Weekly Column: Why U.S. Teams Outvalue European Sports Giants

In this week’s column, California Sports Lawyer® CEO and Managing Attorney Jeremy M. Evans writes about the financial valuation of American vs. European professional sports franchises.

The American system provides more stability and thus higher franchise valuations than the European counterparts.

You can read the full column below. (Past columns can be found, here).

The value of American professional sports franchises are continuing to rise well beyond the European franchises in countries like England, France, Germany, Italy, and Spain. Mid-market U.S. franchises now outvalue globally iconic European sports franchises. The Financial Times reports that “Of the 10 most valuable sports teams in the world, six compete in the NFL, three in the NBA and one — the New York Yankees — plays Major League Baseball. Sportico estimates that Real Madrid is the world’s most valuable football club, yet it only ranks in 22nd place overall.”

The essential difference between the valuation of American versus European sports franchise evaluation is not one of popularity. Arguably, the European football clubs are far more popular globally that the average NFL, MLB, or NBA team. The difference is in legal structure and risk allocation. Simply, American leagues have stronger financial structure to be successful, leading to predictable financials that keeps their valuations souring.

First, American leagues are closed leagues with predictable membership. The U.S. closed-league professional sports franchise model does not allow for the promotion or relegation of teams. League participants are either professional or minor leagues or colleges and not a part of the professional leagues. The permanence of league membership and insulation from change or competitive collapse means that revenue is predictable and long-term leading to strong valuation modeling. European leagues and teams on the other hand have year-to-year structural risk that leads to diminishing returns for the teams at the bottom of the league standings. While relegation may be fun, it is unpredictable, but American leagues do attempt to ensure competitiveness and parity through relocation, expansion, league minimum standards, drafts, and anti-tanking policies.

Second, centralized media rights among the major American sports leagues, with Major League Baseball and the National Hockey League as outliers with regional sports networks, provide guaranteed, long-term revenue streams. Furthermore, the geographic and population differences are important to note as well. Meaning, the United States of America is larger in both geographic size and population than the combined countries of England (the UK), France, Germany, Italy, and Spain. This means that American professional sports leagues have guaranteed income that is often shared among the teams as a stabilizing and competitive force. Collective bargaining in sports, while tumultuous during strikes, can limit volatility during labor peace. The American system provides more stability and thus higher franchise valuations than the European counterparts.

Third, there is more governance clarity and less government involvement in American sports. Governance clarity for owners with voting rights and defined ownership frameworks in U.S. leagues along with minority (smaller) ownership structures provides for more meaningful financial projections year-to-year and decade-to-decade. In addition, private equity in the U.S. with its 1,000+ millionaires as of 2025 according to Forbes is also a driving force for increasing valuations as there is limited supply of sports teams, but increasing demand to be a professional sports team owner (or financial partner in college sports teams). All of the aforementioned leads to higher team valuations in the United States.

It is important to remember that professional sports franchises in the United States are legally engineered assets, not just sports brands. The differences between European and American professional sports franchises should not be read as being less fan-centric, but more that investors want to protect their pretty pennies paid for the investment. The law and structure is the differentiator leading to higher valuations of American professional sports franchises. If European leagues want to grow their valuations, they may want to structure their leagues to protect the investments.

About Jeremy M. Evans:

Jeremy M. Evans is the Chief Entrepreneur Officer, Founder & Managing Attorney at California Sports Lawyer®, representing entertainment, media, and sports clients in contractual, intellectual property, and dealmaking matters. Evans is an award-winning attorney and industry leader based in Los Angeles and Newport Beach, California. He can be reached at Jeremy@CSLlegal.com. www.CSLlegal.com.