Football Dynasty-Chapter 112: Becoming the LA Galaxy Founder

In 1988, the United States was awarded the bid to host the 1994 FIFA World Cup—a golden opportunity to ignite the growth of soccer in the country.

Following the tournament’s success, the U.S. Soccer Federatio, led by President Alan Rothenberg honored its promise to FIFA by launching a professional soccer league in the U.S.

In fact, preparations had already begun a year earlier, in 1993. The USSF had quietly laid the foundation, securing banking partners and assembling marketing teams in anticipation of the league’s creation. Their goal was to keep the momentum alive and build something sustainable in the wake of the World Cup.

Richard hadn’t slept a wink the night before.

Between heated conversations about Yahoo’s issues and a surprise phone call from Vince McMahon, his mind was racing.

McMahon had reached out with an unexpected proposal: an opportunity to invest in a new team as MLS prepared for its official launch.

Naturally, Richard was intrigued. He wanted in.

FIFA does have ownership rules—primarily to prevent the same owner from controlling two teams in the same competition. But since MLS teams don’t compete in European tournaments, owning a club in both MLS and Europe, posed no conflict. It was fair game.

The next morning, Richard said goodbye to Jerry and David, then headed back to the hotel with Adam Lewis.

After finally catching some well-deserved sleep, he woke in the afternoon, got dressed, and stepped outside.

A Rolls-Royce Spirit was already waiting at the curb.

Vince McMahon greeted him with a nod and a handshake. Lewis followed close behind, and the three climbed into the luxury car.

"You sure you want to do this?" McMahon asked as the car rolled out. "If you back out now, maybe you’ll be fine. But once they’ve got their eyes on you... they’re not going to let go—especially not when they find out you already own a football club."

Richard shook his head with a calm smile.

"Mr. McMahon, this isn’t about the money. It’s about passion. I used to be a footballer, remember? There’s no way I’m walking away from a chance like this," he said confidently.

A founding member of MLS?

Well, maybe not officially, but his name would be tied to the league’s beginning. That alone was worth it.

He made sure to ask McMahon about the current state of MLS—its structure, the challenges it faced, and what to expect, including the key figures to watch out for. Vince, more than happy to share, laid everything out in detail.

Don Garber, the current MLS commissioner.

Alan Rothenberg, serving as President of the USSF and helping the U.S. win the 1994 World Cup bid.

Phil Anschutz: A major businessman and one of the most influential investors currently.

There are currently the most important figures at the top of MLS right now.

"How much money does it actually take to build a league from scratch like this?" Richard asked curiously, watching McMahon sip his whiskey.

McMahon set his glass down casually. Now that Richard had agreed to team up, he was visibly more at ease—legs crossed, one hand resting on the armrest, the other gently swirling a glass of ice water. novelbuddy.cσ๓

Truth be told, he hadn’t called Richard just to ask whether investing in the league was a good idea. From the very beginning, he’d been looking to pass the hot potato onto someone else—and Richard, ever the football romantic, had walked right into it.

McMahon chuckled to himself, hiding it behind his whiskey glass.

’These football maniacs,’ he thought. ’They’re absolutely nuts. But hey, who am I to stop a man from chasing his dreams... or his financial ruin?’

Leaning back, he said, "The initial meetings to discuss the creation of MLS took place in the early ’90s. There were about 22 cities that submitted proposals to host one of the league’s first franchises, and eventually, 10 of those proposals were accepted."

Columbus Crew – Columbus, Ohio

D.C. United – Washington, D.C.

New England Revolution – Foxborough, Massachusetts

NY/NJ MetroStars – East Rutherford, New Jersey (near New York)

Tampa Bay Mutiny – Tampa, Florida

Colorado Rapids – Denver, Colorado

Dallas Burn – Dallas, Texas

Kansas City Wizards – Kansas City, Missouri

Los Angeles Galaxy – Los Angeles, California

San Jose Clash – San Jose, California

"I heard it was an ambitious project from the start—they managed to pool together over $100 million just to get the league off the ground," McMahon continued. "The thing is, the initial investment for the league, including ownership stakes and stadium construction, required contributions from each team. $40 million was needed to launch the first 10 teams, which meant each team had to pay $4 million."

"Did the league have any revenue streams?" Richard asked.

McMahon’s face twitched slightly as he recalled some unpleasant memories. He let out a long sigh. "Welcome to America," he said. "Even with all that, every team still had to chip in financially."

That’s why he himself was very reluctant to get involved in this potential pitfall.

If Richard could hear what McMahon was thinking, he would likely sneer. Thirty years. That’s the timeframe MLS needs for each team to reach hundreds of millions of dollars, with top franchises potentially exceeding $1 billion.

A little million in sacrifice seems nothing in front of a billion.

Soon, they arrived at their destination.

This was the Hilton Los Angeles, where they would meet with the MLS representatives.

The sleek black Rolls-Royce pulled up in front of the grand building, its polished glass windows towering over the city and reflecting the late afternoon sun. Richard couldn’t help but feel a surge of anticipation as he gazed up at the imposing structure.

The elevator doors opened, and they stepped inside.

"Vince, we’re glad you could join us today," Phil Anschutz said as he was the first to rise and greet Vince McMahon with a warm hug before turning to Richard in surprise.

"This is?" Anschutz asked, eyeing Richard curiously.

"Another potential investor I’ve picked, of course," McMahon replied, smiling proudly.

Anschutz’s eyes lit up as he shifted his attention between the two men.

"Well, well, welcome! My name is Phil Anschutz, it’s a pleasure to meet you."

Richard smiled and shook his hand. "Nice to meet you too, Mr. Anschutz. I’m Richard Maddox."

"Rover Group?" Anschutz asked suddenly, his expression changing as he scrutinized Richard, having heard the Maddox name before.

Richard nodded.

"Haha, so you’re Mr. Richard Maddox! Come, sit down. Let’s get started. I hear they have a delicious tomahawk steak here..."

Richard thought it was a nice, formal meeting—after all, this was America. He expected a more direct conversation, but they spent most of the time chatting casually, not even touching on MLS. It wasn’t until they had finished their steaks that the conversation took a more serious turn.

"Mr. Richard, to be honest, we didn’t expect Vince to bring in a new investor. You’re already familiar with the requirements, aren’t you?"

Richard was taken aback. "Requirements? What requirements?" he asked, his expression puzzled.

It was only after the explanation that he began to understand.

Unlike European football, Major League Soccer operates quite differently here.

MLS is a single-entity league, meaning the league itself owns all the teams. Investors don’t buy clubs outright; instead, they buy into the league and are granted operating rights to manage a specific team. This gives MLS the authority to approve or reject any potential investor or owner.

This also means investors needed to agree to MLS’s single-entity structure, which was unique compared to European club ownership. This included agreeing to share revenue, operate under the league’s collective rules, and adhere to league policies.

Richard nodded, understanding but still curious. "Sir, may I ask about the current projections for MLS? How do you see the league’s profitability moving forward?"

"Revenue is generated from media rights, sponsorships, and gate receipts. Fox, ESPN, and ABC were some of the first media sponsors when MLS launched, and we’ve seen steady growth in these areas. The better your performance, the better the money allocation for next year, and your salary cap will also increase."

Richard listened closely, but then something caught his attention. "Salary cap?" he said, surprised to hear that term. ’Isn’t that similar to American football?’

Indeed, MLS embarked on this remarkable journey with a unique and innovative financial structure at its core—the salary cap.

The salary cap, a pioneering concept adapted from American football, marked a ground-breaking addition to the world of soccer. It emerged as the ultimate equalizer, effectively levelling the playing field and ensuring that teams with limited financial resources could still stand shoulder to shoulder with their big-spending counterparts.

"The MLS salary cap is a system that limits how much a team can spend on player salaries. This is designed to maintain competitive balance across all teams and prevent any one team from dominating the league financially by outspending the others." Rothenberg explained.

This ingenious structure did more than just create a sense of parity; it played a pivotal role in helping the league maintain fiscal responsibility, a factor of paramount importance in ensuring its survival during the crucial formative years later.

"So, that’s how it is," Richard nodded.

"But," Rothenberg added quickly, "players who are developed through a team’s youth academy are often exempt from the salary cap, which allows teams to invest in developing their own talent without the salary limitations. Also, each teams must also meet a minimum salary cap floor, ensuring that the minimum amount spent on player salaries doesn’t fall too low."

Richard wasn’t too concerned about it, honestly. His goal here was to invest his money and let it grow over the next thirty years before enjoying the returns. Of course, if he had the opportunity to accelerate the value, he wouldn’t hesitate. After all, America loves opportunity. And money.

Initially, the goal for today was to pull McMahon into the proposal and convince him to invest in a new team based in Los Angeles.

But McMahon was reluctant, which allowed Richard to engage freely and learn many things he hadn’t known before about MLS.

The franchise fee to enter MLS was around $10 million per team. This amount covered the costs of securing the rights to own and operate a team, including expenses for marketing, infrastructure, and salaries.

This meant a total of $14 million—the franchise fee plus an initial investment of $4 million. Anschutz Entertainment Group would hold about 80% of the shares, leaving 20% for Richard and McMahon.

Richard briefly skimmed through the current proposal for all the team.

It still had no name, and its value was relatively low, currently estimated at around $10 million per club.

This valuation reflected not only the initial franchise fee but also the challenges of building a fan base and generating revenue in a country where soccer wasn’t as entrenched as it was in Europe.

"That’s fine, though," Richard said suddenly. "I’ll invest $2 million, as long as I’m allowed to invest in the new club in Los Angeles."

Given that MLS was still in its infancy, investor reputation was crucial. Existing investors needed to be sure that newcomers would be trustworthy, aligned with the league’s vision, and committed to supporting its long-term growth.

This was the purpose behind approval from the existing investors.

The proposal on the table was for Anschutz Entertainment Group to hold 80%, while McMahon and Richard would each own 10%.

"You understand that by agreeing to this, you’ll be sharing in the league’s revenues and financial risks, right?"

Richard nodded.

From that moment on, Richard officially became a key player in the development of American soccer, positioning himself as a foundational figure in the creation of LA Galaxy (later).

’Establishing a strong fanbase in one of the largest and most diverse cities in the world,’ Richard thought to himself. "This is the first step for Manchester City as I’ve already entered the U.S."

Although the soccer community here was still in its early stages, the 1994 World Cup had ignited a surge of interest in the sport.

Los Angeles, in particular, stood out.

As a global entertainment hub, LA was the ideal market for a future Manchester City to build a worldwide fanbase. Richard could leverage the city’s entertainment industry to attract new fans, secure high-profile endorsements, and land valuable sponsorships, which would help accelerate the growth of Manchester City.

Additionally, fostering a relationship with Hollywood could significantly boost the club’s profile, drawing in new fans and sponsors, while benefiting him both financially and reputationally.

"There are still Asia, Australia, and Africa too..." Richard mumbled to himself.