MLS club LAFC has the option to purchase equity in NWSL newcomer Angel City as part of its agreement to let the women’s soccer team play home games in its stadium, according to multiple people familiar with the contract.
The agreement between the two clubs, announced nearly two years ago, is primarily a revenue share, granting LAFC a cut of ticket, merchandise and concessions sales for games that Angel City plays at Banc of California Stadium, said the people, who were granted anonymity because the terms are private. The contract also includes priced warrants, the people said, giving the MLS club the option to eventually own equity in Angel City.
The warrants expire at the end of the four-year lease, according to one of the people. It’s unclear how much equity LAFC is allowed to buy, or how the warrants are priced. Representatives for both LAFC and Angel City declined to comment on the terms.
The lease is the latest example of how Angel City, which made its NWSL debut in April, is rethinking franchise “ownership.” The team has roughly 100 investors, the largest ownership group in the league and among the largest in U.S. sports at any level. They include movie stars, pop music stars and multiple toddlers.
Few, however, have a substantial say in the direction of the team. Reddit co-founder Alexis Ohanian is the club’s leading investor, one of four “principle owners” alongside Natalie Portman, Kara Nortman and club president Julie Uhrman. In February, the club added owners in what it called a “Series A” round, terminology more common for tech startups than sports franchises.
The lease agreement with LAFC is following in that mold, approaching the cap table as an ever-growing list of people and organizations that provide benefit to the club, either via cash, social influence or other in-kind service.
LAFC has not yet executed on any of the warrants, one of the people said. The relationship between the two teams also runs a bit deeper than just the stadium. LAFC is also providing Angel City with other services, including some consulting and ticket sales expertise.
LAFC, which made its MLS debut in 2018, is controlled by Riot Games co-founder Brandon Beck and a pair of Apollo Global executives, Larry Berg and Bennett Rosenthal. The club has its own share of celebrity investors, including actor Will Ferrell; motivational speaker Tony Robbins; former U.S. soccer star Mia Hamm, and her husband, former MLB player Nomar Garciaparra. It is worth $860 million, according to Sportico’s database, making it the league’s most valuable franchise.
LAFC is currently shopping naming rights to the stadium, which cost $350 million and opened in 2018. The prior deal, with Banc of California, was terminated 12 years early, though the team is still using the name.