Soccer Is Hot: MLS Teams On The Rise As Valuations Soar

MLS is on track to post a record attendance of over 10 million in 2022, surpassing the previous milestone of 8.6 million, which was set in 2019.

While most teams have operating losses, these are now reducing due to a steady growth in revenues, which is no small part thanks to the growing viewership of the sport in America.

The 28 American clubs are expected to earn a whopping $1.6 billion during the regular season of 2022, up from a lowly $468 million in 2020, when there were few or no spectators present due to the pandemic.

In simple terms, MLS teams are earning a lot more money now. And this growing income has been accompanied by a rise in value.

MLS teams, on average, are now valued at $582 million, according to data gathered by Sportico.

CF Montréal is the least valuable at $390 million, while Los Angeles FC, with new big-name signings like Gareth Bale, are the most valuable at $900 million. 

The franchises have a combined value of $16.3 billion. 

So why are valuations growing?

There are numerous justifications for the continued bullishness when it comes to the US league.

Viewers

The demographics of the league are often younger and more diverse than those of the other major sports leagues in North America like MLS, NBA and NFL.

This means that younger generations are preferring this to other sports and come tomorrow, more and more people will watch soccer.

Stadiums

Teams are also putting in the effort. They are striving to deliver the finest matchday experience possible.

Investments are being made in stadiums, with the majority of teams now playing in arenas designed specifically for football.

TV Revenue

MLS still lags behind other leagues in some facets, one of them being revenue from TV rights.

Just consider Norwich City, who finished 20th in the EPL last season. The English club raked in $107 million from television last season despite getting relegated.

Compare this to the national media contracts for MLS teams, which brought in an average of just $3 million per team, and you get the picture.

MLS is catching up here as well though.

A $250 million per season, a ten-year global broadcast pact between Apple and MLS is poised to begin in the 2023 season.

Through a unique MLS subscription programme, every game from the competition will be streamed live on the Apple TV streaming platform.

All of the on-field and off-field improvements have catapulted MLS teams in terms of valuations.

While the EPL completely outshines MLS in terms of quality of football and wealth, the US-based league is catching up in valuations.

In fact, many MLS teams are now on par with midtable PL teams when it comes to sponsorships and ticket sales.

Comparing MLS and PL valuations

Sportico estimates that a Premier League club is worth an average of $1000 million.

This comes with a caveat.

The gulf between the top clubs and the bottom feeders is vast.

Teams like Fulham are valued at about $100 million, compared to big teams like Manchester City, which are worth multi-fold that.

Then there are midtable sides like Leeds, Aston Villa and West Ham.

Although the tweet mentions that the club valuations are similar to that of midtable clubs, it must be noted that the average valuation of MLS is well above the stated teams.

Leeds, Aston Villa, and West Ham all max out at a value of around $400-500 Million, whereas the average of MLS is $582 Million.

If a combined EPL x MLS table is drawn purely based on club valuations, the top MLS teams would fall just below the EPL Big Six and above a lot of the supposed legacy teams of England.

The Verdict

In the broad scope of things, MLS is still in its infancy.

English sides have heritage and culture on their sides.

They have seen out wars, have been graced by legends of the game and can boast of some of the most iconic footballing moments in the history of the game.

There is no denying that England has a stronghold on football.

However, considering these new TV rights deals, massive overhauls with stadiums, and the signing of brilliant young talents like Riqui Puig, it’s clear that MLS’ and America’s imprint on football is slowly but surely growing. 

There may soon come a time when MLS teams topple the top PL sides to become more valuable.

The league has a lot to do to get there, but it is surely taking the right steps.