Barcelona went through a crisis. Can he leave now?

Joan Laporta’s smile was hard to miss. Last month, looking down from a stationary digital billboard, a grinning image of the president of Spanish football giant FC Barcelona occupied nearly the entire side of the Palms Casino Resort in Las Vegas.

billboard scrolled through the other images – there was one of several Barcelona players and the other was her coach, Xavi Hernandez – but soon enough he was back with Laporte. And it was that look, the beaming president front and center in the gambling capital of the world, it was perhaps the best symbol of the financial turmoil Barcelona is currently in and the boundless confidence of a man who says he has a plan to fix it.

Barcelona, ​​in true Vegas style, doubles down.

A team that less than a year ago was unable to pay a huge salary; a business that, with a €487 million ($496 million) loss last year, was described by its own chief executive as “technically bankrupt”; the club, currently saddled with over $1.3 billion in debt, has decided the best way out of a crisis brought on by financial missteps, high salaries and extravagant contracts is to spend it.

He sold one club assets after another to raised about $700 million help balance your ledgers. However, he is moving forward with a $1.5 billion project with funding arranged by Goldman Sachs to repair and modernize its iconic Camp Nou stadium, which, due to the rush to raise funds, will bear the name of a sponsor for the first time. And this summer, it has paid more money for new signings than almost any other major team in Europe, with a new flamboyant acquisition being announced with great fanfare, seemingly on a weekly basis.

The runaway spending left Barcelona’s rivals bewildered and fears from some of its 150,000 members about the club’s financial viability if Laporta’s massive bet didn’t pay off. But the president, in an interview at the Manhattan headquarters of The New York Times, repeatedly assured that he knew exactly what he was doing.

“I’m not a player,” Laporta said. “I’m taking calculated risks.”

However, the risk has become an integral part of Barcelona.

Laporta was elected club president for the second time last year after his predecessor and the previous board were elected. pushed out for what amounts to the simultaneous financial and athletic collapse of one of the world’s greatest sports teams. While many expected Barcelona to recover slowly in order to live within its means during a period of modest savings, Laporta instead opted to set Barcelona on a completely different course. He says he has no other choice but to try to win every year.

“This is a requirement,” he said.

Over $700 million was raised through the sale of part of the club business. twenty five percent club domestic television rights – for a quarter of a century – went to an American investment fund. Spotify, music streaming service, signed a four-year contract put your name on the Camp Nou and even more valuable real estate on team shirts. Monday, Barcelona announced the sale from a quarter of its production business Barca Studios to blockchain company Socios. Further, the company is negotiating the sale of part of its licensed business.

However, instead of paying off the club’s debt, the money has mostly gone towards accumulating new talent: $50 million for Polish striker Robert Lewandowski, $55 million for French defender Jules Kunde, nearly $65 million for Rafinha’s Brazilian flank. More players have joined us free agents. Additional reinforcements may be on my way.

For Laporta, signing Lewandowski, soon to be 34, and others makes sense. It’s part of what he claims will be a “virtuous cycle” in which success on the pitch will bolster the team’s finances through increased revenue. This strategy is a repeat of the recipe he used during his first tenure as president, a seven-year period that began in 2003 and ended with a Barcelona team hailed as one of the best in football history.

“In my time, we had very high expectations and we were successful,” he said of his previous tenure. “And then the Barça fans around the world, about 400 million fans around the world, they need a certain level of success.”

But times and incomes have changed. The club, which Laporta inherited in 2003, is also mired in a financial crisis, with losses nearly double its earnings and mounting debt. But then the numbers were 10 times smaller and the club had not yet begun the process of turning itself into the commercial juggernaut that it has become.

These teams were also not required to comply with the strict player spending caps that have since been put in place by the Spanish league, and it is these rules that represent the most immediate obstacle to Laporta’s revival plan. With La Liga insisting it won’t ease the rules for Barcelona by one euro, the club has yet to be able to sign up any of this summer’s new players. Fearing the team might miss the deadline, the league has yet to use any of these players, not even the reigning World Player of the Year Lewandowski, in any of its brands for the new season.

Laporta insisted that the latest asset sales should help Barcelona comply with La Liga financial rules and register a new battalion. “Honestly, I didn’t want to do that,” he said of the sales, even if they would – at least temporarily – push Barcelona’s balance sheet to profit.

This type of maneuver – a mixture of daring and brinkmanship – is typical of Laporta, who benefits from a personality cult unmatched by previous presidents in the club’s modern history.

This is why he can place himself on Las Vegas billboards and why he can continue to publicly defend the short-lived and widely reviled European Super League. (Barcelona, ​​Real Madrid and Juventus, three of the 12 teams signed to the separation concept, are pushing the project, which Laporta says is now seen as an open competition that will benefit the biggest teams. Recently he met with Andrea Agnelli and Florentino Perez, his colleagues from Juventus and Real Madrid, in Las Vegas to discuss next steps.)

But Laporta’s popularity is also the reason he can get away with financial risks that would most likely be unsustainable if offered by previous presidents, and especially by his unpopular predecessor, Josep Maria Bartomeu.

“What would happen if Bartomeu did the same as the current president does?” said Mark Duch, a club member who helped oust the previous board. “We would all be on fire pointing at him and trying to fire him.”

According to Duch, Laporte was given a wider space and even supported by fanatical advocates on social media due to his links to the earlier golden era. “There is a success story behind Laporta,” Duch said. “He has a huge fan base: he is like the Pope, like Kim Jong-un: the supreme leader.”

Laporta’s extremely personal style of management also showed up in other changes at the club. In order to run for president, Laporta first had to secure a €125 million guarantee, a bail that was set up largely to protect against mismanagement. But the club’s members recently agreed to make changes to the rules that mean it no longer bears any personal risk, according to Victor Font, a businessman who challenged Laporte for president. Because of this, Font said, Laporta is risking the future of the club, not his own, by borrowing money and selling assets.

“If anything goes wrong,” Font said, “we will hit the wall.”

Conflict of interest provisions were also quietly changed last year, putting many of Laporta’s friends, former business partners and even family members into positions of power. For Laporta, these changes were necessary given the hardships he inherited. “I need people I trust,” he said. But the circle continues to narrow: Laporta’s appointed chief executive quits after a few months; instead of replacing him, Laporta took over his duties himself.

At the same time, he has had to rebuild trust with a group of players and convince many to accept pay cuts, millions of dollars in some cases, while the club shells out eight-figure sums on new talent. Laporta called the players who agreed to pay cuts “heroes” and insisted that by reducing the payroll and laying off some high-paid players, newcomers would fit into an elaborate salary structure. But getting there was not always pleasant.

One player who has so far turned down neither a pay cut nor a move to a new club is Frenkie de Jong, a 25-year-old Dutch midfielder who was signed in the summer of 2019 for nearly $100 million. De Jong has been the subject of intense speculation all summer, with Barcelona publicly pushing him to accept a pay cut – he’s already agreed to a €17m ($17.3m) deferral – or agree to a move to a new club. (Manchester United were reportedly the most active bidder.)

But de Jong has made it clear he wants to stay in Spain and while Laporta has professed his “love” for the player and said he is not for sale, he added that de Jong needs to “help the club” by restructuring his salary. . Unions and the president of the Spanish league warned Barcelona against putting pressure on de Jong, and in response, Laporta stated that his club would pay de Jong what he owed. “He has a contract and we are fulfilling it,” Laporta said.

Ironically, much of Barcelona’s current plight dates back to the era of success it enjoyed during Laporta’s first term. These teams played unrivaled football, winning a number of trophies, as well as a team of popular superstars receiving ever-increasing salaries. No player has embodied this escalation more than Lionel Messi, whose last contract with Barcelona was worth around $132 million a year.

However, as Barcelona’s debts mounted, signing a new contract with Messi that would comply with La Liga’s financial rules became impossible. Messi tearfully said goodbye to Barcelona by joining Qatari side Paris Saint-Germain as a free agent. Laporta, who promised to keep Messi as a presidential candidate, has since wistfully suggested that he would like to have him back.

“I feel like as President I have a moral obligation to him to give him the best moment of his career or give him the best moment at the end of his career,” Laporta said without offering any explanation. How can I do that.

Meanwhile, relations have soured: Laporta, in constant campaign mode, continues to hint that he will try to bring Messi home. Messi has previously expressed his disappointment with the way Laporta has characterized his departure and his father. reportedly asked the President of Barcelona to stop talking about his son in public.

However, a discussion on how to resolve this situation may take place later. The same is true for difficult questions about where Barcelona will continue to find ever-increasing revenue streams in the post-pandemic economy, or what it will do if it cannot register all of its players, or what will happen next year. or one year after that, when the nine-figure bill comes due.

Laporta lives in the present. “Winning,” he said, “is a universal human motivation.”

But now he is out of time. Laporta politely ends the interview by saying that he needs to hurry. He has an appointment at Goldman Sachs to discuss a new funding mechanism.