By GRANT WAHL, Sports Illustrated
LOS ANGELES — The Global Sports Summit is an annual summer event in Aspen, Colo., that’s a sort of Davos for sports owners and executives from around the world. In one of the most gorgeous spots in America — the St. Regis Aspen Resort — the GSS encourages networking by quietly bringing together a cross section of heavy hitters from the NFL (Steve Ross, Zygi Wilf, Dan Snyder), the NBA (Mark Cuban, Jerry Reinsdorf, Dan Gilbert), MLB (Peter Angelos, Ed Cohen), the NHL (Jeff Vanderbeek, Charles Wang) and European soccer (Adriano Galliani, Andrea Agnelli, Bruce Buck).
President and Owner Los Angeles Football Club Tom Penn, Managing Partner and Owner Los Angeles Football Club Henry Nguyen and Executive Chairman and Owner Los Angeles Football Club Peter Guber attend a press conference to announce the new Los Angeles MLS team and ownership group at Siren Studios on October 30, 2014 in Hollywood, California. (Photo by Charley Gallay/Getty Images for LAFC)
MLS owners are also fixtures at the event, including Clark Hunt, Stan Kroenke, Merritt Paulson, Robb Heineman, Jay Sugarman, Andrew Hauptman and Larry Tanenbaum. Given the setting, then, it probably shouldn’t be surprising that the genesis moment of MLS’ newest team — the Los Angeles Football Club, set to debut in 2017 — came during the 2012 Global Sports Summit.
At lunch one day, a Vietnamese-American venture capitalist named Henry Nguyen sat down next to MLS commissioner Don Garber. Nguyen was intrigued by MLS. Born in Vietnam, he came with his family to Fairfax County near Washington D.C., and grew up following the area’s sports teams, including Joe Gibbs’ Super Bowl winners and Bruce Arena’s championship soccer teams at the University of Virginia and D.C. United. After earning degrees at Harvard and Northwestern, Nguyen had moved back to his birthplace (where his father-in-law, Nguyen Tan Dung, is the country’s prime minister), been wildly successful (his group opened the first McDonald’s in Vietnam) and become the co-owner of the Saigon Heat, a team in the ASEAN Basketball League.
“Don, I really love the direction MLS is going,” Nguyen told Garber that day. “I’m a fan of all sports, but I realize now living outside the U.S. that there’s only one world sport, and it’s soccer. MLS has so much potential. Do you think there’s an opportunity to invest in or own a team?”
“Of course,” Garber replied. “We’re going to be expanding. We still have some current owners with multiple teams, and we want to move away from that.”
Nguyen couldn’t let go of the thought. At the end of the conference, he reached out to Tom Penn, the Global Sports Summit co-creator and organizer, who had worked as an NBA executive (for the Portland Trail Blazers and Memphis Grizzlies) and was now an NBA analyst for ESPN. “I’m going to call you about something,” Nguyen told Penn.
Soon, Nguyen checked back in: “Tom, I’m pretty serious about MLS. Can we start looking into it?”
Two years later, on Oct. 30, 2014, Nguyen and Penn stood on a stage in Los Angeles with a third principal owner — Peter Guber, a co-owner of the Los Angeles Dodgers and Golden State Warriors — and a star-studded list of global investors (there are 22 in all) to announce the birth of LAFC, a new soccer club with the most ambitious of goals.
“We have aspirations to be a club that can be on a par with some of the great clubs in the world,” Nguyen said. “It won’t happen overnight, and it may not happen in a decade, but that’s the lodestar, the goal we have set. I believe that’s where soccer is going in this country. We want to be one of the clubs here that leads that.”
Two years ago, not long after Nguyen decided to pursue an MLS team in earnest, he called his friends Vincent Tan and Ruben Gnanalingam, who also attended the Global Sports Summit. Like Nguyen, both men own basketball teams in the ABL, and both have a big soccer interest. Tan, a flamboyant Malaysian, is the majority owner of Cardiff City, which played in the Premier League in 2013-14, while Gnanalingam is a co-owner of Queens Park Rangers.
Nguyen asked them what they thought about pursuing an MLS team. “They were like, ‘Wait a second: First of all, there’s no relegation? All right, you got me!'” Nguyen, 41, said with a laugh. They talked more about MLS’ single-entity structure, in which all the team owners were partners, just like in the ABL. “And it snowballed from there,” Nguyen said.
Penn, 47, was ready to dive in too. While living in Portland, the NBA guy had fallen in love with the Portland Timbers, the wildly popular MLS team with the league’s most rabid fanbase. “It’s phenomenal, one of the best sporting experiences in the world,” Penn said. “You can say that, actually, with the size and the intensity.”
What’s more, Penn was fascinated by the conversations he was having with Portland owner Merritt Paulson and other MLS owners while organizing his Global Sports Summit. “I got to meet all the guys who run the teams across all sports, and some of the best operators in sports are in MLS,” Penn said. “Somewhat by necessity, because they’re grinding it out, they’re still building, they’re in the trenches.”
Once the group decided it was serious about pursuing an MLS team, they started thinking about cities. Los Angeles was at the top of the list. “And one of our first door knocks was to AEG: Would you sell the Galaxy?” Nguyen said. “It just wasn’t available. As we kind of kept looking, Tom said, ‘Hey Henry, why don’t we look at Chivas USA?'”
Talks continued with MLS, which bought out Chivas USA owners Jorge Vergara and Angélica Fuentes in February and took over the floundering club, which was poorly run and, truth be told, poorly conceived in the first place to try to attract fans of Chivas de Guadalajara.
A year ago, Nguyen was introduced to Guber, 72, the L.A.-based chairman and CEO of the Mandalay Entertainment Group. Over 40 years in the entertainment business, Guber has produced movies like Rain Man, Batman and The Color Purple, totaling more than 50 Academy Award nominations.
“If we were going to pursue something in L.A., we needed to have really strong roots here, and Peter fit that bill perfectly,” Nguyen said while sitting next to Penn during an interview with SI.com at Mandalay’s headquarters. (Guber was out of town at the time.) “So when our ownership group got together in terms of myself, Peter, Vincent and Ruben, it was like, O.K., this clicks, this works. Tom and I were really just charged with keeping this process rolling.”
As the project accelerated this year, LAFC kept adding minority investors, including some of the biggest names in sports and entertainment: Magic Johnson; Mia Hamm and Nomar Garciaparra; Chad Hurley, a co-founder of YouTube; and the motivational speaker Tony Robbins. (See the full list of 22 below.) The group was finally ratified at the MLS Board of Governors meeting in L.A. in early October. Chivas USA would fold, and LAFC would start as an expansion team in 2017, coming into the league with Atlanta to make 22 MLS teams.
The expansion fee for LAFC is in excess of $100 million, an MLS record, and the clubs says it will spend at least $150 million on its new stadium.
“With the army of assets that we have together, it’s just such a cool professional opportunity,” said Penn, who proudly shared a bottle of the LAFC “Ignition Ale” that was produced by his friends at Portland’s Rogue Ales for last week’s launch event. “When you think about Los Angeles, so much of sports ownership is about the real estate that you end up owning, the territory you have. And this is Boardwalk and Park Place together for this sport.”
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