BRIGHTON & HOVE, England -- At a time when many clubs are struggling to comply with the Premier League's financial rules, Brighton & Hove Albion began last month by announcing the biggest annual profit in the division's history.
Their £122.8 million post-tax gain for the year ending June 30, 2023, came in a season of unprecedented success on the field too, as the Seagulls qualified for Europe for the first time in their 123-year history with a sixth-place finish while also reaching the FA Cup semifinals.
Figures show Brighton achieved all this with the 13th-highest wage bill and the 17th-most expensive squad. Progress continued this season as Roberto De Zerbi's side finished top of their Europa League group -- featuring victories home and away against European heavyweights Ajax -- but a round-of-16 defeat to Roma preceded a late-season Premier League slump which leaves them in danger of missing out on a top-10 finish.
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Turning a profit in the Premier League is a rarity. Brighton finish their campaign against three teams who made substantial losses in the same period, Newcastle United (£73m), Chelsea (£90m) and Manchester United (£42.1m), raising the question as to how long they can buck the trend.
So, how did they reach that record figure and is their model genuinely sustainable? ESPN spent time with several senior figures at the south coast club to find out.
Mastering the market
Tottenham previously held the record for a single year's profitability in England when registering a £113m figure in 2017-18. While Spurs could point to a significant increase in commercial revenues, greater matchday returns from playing at Wembley while their new stadium was built and higher Champions League income from reaching the knockout rounds, Brighton's story is markedly different.
For a start, their eye-catching figure is largely based on outgoing transfers. Mali midfielder Yves Bissouma (to Tottenham Hotspur), Spain defender Marc Cucurella (to Chelsea), Belgium forward Leandro Trossard (to Arsenal) and Argentina midfielder Alexis Mac Allister (to Liverpool) all left the club during this period, leading to a profit of £121.4m. Brighton also received around £21m in compensation when losing head coach Graham Potter to Chelsea.
The club had posted a £24.1m profit in the previous financial year and while broadcasting revenue and prize money income went up from £126.2m to £155.2m, the dramatic overall increase advertises the success of a business model predicated upon maximizing their efficiency in the transfer market. Significantly, these figures do not include the British-record £115m fee received for Ecuador midfielder Moisés Caicedo's move to Chelsea last August.
"We're not in a position to drive the traditional revenues that the bigger clubs can," chief executive Paul Barber tells ESPN. "The Amex Stadium holds 32,000. Manchester United is 75, Tottenham and Arsenal are 60. So we're having to drive revenues in different ways.
"Part of our model is obviously to fill our stadium, generate as much sponsorship income as we can being the club that we are, with a particular brand and set of values, merchandise sales, all the things you would expect. But the player-trading model is one where we think we can punch above our weight with a combination of using our own academy to develop the best possible talent from local resources and by fishing in 'ponds' overseas that other clubs don't tend to look in, let alone fish in."
Brighton's track record in identifying young players at a low cost, developing them over several years and then moving them on for huge sums is remarkable. Their strategy dates back to 2017 when the club secured promotion to the Premier League, their first time in English football's top flight since 1983. Brighton pivoted away from primarily signing older, domestic-based players to younger prospects in emerging, overseas markets. Initially, it wasn't a profitable gambit. According to transfermarkt.com, Brighton spent a net figure of £171m on players as they scrambled to establish themselves in the Premier League and began shifting their style of play toward one more based on possession.
But the key to both was owner Tony Bloom, a professional poker player turned gambling mogul whose property and private equity investments have helped him become a billionaire. Bloom acquired a 75% stake in Brighton back in 2009 and has since invested £406.5m in interest-free loans into the club. This year marked the first time Brighton were able to make a payment back to Bloom, a £32.2m sum taking the balance owed down to £373.3m.
"It has always been something that sits uncomfortably with me because I think if you are running a business that is losing tens of millions of pounds every year, the perception is you are doing a very good job," Barber says. "If you are able to make your business profitable and you are able to repay loans to your owner, there is something within me that says that's a good thing."
Barber insists there is no annual prerequisite to move on a certain number of players or generate a set figure from transfers, partly because Bloom has never requested a repayment on his investment. The reliance on Bloom's generosity, however, is clear.
"Tony Bloom is without a doubt Brighton's biggest asset," football finance expert Kieran Maguire tells ESPN. "Anyone who has been in his company will know how much of a visionary he is. He understands the value, the benefits of a long-term strategy.
"Equally, Tony Bloom is also the biggest risk. No Bloom equals no party. With regards to the loans he has made, there is no urgency from him for those loans to be repaid and it will be done if the club has spare resources.
"We can certainly expect some of those loans be converted into equity in the medium to long term if Bloom's success in all of his other industries continues and therefore the necessity for repayment diminishes. He is a fan of the club first and foremost, it also happens he is a genius and a billionaire second."
However, Bloom's influence is not purely to bankroll the club. In 2006, he founded sports betting company Starlizard, which has since grown into an extremely extensive database containing information on thousands of players around the world. "I don't know a number but I imagine it would be the vast majority of players who play professional football in all the leagues in the world," Brighton technical director David Weir tells ESPN. "It would be a big number."
This database uses an algorithm to identify players; Weir admits he does not know how the algorithm works and it is kept a closely guarded secret. "It is just a filter or some parameters that allows us to work within certain criteria that we think will enable us to get talent early that has scope for improvement," he says. "I don't know the exact details of the algorithm itself, but I do know the output and the clarity it gives you enables us to work with a smaller pool that we can investigate more. The filtering system gives clarity to the role and the direction we want to go in."
It all begins not by geography, but by position. Scouts are reportedly sent a list of names to watch and compile reports on. These are then colour-coded using a traffic-light system to determine how well a possible target could fit into the club's model.
"We don't go into details of how we operate but broadly speaking, everything starts with a positional need," Barber says. "We're not the sort of club that's constantly scouring for talent we don't need. We're very much [focused on] positional need, data to determine the best candidates to fill that positional need, eyes-on scouting to verify the data, personality profiling to verify the person and then the first choice and the last choice will always be with the coach. We're not going to bring players into the club the coach doesn't need or want."
Barber confirms that the head coach -- currently De Zerbi, the outspoken Italian who has admitted previously he had to be convinced about Brighton's methodology -- has a veto "to every sense," adding: "The coach has to want the player that we are bringing in because otherwise we're wasting money if they're not going to play them. There might be situations where we are investing in talent for the future and the first-team coach doesn't need to have a particular right of veto because, chances are, that player will be on loan for a year or two and it's only when they are ... ready to come back to our first team that the coach will even have significant interest in them."
Brighton's scouting network is modest relative to the obscurity of some of their signings. All top clubs now balance the modern-day use of analytics with traditional scouting, and it would be easy to envisage Brighton gained an edge through a vast array of global contacts, but Weir debunks that assessment.
"Our model requires fewer scouts, a lot more analysis of data to identify the players that best suit the attributes that the coach is requesting, and then it requires us to be prepared to go wherever they are," he says. "It requires us to be prepared to go to wherever they are and they may not necessarily be the most obvious football markets.
"If you look at the bigger clubs, they will be [scouting] in Argentina, Brazil. We are more likely to be in Ecuador and Paraguay. The bigger clubs might well be in Spain and Italy, we might be perhaps in Belgium or one of the smaller European leagues and we're fine with that."
Maguire notes that Brighton might struggle to maintain that edge. "What separates Brighton from many other Premier League clubs is that they do invest significant resources into succession planning, talent identification and they are fishing in different pools to many of the other clubs," he says.
"This means they have to be smarter and do more homework but football is a very competitive and copied industry and other clubs have taken note of their success and are trying to find raw talent in those markets with a view to copying the Brighton model. Often they are in a position to offer higher wages as well, although they won't be able to offer the development path in the way Brighton have."
Brighton have established themselves as a proven pathway for young players, either giving them a chance in a major league earlier than they may have found otherwise, or by devising a coherent loan strategy that will boost their development. Weir cites Mac Allister as an optimal case study.
"We were brave enough to be early, go in and navigate that market ... then subsequently loan the player back," he says. "To then manage that, to loan him out again to Boca Juniors -- a step up and a really interesting progression in the player's career -- to know when we thought the right time was to bring the player in, to enable him to integrate within our building, to determine his off-field integration -- language skills, adaptation to the UK -- and then to determine when it is right to put him into the team. That was a long and arduous progress.
"People remember the end point when he plays fantastically well for Brighton, wins the World Cup with Argentina and moves on to a top-level historic football club in Liverpool. But there are so many people involved in that process who are all part of something that ended with a lot of great achievements along the way. That Alexis story was probably four or five years in the making for us and a lot of people involved."
Barber says: "The way we work is honing in on particular attributes in particular positions are either the best that we can get at the price point we can afford or have the potential to be even better players with the benefit of our coaching and development. That's where we back ourselves.
"Good coaches, in good facilities, good player pathways and then ultimately leading to first-team football here. If we get all of that right, then we can usually generate quite a significant profit on whatever we've invested in the first place."
Investing off the pitch
This is where Paul Mullen comes in. Brighton's chief operations officer is responsible for setting and maintaining the culture at the training ground. The £20m facility opened in 2014, with a separate hub for the women's team following in 2022.
"We put big emphasis on embedding players in the area right from the start, with the recruitment guys who are looking at characters of individuals, their backgrounds, their suitability to fit into our culture," Mullen tells ESPN. "But then also making sure that as they move through the club, and when they're passed on to the player care team, that they are well-briefed."
No stone is left unturned. The club once arranged a dog sitter for a new overseas player with no family in the area while he was travelling for an away game, others have requested information on routes around Brighton to best avoid traffic. A new cook-to-order facility that helps with nutrition and player performance was also recently completed at the training ground.
"We are making sure we've got those things that are going to be a tipping point for a player or an agent to choose us over another club," Mullen says. "Our investment in facilities at the training ground have actually made a difference in their decisions because the agents have told us that. We have world-class training facilities, and that is where they work five or six days a week. We're looking at the next level of medical investments, a space that the players might want to relax in."
A new women's stadium is a priority project. Sites are currently being scouted, but Mullen believes something close to the existing Falmer site where the men's team is based "makes most sense because of the centralised resources we can tap into: ticketing, the grounds team, the shop, hospitality."
He adds: As we've started to look at a bespoke facility, we factor that in. So we need to make sure we have the right number of urinals in the home dressing room compared to the men's. We want to make sure if families are bringing young children that we have enhanced buggy facilities. All those small things may seem minor but they are important because it shows we care and understand our audience."
Avoiding a boom-and-bust scenario
Can Brighton really keep punching above their weight? Two years ago, the club set themselves a mission statement to become an established top-10 Premier League side and a top-four Women's Super League outfit. The men's team has since finished ninth and sixth. A six-game winless run leaves them scrambling to maintain that record, sitting in 11th place ahead of Saturday's trip to Newcastle. The women's team sit ninth in the 12-team WSL with one match remaining, having finished seventh and 11th in the past two seasons, but there is hope the club's database can have the same effect as on the men's team.
"It is still relatively early in terms of the interpretation of the data but there's definitely a willingness to explore that further and use the same process to allow us to have the same edges," Weir says.
Succession planning is key. Barber has a single document on his computer carrying the names of potential candidates for a host of key staff positions across the club. "The owner will always tell you his most important appointment or decision to dismiss is the head coach," he says. "That's his No. 1. He'll take care of that one. The next 25 jobs in the club are mine to take care of.
"We have a similar list for players. Most football clubs would map out their 25-man squad and the under-21 squad beneath it. So if we lost Cucurella, who would replace him? [Pervis] Estupiñán. When we lost Trossard, we had [Kaoru] Mitoma. When we lost Bissouma, we had Caicedo. When we lost Caicedo, we had [Carlos] Baleba.
"That kind of thinking is what we've introduced for the rest of the club, for the suits rather than the tracksuits. Again, it is not rocket science. I don't think it is going to win Nobel prizes. It is just business planning ... what good organisations outside of football do all the time. In football, it is not that common. I don't know why."
As Maguire points out, however, there are warnings from history. "Brighton's model has repeated that of other clubs," he says. "Look at Southampton around about a decade ago, it was a talent spotting model -- Gareth Bale, Adam Lallana, Virgil van Dijk, et al. -- moved on to other clubs and they were able to continue.
"But you can only let your talent go and not replace it with players of the same calibre for a limited period before things start to catch up with you, eventually manifesting in Southampton being relegated in 2023. The difference between Southampton and Brighton is they have Tony Bloom and the benefits of Starlizard which itself self-services to the club. If that model continues, it might give Brighton a competitive edge for a longer period of time but these things don't tend to be infinite."
Timing is everything. Brighton's decision to allow both Mac Allister and Caicedo to leave last summer undoubtedly weakened De Zerbi's ability to replicate last season's success.
"There has to be a degree of bravery in selling at the right time," Barber says. "Sometimes it is easy. Last summer is a good example -- Caicedo and Mac Allister were massively important players in getting sixth place and qualifying for the Europa League but the value of those players was at an all-time high and so was the interest. So we decided to [act]."
Asked if Brighton eventually aspire to being more than a steppingstone club, Barber replies: "When you become a top-10 club in the Premier League, the steppingstones beyond that become more and more limited so by definition you stop being a steppingstone for a lot of people because actually you've got to be a top, top player to step from a top-six club to an even bigger club."
Big clubs will be lurking around Brighton again; striker Evan Ferguson and midfielder Baleba are just two linked with potential summer moves. De Zerbi has been repeatedly linked with Bayern Munich and Manchester United and he has also been mooted as a possible successor to Manchester City's Pep Guardiola -- although there is confidence within the club their head coach will stay put for the time being. The club's academy also offers hope of maintaining progress. Ferguson, defender Jack Hinshelwood, forward Mark O'Mahony, midfielder Cameron Peupion and defender Odeluga Offiah have all made first-team appearances after breaking through. Ben White, another youth product, is now thriving at title-chasing Arsenal.
"The first team has developed really quickly so the academy has had to catch up," Weir says. "That gap has become challenging. We have fantastic facilities, we're all on the same side and there's an aspirational element to it so I think some of it happens by osmosis."
The shifting financial landscape creates potential uncertainty. The Premier League has agreed to replace its Profit and Sustainability Rules (PSR) from the 2025-26 season with a squad cost control, limiting clubs to spending 85% of their revenue on wages, transfer and agents' fees. The clubs voted in principle on Monday to "anchor" those limits to ensure the top teams could spend only a proportion of what the bottom-placed club received in TV and prize money. Everton and Nottingham Forest have been docked points for rules breaches and Leicester are facing similar charges. City's case to answer 115 charges relating to their financial conduct will be heard later this year.
Speaking before that vote, Barber said: "Anything that drives football clubs to be more sustainable and ultimately profitable has to be a good thing because that's what's at the root of the regulator's aims: that clubs and the pyramid is more sustainable.
"The direction of travel has to be the right one but the trouble is, the devil is in the detail. Until we actually adopt the rules and work within them, we are not going to know what effect they are really going to have on us.
"On the one hand, fans want owners to be expansive and invest. On the other, owners who are keen for that want to do it within certain parameters because they don't want to lose money. On top of all of that, we all want to be super competitive. The new rules are to be welcomed for their purity and direction but let's see how they work in practice."
Brighton seem to understand detail better than most.