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UNITED SOCCER LEAGUE MEDIA CONFERENCEMarch 24, 2016Jake EdwardsJOHN GRIFFIN: Thank you for joining the call today. As we announced, Jake Edwards, our president, is going to be available for some Q&A, before we start the Q&A session, I'd like to give the phone over to Jake so he can give you an update on the start of our 2016 season. Thank you again. JAKE EDWARDS: Good after everyone, and thank you for joining us. We've got many people on the line now from across the U.S., Canada and overseas, so we appreciate your time. We appreciate your support of USL and continued support of the growth of our sport over here. Big season ahead for 2016. We've had a busy off‑season, that's for sure. But we like to look ahead now to all the exciting things that will be coming for USL in the 2016 season. There's been a lot of league growth, continued growth. We've gone from 24 to 29 teams. We've got seven new clubs that have joined the USL in the off‑season, six that are going to be participating in the 2016 season. We continue to focus on markets, focus on ownership quality and we continue to focus on improving the stadiums as we look to expand the league. Excited to welcome our three new independent clubs in south Texas, Rio Grande Valley. Great ownership group there, owners, operators of an NBA D‑League team currently building a 10,000‑seat soccer specific stadium. Thrilled to also welcome FC Cincinnati into the league this year. Another strong ownership group with Carl Lindner at the helm. Fantastic facility in Nippert Stadium and a great executive management team in US Soccer legend John Harkes at the helm of that franchise. Also thrilled to welcome San Antonio, led by the Spurs Sports and Entertainment Group, one of the outstanding sports organizations in North American sport across a number of sports. Thrilled to have them in what is a fantastic stadium down there in San Antonio. Our MLS partnership continues to go from strength‑to‑strength. It remains a great example of two independent professional soccer leagues working together on a number of fronts to advance the game across the United States and Canada. Pleased to welcome three new MLS franchises into the USL: Sporting KC Swope Park Rangers, an exciting new club in the downtown part of the city, resurrecting a brand there that the supporters are very familiar with. Pleased to welcome back Orlando City, long‑time USL club, got their start in the USL, led the way for many years and have knocked it out of the park since joining MLS. We are happy to welcome them back with Orlando City B. Finally an interesting new model with Philadelphia Union extending into an very historic part of the county in Lehigh Valley and resurrecting the Bethlehem Steel FC brand. So thrilled to welcome these three new clubs into our league and expecting big things from them. The affiliation model continues to be beneficial to both MLS and USL clubs, nine affiliations this year including the new MLS team Atlanta United partnering with our long‑time historic club Charleston Battery, and some of the first players you'll see wearing from ‑‑ well, turning out from the Atlanta organizations will actually be making their debuts in USL which will be interesting to see. New ownership. We've got three new independent teams, three new MLS teams and in addition to that, interest in USL remains an all‑time high, not just on the expansion front, but new ownership coming into our existing teams in the off‑season. We've had two very historic teams in the 20‑plus club, Rochester Rhinos and Charleston Battery both have new ownership groups. We welcome David and Wendy Dworkin, outstanding real estate developers, local owners out of Rochester, minority owners of the Sacramento Kings, have taken over that franchise to make sure it has a very promising future ahead. And Eric Bowman, very successful tech entrepreneur locally‑based man, and very passionate supporter of Charleston Battery, has taken over that club and is already making significant investments and infrastructure into the club. Arizona United bringing on Grammy Award‑winning artist, Diplo, and his management team into the ownership group there. So very healthy picture with our ownerships, new and established. We continue to invest heavily to focus our attention on the venues that we showcase our sport in. We continue to make progress on a number of fronts with our soccer‑specific stadium initiative, our partnership with HOK has been tremendous over the last 12, 18 months. We have redrawn the guidelines for our venues. We have added a whole host of new amenities into those guidelines that our teams are working to implement and ETU Cable (ph) have also created a prototype stadium, a 10,000‑seat stadium for USL, and we'll be excited to make the announcement in the next 30 days of the first one of its kind being built now ahead of the 2018 season. We continue at the league office here to make major investments into our commercial, into our media and into our digital initiatives. We have a digital‑first strategy here at USL and we'll be announcing in the coming months a new commercial entity tasked with the packaging and selling of media and commercial rights for the league. We'll also be announcing a new broadcast partner for both digital and linear broadcast of our games for the '16‑'17 season and beyond. We'll also be embarking on a new digital strategy, which we've launched yesterday, our new league website, much more capabilities and interactive content, and that is step one of a migration towards bringing all of our clubs onto a single, digital platform to aggregate the value we have across 30‑plus markets. There's been a lot of work in the off‑season. We focused on league operations and some of these commercial investments that we're making. We focused on the expansion and the quality of the clubs and the venues and the ownership groups coming in. So despite all of that, finally, it is about the competition. It's about the game, and we are building here the highest level of competition on the field outside of Major League Soccer. We truly believe that. We've got a large number of our players now will be participating in the international competitions this summer and did so last year in the Gold Cup. We've got a tremendous stable of coaches in our league. We've got some top‑class coaches coming on board now to drive us forward with coaches like Frank Yallop, John Harkes, Paul Buckle, Marc Dos Santos joining long‑serving coaches such as Bill Becher, Leigh Cowlishaw, and Coach of the Year, Bob Lilley. Last year we saw a tremendous turnout from the fans to watch those games and cheer the teams on, both in the live event and on the stream. Those numbers will continue to go up across the country. Exciting times. We're looking forward to kicking off this weekend, looking forward to seeing our new teams compete. With that, I'm happy to turn it over to you guys now and take a couple of your questions. Q. I'm curious about expansion, in the context of how we're seeing the various leagues now starting to fill out a lot of the markets across the United States and even into Canada where there are maybe sometimes even competition within cities. Do you feel like as all three leagues have grown, particularly yours, we're starting to reach capacity or how much room there is yet to grow for professional teams on the continent? JAKE EDWARDS: There are, in our minds, a significant number of markets that do not have professional soccer in them; that don't have access to live, professional soccer in their market. It's a significantly large continent. There are a number of markets that we think would sustain high‑level professional soccer, and so as we look to build the national footprint that we have, we do so on a regional basis where we look to build those regional rivalries between clubs where we look to find markets that are within a couple of hours drive, so the fans can travel and follow their team on the road. We've seen that in significant numbers this year; we will do again this season coming up. But look, we have to think about getting the mix right when we look at these markets, as well. There are absolutely a lot of markets left to go but we've got to find the mix of quality local ownership, stadium options, whether they exist or not, or whether the ownership group needs to build something, and again, how that market fits into both the strategic growth and the support of the sport in that market. So we believe that there are a number of markets out there that fit that mix and so we will continue to push forward. We have ownership groups now ready to go into the 2018 and 2019 season. So I think we're seeing year‑on‑year growth from here on out. Q. Tell me how you see the league in five to ten years, in terms of, you've touched on cities, facilities, but what does the league look like, and what's your thoughts in terms of possible expansion into Caribbean markets? JAKE EDWARDS: Let me take your second question first, expansion into Caribbean markets. We did a number of years ago and we have no plans to do that again at this point. We are focused on the USA at the moment and Canada where we exist. We don't have a plan to go back into the Caribbean market. We don't think that makes sense for the strategic growth of our league and the desires of our clubs. In terms of your first question, as I look into the crystal ball here about what it looks like in five, ten years time, what we are trying to build here, our goal here is to be one of the very best second divisions in the world, and we put ourselves up there with some very‑‑ some of the top leagues in the world. I referenced the championship in England several times, as one of the fourth largest leagues in Europe based on attendance, venue size, revenues generated, etc. Can we get there? Yes, we absolutely can. We've got a lot of work to do, of course, but as we focus on investing in infrastructure and creating top‑class stadiums and we look at bringing on world‑class ownership groups that have owned and operated at the highest level, and we start to build out our operations of our league, I think that's achievable. That's something we're focused on going forward. Q. Just wondering with this agreement with the hybrid affiliate with the Dynamo, what are the expectations for that, as well as the first hybrid between the two leagues? JAKE EDWARDS: Well, it's very simple. You've got two really top‑class organizations there coming together to do one thing, and that's to win; to put on an extremely strong team that's entering the USL to win a championship. That's what it's all about. And so, as I said, two very experienced groups. I know full well they have got a great coaching staff and some great players there coming to represent RGV. We've got a great local ownership group down there that are building a fantastic stadium. It's going to be a fantastic market for the USL. It's well over a million people down there. It's one of the youngest and fastest‑growing populations in the United States. It's a vibrant soccer community. So we are fully anticipating a very well‑supported club in that market. Q. What is the status of the application for second division status, and do you think that as you do that, there will be a chance of Instituting promotion relegation ten, 20 years down the road? JAKE EDWARDS: Well, your first question is a simple one, and it is we are currently in the process of going through that application with the federation, submitting all the final documents required. We continue the process for Division II sanctioning. I won't get into the promotion relegation question. I think that's certainly a long way off. It's not something that I think is going to happen anytime soon. Q. A number of teams last year lost significant money. I think of Austin and Charlotte where there have been reports they lost in the seven figures. How realistic are the new owners of what it's going to take to build a club, and also, how many clubs at this point are profitable or breaking even? JAKE EDWARDS: I'm not going to go into the revenue side from a club perspective. This is about creating long‑term value, long‑term added value or franchise value for our owners. That's what they are all in the game for. We have been able to heavily invest in our league and all of those clubs have heavily invested into their infrastructure and their clubs to see the value go up over time. We've got clubs now that are valued in our league from 3 million at the low end to almost 20 at the high end, 20 million, so these are significant numbers, significant growth in value that our clubs have been able to achieve in a short space of time based on the growth. You referenced Austin. Austin had, as you know, a very difficult year last year with losing the stadium and the impact that had on that club was significant due to the massive floods that hit the market. We've given them some breathing room now while they regroup and come back to build a stadium which is required in that market, given the lack of appropriate stadiums for the standards that we have for our teams now. Q. You talked about room for growth. Have you had expressions of interest from north of the border, and can you see expansion imminent in Canada? JAKE EDWARDS: We've got three, as you know, three professional teams up in Canada that are participating in our league, three or four professional members of the U.S. Soccer and have had a good experience so far in the USL. They have got a long future with us. I know there's some movement into Canada at the moment or discussions going on about creating their own league up there, which is frankly needed. But right now, we do not have any plans to further expand into Canada, given the potential dynamic of a league forming in that country. But as I said, we've got three teams that are doing great things, but will be with us for the foreseeable future. Q. And do you anticipate those three teams would leave you and join the National League if that was to happen? JAKE EDWARDS: No. Q. Can you talk about the process of disbanding the W‑League and your thoughts and terms of will USL get involved in a top‑level summer league in the years to come? JAKE EDWARDS: We have long supported women's soccer at the youth, amateur and professional levels in the United States and Canada and certainly will continue to do so. I'll just put in closing, thanks everybody for participating and thanks there for the guys that asked questions and thanks for all the other folks on the call listening in. Look, we very much appreciate all your support and support of the USL and the sport in general going forward. I look forward to speaking with you again as we go through the season. Thanks again for your time, everybody. FastScripts Transcript by ASAP Sports |
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