Today, I found myself passing the halfway mark of Christoph Biermann’s Football Hackers, a book from which I’ve jotted plenty of notes and been exposed to several tremendous studies. It is through this past chapter alone that I’ve discovered the story behind the packing metric, learned about the origins of Wyscout and InStat, uncovered a bundle of top analysts whose work is readily available to read, and more.
But today, as I sat in my family’s jacuzzi for the first time in several years, toes bubbling in a eucalyptus baby bath that must’ve been going on its second decade in the depths of our bathroom cabinet, I came across a simple but intriguing idea. Biermann discusses, in a chapter on “Scouting the Digital Space”, the variety of super-scouts that’ve been acclaimed for their efforts in assembling some of the world’s most formidable “underdog” teams in recent memory. Steve Walsh was recognized as the man behind Vardy, Mahrez, and Kante’s signigns at Leicester. Luis Campos discovered many of the players that were fielded in AS Monaco’s 2016/2017 season–most of whom made the club a subsequent fortune after being offloaded to clubs throughout Europe. Ramon Rodriguez “Monchi” Verdejo brought Dani Alves, Ivan Rakitic, and Carlos Bacca into Sevilla. Sven Mislintat told Klopp to buy a 21 year-old Shinji Kagawa from then-second-division Cerezo Osaka. The list goes on.
At the heart of each of these fairy tale stories lies two goals that go hand in hand:
1. Scouts live for their findings to make it big. The feeling of placing a bet on a prospect, and having them sell for a world-record fee a few seasons later, is second to none. It’s reflexively reassuring, and suggests that yes, you really know what you’re doing. If you spotted him before everyone else, you perceived talent that others couldn’t–and that makes you a valuable asset for any club. When Mbappe was transferred to PSG for nearly $150M (per Transfermarkt), I’m sure Campos was grinning from ear to ear.
2. When individual players to go from prospects to highly coveted superstars, it is fantastic for the club, the player, and certainly the scouts that brought him in. But if a club can maintain a reputation of “buying low and selling high” they can consistently afford bigger and better talent. This is the second objective. Over time, and as the transfer market inflates, they’ll be the ones that are able to keep up, even if their larger sums are the factors driving higher prices. We look back on Leicester’s transfer market business with awe (nabbing 2020 Golden Boot winner Jamie Vardy from Fleetwood Town in the 5th division of England), while conglomerate clubs like PSG, Real Madrid, and Barcelona have become notorious for their “galaticos” signings that have varied in terms of their abilities to live up to the fees that were paid for them.
Quickly, it becomes intriguing to figure out which teams have the best policy, in this regard. There are certain academies that are lauded as top tier, like Ajax or Barcelona’s La Masia, but some are more effective than others at translating their top talents into world stars–especially in recent years. Sporting CP has long been praised for its cultivation of a tricky trio of contemporary wingers: Cristiano Ronaldo, Nani, and Ricardo Quaresma. They’ve also cultivated the talents of Luis Figo, Rui Patricio, Joao Moutinho, and more recently Bruno Fernandes. It’s clear that by establishing an academy as a fasttrack to the top level, more promising youngsters will seek out trials and sign contracts. It’s a handy feedback loop to develop. It’s even better if these players get regular minutes with the first team, or are even signed directly to it.
So who are these top teams? The graph I plotted down below depicts the top 25 clubs worldwide, in terms of their net transfer balance. Teams that are excellent at generating revenue by selling players at high prices, while bringing in fresh names for cheap, find themselves with the furthest perpendicular distance to the diagonal y = x line through the center of the graph area. Naturally, and with our axes, the ideal club would be bringing in $350M from sales, and spending none of it, resulting in a highly impressive net balance of $350M. Their crest would feature in the top left of the graph. An abysmal club, under these terms, would be at the bottom right. Keep in mind that these are the top 25 in the world, so even though FC Porto may appear as “the worst of the bunch”, that’s simply a perspective error. Their transfer balance of $27.40M is tremendously impressive, especially given that only 101 clubs even reported a balance that was net positive. Even transfer hard-hitters like Juventus and RB Leipzig come in at 210th and 216th, respectively (-$24.26M and -$26.95, each). Arsenal, Internazionale, Napoli, and most alarmingly, Aston Villa, make up 243rd, 246th, 248th, and 249th (-$117.43M, -$133.24M, -$158.29M, -$170.61M).
So with that perspective in mind, take a gander! As one final note, bear in mind that these figures only count for transfers in and out of the first team, not the B squad or other academy programs.
Which names surprised you?
Chelsea was certainly impressive at third. Their loan strategy has been mocked for years, but this past year’s list was quite a haul. With players like Christian Pulisic, Mario Pasalic, Tiemoue Bakayoko, Mitchy Batshuayi, and Mason Mount all coming back into the Chelsea team at the end of the previous season, there was loads of talent returning to the team through a side door, despite a transfer ban that lasted until February of 2020. Eden Hazard’s long-awaited sale to Real Madrid brought in $126.5M, while the loophole purchase of Mateo Kovacic went in the other direction, and set off the whopping fee by $49.5M.
RB Salzburg is an expected candidate, as the club is well-known for developing young players and moving them on to the slightly higher-positioned RB Leipzig, or across the continent. In 2019/2020, they brought in Noah Okafor for $12.32 from Basel, and Maximilian Wober from Sevilla, alongside a handful of other loans and minor purchases. Heading out the back door, soon-to-be-superstar Erling Haaland left for a $22M fee that looks paltry compared to what he’ll sell for in a few years time, while Dabbur, Schlager, Lainer, Wolf, Samassejou, and others departed for between $13-$19M apiece. Quintessential Salzburg dealings.
Elsewhere, Atletico is well known for creating top level strikers and central defenders. The likes of Forlan, Falcao, Torres, Aguero, Diego Costa, Griezmann, Joao Felix and more have emerged from Diego Simeone’s ranks in the past decade, nearly all of which have graced the upper echelons of world futbol. Godin, Miranda, Jose Maria Gimenez, Savic, Felipe, and more have come through the club as resolute defenders, too. And while Simeone tends to buy cheap and sell high, I certainly didn’t expect Atleti to come in so high on the list. Perhaps there’s recency bias at play, with the purchases of Joao Felix, Marcos Llorente, Kieran Trippier, Mario Hermoso, Felipe, and Renan Lodi firmly rooted in my memory. We might forget that Griezmann’s move to Barcelona brought in $132M, Lucas Hernandez to Bayern brought $88M, Rodri to Manchester City yielded $77M, and Gelson Martins to Monaco rounded out the big ones with $33M. Even with one of the world’s most expensive signings in history, Atletico still manages to do excellent business.
Frankfurt, as a top performer, wasn’t all too surprising. The purchase and turnaround sale of Luka Jovic is a huge contributor here, being brought in from Benfica for $7.7M and leaving at the end of the year to Real Madrid for $66M. Sebastian Haller was another big win, financially, as he left for $55M for West Ham, and has failed to impress the English as he did the German audience. Generally speaking, not many other big buys from Frankfurt. Sebastian Rode was a Dortmund import for $4.4M, Kevin Trapp joined for $7.7M from PSG, and Djibril Sow came for $9.9M from BSC Young Boys in Switzerland. At the end of the day, this leaves them with quite a hefty increase in their total budget for 2019/2020.
Crystal Palace is peculiar at first, until we recall the bombshell sale of Aaron Wan-Bissaka to Manchester United. You guessed it–that’s $60.5M right in the reserves. By contrast, their biggest buy was James McCarthy for $3.63M. Gary Cahill joined the club on a free transfer from Chelsea.
Paranaense and Santos were intriguing to see, as the Brazilian League is so commonly touted with big-money European signings. In recent years, Neymar, Alisson Becker, Gabriel Jesus, Richarlison, Arthur, and others have been brought to Barcelona, Roma, Manchester City, and other locations highly anticipating the arrival of joyful South American flair. In 2019/2020, Paranaense exported the aforementioned Renan Lodi, and Bruno Guimaraes to Lyon, primarily–and for +$22M each. Santos’ big win was Rodrygo, who gave rise to a bountiful $49.5M sent over from Florentino Perez’s Blancos.
Atalanta was a curious find, seeing as their performances have truly begun to take off in a year following such exceptional market proceedings. As it turns out, Atalanta has an absurd number of loaned-out and loaned-in players, but their expensive commodities came in the form of young talent Dejan Kulusevski who joined Juventus for $38.5M, Franck Kessie travelling to AC Milan for $26.4M, Bryan Cristante to Roma for $23.1M, and Andrea Petagna to SPAL for $13.2. Hopping aboard the Atalanta plane were Muriel, Malinovskyi, and Zapata, three of their most impressive players in the subsequent campaign. They went for $22.11M, $14.96M, and $13.2M each.
Next, we find French clubs Saint-Etienne and Lyon, both of whom enjoyed a strong performance. The former offloaded their young prospect William Saliba to Arsenal for $33M, while Lyon sold Ndombele, Mendy, Tousart, and Fekir for $66M, $52.8M, $27.5M, and $21.73M. Lyon paid somewhat hefty fees for several new players like Reiene-Adelaide for $27.5M, Andersen for $26.4M, Thiago Mendes for $24.2M, and Guimaraes for $22M, but still managed to come in the top 20.
Liverpool appears as the only other Premier League team in the cohort, but with a small number of moves Danny Ings sold to Southampton for $24.42M, while Ryan Kent and Simon Mignolet left for a combined ~$16M; Minamino was brought in for $9.35M.
Rounding out the bottom we have Club Brugge who earned just over $40M from Wesley and Nakamba’s transfers to Aston Villa; CF America who sold Edson Alvarez to Ajax for $16.5M + Uribe and Marchesin to Porto for just under $20M; and Porto themselves, making bank on Eder Militao’s marquee Real Madrid Signing ($55M), with Felipe and Oliver Torres reigning in an extra ~$35M.
Kudos to the boards of these clubs! Efficiency is always good to see in a market that is ever-plagued by overpriced “gems”. But is there more than we can interpret from this data?
We might be eager to congratulate these teams, but there are a variety of circumstances that can emerge from these transfer dealings. After coming in #1 on our list, Benfica fell from being the champions of the Portuguese League, to coming in 2nd behind FC Porto. Despite Porto’s comparatively less-impressive transfer balance, we might say that their decisions were more effective–even if they weren’t as efficient. There are undoubtedly other factors at play here, including coaching, COVID-19, and a myriad of other elements I’m neglecting, but the fact of the matter is–it seems like Benfica didn’t improve–that is, quite yet.
Hugely successful transfer earnings are cyclical in nature. Many teams, take 2016/2017 Monaco, for instance, spend several years developing or recruiting talent until they eventually have a breakout season, That spike in performance is usually paired with an akin spike in attention towards their players, sprouted transfer fees, and suitors happy to pay the premiums. Thus, it is not uncommon for a team to offload loads of personnel, and then embark upon a journey to rebuild again. Such is the way of life for many of the top 25 in 2019/2020, many of which are serially efficient trading outposts.
Thus, it is possible that evaluating net transfer balance in direct juxtaposition with the following years’ performance, is entirely misleading. It ignores the cyclical nature of player development, and the notion of “golden years” for various clubs or even countries. Instead, what’d be more interesting is an expression of how well a team outperforms its fellow competition, with a comparatively low budget. And mind you, this comparison ought to be drawn out for 5 or 10 years to give the full picture. What we’ll find, then, is a list of some of the best-run clubs in the world–those that get results while making money. Unfortunately, these are hard to find.
Many of the most name-brand league leaders of the past decade, like Real Madrid, Barcelona, Manchester United, Bayern Munich, Manchester City, AC Milan, and more, have gotten their results with fat pockets. Madrid had a 2019/2020 balance of -$244.75M, which might make their continental successes comparatively less compelling than, say, Atalanta’s recent triumphs and positive balance. This is to say, yes, some of the biggest clubs in the world keep on winning, but with one look at the ledger, we’d certainly expect them to.
If we return to the rankings and examine the bottom end, we’ll find many of these consistent big-money performers, but we’ll also encounter those that haven’t faired so well. Between spots #226 and #250, we might discern some of the lesser-known clubs that’ve underperformed their transfer spending in the past year, including the nearly-relegated Aston Villa, and mid-table sides like Hertha Berlin, West Ham United, or Bologna. These four netted -$170.61M, -$95.98M, -$71.74M, and -$49.05M, meaning that their investments didn’t quite provide an immediate return. But once more, perhaps they simply need time for their signings to develop synergy. At either end of the spectrum, we’ll be harsh if we judge things without enough time and perspective.
That being said, soccer is an unforgiving sport. Fans are quick to denounce leadership for poor decisions, and they’re unlikely to give a board or head coach or scouting staff the time of day if an entire season goes awry. Often times, it only take a short stretch of bad performances for a manager to get the sack. If a team shows such an abysmal response to the owner’s financial generosity, tournament winnings, promotion, or other sources of income, they may not get the chance to cultivate that winning culture. The ideal is always to sign and integrate quickly, with the hopes of avoiding these pitfalls.
We understand that overhauling squads is precarious (just ask post-Gareth Bale Tottenham supporters), and we also know that evaluating performance immediately afterwards might not lend a club enough time to bounce back and reintegrate new pieces. But what if we’re afforded a longterm outlook? What if we want to uncover those teams that win while generating cash?
If we embark on an investigation to find the best-run clubs (in this specific economic/performance-based definition) of recent years, I find that the widespread nature of annual competitions mars objectivity.
Arsenal’s recent celebrations might make it seem like winning the FA Cup is equivalent to finishing top of the EPL–but we know it isn’t quite as sweet. How much value to we attribute to each? Can a team be successful domestically and not in Europe? What about vice versa? Did they beat their biggest rivals home and away? Did they bottle matches against inferior sides? What matters to the fans? The Board of Directors? These questions are not simple to answer, let alone translate into numbers of normalized significance. Transfer balances are pretty straightforward. “Success” isn’t.
Thus, we’re left with is a pretty image and a lesson.
Pretty images are ubiquitous in the world of sport. Graphical data visualizations are the new currency; they show the world that you’ve got info, and a beautiful way to explain it. The graph shown above is pretty neat, after all. We can see some clubs that we’d expect to rank highly, and there exists a few surprises. Cool!
But the lesson comes from the importance of context and positive scrutiny. Without the understanding that high performance in the above rankings doesn’t necessarily translate into strong results, or some of the nuances of the data set, we might erroneously begin to believe that Chelsea was totally unlucky not to have won the EPL this year.
“They seem really good at transfers, so they’ll probably be bringing in some good cheap talent. If they’re third on this list, and the top English team, maybe they’ll have a good chance at winning the league.”
The above quote is a mildly-exaggerated, theoretical stream of consciousness, but what a wild misstatement that might’ve been. For the easily-excited, or optimistic Chelsea fan, it’s a conclusion that may not have been all that hard to arrive at.
The fact of the matter is, we must be wary of where certain information allows our minds to wander.
Statisticians refer to a familiar law that governs over even seemingly-related data as “correlation is not causation”, the idea that just because one thing is connected to another, doesn’t mean it directly leads to it.
There is also the psychological concept of the Halo Effect, known as “the tendency for positive impressions of a person, company, brand or product in one area to positively influence one’s opinion or feelings in other areas”.
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The critical thing we must consider is that these data visualizations are often only truly useful in a highly specified and constrained environment. We must resist the temptation to expand our conclusions beyond that scope. In fact, extrapolating in general is a precarious task that, in my humble opinion, ought to only be carried out if truly necessary. Once we venture out into the unknown, any proclamation of a continued trend–no matter how longstanding it’s been proven to last for–is merely conjecture. Humans are ever-searching for explanations, but our universe contains much more randomness than we might like to admit.
It is for this reason that I encourage what I’ll dub “positive scrutiny”, a constant state of being in which we take no “proclaimed knowledge” for granted. Just because someone says something, draws something, assembles something, writes something, or otherwise puts it forth as true, doesn’t mean that we should assume its membership to the validity club. We must always squint just a little harder at what’s thrown in front of us, so we can sort the 24k nuggets from the fool’s gold. This allows us to admire the pretty graphic with all the logos, but understand the the conclusions we may draw from it are hugely limited.
Anyways, amidst this state of eye-squinting, we’ll find ourselves in a lovely discussion. There are plenty of people who will see the clubs in our top 25 and think “that’s an excellent football model”. There are others that view teams who unfalteringly sell their best talent to the domestic champions as feeble, and more interested in finances than genuinely challenging for the top. The biggest example of this, in recent years, is Borussia Dortmund’s relationship with Bayern. Dortmund is certainly a competitive club with incredibly attractive football, but they’ve sent Lewandowski, Hummels, and Gotze to their biggest competition, in their primes. Yes, Dortmund has generated loads of revenue from their exports–but is this hindering their chances on the field?
What about Ajax? Frenkie de Jong, Mathijis de Ligt, Hakim Ziyech, Donny van de Beek, and others led the Dutch club to a fairytale Champions League semifinal run–and were nearly all shipped across Europe the subsequent summer. de Jong sealed a move to Barcelona, de Ligt to Juventus, Ziyech is now moving to Chelsea, and van de Beek will likely follow to another eager program. Their sales may be impressive, especially noting their recent history with players of Ibrahimovic and Suarez’s stature growing into some of the best players of the modern era–but is their tendency to get picked apart by Europe’s sharks mitigating their competitiveness in the UCL?
There are loads of elements to unpack with each of these teams, and no particularly right answer. At some point, we must let our souls rest and simply enjoy the argumentation itself.
So with that, make what you will of the reported top 25. It is fair to say, at minimum, that these teams have shown a tremendous ability to sell high and buy low, in 2019/2020. Purely economically, these numbers are strong and suggest leadership that is interested in scouting true diamonds in the rough, developing players effectively, and translating growth into profit. In a soccer world in which clubs, more than ever, resemble businesses more than teams, perhaps this is a critical metric by which they ought to be evaluated. Then again, no dollar amount is quite as sweet as lifting the trophy.
Till next time.
