What life’s like as a football club CEO in Saudi Arabia

0:03Welcome along to another episode of the Leaders Worth Knowing podcast, the podcast about leaders in sport from leaders in sport, something like that. Anyway, I'm David Cushman. I'm the content director round here at Leaders. James Emmett, back in your ears next time. I'm here though, just briefly to introduce a conversation that I had a few days ago on Sunday, in fact, in Riyadh. I was in Riyadh to do a little bit of stuff with the folks from the Public Investment Fund over there, PIF, for an upcoming podcast series. So stay tuned for that and more on that over the next few weeks. But I also took the opportunity to sit down with Esteve Calzada, the CEO at Saudi Pro League Giants, Al Hilal.

0:55He has been in Riyadh running Saudi's most famous and most successful club for a couple of years now. He's very much all in on the project to help with the modernization and professionalization of the team, a reflection of what's happening, of course, in the Saudi Pro League more generally. Al-Halal, the most successful club in Saudi Arabia historically, with a vocal and very, very passionate fan base and a lot of history behind them over many decades now. They have fairly recently come under the ownership of PIF, certainly the ownership and Esteve has been navigating all of that whilst also managing an organisation that has a combination on and off pitch of international and local talent.

1:51He of course is a man well-versed in all things football business, long-standing career at City Football Group as an advisor and then as group chief commercial officer before setting up in Saudi Arabia. As you will hear, he is all in on the Al-Halal project. He's learning Arabic, as he will tell us. And he has a really fascinating perspective on football development in Saudi Arabia at both a club level, a league level, but also a national level, of course, with Saudi Arabia poised to host the 2034 FIFA Men's World Cup. It's an extended conversation. We cover all aspects of the club, how it's run, the league, and the sport and life in Saudi Arabia.

2:42And in fact, that's where we started when I sat down with Esteve Calzada. Esteve Calzada, it is a pleasure to see you. We're in Riyadh. It's Sunday afternoon and we are in your, I must say, very attractive Al-Halal club offices. Thank you for having us. Thank you. Thank you for coming on a working Sunday. Yes, all a bit different in this part of the world. And maybe let's start there, actually. We'll come on to talk about the club, what you're doing and how you're finding things. But it struck me being in and around Riyadh over the last few hours that this is probably the city that is most talked about in the global sports industry at the moment.

3:27Everybody has their eyes trained on Riyadh in one shape or form. And I just wonder, you've been here running Al Halal for a couple of years now. What sort of city have you found to work in, to live in? How are you enjoying the experience of Riyadh? Well, it's a vibrant, dynamic city. And every day something has changed. Every day, there's a new crane. Every day there's a new thing opening. And as you can see, I mean, we are right for listeners. We are in front of one of the major roads. And if you start counting vehicles, you realize there's many, many of them. So the city is vibrant. The traffic is complicated.

4:10Probably it's the only non-positive thing that I would say about the city, about the people. But the rest, it's been only about positive surprises in terms of the people that I met, in terms of the hospitality, in terms of the infrastructure, the way the city's development, the amount of people that have come here. So in short, it's a great place to live, right? And yes, it gets hot in the summer. Riyadh is dry, which makes it easier. So I often say that it's worse to be in Barcelona 30 degrees that here at 45 degrees, there's plenty of things to do. And for now, I'm really, really enjoying the journey from a personal perspective.

5:00The city, as I said, is vibrant. There's many, many events and infrastructure development. And all in all, it's an amazing experience. You're right. We are looking out on what I understand, because I've spent quite a lot of time on it today, is the Northern Ring Road here. But I will say, and we're talking probably nearly at rush hour, it's not too busy. And it is a working Sunday, as you see. And the metro seems to be big news here. I was reading that it's gone into the Guinness Book of World Records. Something like the longest metro in the world that's driverless, I think. Probably. Probably.

5:38It's all about the longest, the biggest. That's it. Now the biggest, longest roller coaster. It will open in a couple of weeks' time in Gidea, Six Flags, and there's many of those. Yeah. So lots that's new here. One thing that isn't new is Al-Halam, which has been around since the 50s. But has, I think it's fair to say, just as the Saudi Pro League has over the last few years come, I think, to greater international prominence as a club brand. And you've been in this role, as you said, for a couple of years. How have you found the experience, first of all? And do you feel like you've properly settled in here now?

6:21Yes, certainly. As I said, settling here has been much easier than I expected. And also, just the way I am when I arrived here, I wanted to immerse myself into the culture, into the people. And I made the effort of learning the language. So I'm doing Arabic lessons three times a week with a private professor, two hours each class. And it's extremely rewarding because it might look that it's impossible. It's not. If you take the time, you can read, you can progress. It's difficult, very difficult. But this is something that I decided to do and it's helping me a lot. Then, of course, when it comes to take the decision to come here, in principle, it's not an easy decision.

7:09I was working for City Football Group for the last 12 years. We were doing great. And to be honest, I wouldn't see this coming. But if I would have been asked, what is it that would attract you if you were to leave Manchester City? I certainly would have said Saudi because you could feel the transformation you could see what's going on here and then when I got approached by PIF with this opportunity and of course found out that it was Al-Hilal Al-Hilal is arguably the biggest club not only in Saudi but also in Asia born in 1957 the biggest track record in terms of trophies, in terms of fan base etc.

7:50and all of a sudden it felt like it was the right opportunity at a time where at Manchester City we had hit record high revenues from a commercial perspective, which is the area that I was running. We just had won the Champions League in Istanbul. So even if I would not see it coming, when I analysed this opportunity, I just realised that I was ready for it. And yeah, arriving here has been, again, as I said, an amazing experience. We have a plan. We have an owner that knows what wants. And we have an amazing brand. And it's only opportunities that we have ahead of us. Did anything surprise you when you first joined the club?

8:39Many things surprised me. And we cannot deny that there's a big cultural difference with Europe, but probably there's two things that surprised me. First, even if I know it was the number one club, the greatness of the club and the responsibility that goes with it. The status that you get as a senior leader, people will stop you in the streets, they will ask you for photos. You will get sometimes treatment of a football player, which is something that I was not expecting at all. In Manchester, people would just not recognize us or stop us. And this is showing the greatness of the club. And also probably as a result of the other thing that surprised me a lot, which is the strength of the social media.

9:31Obviously, with a country with such a huge young population, everything happens in social media. And the passion of the fans is expressed in there. and it impacts a lot the decisions of the decision makers, right? They look at the sentiment that they say in there or we see in there, sometimes not necessarily representing the majority of people, but everything happens in there and our comms and content strategy is driven by what we do in social media, right? Yeah, I was thinking about that sort of fan culture and that ecosystem of information and conversation around a club like Al Halal and thinking about maybe comparisons to a Barcelona or El Madrid where you have newspapers dedicated to and radio stations dedicated to the club.

10:31Talk a little bit about some of the differences you found in that fan culture. Sounds like social media is right at the heart of it, perhaps more so than in Europe. But again, what surprised you and what have you noticed about the way that fans do fandom, I suppose? Well, they just want to consume content, which is linked to new players, signings, football news. And even when I started here, I wanted to open up myself, including my personal life, sharing situations of my personal life, just to show openness and closeness. And then people were just not interested. They would say, sorry, don't post lunch with your friends or your running workout.

11:22We want to know who's going to come in January. It all comes back to the transfer window, doesn't it? 100%. This is somehow universal, right? So as I said, this is a big surprise, but still, it surprises me how much it influences the decision from the different stakeholders. And we just, our comms strategy is basically directed to see how do we influence and how do we publish, you know, in social media. Tell me about the team here. We're looking out on your corporate office here. Off the field, how many people do you have? What's the sort of setup? What's the organizational structure? And who are your key executive leadership team?

12:16So this is roughly 300 people workforce, excluding athletes. Let's not forget that Al-Hilal, as it happens with other sports clubs here in Saudi, is a multi-sports club. So we've got up to 20 different sports, many different sports. And that's down in Ourasia, which is where we have our training ground at the moment. And then what I've been trying to do since I arrived is to set up, that was part of the ambition of the new owner, professionalize the structure and bring international experts that could mingle with the local talent so that we could come up with the right combination and also we could get the local people learning just like we as foreigners learn from them, they learn from us.

13:10So you can imagine a structure very much similar to what we could have in Europe where there will be a CFO, a CMO, a chief commercial, a COO, you know, a football director. The usual strategy, something that is part of the professionalization of the industry here is moving on from having many part-timers into full-timers, right? We inherited a situation where many of the employees would have another job and come in the evening to work for the club, right? This is something that is changing and including this new corporate office, which is very much to standards in Europe, open space. No one has a private desk.

13:56All in all, we organize very similar to Europe. We have a combination at the sea level, at the top level, a combination of local and international talent. and because it's a must that we just find the right balance. It's not only about all being foreigners, just like it's not only about all being locals. And does that, from your point of view as the CEO, does that require a very different leadership approach? You're obviously learning the language, as you said, which sounds like a critical element of that. But managing the different dynamics and maybe the working cultures and practices, of international people coming in and a local workforce, local executives.

14:45How have you tackled that challenge? Yes, obviously, as I was saying earlier, there's a big cultural difference, a different approach into work. And the way we're tackling is probably, I would say, adapting, right? At the end of the day, there are things that we have to respect. But obviously, here religion is extremely important to people. It affects the working hours because there's breaks for praying. Obviously, there's the Ramadan period where the whole scheduling gets impacted. And we as foreigners just need to understand how important this is, right? Try to support it, but not try to change it, right?

15:31This is the way it works, and it's us that we have to adapt to this and see how we can extract and get the best out of the brilliant talent that there is here in this country. You're obviously competing in the Saudi Pro League, which has come to much greater, I think, international attention over the last few years. We've seen something of a spending spree, some really significant international players coming to play in the league at great expense. From the outside, maybe over the past year or so, it feels as though that sort of initial wave of spending has maybe cooled ever so slightly. But take us inside the league.

16:15What's your assessment of the health of the property at the moment? I guess the health is just great and fine, right? At the end of the day, true, there was a plan to, an initial big investment to just trigger a process that then had a follow-up, which was somehow easier because it's easier to decide to come here as a player. once you see that other colleagues have come before and you speak to them and they tell you, life here is good, my family adapted well, you know. And with that in mind, we as clubs will be given this support by the government, but then we've been encouraged to carry on and to develop our different revenue streams just like you would expect it to be in Europe.

17:12In our case, we are a profitable operation and our biggest single revenue stream is sponsorships, for instance, right? And we're trying to develop the other revenue streams. So certainly we intend to continue attracting talent. Sometimes the competition for this talent comes from the very same league, right? We all want to have the same players because it's true that when it comes to bring players from Europe, we have a very attractive proposition, especially because of the tax situation, right? All of a sudden, spending the same as a European club, you can offer a player almost a double of the salary and that makes it extremely competitive.

18:00So to your point, the league is growing, the competition is increasing, so you will see less and less big scores like 10-0 you know, every club has become better and better there's been different league winners as well and then of course it was good to showcase our product in the Club World Cup some people were surprised like guys, I mean we didn't expect you guys to have this level right? But then if you analyse our squad player by player you've got a number of players with good experience in the Premier League, in La Liga, playing for the national teams. Another example of the health of the competition is the fact that, first of all, the players are coming at a younger stage.

18:51You know, we look for players that are at their prime, not players that come here to retire. And more importantly, these players that are coming, and they are coming as internationals, so basically playing for the national teams, they don't lose that status when they come here. In the past, you could argue that they go to a smaller league and then, of course, they become less competitive and the national team coaches will stop calling them. That's not the case. In our team, every single player that used to go with the national team continues to go with the national team. Now they are playing here.

19:28And this is another example of the health of the competition. Or as I was saying, when people saw us beating Manchester City, drawing against Real Madrid and playing a strong competition, people were surprised like, wow, we didn't expect to see this quality of football. What was your view of participating in the Club World Cup? Because it was a tournament that got a lot of criticism, particularly from Europe and European clubs. but for clubs playing in other parts of the world with the opportunity to go to the US and play some of the European giants and beat them, how did you find it? Well, just like you said, David, at the end of the day, for us, it's an opportunity to showcase our product in the global stage, right?

20:18Because the way it works, we play in Asian competitions. Yes, if we win the Champions League, we would have gone on to play what's now called the Intercontinental Cup with a different format. But this competition, even if it's... I mean, we just saw that it's only every four years and it's not easy to qualify for it. But in terms of what has meant for us, it's absolutely amazing. And I can also understand why the European teams were not seeing the value out of it because they don't need to promote themselves. They have a calendar already very much packed of matches and it disrupts the preparation.

20:57For us, it was the opposite. It was an amazing opportunity, of course, to play these big teams, to project ourselves, to show our product, to win international fans. Only during the competition, we won one million new followers in our social media, which is a testament of the relative importance and what it means for us. Back to Riyadh. I think I'm right in thinking there are four Riyadh-based teams in the Saudi pro league, but probably Al Nasser, you would... Am I allowed to say that in this building? As long as you're not wearing anything yellow, Al Nasser, you're your biggest rivals. I think that's fair to say.

21:43How important is that rivalry? And from an executive level, given everybody wants the league itself to grow, How closely do you work with the folks over there at that sort of leadership level on certain matters? So that's interesting because this is very different from Europe. So just for people to understand, if we were comparing to, for instance, La Liga, our Clásico would be ourselves against Itihad from Jeddah, not Al Nasser. Al Nasser could be the city rival like Real Madrid and Atletico. And of course, for people not so much familiar with our league, they probably know Al Nasser more because of Cristiano.

22:31But before that, and still, Gilal has a much bigger fan base. The thing that surprised me a lot is the fact that in here, I mean, if I would be seen talking to the CEO of Al Nasser, I would just become someone extremely unpopular. We're not supposed to talk to our rivals, to be seen to partnering on discussing things. Sometimes you do have to do that, to sit down and discuss league matters, etc. In this case, it's something that just doesn't happen. And as opposed to the way it is in Europe, you know, in Europe, you do like an official lunch when there is a match, when you put both teams together.

23:17This is something that doesn't happen here, you know, and it just people would not understand. They are our rivals. We should not even spend one minute with them. Yeah. Okay. Okay. Be careful. Be careful. Yeah. Obviously, there was quite a significant move in terms of the club's ownership fairly recently with PIF taking over. The majority shareholding, I think, at 25 % remains with a sort of fan group. Part of a wider privatization process that the league has been going through, or many of the clubs within the league has been going through. Has that changed things? Does that change things for you on a day-to-day basis?

23:59having new owners? Does it bring fresh impetus, fresh direction to what you're trying to do? Well, in my case, I came under the new ownership already, so I cannot talk about the change. Obviously, PIF, being part of the PIF ecosystem means that we get the level of professionalization that you have in any other PIF company in terms of the way we are structured, in terms of reporting, in terms of the responsibility that comes with it. But we cannot underestimate or undermine the other 25 % because it's representing very significant stakeholders. And even in the way the governance is set up, the chairman is named by the 25%, so to say.

24:49So for us, it's important to take into account both stakeholders and my job and the one of my executive team is to basically carry on with the direction that we get from the board. There's an ex-com, there's a board of directors that represents the ownership, five members from PIF, two members from the, as we call it, NPO, non-profit organization. And we need to take both into consideration. I wanted to ask you, and you mentioned earlier that this is a sports club and there are 20 plus sports represented as part of that. But I did want to ask you about the women's team and the Saudi Women's Premier League, which is obviously a much more recent development.

25:42How are you seeing the evolution of the league and within that, the women's team here? Well, it's certainly something that you can see the evolution. I guess still the gap male football, men football is much bigger yet than in Europe and I guess it will end up picking up in the same way there are big efforts there including ourselves this year in particular we made a substantial investment to bring good players because at the end of the day the fact that we're representing Al-Gilal means that we have to compete to win in any single sport or competition, right? So we cannot have the lowest budget in the volleyball or in the handball or in the women team.

26:33We have to invest. And also there is a drive to support the competition, but it still requires a lot of development, right? I'll just give you an example of things that prove that we still have a long way to go. still now we find that sometimes the female the women team the women's match is scheduled at the same time as the men's match right right this is this is something that is completely counterintuitive if we want to develop the sport if we want our fans to engage with our women's team as well we cannot play at the same time yeah and and just just going back to the the multi-sport element here.

27:19If you are a fan of the men's football team, is it then completely natural that most of those fans are also followers, fans of the other Al-Halal teams? Or does it tend to differ in terms of who supports which sports team? Yes, there are. They are. But the reality is that the way football monopolizes the attention in this country, I haven't seen it anywhere else, right? And that's why we keep on saying that this is very different from when the Chinese decided to do something similar in terms of spending a lot of money bringing players because in there, there isn't a true tradition of following football, like there is in here, which as I say, I haven't seen it anywhere.

28:08Not only for our team, but also the likes of Real Madrid, Barcelona, the Premier League. The level of passion that you see, it's just ridiculous, right? So yes, the people are following the other sports, but the absolute number priority for the fans is the football team. And the way it's positioned with kids wearing the shirt in the school, talking about it, you know, not having dinner if your team has lost, things that you would think that they don't happen anymore, they're still happening here. Yeah. I'm looking over in the corner of your office at a mannequin of this season's kit. And what a great kit, by the way, what a brilliantly designed kit.

29:02And it has, just going back to the commercial side, Savvy Games Group, your front of shirt sponsors this year. And I just wonder, there is this perception, I think, sometimes with teams, with organizations based in Saudi that everything is government money. Everything is, you know, publicly, ultimately publicly financed when it comes to sport. And obviously, there's lots of connections between companies and various ownerships of companies, a lot of which do link back to PIF and the government here. But I just wonder what your experience has been of the private sector here in terms of appetite, interest in sponsorship, and how teams who are operating here in Saudi or maybe international organizations looking in might best work with the private sector potential sponsors that exist here.

30:02Well, first of all, when I arrived, I was very surprised by the prices. The sponsorship market is very heated up and the prices are much higher than the prices that you would expect to see in Europe. In our case, it is true that there is some sponsors that are owned as well by our main shareholder. But at the same time, we've got a big proportion of non-PIF-linked sponsors, right? And this is the beauty and the strength of the Al-Hilal brand. If you look at the shirt, Jahez and Flynaz are sponsors which are completely private, that have nothing to do with the ownership. if you go if you continue on the shirt on the sleeve we have Taunia also privately owned Sanabil and Seven are owned by by our shareholders as well and then you have Riyadh Bank which is another institution which has nothing to do with it and now more recently we've been we have started to incorporate international sponsors normally companies that they want to to make their way in Saudi and there is a better way than partnering with the biggest club here, right?

31:22So recently we have done deals with the likes of Nestle, with Nescafe, or very successfully with Chinese companies. So we just brought to our sponsor roster, Hire, which is the number one home appliances company in the world, 4 to 500 company. We have Honor, one of the top handset devices producers in the world, Unilumen, which is arguably the leader as well in LED screens. So this is part of the journey. We are opening up more from an international perspective, looking at those opportunities. And this is also one of the reasons why we were brought from outside to try to help with our expertise, our connections.

32:08But the reality is that the local market is already extremely, extremely strong. I wanted to ask you about the AFC Champions League, or I think the AFC Champions League elite, as it's now known, because it is a competition that I think goes under the radar as far as most European, North American sports fans, football fans, and indeed sometimes by the sports industry, maybe based over in London and further towards North America, but it's a pretty prestigious historic competition, very lucrative competition as well. And I just wonder, again, how you, as somebody who's come in and is now competing regularly in it, has found it as a competition and as a way, again, to, on a continental stage, showcase what Al-Hal can do.