Chelsea’s troubles and the limits of ‘smart money’ in sport
Also in today’s newsletter, Premier League managerial churn and a brutal NY Mets losing streak
Will Italy make it to the World Cup after all? The question appeared settled late last month when Bosnia and Herzegovina triumphed in the qualification play offs, locking the Azzurri out of a third consecutive World Cup. The humiliating result cost the Italian head coach and the head of the football federation their jobs.
But now a US envoy is seeking a do-over, suggesting to the White House and to Fifa that Italy should take Iran’s place at the tournament. So is this for real?
Fifa has so far laughed the suggestion off. Officials at the governing body expect Iran to play, meaning there is no vacancy to be filled. Having previously said Iranian players would not travel to the US, the country’s football federation has recently signalled the team’s intent to play games in Los Angeles and Seattle as planned.
Italy’s sports minister has also dismissed the idea, saying it would be an embarrassing outcome for the four-time world champions. Asked by reporters on Thursday about the idea, Donald Trump seemed unaware, but said he’d give it some thought.
In the current world of geopolitics, even things that initially seem outlandish (eg the US invading Greenland) can swiftly become deadly serious. But even so, Italian fans should probably refrain from booking any plane tickets just yet.
This week we look at two big, rich but struggling teams — one in football, one in baseball — and ask what their troubles tell us about “smart money” and sport. Do read on — Josh Noble, sports editor
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Chelsea’s coaching problem
Chelsea’s private equity owners paid £2.5bn for Chelsea FC in 2022 when they took over from Russian tycoon Roman Abramovich. They’ve since spent over £1.5bn on players. But somehow, things keep getting worse.
This season, Clearlake Capital and US financier Todd Boehly have parted ways with two head coaches — Enzo Maresca and Liam Rosenior — and look set to miss out on the lucrative Champions League next season.
On top of that, Chelsea posted a record £262.4mn pre-tax loss in the year ended June 2025. That’s higher than any other English club in history.
It’s easier to excuse early missteps, like the appointment of Graham Potter as head coach to replace Champions League winner Thomas Tuchel or the signing of Raheem Sterling, who barely played before being let go earlier this season.
But managerial churn and underperforming new signings — such as the £40mn Alejandro Garnacho — point to ongoing, systemic problems.
Kieron O’Connor, who analyses club finances under the Swiss Ramble moniker, thinks there is now a serious risk that Chelsea will fail to comply with the terms of a settlement agreement struck with Uefa last year.
Questions persist over the ownership group’s funding model. The holding company has a $500mn payment-in-kind note provided by Ares Management. There is a separate layer of £794mn debt at another entity above the club.
While debt might look scary to fans, Chelsea’s owners have options because the PIK notes don’t mature until 2033, leaving time for refinancing. The bank debt is on course to be extended, according to a person familiar with the matter.
Financial engineers should know how to navigate what are common funding tools in their world. The immediate issue at hand is whether Clearlake, as majority shareholder, can show it has learned its lessons about operating a football club. The next choice of head coach and the upcoming transfer window are a huge test.
On an optimistic note, Chelsea has, on paper, a squad with real balance sheet value. That gives them the opportunity to sell some players this summer if required. But what about the longer-term strategy?
“There is a plan. We reflect on the plan. We try to improve the plan and tweak the plan if it’s not working. The message is we’re committed,” Clearlake co-founder Behdad Eghbali said at a recent industry conference.
With the club now looking for its sixth manager in under three years, those tweaks seem to be getting more and more frequent.
Premier League managers: wanted, but not for long
In the Premier League this season, heads are rolling faster than ever, as the financial pressures of underperformance on the pitch push owners to take action.
Since the start of the 2025-26 season, nine full-time managers of top-flight English clubs have been dismissed by their owners, averaging less than a year in the job, according to FT analysis of Transfermarkt data.
Managers who left this season lasted an average of 295 days in charge, the lowest tenure since the Premier League was launched 34 years ago. The previous record low was 415 days in 2008-09, excluding 1992-93 and 1995-96, when only one manager departed in each season.
Alongside goals from corner kicks and the return of the long throw-in, managerial churn has been a feature of the season. Aside from Rosenior, Chelsea also sacked Maresca after 18 months in post, while Manchester United parted ways with Ruben Amorim after 14 months.
Things have been even more brutal at the other end of the table. Nottingham Forest have already appointed four managers this season. Ange Postecoglou was sacked in October after just 39 days, making him the club’s shortest-serving manager and the second shortest-serving in Premier League history. Igor Tudor lasted 44 days at Tottenham Hotspur.
These short managerial stints highlight the increasingly ruthless approach of club owners as the financial rewards of staying in the top flight or qualifying for lucrative European football grow ever larger.
The figures mark a sharp contrast with earlier decades, when managers typically stayed in post for years and owners showed greater patience when results fell short of expectations.
New York Mets: when money can’t buy wins
No American sport illustrates what money can achieve quite like Major League Baseball. Look no further than the Los Angeles Dodgers, who spent a staggering $515mn in combined payroll and luxury tax last year en route to their second consecutive World Series title. But for the New York Mets, a brutal 12-game losing streak that finally ended on Wednesday night was a reminder that even a payroll of roughly $380mn doesn’t guarantee success.
Once the city’s “loveable losers”, the Mets were supposed to have shed their reputation for underachieving under the ownership of Steve Cohen. Since buying the team for $2.4bn in 2020, the “hedge fund king” has spent aggressively to build a winning roster. Following a deep run in the 2024 postseason, Cohen outbid the rival New York Yankees for Juan Soto, signing the star hitter to a record-breaking 15-year, $765mn contract.
But the Mets failed to make the play offs in Soto’s first season with the franchise, triggering a roster overhaul designed to vault the team back to World Series contention this year. Despite the disastrous 9-17 start, there are still 136 games left to play. But no MLB team has ever made the postseason after enduring a 12-game losing streak.
Another failure and “Uncle Steve” — as Met fans affectionately call him — may be spoken about in less flattering terms in Queens. Purchasing the team had allowed Cohen to remake his reputation. A ruthless hedge fund manager with a controversial past became the savior of a franchise that had long played second fiddle to its more illustrious rival in the Bronx. Having won the support of local officials, the Mets’ owner now has plans to build an $8bn casino complex next to Citi Field.
Win or lose, the Mets’ runaway spending — and that of the Dodgers — is also set to become a flashpoint in pivotal labour talks looming after the season, when team owners are expected to push for a salary cap. Unlike other major US sports leagues, MLB does not have a hard cap, a concept the players’ union has long opposed.
Proponents argue that a salary cap and a minimum floor would fix MLB’s widening payroll disparity and improve the league’s competitive balance. However, others believe the real motivation behind a salary cap push is that cost certainty could boost MLB franchise valuations, which have lagged behind the NFL and NBA. That argument grew more complex after reports last week that the San Diego Padres are nearing a $3.9bn sale, a record valuation for an MLB team.
For the Mets, there is irony in all the big spending. While a deep-pocketed owner willing to splurge is an undeniable advantage, Cohen himself has voiced a desire to “be more measured in payroll growth” and strengthen the team’s player development system. If a highly-paid roster fails to deliver, sustained success may ultimately depend on cheaper, homegrown talent, rather than Uncle Steve’s wallet.
* When is a football club more of a lifestyle brand? Find the answer on the shores of Lake Como.
* An AI-powered robot invented by Japanese tech group Sony beat expert table tennis players in a landmark machine-over-human triumph in a major competitive sport. - Link to article
* LVMH-backed private equity firm L Catterton is launching a $500mn consumer-focused fund with athletes including basketball star Kevin Durant, baseball player Mike Trout and golfer Patrick Cantlay.
* Former Premier League footballer Kevin Davies owns a golf simulator. He’s not the only one shelling out £30,000 for the technology.