MLS Commissioner Don Garber Continues To 'Break Glass' With The League

0:00Robert Kraft and Lamar Hunt, who founded MLS. I was at an owner's meeting after making a presentation and Robert said to me, what do you know about soccer? I said, absolutely nothing. He said, you'd be a great commissioner. What's up, everybody, and welcome to another Boardroom Talks. Today, we are in New York City, New York, in the offices of Major League Soccer. And today, I have the honor of speaking to the man in charge, the commissioner, Mr. Don Garber. Don, welcome to the boardroom. Rich, great to be here. Thanks for our friendship and all the great things we do together. This is going to be fun.

0:36This is going to be a lot of fun. I wanted to have this conversation with you for a while because I'm truly curious. As you know, we invested in the league years ago. We've spoke throughout the last few years, and I've always tried to learn more and more about what it is that you've built and what you're continuing to build. You came from the NFL. I heard that there's an amazing story about how you were presented this job. First, I'd love to hear that story, but also would love to hear a bit about that experience working for the NFL and then kind of what learnings you took from that entering into this challenge.

1:11Sure. You know, I almost out of college, I had a couple of years at a PR advertising agency, but almost out of college, I went to work for the NFL in their marketing group. It was called NFL Properties. Then it was filled with a bunch of Ivy League guys who worked at Colgate, Palm Olive, or Nestle, or Nabisco. And I guess they thought that selling the NFL was like selling Ritz crackers or something like that. And I came out of a background of agency sports marketing, which in the 80s was pretty new. And I worked at NFL Properties selling sponsorships and doing fun deals. And I was the guy that kind of did the things that were a little off the beaten track.

1:57I have the honor of taking Hank Williams off the Monday Night Football opening. And then we did a different artist with a different record label all year. I thought it was the coolest thing I've ever done. And then after one year, they canceled it and went back to Hank Williams. Back to country music. But I was that guy, Rich. I started the NFL Experience, which is the now an industry standard in pro sports and all their youth programs and taking the helmets off the players. Crazy stuff like the NFL quarterback challenge. You know, Dan Marino throwing a ball at a target on a golf cart that was zooming across the field in Disney World.

2:42And those kind of ideas, which were about promoting the NFL to a different audience, led me to launch their international business. The league didn't really have a business other than selling their media rights. We had a league in Europe. We opened up, I opened up eight offices and did all sorts of fun, cool stuff to extend the NFL brand outside the U.S. And I reported into Robert Kraft and Lamar Hunt, who founded MLS. I was at an owner's meeting after making a presentation and Robert said to me, what do you know about soccer? I said, absolutely nothing. He said, you'd be a great commissioner.

3:22And that was 26 years ago. And going into that role, you worked for two commissioners at the NFL, right? I saw you worked under Pete Rozelle at some points and Paul Tagliabue. What were commissioner kind of inspirations that you got from the two of them that you knew of? Like, what did that role look like to you based on your experience? Yeah, what a great question, Rich. I mean, Pete Rozelle was like a monarch. You know, he had an office almost on his own floor and this assistant who had been with him for 40 years. And you couldn't get past her without, you know, permission. You almost couldn't get on the floor if you didn't have permission to see Pete.

4:07And nobody ever really called him by his name. And in the afternoons, he'd go out and meet people, just like you've seen in all the great documentaries. But he wasn't an accessible guy, at least to a young 20-something. Paul Tagliabue came in, and Paul was just really smart, really accessible, really inclusive. And as I moved up the ranks, Paul had large executive staff meetings. And we got to see what was going on all across the NFL enterprise. You know, Paul's an attorney. He's super thoughtful, very engaged with the owners, open to ideas. And, you know, you learn, I believe, Rich, you learn, you know, you can learn in school the technical aspects of business.

4:50But the best way, and we've talked about our mutual backgrounds, is to just do it and absorb through experience those who have been successful and then learn what not to do from people who really you don't admire and don't respect. In fact, for me, it's probably 50-50. There's a lot of what I do, which is something that I knew I never wanted to do when I was around somebody in business that, you know, I thought wasn't managing their relationship or their business properly. Paul gave me some advice, you know, in my exit meeting. Nobody leaves the NFL. You're a young guy and you're in the sports marketing business.

5:28You got fired or you are still there. Yeah. And he was intrigued as to why I would leave to go work for a fledgling soccer league. And soccer league was not something that most people in the sports industry back then really had any thoughts to aspire to where it would be where it is today. And Paul said, to be a good commissioner, you need to keep the owners who hate you away from the ones who are undecided. And I think about that all the time. You know, owners really are the center. They're the yoke of the egg, right? They are the center of the universe. And you've got to manage them and let them manage you and be open to ideas and understand that they come from different backgrounds.

6:14They have different political leanings. They come from cities that have a different demographic. And managing them is, I think, the key to being a successful sports league commissioner. And you said fledgling. I do remember the early days of MLS just being such a big sports fan. What were you actually walking into? What was the league at that point? I think it speaks to others that if you don't take risk and have some courage and get discouraged, you're never going to get out of wherever you are and achieve something that might be even unimaginable. I never thought I'd be a commissioner. So when I had the opportunity to come into MLS, I didn't do a whole lot of due diligence.

7:00They had 10 teams, and I had heard they just expanded. So they had one stadium that Lamar Hunt built for$30 million. And in Columbus, we now have 26 and have invested$6 billion in stadiums. It came out of the 1994 World Cup. A bunch of American players like Alexi Lalas came home. There were a bunch of players that performed in the World Cup, including the World Cup final in L.A. in 94 that had been signed in the league. And I said, man, that's the coolest thing ever. You could run a league. I'd be around Phil Anschutz, Robert Kraft, Lamar Hunt. You know, what's the downside? And it hit pretty hard, the realization that sports, running and launching a sports league is really hard.

7:43You need to have the right investment. You need to have the right product offering. We're in a very competitive environment in our sport, but the entire entertainment business is certainly quite crowded and cluttered. You need to have good staff. You need to be able to engage in thoughtful, short, medium and long term strategy. But you also need to be able to put the lights on and put them off every day. I just had a meeting earlier today and I said, if you're not a player coach, you're not going to be successful in MLS. There's no big throne here. There's no huge office with doors behind it. You know, we all work hard.

8:20I've been traveling 100 days a year for 26 years. and sweat and blood and building a sport and a league that really wasn't then what it is today. Because it was really pretty challenging, and I'm being polite. Because I know this will live longer than I do. Well, so let's do that. Let's jump now 26 years ahead, because what you have done is remarkable, but still comes with challenges, I'm sure, every day. One of the more unique things you've done and that the league did was one of the first to do a deal, if not the first, with a streaming service, the Apple deal, which got incredible press. The numbers were very staggering and impressive.

9:05What was the process in your mind in approaching that? What was the expectation for you in that deal? And how would you kind of assess that for yourself right now from a league standpoint? You know, we are an emerging sport, an emerging sport so much so that back when I came, the World Cup wasn't sold by FIFA, the governing body for the World Cup in the English language in 2002 when the World Cup was in Korea and Japan. And here we are, you know, decades later, and it's the most valuable soccer market from a media perspective in the world. But we're competing against all the European, South American, Mexican leagues selling their broadcast and media rights here.

9:50All the leagues, both the established leagues and volleyball leagues and pickleball leagues and just about every other sport. Obviously, the U.S. media sports market is just filled with product. And we also were managing through local television. As you know, as a longtime sports fan in America, teams in the major leagues have local broadcasters. And our group, the strategy that we were working on, just doing research and following ratings, talking to our fans, 80 % of them were watching streamers, streaming soccer, soccer through streaming product. seeing where the disfractionalization and the disruption that was going on in the cable and broadcast media space, we said we have to be with a streamer.

10:39We have to have a global offering. So somebody in Miami could watch a game the same way somebody in Madrid or somebody in Buffalo or in Boston is watching it the same way in Barcelona on any device, an Apple device, an Android device, a computer screen. And this idea of no blackouts accessible globally was super important to us. And what do you do? You go out and you meet with Netflix, you meet with Amazon, both by the way, at that time, in Amazon's case, not globally distributed with one click. And Apple was thinking a lot about the offerings that they would have to their global consumer base and went and did a deal with the biggest technology company in the world and launched a subscription service, launched channels for all of our teams.

11:32As you know, the Philadelphia Union have their own content. That content sits on a global offering. Still have some linear with Fox and Univision. I think that makes sense for us, but it's an exciting partnership with a company that really, really likes to break glass. Yeah, I was always, as I told you, very excited, encouraged by the deal. I mean, I think the idea that you could grow with them as well, right? Because what Apple can unlock year to year and what you guys can create and iterate off of is more unique than probably any other cable provider or streaming service, just based on the hardware that Apple has and the brand that Apple has.

12:13I know that there were some changes this year, which I'm also excited about. one of them being the Sunday night game that you no longer have to have the MLS package, right? To have, just have to have Apple TV. So the changes that were made, was that because you guys were happy with where you were, but saw that there was more upside and more that you needed to do to have all of this start to really come to fruition for you? And how have, I would say, the teams in the league, within the league reacted to the deal so far? So, you know, I've been around the sports industry for a long time. I remember when ESPN was launched and every time a major league would go on cable, it was like the world is ending.

12:54You're no longer distributed. You have to pay to get a game. Right. And I'm sure you remember that also, Rich. And, you know, times the media business, sports industry goes through cycles. There was a cycle when baseball was brought in and you're watching, hearing those games on radio. and then network television comes on and the NFL powers that. Cable comes on and every sports product and league is powering that. And here we're going through a new transformation with streaming partnerships. And with that, you're dealing with a closer direct relationship with the consumer. You can understand who they are, what they want.

13:30Do they want to see a particular team, a particular player? You're now in a digital environment. So we had a messy stream on TikTok with millions and millions of live streams going on. Not something you can do. You had a different partnership. So we're constantly balancing the schedule and the access for our fans. Are we trying to get more people to watch our games? Are we trying to get those people watching our games watch more and become more engaged? And this idea of a super fan versus going out and having a broad reach. and all leagues are dealing with this, all clubs are dealing with this all the time, and we're right smack in the middle of it, right?

14:08So I don't know that we have the answer yet, but we have a commitment with a great partner to work together to figure it out. And the Sunday night game is a nice new addition, right? This will be marketed differently and it's available to more people. It is, and it goes to the fact that we have a partner in Apple. So we can decide to change our schedule without having to worry about, is that time slot available with another broadcaster? because they might have another programming there. Before the Apple deal, 60 different start times a year. 60. Think about that. What fan knows where our games are and when they're going to be able to be played?

14:45Now, if we want to have a Sunday game, global Sunday game, we just change our schedule, work with Apple, work with different offerings, and then you can innovate. They're an innovative company, and we're leaning in to the fact that we have a partner that's going to push us. You mentioned Messi over the last few years. Obviously, that's been an incredibly exciting addition to the league. I think there's nobody that's a passive sports fan or a very engaged sports fan that didn't know about it. And it's been successful. I would imagine it's been successful for you guys. It has. What was the impact for you guys?

15:22Like, where is the impact? Like, where have you been able to see that the impact allows you to kind of like launch from? And what goes from there, right? Like, how does this start to become a bit of a scalable thing for the league? And with that, I ask about like what he, not what he gets paid, but the structure in which he got paid. Is that a future for the league? Because I know that there's three exceptions. There's more exceptions in MLS for the salary cap than any other league. So what have you guys seen that this greatest impact has been? And then how does this potentially allow you to scale in bringing in other stars of that caliber?

16:02You know, it starts with the impact has been enormous. The attendance has been enormous. The media coverage has been off the charts. The television viewership and increase in subscribers has been beyond our expectations. But I think it's the ubiquity factor, Rich, that even I didn't realize the power, the influence, the awareness that Leo has around the world. I see pink Messi jerseys wherever I go. Hopefully they're all Adidas Messi jerseys as opposed to knockoffs made somewhere. But we in America have so many great sports stars. You know, they're basketball stars and hockey stars and baseball stars.

16:48But there's one Messi. If you were going to ask everybody, maybe not Cristiano Ronaldo, but you ask every coach, every player in the world, who the best player ever to play the game is, it's Messi. And we're living with him. So he scores a couple, has a couple of great assists this weekend. Prior to that, you know, he played in a CONCACAF, a FIFA tournament. He scores a goal and it's less than 10 degrees and he's out there playing in freezing weather. You and I wouldn't have been out there playing, right? So he's a remarkable guy. He loves our league. His family loves being here. He's got a bunch of sons who are pretty elite youth players.

17:28So the impact from a commercial perspective has been beyond our expectations. And it's the unique structure of Major League Soccer and our desire to take risk, evolve our system that allowed us to sign them. You know, we were competing against Saudi Arabia. We were competing against his home club in Barcelona, where he went as a 15 or 16 year old. We were able to structure a deal where he gets a share of certain incremental revenues. We were able to figure out a way that it works for him. And long term, we hope that it continues to keep him involved with us. And frankly, you know, he's doing pretty well.

18:06I hope he resigns and stays with Major League Soccer for some time. And have you felt that there's potentially been more conversation around stars? There is no star like Messi, but stars from around the world that see this kind of track now? Yeah, it's a good question. And it's not, from my perspective, you know, there is only one Messi. But when we signed David Beckham, there was only one David Beckham, right? And he really was the guy that brought Major League Soccer to the world. So I don't know what it'll look like years from now. I would assume that whoever is occupying that space is a guy that one or two of our teams is going to try to go after and then come up with unique structure.

18:47But I think it's the awareness of Major League Soccer with those players now who are way younger. The average age of international signings this year is 24 years old and we're buying these players competing against the best clubs in the world. You know we signed a young kid from the Ivory Coast in Atlanta who scored two goals in his first game and it was north of a$20 million signing, you're seeing our teams going out and saying, hey, maybe it's not Messi that will help me in my market, but maybe it's a great young player who's played in England or Germany or Spain or played in Belgium or the Netherlands or played in Mexico.

19:23And all of that opportunity, I really believe, has been driven by the fact that Messi has made MLS his league of choice. He ain't gone anywhere, but he chose Major League Soccer. So certainly that might make sense for other players. You mentioned Atlanta, and I know this past weekend they had 65 ,000 people at the stadium. Why does Atlanta work so well? And what is a market that works so well? What does it make for a market to be able to impact the way that they do? You know, listen, if I knew the answer to that, I probably wouldn't be commissioner. You know, I'd be having a company and I'd be, you know, sought after as much as Rich Kleiman is.

20:06But, you know, seriously, Atlanta was a coming storm. It happened at a time when MLS was growing. It had come after the World Cup in 2014. That team joins in 2017. Arthur Blank is a visionary sports industrialist. And I didn't think Atlanta would be a great MLS market. And he said, hey, buddy, I'm telling you, it's going to be big. Opening game, which they played before Mercedes Benz was built at Georgia Tech had 45, 50 ,000 people. I remember walking in and saying, man, you were right. Arthur, you got it done. And 65, the team has been around since 2017. And they've had some struggles after they won a couple of years in.

20:48And, you know, 65 ,000 people for any sporting event. And the place was rocking in a 3-2 game. You know, we had the president of U.S. soccer there. You had a lot of big sponsors there. Arthur is there cheering away. And, you know, I think it speaks to that if you do it right in our business and you spend a lot of your time on this, then the dots get connected and fans will embrace it. You can't buy it. You have to earn it. You've got to be creative. You have to take some risk and have some courage. And year after year, Atlanta has done it right. I was at the LA Galaxy game right after the Atlanta game and they had packed stadium.

21:28They had people in the berm, outstanding room only and an unbelievable opening for them, but for our newest team in San Diego that will open up with 30 plus thousand, our 30th team. And that team has done a lot of good things and have signed a top young Mexican player. So our business, I think, is pretty linear. Some of it is luck, but you got to do the work. You know, you've got to be smart marketing people. You got to have smart entertainment people, smart sporting people, be focused, manage to a bottom line and hope the stars align. Hope the stars align. You know, a lot of people have talked recently about the NBA ratings, and then people like to compare everything to the NFL, right?

22:10So I think one of the things that you hear about the NBA is that with the amount of games and the amount of access to games, that a little bit of the stakes behind some of these regular season games have become less important to a fan. Whereas in the NFL, there's so much scarcity, each game has so much meaning. And I think that for me, you know, obviously when the Philadelphia Union made the finals and the semifinals, there was no difference in terms of how I engaged in watching that than if I was watching KD play with the Suns in the playoffs or watching the New York Giants or watching my St.

22:44John's Redman, Red Storm. And I think it's because I understood what the stakes were. And I wonder sometimes, and as a bit more of a layman fan, throughout the year, you guys have the North American Cup, you have the U.S. Cup, there's the Canadian Cup. And sometimes I wonder if the storytelling at times to the more passive fan can get confusing as opposed to seeing the MLS Cup as the ultimate and having everything kind of targeted towards that. Will you first just kind of break down what goes on throughout the season outside of the Governor's Shield and the MLS Cup? And then your thoughts on just how that plays into the storytelling.

23:26And if you think for some reason that it could be confusing a more passive fan on just exactly what's at stake when it comes to winning it all. But it's a conundrum. And the soccer business or the football business is so complicated. You know, there's a global governing body. There are regional governing bodies. We have our own federation. And each of the governing bodies, FIFA and CONCACAF or UEFA, have their own competitions. And those competitions are there to create alternative properties for a wide variety of folks to benefit, whether they're players or whether they're clubs. And it's crowded.

24:11All of us in the league business believe it is one of the biggest challenges in the sport of soccer or football. Next week, I'm going to speak at the European Leagues Association annual meeting. And it's the subject every year, Rich. And I don't know how that gets resolved in a way that does most importantly protect the safety and health of our players who are asked to, in many ways, want to play in more and more games because of the appeal of winning for your country or winning for your region. And what do you qualify for if you win one of those tournaments? And all of that creates a lot of global buzz in a world where the world is shrinking.

25:00So I think back in the day when you had all these tournaments, you would scratch your head and say, boy, this makes no sense. But now in Miami and Seattle, who've won the CONCACAF Champions League last year, are playing in the Club World Cup here in the United States against Chelsea and against Real Madrid, that creates a global competition in a way that all the stakeholders are benefiting by. And then the onus falls on all of us to effectively market and communicate it. So I think the challenge is probably less the structure and more that we all need to be aligned with a global narrative. your expertise right I mean everybody has to be thinking about where do we all fit and how do you tell the story simple idea you win a tournament you get a patch on your jersey you're you become on your when you see the uh the lineups you know it says you know Brandon Aronson who used to play for Philadelphia has a logo that might be the MLS logo because he played there and he's playing in the Champions League and it could create for global football.

26:11Remember, 100 plus leagues playing the global sport. The NBA is a global sport. They only have one league. So I think we need to connect the dots. But I ain't king. I'm not sure the dots will get connected. Does the league benefit from having their teams compete in those different federations? We do when we win. Financial benefit, players get paid prize money. For MLS in particular, Miami will open up the Club World Cup against an Egyptian team. And that's going to be seen by maybe a billion people. Miami, a little MLS team, has a messy playing for them. But that exposure is good for us. On the other hand, you just got to be smart in how you manage the schedule.

27:02I heard a stat prior to talking to you about how Atlanta's season ticket subscribers and then their football team, both these enormous numbers, and there was only about a 3 % overlap. What does an MLS fan look like? What is the MLS fan? The MLS fan is unique. It's distinct. It's separate from all the other major leagues here. It's the youngest fan base. It's the most diverse fan base. It has the highest percentage of Hispanic fans and followers. It's the most digitally native. So those qualities are the qualities that give us our brand identity. It's why Dochi is doing our league kickoff ad. So we have a point of difference and a point of differentiation.

27:51And the best stat is the 3 % crossover between season ticket holders in Atlanta and in Atlanta Falcons and Atlanta United. We see the same thing in Seattle where we have 40 ,000 fans. Very few of them are Seahawks fan. We see the same thing in Charlotte where Charlotte's getting 30, 40 ,000 fans a game. And very few of them are Panthers fan. That gives the community an opportunity to support, get more people downtown, have more people wearing. You know, the Panther uniform is the same color as the Charlotte FC uniform, but it does give you brand differentiation. Is the upside in more and more of what the MLS fan looks like, or is the upside potentially even more so trying to tap into that other fan?