How debt-ridden Barcelona can afford to sign superstar players

Barcelona have signed big names this summer despite having money issues. How do they do it? Here’s a look at Barca’s creative ways to free up cash. 

Barcelona have had money troubles since before the pandemic. The pinnacle of their problems took place last summer when the storied Catalan club was forced to let go of Lionel Messi. Over the course of last season, Barca had a topsy-turvy campaign. In the process, Barca discovered it had some young talent to rebuild around, like midfielders Pedri and Gavi, and the team finished second in the La Liga table.

Barca are debt-ridden after spending more than they took in, yet they have signed winger Raphinha and striker Robert Lewandowski during this summer’s transfer period. In signing Lewandowski, the aim is to find the scoring consistency they lost when Messi left for Paris Saint-Germain after the team ran afoul of the Spanish league’s strict financial fair play rules.

How could a club that until recently was $1.37 billion in debt afford Lewandowski?

Barcelona have engaged in some creative accounting by raising something called “extraordinary income” through sponsorship deals, agreements with investment funds and the selling off of players.

Barcelona has been getting creative with their finances

The club can use a third of all funds raised this way to buy new players. As a result, Barcelona has agreed to sell 10 percent of their league TV rights for the next 25 years in return for $207.5 million. In other words, they are mortgaging off their future for the present. This worked to get the Raphinha deal over the line, but more needs to be done to stay within the financial rules.

If they fail to offload more players (midfielder Frenkie de Jong could very well go this summer), then many players won’t be able to make the roster. Barcelona also plan to sell off a 49.9 percent stake in its licensing division. At the same time, the team refinanced their club debt with Goldman Sachs in a loan of more than $528 million that gives the club breathing space. In a $300 million deal with Spotify, the team will rename their stadium the Camp Nou and feature them on their jerseys.

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It’s a risky move to put future profits at risk in the hope that Barcelona could rake in more income in the short term should they win the league and go far enough, or even win, the Champions League.

The team, currently training in Miami for a string of preseason games in the United States, has felt the need to try and keep up with rivals Real Madrid, winners of this past season’s Champions League, and with European spending powerhouses PSG and Manchester City.

Jonathan Wilson, writing for Sports Illustrated, recently noted the following:

"The gamble appears to be that buying now will get Barcelona out of its slump and the success it generates will raise revenues sufficiently for the club to reach a level of sustainability. Perhaps it can, after all, Barcelona was until recently habitually one of the richest two or three clubs in the world by revenue. But it seems like an astonishing risk, particularly when there was an obvious opportunity for gradual consolidation based around the current fleet of exceptional young players, using Xavi to return the club to its philosophical roots."

The team got center back Andreas Christensen and midfielder Franck Kessie, both signed on free transfers from Chelsea and AC Milan, respectively. Talks continue about the free transfer of defender Cesar Azpilicueta, also from Chelsea.

Barcelona are pinning everything on the current transfer window. Instead of waiting a few years and rebuild slowly, they are looking for instant gratification. Instead of living on a budget, Barca is making splashy signings.

It could all end well for them. It could also be a bigger disaster down the line should the club fail to win any trophies this season.