EletiofeMLS is ready to take off its financial training...

MLS is ready to take off its financial training wheels

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Inter Miami's Argentine forward #10 Lionel Messi during the friendly football match between Inter Miami CF vs. Newell's Old Boys at DRV PNK Stadium in Fort Lauderdale, Florida, on February 15, 2024. Inter Miami superstar Lionel Messi returned to the starting lineup for the MLS club on Thursday in a 1-1 home draw with his Argentine boyhood club, Newell's Old Boys. (Photo by CHANDAN KHANNA / AFP) (Photo by CHANDAN KHANNA/AFP via Getty Images)

The arrival of Lionel Messi has sparked a renewed push for the MLS to ditch financial restrictions in order to allow the league to blossom into one of the best in the world. (CHANDAN KHANNA/AFP via Getty Images)

The unseen evolution steering MLS through adolescence is a function of technology, money and necessity.

The league’s childhood was one of volatility and austerity. Its present, at age 29, is full of incongruity and contrasts. While Lionel Messi dazzles, and owners boast of a future among soccer’s elite, self-imposed roster restrictions stunt their collective growth. Arcane rules alienate fans. Spending limits handicap the quality of play. They promote parity within MLS, but impede competitiveness with foreign clubs — for continental titles, and for TV audiences.

Off the screen, though, an elemental reason for the restrictions is disappearing.

The implicit message behind the rules, as multiple club executives explained to Yahoo Sports, is that the league and owners don’t trust teams to make smart decisions with their money.

So, in recent years, they’ve spent millions of dollars to improve decision-making.

They’ve built modern scouting networks and sporting departments, full-fledged staffs and databases, infrastructure that didn’t exist when restrictive rules were formulated. Most, if not all of the league’s 29 clubs have hired specialists in realms like player identification, analytics, economics and high performance. Their many responsibilities used to burden one head coach, or perhaps a single general manager; now, they’re delegated to experts, who are increasingly capable of finding talent in far-flung corners of the soccer world.

The league, meanwhile, has rolled out some spending initiatives, which have allowed clubs to sign some of the talent they find. But many sporting directors — or “chief soccer officers,” CSOs, in MLS parlance — still feel constricted. In interviews over the past month, some advocated for a loosening of the rules or a lifting of spending limits.

And a few specifically cited this league-wide evolution in scouting and recruitment as evidence that they’re ready for more freedom.

“I wouldn’t have said that 10 years ago,” one experienced club official clarified. “I don’t think that the teams nor the league was sophisticated enough. Now, the teams and the league are much more sophisticated.” Now, they have foundations from which real ambition can bloom.

Los Angeles Galaxy President Alexi Lalas presents David Beckham with his jersey during a press conference introducing Beckham as the newest member of the Los Angeles Galaxy on July 13, 2007 at the Home Depot Center in Carson, CA.

It’s been nearly 17 years since David Beckham arrived in MLS in 2007 in what was the league’s splashiest signing of an international star. (Getty Images)

Holding hands

Long before the evolution, in 2008 or thereabouts, Curt Onalfo jetted down to Argentina on a mission that typified an era. Officially, Onalfo was head coach of the Kansas City Wizards; but in those prehistoric times, coach was also chief scout. And there were no digitized libraries of game film. So, on spare days, Onalfo would travel and forage for players. On this particular day in South America, he met an agent — whose car promptly broke down.

“Literally, I had to push his car,” Onalfo remembers. “That’s kinda how it was back in the day.”

That’s how it was, in MLS markets big and small, throughout the 2000s, and well into the 2010s. Garth Lagerwey, who began his front-office career with Real Salt Lake in 2007, was “senior vice president and general manager,” but also “scout, agent, contract [negotiator], salary cap [expert], everything,” he says.

Coaches also remember “wearing a million different hats,” because budgets were tight and staffs were slim. To fill roster holes, they’d often hit up agents for recommendations. They’d road-trip to college games. They’d scout within MLS on bye weeks. They’d grind through VHS tapes, and later binders full of DVDs.

So they were wholly unprepared when the Designated Player rule arrived with David Beckham in 2007, then expanded in 2010. They’d been scouring American amateur ranks; suddenly, they could also chase international stars. “That’s really when it became apparent that teams did not have robust scouting departments,” says Tim Bezbatchenko, an MLS Cup-winning exec in Toronto and now Columbus who worked in the league office at the time. Designated Players (DPs) flopped, again and again, so frequently that the league intervened.

Four central MLS employees — Bezbatchenko, Todd Durbin, Lino DiCuollo and Ali Curtis — would divvy up the league’s 16-plus clubs and help recruit players or negotiate contracts. Some coaches and GMs felt micromanaged; others welcomed the assistance. Bezbatchenko remembers near-daily calls with Houston Dynamo leaders to talk through their roster. He and the league were “really hands-on,” he says, “facilitating the acquisition” of Honduran winger Oscar Boniek Garcia in 2012.

The interventions soon progressed to legislation. By the mid-2010s, owners and league officials knew that on-field quality had to improve; but they worried that a simple salary-cap hike might simply lead to more money wasted. They rolled out a series of calculated spending mechanisms, with strings attached. There were “Young DPs” in 2012; Targeted Allocation Money (“TAM”), on top of General Allocation Money (“GAM”), in 2015; and the “U22 Initiative” in 2021, among others. Each measure encouraged investment in young foreigners, in roster slots 4-10. Each one, in other words, allowed clubs to spend, but controlled how they spent — because teams still weren’t trusted if left to their own devices.

“As the owners and the league office decide to put forth these initiatives, they also want to know that the money is going to be spent wisely,” Bezbatchenko says.

So, simultaneously, they encouraged clubs to invest in sporting departments.

Some well-run and resourced clubs had already identified scouting as an inefficiency. Data analysts began popping up in Seattle, Toronto and elsewhere. The ever-growing MLS rulebook only made them more valuable and necessary. “You’re trying to find wins in the margins,” says current Toronto GM Jason Hernandez. And you’re trying to evade mistakes; the cap prevents clubs from spending to undo mistakes; but spending on analytics and trained human eyes can help avoid them in the first place.

Still, though, many clubs prioritized physical infrastructure. Some soldiered on into the 2020s with scouting systems virtually non-existent. When Pat Onstad took the reins in Houston in 2021, for example, “it was basically the general manager and assistant general manager, essentially responsible for recruitment and finding players,” he says.

“And don’t get me wrong,” Onstad continues, “that’s what a lot of the league was in the past.” Now, he says, “everybody’s evolving.”

The analytics rush

A typical MLS process now begins internally with carefully crafted “player profiles.” Coaches, CSOs and others meet to clarify: What, exactly, are we looking for? They talk through various criteria — physical and mental, technical and tactical. They might discuss age and wage brackets. They’ll definitely discuss how Ideal Player X would mesh with club philosophies or a coach’s style of play.

And then, at a growing number of data-driven clubs, they’ll attempt to quantify all of that.

Analytics now assist most MLS clubs; but there’s a distinction, execs say, between being data-informed and data-driven. A data-informed club might use numbers toward the end of its process, to support or refute a human’s intuition. The data-driven clubs use objective metrics at the beginning, to “sort the world through data,” as Vancouver Whitecaps sporting director Axel Schuster says.

“Let’s say, hypothetically, we’re looking for a center back,” Hernandez, the Toronto GM, explains. “Out of the thousands and thousands of center backs in the world, the data can filter that down to say, ‘OK, well we want these five core competencies from the position to pop off the radar … and then the next five sub-core competencies to hit these measures.’ So you can go from a list of 5,000 center backs to 25.” And if 15 of the 25 play in the English Premier League, outside an MLS budget, 25 becomes 10.

Some clubs work with consultancies, such as src|ftbl (“source football”) in Houston, to develop shortlists. Others cultivate proprietary algorithms and models in-house. The Whitecaps “built our own digital black box,” Schuster says. Real Salt Lake, for example, uses quantitative profiles and a weighted scoring system to assess potential prospects. Most clubs are hesitant to discuss details, to protect what they believe is a competitive advantage.

All 29 clubs also rely on subjective assessments. Scouts watch games and file reports on hundreds of players. At some clubs, their recommendations contribute to initial shortlists. At some, their reports are stashed away, and help decision-makers maintain constant top-threes or top-fives of potential targets at each position.

Then, with shortlists solidified, and with video now easily organized, tagged and coded, scouts and their superiors devour clips and 90-minute matches. They’ll also travel to see players live, to get a feel for prospects as footballers and humans. The average MLS club, according to CSOs, now employs a half dozen full- and part-time scouts covering multiple continents. FC Dallas, for example, has three in Europe and two in South America — a far cry from the days of a head coach carving out a couple hours a day to cover everything.

The latter stages of the process include background checks and character evaluations. While assistant GMs might sort through salary cap implications, sporting directors, coaches and analysts triple-check to make sure they’re all aligned.

They know, of course, that all of this is inexact science; and that the evolution is nascent. Data and emerging technologies remain underexplored. Mistakes are still being made, even by the league’s biggest-budget clubs.

But the savviest clubs believe they’re finding bargains — and helping drive MLS forward. The question, now, is when and how MLS will raise the speed limit.

Speeding up

In many ways, sporting departments felt like the foundation’s penultimate puzzle piece. Nearly every facet of MLS has transformed over the past 10 years, from stadiums to training facilities, from sports performance staffs to the player experience. Among some foreigners, stigmas have proven sticky; but salaries and care have improved, and American life is as attractive as ever.

“By and large,” says Onalfo, now the New England Revolution sporting director, “more and more players want to play here.”

And more and more, scouting networks can find them. More and more, MLS clubs can accommodate them. The final puzzle piece is the spending restrictions, which still inhibit all involved.

Messi’s arrival last July renewed a push to ditch or streamline some regulations. Some coaches, CSOs and owners argued for expanded senior rosters, corresponding cap room, and the opening up of an intraleague transfer market. Throughout the summer, momentum grew. Change, however, failed to materialize at the league’s annual December board meeting. Inaction led to widespread ridicule. “We’re so slow-moving,” one CSO complained. “It makes no sense to me.”

But Todd Durbin, the MLS executive tasked with formulating roster rules and overseeing the board’s Product Strategy Committee, said last week that the reason for inaction was actually concern that proposed amendments perhaps weren’t “broad, deep and ambitious enough.”

“We were asked to go back and see if there are ways in which we can move beyond simple modifications to our rules,” Durbin told reporters. He and the owners eschewed incremental tweaks for 2024 because they didn’t want to “corner ourselves, or pigeonhole ourselves,” he said, in case “we wanted to make more sweeping changes, or do a more significant overhaul of the system.”

Five club officials, including one owner, told Yahoo Sports that they expect meaningful change in the near future, perhaps as soon as next offseason. Durbin and the Product Strategy Committee — a collection of eight owners or club representatives, akin the NFL’s Competition Committee — are knee-deep in a big-picture review, with meetings scheduled for late February and the spring, and a plan to present “initial strategic conclusions” to the full board this summer.

Their decisions will set the trajectory of the league. Sweeping change could deflate parity and create internal divides. But it also could allow MLS to maximize Messi; to compete at the 2025 Club World Cup; to capitalize on the 2026 World Cup; and to be the “top league” it has always promised to become.

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