The rise of RB Leipzig has been remarkable. Until 2009, RB Leipzig were only a fifth-division club called SSV Markranstädt and few had heard of them. Under the wealthy ownership of Red Bull, they were promoted to the fourth division in 2010, the third division in 2013, the second division in 2014 and finally the Bundesliga in 2016. Now, in 2020, RB Leipzig are among the favourites to win the Bundesliga title each season, whilst playing in the Champions League. How did this remarkable rise happen?
The rise of RB Leipzig
Red Bull purchased the club on the 6th of April 2005 and rebranded them as ‘RasenBallsport Leipzig eV’, or RB Leipzig for short, and allegedly sanctioned a transfer budget of £85m. After the takeover and name change, the club dispensed with the previous management and staff, declaring Leipzig ‘a new club with no history’.
Because the rules of German football don’t allow clubs to include a sponsor’s name in their title, the club had to be called Rasenballsport Leipzig, meaning ‘lawn ball sports’. By doing this, the club’s marketing team were able to continue calling the club RB Leipzig, which everyone naturally assumed stood for Red Bull Leipzig. When playing in European competition, RB stands for Red Bull and the energy drink manufacturer can advertise its flagship product to the broader public.
Such heavy investment isn’t new in European football. Manchester City are owned by Sheikh Mansour, one of football’s wealthiest owners, with an estimated individual net worth of at least £17 billion. Paris Saint-Germain are managed through their shareholding organization Qatar Sports Investments, who have been the club’s majority shareholder with 70% since 2011. Additionally Russian billionaire Roman Abramovich bought Chelsea for £140 million in 2003, with over £100m quickly spent on new players. So if other clubs are doing it, why can’t Leipzig?
It’s a problem as it is not how things are done in Germany. Unlike other European football leagues, the statutes of the German Football Association deter big investors from taking over its clubs.
The 50+1 rule, an informal term used to refer to a clause in the regulations of the German football league, is in place to avoid this. The rule states that in order to obtain a license to compete in the Bundesliga, a club must hold a majority of its own voting rights. The rule is designed to ensure that the club’s members retain overall control, by way of owning 50% of the shares +1 share, thus protecting clubs from the influence of external investors.
Prior to 1998, football clubs in Germany were owned exclusively by members’ associations. This meant that clubs were run as non-profit organizations and private ownership was not allowed under any circumstances. This changed in 1998, when clubs were allowed to convert their football teams into public or private limited companies. However, the 50+1 rule stayed in place, ensuring that the club’s members would still hold a majority of voting rights.
RB Leipzig’s solution
RB Leipzig have cleverly worked under the 50+1 rule in Bundesliga but managed to find a means of escape. Red Bull, who also own Austrian club RB Salzburg, discovered a loophole in the system. By 2009, the club had only 17 paying members, compared to Dortmund’s 170,000 members, who were also Red Bull employees. By exploiting this loophole, it was easy for the company to acquire the ownership status of the club with Red Bull becoming the de facto owner.
Red Bull also made sure that the ownership cannot be taken away from the club anymore. Firstly, they increased the membership amount to 1000 Euros, making it unaffordable to the average German. The membership price is comparatively extremely high with fans could of other clubs able to acquire a membership card for less than £100. Dortmund, for example, have about 139,000 paying members, who have veto power over deliberations such as ticket prices.
Even after being forced by the German Football Association to open up their membership system, RB Leipzig still only have 17 members with voting power, the majority of whom are either employees or associates at the Red Bull company. So much for fan power, right?
Although the club have been able to climb up the ranks, according to German football fans they are a betrayal of everything German football holds dear. The RB Leipzig board see things differently though, in their opinion Leipzig’s supporters are ‘customers,’ and are not to be involved in the decision-making process.
Most hated club in Germany?
Because of the membership structure, RB Leipzig are considered the most hated team in the Bundesliga. Fan groups around the Bundesliga routinely boycott trips to the Red Bull Arena as they don’t want to contribute any of their hard-earned Euros to this “abomination” of a club. Historically, Bayern Munich were the most hated club in Germany as they would, and continue to, buy the best players from their competitors. Now it is RB Leipzig who can claim the dubious honour with Bayern a close second.
This isn’t to say RB Leipzig don’t have a bright future ahead or any support. Apart from fragmented Berlin, Leipzig was the largest city in the former East Germany and a significant center of sports. Until Red Bull invested in Leipzig in 2009, football in the former East had deteriorated to a few struggling clubs. But now, Eastern Germany has a top club once again and success is returning. RB Leipzig this season have, for the first time ever, qualified for the quarter-finals of the Champions League. Ultimately, if the clubs breeds success and brings home trophies, RB Leipzig fans won’t care less about the company structure. Unfortunately for those who do, it’s not as simple as asking which football club should I support?
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