European Soccer’s Smartest Stock Pickers
From Lewandowski to Pulisic to Sancho, there is no team that spots value like Borussia Dortmund
Dortmund, Germany
Before Borussia Dortmund could be European soccer’s smartest talent spotter, it had to go almost broke.
It was 2005 and times should have been better. Dortmund was just eight years removed from winning the Champions League and three from a Bundesliga title. But in this normally staid corner of Germany, success bred recklessness. The club started spending euros like it was printing them. When it needed more, it launched a disastrous IPO. The share price lost half its value in the first year.
There is a specific German word for Dortmund’s situation in those days. That German word is unprintable.
“We were not dead,” sporting director Michael Zorc said in an interview here, “but nearly dead.”
Dortmund is back in the Champions League round of 16 on Tuesday, but back then it didn’t have a choice. The only players it could afford were young and unproven. And if the club was ever going to challenge Bayern Munich again, it needed to figure out which of them might have a future. What happened over the next 15 years became one of the greatest hunts for value in modern sports.
Though Zorc said the club still whiffs on plenty of young talent, no one seems to hit so spectacularly and so often as Dortmund. The list of teenage and early-20s sensations to pull on Dortmund’s black-and-yellow jersey is the envy of European soccer.
Over the years it has included Poland’s Robert Lewandowski, Germany’s Marco Reus and Mats Hummels, England’s Jadon Sancho, Gabon’s Pierre-Emerick Aubameyang, and the captain of the U.S. national team, Christian Pulisic—all acquired before their careers exploded. The latest member of that club is Erling Haaland, a 19-year-old from Norway who joined this winter. He’s still coming off the bench, but already has nine goals in six games. In January, he averaged one for every 11.8 minutes he spent on the field.
“They know that Borussia Dortmund is the hottest spot to be for a 17- or 18-year-old boy who wants to become a top player in Europe,” Zorc said.
Dortmund’s pitch is simple: Come to this post-industrial corner of Germany and play significant minutes, in bigger games, at a younger age than anywhere else. Because despite its commitment to youth, Dortmund still manages to keep itself in Bundesliga title races and qualifies for the Champions League.
Plus, Zorc tells them, it’s all going to happen in a bumping stadium packed with 81,000 of the loudest fans in Europe.
To hammer home the point, he slides a printout of Dortmund’s most recent starting lineup across the table and starts reeling off ages. “Look, he’s 20. He’s 19. He’s 17,” he tells targets. “It’s not a promise or a dream. That’s the reality we are facing every Saturday…And of course, we are still a massive club.”
The club it is facing on Tuesday couldn’t make the contrast any clearer. If Dortmund is Europe’s shrewdest investor, Paris Saint-Germain might be its most extravagant. The PSG tandem of Neymar and Kylian Mbappé alone cost over $430 million. That’s more than Dortmund’s entire first 11.
Dortmund’s rebuilding project after the crisis happened to coincide with a larger rethinking of talent development in German soccer. Everyone was suddenly investing in its academies and promoting from within.
Then, in 2008, Dortmund found a bearded, bespectacled coach from the Black Forest with a penchant for hugging to nurture the talent. His name was Jürgen Klopp. At the time, he’d only ever managed Mainz 05, a team that yo-yoed between the top two divisions.
Klopp and Dortmund became the only club to unseat Bayern in the 2010s, winning back-to-back Bundesliga titles in 2011 and 2012. His lineups in those days were, on average, younger than 24.
That unflinching commitment to youth remained a condition for every one who followed Klopp, from Thomas Tuchel (now of PSG) to current head coach Lucien Favre.
“For me, it’s not a contradiction,” Zorc said. “You can use young players to win.”
Especially when they graduate from Dortmund’s own youth academy, one of the finest finishing schools in soccer. This is where Pulisic came to hone his craft after leaving Hershey, Pa., at the age of 15. Another young American, Gio Reyna, who happens to be the son of former U.S. national team captain Claudio Reyna, arrived last January at age 16 after being spotted at a youth tournament. “Born in 2002!” shouted Zorc, who has children older than Reyna.
The transition from academy to first-team happened so early that Reyna won’t move out of the academy dorms until the end of the season. “Are you really still living here?” Manager Lucien Favre asked him outside his building this month.
Dortmund’s track record means that convincing young players to move to the North Rhine rather than, say, Catalonia or Manchester or London, where teams can more readily sign expensive players in their primes, is easier today than it was a decade ago. Zorc said he is offered a couple of dozen players every week.
“Most of the work is to say, ‘No, no, no, no,’” Zorc said. “It’s easier only on the one hand, because we can show what we did…But on the other hand, there are so many clubs now going for the same player.”
Dortmund’s latest coup was beating Manchester United to signing Haaland, the 6-foot-4, 192-pound scoring machine from Norway. Though United could offer the kid more money, greater global reach, and even a Norwegian manager, Haaland said he’d had his eye on Dortmund forever. Dortmund, in turn, had been watching him since he was crushing other teenagers in Norway three years ago.
The challenge once Dortmund identifies and signs those players is keeping them for a few years. And unlike American sports, the club rarely has much say. French forward Ousmane Dembelé spent only one season, from age 19 to 20, before forcing a move to Barcelona.
“But at least it was well rewarded,” Zorc said. Dortmund received $135 million for him. Twelve months earlier, it had paid just 12% of the price.
Over the past decade, Dortmund has pulled one of the most improbable feats in top-level soccer: coming out ahead in player trading. (The club is up in excess of $120 million in transfer fees, according to TransferMarkt.)
Pulisic left for Chelsea last January for around $75 million. Sancho, who came to Germany from Manchester City for around $10 million, could leave this summer for 15 times as much, according to reports in the U.K.
Not that the balance sheet matters much to supporters. They trust Dortmund to keep the talent rolling in.
“If you have 81,000 fans in our stadium, they are not interested in our bank account,” Zorc said. “They want to win. They want to watch good football.”