport and in the weeds of it. So I'm sort of with Dave. I like golf. I love the Ryder Cup. I, and I feel like the athletes participating in the Ryder Cup, they're analogous to me to an international football tournament. Right. Or they are Europe's top golfers as defined by whoever it is this year that's picking them. I appreciate that. You know the England football team. They're, they're the best players in England, but they're picked by the manager who has defined that they're the best players according to his system like I get. I think it's pretty, uh, you know, sports fans are fluent in the vagaries of how a, an international team is assembled and it's all great content rich. The discussion around should this bloke have been picked and why isn't that guy in it? Like these are, these are evergreen content concepts and I don't feel like the integrity of the Ryder Cup is, um, jeopardized by the fact that we've got more controversy and discussion around where these blokes are coming from.
David Cushnan:It might not change their live, you know, we might all like to think and all the coverage suggests that, you know, winning the Rider Cup might be life changing and stuff like that. And maybe we're past that era. I guess from a player's point of view, because, you know, from an mostly American point of view, you know, we hear the mutter as well, I'm not being paid. It's, it's nice to win. It's always nice to win'cause they're competitive beasts. But it's not gonna, you know, by Monday morning, I'm, I'm not gonna be as. Devastated as perhaps people think I ought to be. So that's, you know, it's then I suppose back to the storytelling, how do the broadcasters, how can you sort of tell the story? The sport itself will, I think, surely always be highly competitive, especially when it gets down to that sort of one-on-one, um, you know, singles on the, on the Sunday. But I certainly on the European side, what you do have, because of how the captaincy works and actually this also this world of sort of vice captains that now seems to assemble around the captain. If you think about the next 20, 30 years on the European side, you've got, you've got McElroy, you've got Westwood, you've got Garcia, you've got Justin Rose who are all going to be captains and have their turn at one point and I guess continue to be the. In a very different way to se, but that sort of inspiration for the, the younger players coming in. So I would be much more concerned because you mentioned the Ryder Cup, um, as sort of analogist with the, the British Irish Lions. I would be much more concerned about the long-term future of the Lions as a, as a, as something that, because I just don't think it made it, I just don't, I just don't think it made a dent. I just don't think it made a dent at all this, uh, this summer in the sort of mainstream, uh, world, honestly. And I still think the Ryder Cup does and the, the, the big golf events, and it's probably the form ages and the Ryder Cup. You know, you look at the reaction where McElroy won the masters, that it, it does cross over into, you know, transcends golf. And I do still, I, I'm still, I, I get confused about whether bull or bear is the thing, but I'm, I'm, uh, I'm positive about the future for the Ryder Cup.
Richard Gillis, UP:They're both quite aggressive, aren't they? Balls emperors. Um, good, I'm glad. I'm glad, I'm glad you've, you've talked me out of it. Okay. So I'm, I'm happy, I'm happy with that because it, and also, so will the European tour,'cause it is so fundamental to the economics of, uh, the European tour that, um,
David Cushnan:Who's gonna win?
Richard Gillis, UP:uh, well the money would be on America'cause it's at home. One of the, again, one of the issues is that, is winning away is proving more difficult. It's a bit like, you know, Tess Cricket. It's, it's become. Difficult to win away from home. So that's a challenge for the product itself. And, they've tinkered with the product a little bit. They've done well to keep it to three days that everyone, you know, they remember Colin Montgomery going on, it should be four days and everyone plays, which is what the President's Cup does. But it does, it takes away from, you know, those little bits just take away from the actual product itself. But I'm plea, I'm pleased. I'm, I, you've taught me round. I'm, I've, I'm, now I can have a better day now.
David Cushnan:The thing in New York that could turn some people off is if you know the extent to which it becomes politicized, of course, because you can, you can anticipate one VI.
Richard Gillis, UP:you certainly can. And yeah, Trump's use of it and his, his sort of relationship with golf is obviously very deep. We, and I was working for, and I think it was KPMG and on the, they had a golf event, golf business forum. And they had a, what they thought was a prestigious award, which was the golf business person of the year type thing. And I remember they said, right, we have to give it to Trump. And this was 20 years ago, 15, 20 years ago, and he couldn't be asked to come over and pick it up. And that was when, you know, that was obviously pre pt. So they were desperate to try and get him over, but they just couldn't give him the award because he just. You know, he wouldn't be able to do it. He wouldn't sit on the end of a tele to, to pick up the award. but the golf industry does, like Donald Trump. I know that much for for sure.'cause he's embedded in it, but we'll see. Okay. I think we're there for, for what was gonna be a half an hour chat. We've, we've, uh, gone slightly further than that.
David Cushnan:Hmm.
Richard Gillis, UP:That'll do right. Perfect.
David Cushnan:All right.
Richard Gillis, UP:Okay. Oh, hang on, hang on, No. Whoa, whoa, whoa, whoa, whoa, whoa, whoa.