The misconstrued 777 Narrative
There is no doubt in anybody’s mind, other than arguably the man himself, that Farhad Moshiri’s tenure as Majority Shareholder of Everton Football Club ought to come to an end as soon as possible. However, the next step beyond that is ensuring the new shareholders, 777, are fit to run one of England’s most historic and decorated Football outfit, despite the media coverage, i think they could well be.
In order to discuss what the new owners may bring, it’s vital to understand the mistakes of the Moshiri regime and ultimately, how not to run a football club. Although more complex and agonsing that can be fit into a few paragraphs, his legacy on and off the pitch are clear to see. It’s well documented that Farhad Moshiri, who acquired his 49.9% stake in Everton in 2016 (By January 2022, he had increased his stake to 94.1% with a £100m capital injection) had great ambitions for the club and city, citing that he didn’t want Everton to just “become a museum”. However the way he strove to achieve such ambitions clearly did not correlate, About £700m has been spent on more than 50 players in the Moshiri era, according to The Guardian.
Anyone could tell you that simply ‘splashing the cash’ as Farhad chose to do, would and never has worked, as seen by the likes of QPR and Balackburn. It’s clear to see what Everton missed under this regime was the implementation of a proper sporting structure, with Moshiri appointing eight managers and two Director’s of Football. Often, Moshiri would look to one of his close associates and friends (Becomes a common occurrence) for consultancy on the sporting side of the business, including Kia Joorabchian, a conflict of interest one might think.
This is the very reason the Club has spiraled at such rate that it has been left fighting relegation three seasons in a row, with two PSR breaches confirmed. If only Moshiri had decided to employ proper sporting figures from the get-go, rather than keeping hold of the now-gone board that led to him buying the club in the first place.
Farhad Moshiri has tried it all to cling on, first with the proposed takeover of Peter Kenyon-led Kam Sports LLC falling through in 2022, to the eventual surrender of interest in early 2023. Moshiri again appointed one of his close associates, Matthew Hammond (Circled) , to handle what he originally sought —a minority investment, which would allow him to stay apart of his one redeeming item — the new stadium at Bramley-Moore Dock. Matthew Hammond, who previously held positions as CFO of Russia’s Mail.ru Group, assessed options from both MSP Sports Capital, and 777 Partners in around January 2023.
After a period of exclusivity, it was revealed that MSP sports Capital were the favored investors, agreeing a deal worth around £100m in return for a 25% stake in the form of a preferential share structure that would require the repayment of the loan, rather than equity in the club, as well as this, sporting control and boardroom influence. It’s understood that Jeff Moorad and Jahm Najafi alongside businessmen Andy Bell and George Downing were set to take up respective board roles on completion of the deal. It is also important to understand that Andy Bell lent Everton Stadium Development Holding Company Limited a sum near £40m via Omskirk-based Blythe Capital on May 19th 2023 as form of a bridging loan to ensure the continuation of developments at BMD.
The investment deal fell through in late August, after it was revealed that Chesire-based lender Rights Media and Funding Limited opposed the deal, demanding repayment of their £200m debt to Everton upon completion, with MSP concerned that the 25% that MSP were set to take was unfeasible in relation to the funds that would go into the club. Although any investment deal had now collapsed, MSP decided to proceed with their loan, and lend the club the £100m rather than convertible debt.
This allowed Moshiri to seek alternative investment, and resume talks with 777 Partners. The Miami-based private investment company agreed to purchase all of Farhad Moshiri’s 94.1% stake in Everton in September with Moshiri finally deciding to cut his losses.
Who are 777 Partners?
A name now known to all Evertonians, and fans of clubs across the globe, operating across an extensive list of industries out of several continents. 777 Partners describe themselves as an ‘alternative investment platform that helps bold entrepreneurs transform visions into enduring value’. 777, founded in 2015 by Josh Wander and Steve Pasko, head their large operations out of Miami, USA — which until 2018 was where they conducted the majority of their business, the branching into the likes of the UK, Canada, Spain and Singapore. And as of 2022, 777 Partners Operate their 55 brands acorss 24 different countries, employing over 1965 staff at a 500%+ employee growth rate since 2015. 777 manages $10 billion in assets and around 60 subsidiaries across industries ranging from airlines to insurance. Reinsurance firms in Bermuda seems to have caused an issue, to some. It’s unusual to some as to why 777 domicile their reinsurance in Bermuda. However regulations means it’s a more favourable underwriting criteria- firms such Zurich, Aviva, Lloyds etc all sit their reinsurance subsidies within Bermuda. 99% of insurers will have a Bermuda reinsurance leg connected to their operations.
The name 777 takes inspiration from their 7 core values, describing themsleves:
Curious -We explore new ground and are fascinated, rather than frustrated, with people who think differently than us.
Brave — We courageously lead the teams, companies, and communities we serve to break from the status quo.
Agile- We are smart enough to navigate levels of a problem and adjust quickly in fast-paced environments.
Tenacious — We have the tenacity and work ethic to never lose sight of the goal, measuring our success by the outcomes we manifest.
Accountable — We take full accountability for our actions. We act like owners and operate with high integrity in everything we do, seeking to have a positive and enduring impact on the people and communities we serve.
Entrepreneurial — We are entrepreneurs who serve entrepreneurs. We seek growth and understanding and have the tenacity, ingenuity, and agility to entrepreneurially build businesses and are willing to “get our hands dirty” in the process.
Unified — We win together with care, consideration, and empathy for the wellbeing of our partners and people by building lasting relationships of trust. We align incentives and operate with shared goals with our investors, employees, and partners.
Josh Wander + Steve Pasko
It is understood that Wander and Pasko, having received FA approval, will sit on Everton’s board — potentially as Managing Partners alongside others from within the 777 network. A brief summary of the two is necessary to provide a background onto who will be running the club.
Josh Wander — The figurehead of 777. Prior to establishing 777, he held executive positions at SuttonPark Capital, First Sustainable LLC, and Structured Asset Funding, where he specialized in sourcing, structuring, and financing alternative assets. Mr. Wander leads strategic and investment endeavors at 777, chairing the firm’s investment committee and serving on the boards of F3EA Holdings, Signal Legal, and First Sustainable. He earned a B.S. in Finance from the University of Florida.
Wander allegedly faced drug trafficking charges after accepting and opening a package containing 31.2 grams of cocaine, which law enforcement officers had been tracking. Additionally, he was accused of possessing over 20 grams of cannabis. According to the Washington Post, he entered a plea of no contest, avoiding imprisonment and receiving a 15-year probation sentence, contingent upon his cooperation in a related case. In early 2014, he successfully petitioned the court for early termination of his probation.
The Washington Post also suggests that Wander gained notoriety as a driven and ambitious operator, aiming to ascend within Miami’s financial landscape.
Steve Pasko — Before his tenure at PennantPark in 2008, he occupied Managing Director roles at Natixis Capital Markets and Bankers Trust (now under Deutsche Bank), overseeing asset securitizations and interest rate products. Mr. Pasko also spearheaded specialty finance initiatives at Salomon Brothers and Drexel Burnham Lambert in key leadership capacities. He holds a B.A. in Business Administration from Rutgers College and an MBA from the Wharton School of the University of Pennsylvania. Currently, Mr. Pasko acts as CEO of SuttonPark Capital and retains controlling ownership of Brickell Insurance Holdings.
Across their 55-wide brand portfolio sit 7 different industries:
- Sports, Media & Entertainment
- Aviation
- Insurance
- Fintech
- Litigation Finance
- Private Credit
- Sustainability
Football Operations
Initially, 777 eased into the Sports industry through the means of sports rights, including the international commercial distribution rights for the Argentinian and Brazilian soccer leagues, the Chilean and Peruvian national soccer teams, and the top European women’s soccer leagues in the world. Talent and product development, sponsorship, merchandising, advertising, distribution strategy, NFTs, Web3 approach, data monetization, fantasy sports, and gaming are also cited as their first steps into the market. However, their wide sporting portfolio has been crafted over the last five years, which includes the acquisitions of Genoa, Sevilla, Standard Liege, Red Star FC, Vasco De Gama, Melbourne Victory and UK basketball outfit London Lions.
777 have a dedicated Football team of operations, headed by Don Dransfield, Andrez Blazquez, Daniel Nichol, Josh Wander and Steve Pasko at management level.
It’s highly likelythat Don Dransfield will take up a seat on the board either as CEO of Everton or a related football operations role. With a rich background spanning 20 years across sports, media, and private equity, Dransfield’s journey began at Boston Consulting Group, followed by impactful roles at Manchester City Football Club and City Football Group. Armed with a master’s degree in economics from Cambridge University, Dransfield’s tenure at City Football Group’s ventures team witnessed expansions into various new business domains, including recreational soccer in the US, investment in a Silicon Valley-based Venture Capital sport technology fund, and the launch of Manchester City’s inaugural NFT initiative.
Dransfield’s association with Manchester City commenced during the 2010–11 season when he assumed the position of Head of Strategy and Business Planning, following seven fruitful years at Boston Consulting Group, where his expertise lay in private equity and media sectors. He holds a board position at the American East-West coast recreational soccer venture, Goals-SoFive, and oversees CFG’s investment interests in the Dugout-OneFootball platform.
The group generally deploy a CEO at every club they acquire, who will then report to the 777 board, in Everton’s case this is likely to be Don Dransfield. As well as this, 777 seek to appoint their own sporting Director who will take control of Everton’s football department, he would sit above the Director Of Football Kevin Thelwell — who is currently running these operations.
Johannes Spors is likely the man that will take up that role, with the potential of a role on the board, in collaboration with the CEO — a structure which has not been seen by Everton in years.
Spors commenced his professional journey as an analyst at Hoffenheim in Germany, collaborating with Ralf Rangnick. He later transitioned alongside the former Manchester United interim manager to RB Leipzig, assuming responsibility for recruitment during the German club’s tenure in the second division. His inaugural role as a sporting director materialized at Vitesse Arnhem, where he forged a close partnership with Chelsea. Subsequently, he ventured to Genoa, marking the inception of his affiliation with 777.
777’s network will provide Everton with access to a world-class team and its capabilities, as well as have opportunities to share best practices and intelligence with the other clubs in their networks, with the aim of correlation in the group and a view of working in unison, this means a data-based approach to recruitment should be expected, a system in which the likes of Brentford and notably Brighton have reaped the benefits of. A 777 Asset Management associate Juan Arciniegas explained that ‘whilst 777 does assess the ability to send players from one market to another, it does not necessarily see the smaller clubs within its group today as being “small clubs” forever and it does not intend for one club to benefit at the expense of another.’”
Genoa’s transformation
Andres Blazquez Prior was a Senior Advisor with Guggenheim Partners. Before that, he was the Founder and Managing Partner of Caucasus Capital Partners, one of the pioneer private equity investors in the Caucasus. He also was in charge of business development at Erlang Technologies, a US-based fabless semiconductors company and started his career with Accenture.
Mr. Blazquez has a B.A. in Physics from Kalamazoo College, a B.S. and M.S. in Electrical Engineering from Washington University in Saint Louis, and an MBA from INSEAD. Mr. Blazquez is the President and CEO of Genoa C.F.C. S.p.A., and sits on the boards of Fanatiz and Vasco da Gama SAF.
In September 2021, 777 acquired 100% ownership of Genoa during a period of severe financial distress, with retained earnings plummeting to lows of -€42.3 million in 2021 and -€61.7 million in 2022. Additionally, Genoa faced a concerning wage-to-revenue ratio exceeding 100% in 2021. Under the new leadership of Andrés Blazquez, a cost-cutting strategy was swiftly implemented, reducing salary expenditures from €70 million to €30 million over two years, aiming to stabilize the club’s finances following consecutive years of significant losses, reminiscent of Everton’s current financial challenges.
Blazquez emphasized the need to realign the club’s finances, revealing that despite wages totaling approximately €75 million, the actual market value of the team stood at a mere €15 million. 777 prioritized revitalizing key revenue streams such as matchday operations, sponsorship agreements, and merchandise sales to enhance Genoa’s commercial prospects.
In the 2023-24 season, Genoa achieved the highest stadium attendance in Serie A, with an average of 97% filled throughout the year. Furthermore, the club secured lucrative sponsorship deals, with sponsorship revenue reaching a record high of €10 million. Since the new ownership took over, Genoa have seen their clothing sales increase from 3,000 items sold in 2021 to around 25,000 in 2023, and sponsorship money has increased from €2.7 million ($3 million) to €9 million.
Blazquez: “Now we have a roster that is about €30 million cheaper than when we took over, but it has a value that is about eight times more valuable than what we found. We will have transformed the business and the sports of the club in basically two years. So it is going okay!”
“We are working very hard on the financial side of things and this year, for the first time maybe in Genoa’s history, certainly in the recent decades, we will be very close to breaking even by not only controlling costs but also increasing revenues.”
As well as this 777, had to deal with the mismanagement of the previous ownership who ended up sacking multiple managers, leaving the new group with the compensation bill — “At one point, we were paying the salary of four managers in a single year” — this mistake can be paralleled to Moshiri’s scatter gun approach to managerial appointments.
Filippo Grimaldi, who covers Genoa FC for Gazzetta dello Sport noted that 777' repuation is not backed by sporting fact, stating “The truth? No worries, not even an echo of the problems in the other clubs has reached here.” Grimaldi expressed that 777 have healed Genoa, and that as soon as they arrived their dream was to transform the stadium into a venue for events seven days a week, as happens in greater style at the Wanda Metropolitano (home of Atletico Madrid). For now, however, they have found difficulties, because the other team that shares the stadium (Sampdoria, who were relegated last season after finishing bottom of Serie A), has experienced a period of serious financial crisis and therefore the project has remained on the back burner but the 777 and Blazquez have very clear ideas on the matter.”
“Josh is the boss. The master.” Said Grimaldi.
It is also understood Andrés Blazquez will take up a role at Goodison Park, at the moment it is not clear what role this will entail, having been appointed as CEO of Genoa, however it is safe to assume he will at least be appointed to the board, similiar to his role at Vasco. With such fiscal experience, it will certainly be refreshing to see an absolute expert in his field be appointed to the Everton board – something that the club has rarely been seen with the previous board. As well as this, Blazquez’ tenure at Genoa should not only be commended for the commercial revitalisation, but the implementation of a proper sporting structure, with sustainability at the forefront of operations, it’s not hard to draw the similarities as to how Everton should be operating.
London Lions investment
Moving onto 777’s current only UK-based sports asset, London Lions. In the media the group’s investment in UK basketball seems to be rather understated. In 2020, 777 acquired the London Lions, and just a year later, they also secured a 45% share in the British Basketball League. And since taking ownership, the team has excelled in men’s basketball, having recorded back-to-back domestic clean sweeps and going on an unprecedented 52-game unbeaten streak and women’s basketball, with the women’s squad nearly unbeatable in domestic tournaments.
Bold in their ambitions, 777 serves as the only funding partner investing millions into women’s basketball in the UK. This investment into not only UK basketball, but women’s basketball is unprecedented and nothing on this scale has ever been seen in the UK market – representing 777’s ambitions to grow the game in Europe.
777 have also delivered a vibrant new basketball court to a community in London’s worst-hit borough for child poverty and providing various grassroots coaching activations across the capital, to creating a never before seen youth team structure.
Losses have been accounted, however this a league- wide governance issue. 777 are once again blamed by certain individuals for lack of revenue in a market that the chairman of the league Chris Grant has said that it faces an “unsustainable and untenable” position and is so lacking in resources that it is unable to employ a single person full-time. Whilst 777 have invested millions, the league can’t run itself.
The BBF received than £500,000 a year from the government, which is spent on travel and competition costs for its national teams at senior and age group levels, as well as licensing. That compares unfavourably to £5.65m a year for sailing, £3.4m for canoeing, £3m for equestrian and £1.55m for shooting. UK Sport bases its funding almost entirely on its predictions of medal success. However basketball is the second most played team sport in the UK, with pools of talent, yet nothing to financially support the league. As previously mentioned, sustainability is a pillar of 777, this is why they have strived to implement new revenue streams by increasing brand exposure and altering commercial processes.
The takeaway is that although not perfect, we should be willing to give 777 partners their best chance at running the business. I’m 100% sure they will implement the board structure that Everton so desperately need, a board of experienced professionals across finance, operations, business, and football. The shared scouting and resources network will also provide an interesting backdrop into Everton’s future recruitment with an expected focus on globalising Everton’s recruitment, identifying talents before the masses. Approval is likely to come after Everton’s PSR verdict, so next month is certain to be a rollercoaster. And whatever people say, administration is not an option.
