What if we buy the Real Salt Lake soccer team with crypto?
As Real Salt Lake reportedly nears a sale to a group led by east-coast investor David Blitzer, a Salt Lake City group is proposing a blockchain-based community ownership plan for the team.
Real Salt Lake’s ownership has been in a state of flux since last year. On Aug. 27, 2020, MLS announced an investigation into Dell Loy Hansen, the team’s owner, after allegations of racism surfaced in an article by The Athletic.
Since that time, a range of potential suitors have popped up in various reports, including Blitzer, who is reportedly advanced in the process. MLS Commissioner Don Garber said on Tuesday, Dec. 7 that he was “hopeful we’ll get something done soon,” perhaps by the end of the year, in terms of the sale.
But before the team is sold to someone else, a group from Utah-based Life Elevated Group, led by Sean O’Brien, is looking to make RSL a fan-owned club. O’Brien posted to LinkedIn recently with the idea of buying RSL as a community, with ownership tokens hosted on a blockchain and open to anyone. Under the idea, no one person could own more than five percent of the team, and people could eventually buy-in for as little as one token.
If Blitzer is as advanced in the process as the Sportico report suggests, it may be too late, but O’Brien says it’s still worth a shot. “If I had a magic wand, I would put ourselves back then in the position we are in now and be more aptly suited to say, ‘hey, RSL’s looking for an owner, we have a great idea,’ and they wouldn’t have been this mature in terms of their discussions with another potential suitor,” O’Brien said.
“It’s not ideal timing, I acknowledge that, but there’s a sense that we still have to make it happen to the extent that we can and make the attempt. It took us a while to go through some of the hoops we thought we needed to jump through from a legal regulatory standpoint, to develop the system that we believe is ideal from a blockchain standpoint, so there definitely were things that took time to develop, and even talk about concepts in general.”
The idea is to crowdfund the money necessary to buy RSL using the Binance Smart Chain blockchain and run on smart contracts with an RSL-specific cryptocurrency called the BEP20 token. O’Brien admits that cryptocurrency, tokens, and blockchains might be confusing for some people, but the group hopes to connect people who understand the ideas with those that have always dreamt of owning a professional sports team but never had the opportunity.
In the buying stage, people could contribute as little as $100, or 100 tokens, but if an acquisition were to be finalized, people could then buy in with as little as one token, though token prices could fluctuate as trading among owners would then be live. Tokens would hold real value and give owners the opportunity for dividends, the opportunity to vote on the team’s 11-person owner board, and more.
A lot of token sales would be needed to complete any possible deal. Sportico valued RSL at $420 million in 2021, while Sports Business Journal reported in September 2020 that Utah Soccer Holdings’ sale price was starting at $500 million. “We’re up against some serious odds, but we look at it as, this is the one time most likely in our lifetimes… that our club will ever be in this position,” O’Brien said.
It remains to be seen if MLS would entertain the proposal, especially if a traditional deal with a group like Blitzer’s is in advanced stages, but O’Brien says he’s fighting for a seat at the table. “Once we get to that point, we feel like we can actually bring a better deal to the table for the club than what is currently out there and what is currently being considered, not only from a pecuniary standpoint but also from an overall long-term and short-term operation of the club standpoint,” he says. “It’s the same old song and dance if the ownership just passes hands from one rich guy to another…”
To raise a number like $400 or $500 million is still going to take quite a few rich people’s contributions, but O’Brien hopes that the plan could give ownership opportunities to people who have always dreamed of owning part of a sports team, along with people who are interested in the idea as an investment. But it’s “not a purely crypto play, as much as the back end and the foundation’s based on that,” O’Brien says. “We felt like we had to marry the crypto purists and enthusiasts with the average RSL fan who probably feels unfamiliar and uncomfortable in that arena.”
O’Brien says that if the plan to purchase the team is unsuccessful, “contributions will be returned, less applicable transaction fees.” More information about the plan, including FAQs, can be found at buyrsl.com. O’Brien also answered questions about the idea on his LinkedIn page.