Insight to Villa’s take over by Tony Xia - How football as a business is run in China

[Deisler123]

next comes 'how they run the clubs in China'. 

[PussEKatt]

So, when Aston Villa start their championship season will most chinese football supporters support their local team as well as Villa ? 

Here in Perth 99.9% of football supporters support their local/A-league team as well as an English team.

[Deisler123]

4 minutes ago, PussEKatt said:

So, when Aston Villa start their championship season will most chinese football supporters support their local team as well as Villa ? 

Here in Perth 99.9% of football supporters support their local/A-league team as well as an English team.

won't be a lot if Villa stay in Championships. If they fight back to PL, 1 million at least i would say. If they play in Champions league, 3-5 millions. 

if Villa has a chinese player in the first team, or even first 11, 10million at least. 

And every single Villa game will be broadcasted live in China, no doubt about it.

But it all comes down to how good the Villa football is, which is down to how good the club management is

[Chewie]

27 minutes ago, Deisler123 said:

And every single Villa game will be broadcasted live in China, no doubt about it.

But it all comes down to how good the Villa football is, which is down to how good the club management is

Hey Deisler, thanks for the informative posts.

What are the chances of Villa games being shown in China this coming season with Villa being in the Championship, but owned by a Chinese national?

[Deisler123]

5 minutes ago, Chewie said:

Hey Deisler, thanks for the informative posts.

What are the chances of Villa games being shown in China this coming season with Villa being in the Championship, but owned by a Chinese national?

I can only talk about Mainland China. The chance is 0, if none of the following happens:

1) A lot of PR happening by Recon in China (little effect, because Recon is not a big thing at all).

2) A player can play in the first 11 continously (70% chance)

3) A player can play in the first team (30% chance)

4) a few youth players (0 chance)

 

Just give you two things and you may find the relevance between them,

a) central TV channel bought Premier League rights for the first time in the history, last year. 

b. President visited UK last year, talked about football many times in his speech, and visited Man City.

Edited May 21, 2016 by Deisler123

[snowychap]

57 minutes ago, Deisler123 said:

...corrupted with awful human rights record (I strongly disagree with that, although it often is claimed by some journalists working for CNN/BCC...

No wonder you said it was a controversial topic in the other thread.

Edited May 21, 2016 by snowychap

[It's Your Round]

Thanks for your insight Deisler. I think we're all a bit twitchy with the lack of information/changing information, anything you can provide us with to help us understand how business works in China is a good thing. 

Ultimately though, all we can do is hypothesise, and hope for the best. Time will tell of course. 

[VillaBrum]

Maybe Steve Hollis should have been given this insight - it could be that everything is ok, but this kind of information would have been invaluable during his negotiations. (Just my personal musings  )

[S-Platt]

Ok another question what is the difference between Hong Kong now back with China and the mainland?

As you are probably aware our neighbours were bought by a HK hairdresser who is now in jail!  So they operate outside of Government control or they can pick and choose?

I guess what I am asking is, is it a safer to be owned by a mainland company?

[Deisler123]

51 minutes ago, S-Platt said:

Ok another question what is the difference between Hong Kong now back with China and the mainland?

As you are probably aware our neighbours were bought by a HK hairdresser who is now in jail!  So they operate outside of Government control or they can pick and choose?

I guess what I am asking is, is it a safer to be owned by a mainland company?

HongKong is very different. The whole idea that China got it back from Thatcher is to have a different system running in Hongkong for 50 years at least. But you know things are not that straightforward.

HK is at the edge of a necessary change. In my opinion, a change that is required more in how local people think. 20 years ago, they are far more richer than mainland, so they feel good and superior (nothing wrong with it). 

But now, they are very dependent on mainland, in terms of resources, income, tourisms and everything. And mainlanders are much richer now, probably richer than HK (not in terms of the average of whole population ofc). So some of the local HKers think it is the government's fault, without realising that the world is changing now.

I guess no use to get into these political non-sense (i am interested in politics but have no interests in discussing it online...). HKers do not have full control over what they can pick and choose - Beijing picked a few candidates for them and then HKers vote for one of them. That was the reason why a lot of protests last year in HK. I always joke on that, and it is only a Joke so dont take it seriously - Since when British overlords gave their choice over who the next leader of HK will be when they were part of the UK in the last 100 years? And why would HKer get anything different than what mainlainders get in terms of political rights? I personally even need a permit to go to HK as a Chinese citizen, and british citizens don't, what the hell? (you see why the two groups of people have strong opinions on each other at the first place? Yes, In-Equality that is.) The government has to correct that, and they are working on that.

Regarding your question: 'I guess what I am asking is, is it a safer to be owned by a mainland company?' It is hardly that black and white. If Villa is owned (fully) by Wanda and Evergrande Group, congratulations, Villa will win Premier league within 5 years, and I am willing to bet on that. If Villa is owned by National Electricity Network (who owns Shandong Luneng atm in China - I will talk about this club and how it is run awfully in my next post), you'd better pray for staying in Championships (i say this quite seriously)! These owners all have the commonality - very RICH; It is their difference that makes the difference - how they manage the clubs.

Edited May 21, 2016 by Deisler123

[nnock1984]

Good read so far.

 

The most important thing that I'm sure we'd all like to know is who is Tony, and does he have the financial clout to do what he says he is going to do? 

[Daweii]

8 minutes ago, nnock1984 said:

Good read so far.

 

The most important thing that I'm sure we'd all like to know is who is Tony, and does he have the financial clout to do what he says he is going to do? 

No one knows to be sure but you don't buy a football club and on the global news stage spout plans of football world domination if you don't have a lot of cash. Someone of modest wealth would come in and make modest claims of stability and hopeful success, not we'll win the Premier League is 5 years and be the biggest team in the world in 10 years that just doesn't happen. I mean we are in the Championship a league where the transfer record is like £10 million, most teams get promoted spending about £10 million in a transfer window. Xia basically said the equivalent of "we can spend £20, £30, £50 million or you know whatever the manager wants to spend". Even those in the media have said £30 million is absurd in the Championship and we could be spending £50 million+ so he has plans and money, not sure where the money is coming from but he has it. 

[Duck]

1 hour ago, Daweii said:

No one knows to be sure but you don't buy a football club and on the global news stage spout plans of football world domination if you don't have a lot of cash. Someone of modest wealth would come in and make modest claims of stability and hopeful success, not we'll win the Premier League is 5 years and be the biggest team in the world in 10 years that just doesn't happen. I mean we are in the Championship a league where the transfer record is like £10 million, most teams get promoted spending about £10 million in a transfer window. Xia basically said the equivalent of "we can spend £20, £30, £50 million or you know whatever the manager wants to spend". Even those in the media have said £30 million is absurd in the Championship and we could be spending £50 million+ so he has plans and money, not sure where the money is coming from but he has it. 

This. If he has the money to invest then I'd much rather we had it than any body else. 

The worrying bit is how flippant he is about adding extra £10m's on to the budget in the interview. Smacks a bit like a new kid in a playground trying to impress everybody else. OR it could just be a translation/adaptation thing. Maybe he doesn't know how much a decent transfer budget is in the championship.

Anyway! Love the info in the thread Deisler! Definitely helps to understand things a bit better. 

[gaffmaster]

13 minutes ago, Duck said:

The worrying bit is how flippant he is about adding extra £10m's on to the budget in the interview. Smacks a bit like a new kid in a playground trying to impress everybody else. OR it could just be a translation/adaptation thing. Maybe he doesn't know how much a decent transfer budget is in the championship.

That part seemed to be dependent on what the new manager deems necessary.

[Daweii]

15 minutes ago, gaffmaster said:

That part seemed to be dependent on what the new manager deems necessary.

Yeah also may have been a bit of ass covering after he realised he likely shouldn't talk about funds in an interview every club can hear. Make it as vague as possible is likely the best idea there. 

[matteyp]

This is a really interesting read.

[Villarocker]

A great thread, Deisler and a very interesting read. 

Out of interest, do you have much knowledge of Xia? Is you gut feeling saying he will be good or bad for Villa? 

[Deisler123]

22 minutes ago, villarocker said:

A great thread, Deisler and a very interesting read. 

Out of interest, do you have much knowledge of Xia? Is you gut feeling saying he will be good or bad for Villa? 

no. He is very little known to Chinese people. But in a few weeks we will know. Once he officially takes over the club, he will do a lot of things - this is my prediction- whether or not that will be good for villa, no one knows.

[Deisler123]

I am back. Some more to update: Enjoy.

 

Part IV: The ownership of clubs in Chinese Super League – II: How rich owners run their clubs

 

Looking back at the 10-15 years of the development of the super league in China, owners come and go. Most (70%+) owners are not responsible at all, which is a reflect of what businessman are like in general in China. They (in general) are impatient, focus on the short-term interest and benefit, have no boundary of doing things, and only care about their own interests. This was, in general, believed to be due to the fact that the economy was developed so fast that everyone becomes money-oriented.

So let’s talk about how owners run their clubs in China.

Note here when I mention Chinese names, I will always go Last name first.

There are, in general, a few categories. Let me get to them one by one

 

Type 1) Very self-centred private owner, have some/little background of state support. Super rich. Do whatever they want

Example owner: ZHU Jun, owner of Shanghai Shenhua

Background: owner of the 9^th city, which is a company that operates online games (MMO in most cases). The company became super rich after running some Korean games and World of Warcraft in China.

Examples: He likes to speak in front of fans and media, and makes himself sound huge. He is very cocky, at the same time a crazy football fan. When his club played against a very famous club from Europe (cant remember which one) at a friendly, he played for half of the match. He promised to fans, after Chelsea won the champions league, that he will bring Didier Drogba and Nicolas Anelka to Shanghai. He did that – Drogba played for Shenhua for half season, then left. He didn’t pay his wages, then Drogba raise to FIFA, he got penalty of like 10mil pounds.

He was not very happy about the manager, and decided to sit with the manager in the games. Then he sacked the manager, and made himself as a manager for a few matches.

In 2014, he sold the club to Greenland (a state-owned super-rich real-estate company), under the pressure of Shanghai government.

So to summarise, Zhu knows football, he is a crazy fan. But he interferes how the club is run way too much.

If Dr. Xia is like him, Villa is in SUPER danger. But it is very unlikely that Xia is anything like him, so don’t worry too much.

 

Type 2) private owner, not very rich, huge passion on football, not very ambitious

Example owner: SONG Weiping – Hangzhou GreenCity

Background: not really too much to say about his company. He is not super wealthy. But I mention him here, because he is really passionate on football. He focused on youth camp, contributed quite a few players to national teams at different levels (ages). He spoke out against football fraud, which made him a hero in fans.

There are a few owners like him, nothing particular to say about them. They are just trying to keep their clubs survived in Super league. Their clubs have no hope to win the titles, and most years they have to fight for staying in the super league.

If Dr Xia is one of these owners, then nothing in particular to worry about. The worse thing is Xia will not have enough money to pump into the club.

 

Type 3) State owner, MEGA rich, don’t even know how many minutes a football game has, super ambitious (because of political need)

Example owner: National Electricity Network, owner of Shandong Luneng

Every season they will invest in serious money. However because they are a state-owned company, it is extremely inefficient in how they work as a club. A simple example here to help you understand: Say the manager decides to buy a player, he will tell the CEO of the club, the CEO needs to report to the ’leader/owner’ of the club, then reported to the head of the department in the company that deals with the club issue, then reported to his head, then….. Ok then the boss says yes or no, then managers knows that (from a headed letter with signature, which takes time). Then the manager approaches the player. The agent says: I am sorry my player agreed to join another club. Alrighty then, the whole process starts again. The example may be slightly exaggerated, but you get the point.

And the CEO of the club is often ‘assigned’ by the company boss, who often knows nothing about football. Everyone knows if a new leader comes to the house, what will they do first? Guess what, they will change all the policies and introduce new, exciting projects. Will they work? Only god knows. And if the club performed well, they will get promoted, leave the club and join another department of the company and will never touch football management again. If the club performed badly, they will be moved to another department of the company too.

So, if Dr Xia is this type of owner – Good luck, Villa. Pray for 1 in a thousand chance that will get you back to PL. Villa will not do too bad, so staying in Championship is probably what will happen.

 

Type 4) Private owner, ok-ish rich, want to test the water (for possible economic or political gain)

Example owners: 20%-30% of all clubs

They invest average money in the club, if the club doesn’t work out, they retract their investment and sell the club in half season or in 2 seasons, depending on how patient they are.

I have seen clubs simply got disbanded, all players lose their jobs etc. Mostly happened in the 2^nd or 3^rd division. It rarely happened in super league, as the local government will not allow this to happen- this will make them feel ashamed.

So better PRAY Dr. Xia is not this type.

 

Type 5) Private owner, super rich, determined to make the club success which leads to the success of his business and political development. May know something about the football but really use the club as a tool for his business empire.

Example owner: XU Jiayin, owner of Guangzhou Evergrande

He is a very special character I have to say. He served in the army, then moved to Guangzhou to start his career as a businessman. He operates his business empire like running an army – highly disciplined, he is THE boss, very strong character. He wants to be successful in every single thing he does.

He knew nothing about football. He was a volleyball fan, bought a volleyball club and invested a lot and won tons of trophies. Rumour said he has heard of the president and the head of province are football fans, then he bought his club immediately.

He invested sky-high money in the club – like 200-300 million pounds in the last few years. He wants the best manager and players in the team – Marcelo Lippi came, now Luiz Scolari. The team has 7-9 national squad players. He bought the best world class players, and if the club has no titles, he sacks the manager. Even the club is on the way to the title (2012 topped the group stage), he replaced the manager for Marcelo Lippi (rumour said President likes him, but no one can prove that).

He runs the club like an army (don’t get me wrong, it worked nicely – most Chinese players lacked discipline). A single match win bonus (for Asian Champions league) for the team is 1 million dollars (yes, you read it right, 1M per match). One player broke his bone for a key save in the final match of the group stage, he gave that player 1 million dollars as a reward that night. One player twittered and complained that he did not have 1^st team opportunity – next day he was sent to the reserve and never played again. He does not allow ANYONE to interfere how the manager runs the team – the CEO was chased by the journalists and he had to get in to the players' changing room to escape. That was only 5 mins. The CEO next day lose his 6 months salary and got a warning. He made his ‘6 DO’s and 3 Don’ts’ rules for all players – for example no smoking no alcohol no argument with referee and managers etc. Anyone who violates that rule, will have 1 million RMBs penalty or even kicked out from the club. In an end-season final party, the politicians wanted to cheer with the player (with wine), the player literally turned to the manager and asked for his permission. That was broadcasted live and I watched that – I was very surprised.

So, as I said in another post, if Dr. Xia is 50% as good as Xu (with some adjustment to English football ofc), I will not be surprised at all if Villa win the Premier League in 5 years.

 

After all this, I would like to give my own opinion on Xia’s take over.

If he bought Villa all by himself (with his own company), without any state support:

Then I think it will be either type 2 or 4. Much more likely to be Type 2 than 4, in my opinion. Villa may get promoted, but cannot do what Xia said about becoming one of the top world clubs. He is not that rich tbh.

If he has state support – in this case his own personal wealth is irrelevant.

I think he will be very likely type 5. The reason that the type 3 club does not work is because those owners do not have to make the club successful to be able to climb up the career ladder. The state support Xia may have is at a completely different level, which has the will of the government that they want to export influence, and football is a perfect platform for that ambition. Xia has to do well and the club has to perform well – otherwise his own business could be in danger (imagine what will happen if your wife asks you to wash the dishes, and you refuse that – same ending).

So, looking at the take-over purely from the 3^rd-party perspective, I actually would hope Xia has the state support. Because if he hasn’t, the best Villa can be is just a club that needs to worry about relegation back to 2^nd division every year.

Considering the current national strategy of China, I think it is very likely that Xia has state support. It is no secret that president likes football, he also wants to use football as a lead to a huge expansion in domestic market for economy growth. China has tons of foreign currency (5 trillion USD in their banks) and they need to be spent. And the strategy seems to be have global influence and soft national force (in terms of influence and economy), rather than hard force (like what US does in terms of military actions). You guys all know that the president of China visited the UK for 2 days – and he spent half day in Man City, right?

So I think it is quite likely he has state support.

If he has the state support, the best Villa can be is HUGE. And the worst? Very unlikely to be worse than worrying about relegation every year IMO.

We can only wait and see –

Doing something and doing something quick in the summer after the take over will be a very good sign. Because that means Xia has the urge to make the changes. In the next few weeks, everything will unfold.

Most Chineses owners like to interfere the managerial role, which never worked out. Xu never did that, so his club becomes very successful, based on enough budget he puts into the club. This is THE KEY to sucess for a chinese owner. If Dr. Xia ever decides to interfere what manager should do, nothing good will happen.

Edited May 23, 2016 by Deisler123

[meme]

For all the chumps that like internet images, here you go. Have one for this situation.

Edited May 21, 2016 by meme