Borussia Dortmund German football Bundesliga side and Special One Football club has reached Europe’s elite standards because of its clever transfer policy, keeping an eye for talent that keeps them as a top club in the long-term.
“We nearly went bankrupt. Nearly,” remembers Michael Zorc, Borussia Dortmund’s sporting director, in this interview. Over the winter of 2004-05 Dortmund, one of German football’s great institutions, were flirting with collapse. The value of the club’s shares fell by 80 per cent, and over 400 investors organised an emergency meeting in Dusseldorf Airport. All players were forced to accept a 20 per cent pay cut. Perhaps most gallingly, in 2003 arch-rivals Bayern Munich even helped out with an interest-free €2m loan. Dortmund only had themselves to blame. Financial peril was a legacy of years of unsustainable spending. Dortmund had repeatedly maxed out the company credit card, trying to play the same game as the European super clubs. Only, it didn’t work: financially, Dortmund were not quite one of the giants. And so the club realised that, if the rules were unfair, it was time to play a different game.
Last month, Dortmund sold Christian Pulisic to Chelsea for £58m. Dortmund have already got an upgrade on Pulisic: Jadon Sancho, who normally now starts above Pulisic. Sancho only cost £8m. So Dortmund managed an extraordinary conjuring trick: improving their squad while making a £5m profit. It was the perfect encapsulation of a transfer strategy forged out of the rubble in 2005, and refined since. Their model, essentially, is to identify the world’s best young players, nurture them and give them game-time they would have been denied elsewhere, and then sell them on for a huge profit.
Shinji Kagawa was bought for £300,000 and then sold for a reported £15m to Man Utd two years later. Ilkay Gundogan cost £4m, and was sold for £20m; Pierre-Emerick Aubameyang was signed for £11m and then sold for £58m. Most absurdly, Ousmane Dembele cost around £12m in 2016, and was then sold for in excess of £100m a year later. Dembele only made 22 league starts for Dortmund – so his value rose £4m for each one. In place of short-termism and glitzy signings, Dortmund have now built one of the most admired structures in Europe. European football today, even more so than when Dortmund grappled with oblivion, is a world of distinct hierarchies. And so while Dortmund are the 12th wealthiest club in the world, a chasm also exists between them and many of those above. Excluding cash from player transfers, Dortmund generated £281m in 2017-18, according to Deloitte. Tottenham, their Champions League opponents, generated £98m more. Bayern generated £557m – twice as much as Dortmund – while Man Utd, Barcelona and Real Madrid raised even more cash.
To compete with such sides, Dortmund need to out-think them. And they do. Relative to wage spending – the biggest determinant of how a team performs on the pitch, academic research has shown – Dortmund are outperforming expectations by eight points this season, notes Omar Chaudhuri from the football consultancy 21st Club. “Our target is to be always at least second in the Bundesliga table because it’s difficult to beat Bayern Munich – there’s a big distance regarding revenue and so on,” Zorc explains. “We also want to have a good performance in Champions League. Participate and to be competitive to be [in] the best 12, 16 clubs in Europe.”
Such an approach shows self-awareness and pragmatism the club lacked when they were out-spending Bayern at the turn of the century. Dortmund have become adept at manoeuvring their position in the sport’s ecosystem to their advantage. Not perceiving themselves as a super-club means that Dortmund are inoculated from the need to make short-termist, over-priced signings. Instead, their system is built upon the longer view. Simply put, Dortmund is the best finishing school for young footballers in the world. There is nowhere else in the world that a highly promising player in their late teens can go and so reliably be moulded into a superstar. The smartest players, parents and agents know as much. “The biggest advantage – and it is what young boys are looking for – is that they have the chance to play,” Zorc reflects.
In a sense this model is admiringly transparent. Young stars who arrive know the recent history of players departing the club – but, however long they are in the Ruhr Valley, player and club can rise in tandem. The model has constant evolution wired into it: Dortmund’s team who beat Schalke away in December included only three players who played in the same fixture eight months earlier. This season, the average age of Dortmund’s team has been 25.4 – three years younger than Bayern Munich, and almost a whole year younger than any of the 20 Premier League clubs, according to Football Observatory (see chart below).
Only 10 clubs in the Big Five European leagues have a younger average age, Chaudhuri finds – and none are as good. Personal touch Dortmund manage their young prodigies with familial care. They are in regular dialogue with the parents of Sancho, for instance, and with the FA about his footballing development. Zorc is meticulous in identifying coaches who embrace this approach and believe in the testament of youth. Jurgen Klopp famously won back-to-back Bundesliga titles, in 2011 and 2012, with a side with an average age of 24. Thomas Tuchel, coach from 2015-17, shared the same commitment to developing young players. And so, though he is 61, does Lucien Favre, who joined as coach last summer. One reason Favre was targeted was that “he is able to develop players and make them better, especially young players,” Zorc explains.
The famous Footbonaut machine – where players must control footballs hat spring out at them while in a cage – embodies the club’s focus on improving what they already have. Dortmund’s philosophy is less about assembling a great team so much as constantly improving everyone they have, even if not all will be around for long. Even youth team coaches have become a mini production line: the last three to coach the reserves subsequently moved to first team jobs in England. Zorc has been in position since 1998. “Almost all important factors of modern football changed,” he says, yet he has been able to evolve with the modern game. The financial power of Europe’s super-clubs is such that this is not enough to break into the cartel for good. But the Dortmund way attests to how, with sustainability and forward-planning, teams on the edge of the elite can defy the logic of financial determinism in sport.