How Beckham’s transformative MLS contract paved the way for Messi

More than 700 media members and 5,000 fans packed into the LA Galaxy’s home stadium to welcome David Beckham to Major League Soccer.

It was July 2007 and Beckham’s signing was heralded as a transformational moment for the league, his contract trumpeted as a record-setting five-year, $250 million deal. That nine-figure number was inflated to include potential earnings from endorsements on top of the $32.5 million in salary Beckham would earn, but it also somehow underplayed the real value.

Few knew that tucked away inside the contract was a clause that, 16 years later, would bring the greatest player of all time to MLS.

This week, Inter Miami is expected to officially announce Lionel Messi has signed a two-and-a-half-year contract with the club. Just seven months after winning a World Cup, the Argentine legend is coming to MLS. The path to that historic signing began with Beckham’s arrival more than a decade and a half earlier.

“It’s ironic that Messi is coming to David’s team,” says Tim Leiweke, the former Anschutz Entertainment Group executive and one of the architects of the Beckham deal, in a phone interview from London earlier this month. “It was ultimately the guy who created the opportunity that now exploits the opportunity.”

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The threads linking Beckham’s deal to Messi’s contract are numerous.

Beckham’s arrival was accommodated by the creation of the designated player rule in MLS, a tool which allows teams to spend above the salary cap on certain players with no restrictions. It took two years for Leiweke to convince MLS owners to pass the “Beckham Rule,” as it was initially nicknamed. Teams now have three “DP” slots each and the rule has been used to bring both big-name players like Thierry Henry, Kaká, Bastian Schweinsteiger, Zlatan Ibrahimovic and Didier Drogba, as well as up-and-coming stars or lesser-known players who have thrived in MLS, like Miguel Almiron, Josef Martinez, Diego Valeri and Hany Mukhtar. The level of the league went up as a result.

Miami is using one of those DP slots to sign Messi and another to ink his former Barcelona teammate Sergio Busquets. Without the DP rule, those types of signings would be impossible. (Reports indicate another former Barcelona teammate, Jordi Alba, is also joining them in Miami, but not as a DP.)

A more important influence, however, may have been the structure of Beckham’s deal. The creative approach to luring Beckham away from Europe set the stage for how Miami approached the Messi negotiation in order to compete with the deep pockets of teams in Europe and Saudi Arabia.

The English midfielder was just 31 years old and coming off of a league-winning season with Real Madrid. He was a global superstar. The move was questioned throughout the footballing world, but Beckham kept front of mind that his playing days would one day end. Beckham’s consideration, in other words, was about the long term as much as the short.

The deal with MLS had numerous commercial benefits for Beckham. It also aligned the entertainment interests of the Galaxy’s owner, AEG, and that of Beckham’s manager, Simon Fuller and his company, 19 Entertainment, as well as those of Beckham’s wife, Victoria Beckham, the former Spice Girl.

Beckham’s move to MLS helped provide a boost to Victoria’s celebrity profile and Hollywood opportunities, including a one-hour TV special called Victoria Beckham: Coming to America on NBC. AEG also signed on to promote the Spice Girls reunion tour, which would include multiple concerts at AEG-owned venues. The Beckhams became close friends with Tom Cruise and Katie Holmes and became A-list celebrities in Hollywood. Forbes magazine’s list of the highest-earning Hollywood couples from 2007-08 had the Beckhams at No. 3 with $58 million, behind only Jay-Z and Beyonce and Will and Jada Pinkett Smith.

Fuller, the entertainment mogul behind American Idol and the Spice Girls who brokered the deal, spoke about the ambition behind the structure of the contract.

“Shoot for the stars,” Fuller said in the late journalist Grant Wahl’s book, The Beckham Experiment. “And if you don’t hit them, then it was fun trying. If you do hit them, then you’ve made history.”

Leiweke and the Galaxy had spent years building a relationship with Beckham, dating back to a 2002 meeting with Beckham’s good friend Terry Byrne to discuss starting a soccer academy with branches in London and Los Angeles. Several other meetings would take place over the next four-plus years, but as Beckham’s contract with Real Madrid neared its expiration in the summer of 2007, the Galaxy knew it was time to make a push. MLS owners approved the DP rule in November 2006 and the Galaxy waited for January 1, 2007, when they could legally speak with Beckham about signing a pre-contract to make their formal offer. Per The Beckham Experiment, Leiweke would call the next 10 days a “mad dash” to work with Fuller and CAA agent Jeff Frasco to get the deal over the line. On January 11, 2007, Beckham signed the deal. The contract included revenue sharing tied to the sale of cleats, jerseys, ticket sales and more.

But it was a lesser-known clause that would, as Fuller hoped, help Beckham make history.

The clause allowed Beckham to purchase the rights to an expansion team for a set fee of $25 million. At the time, MLS’ latest expansion team, Toronto FC, had paid just $10 million to enter the league. But, as MLS commissioner Don Garber revealed to The Athletic in an interview in March, the contract was not as simple as just including an option for the team.

Beckham had to play in the league for the entire five years of his contract and, over the course of those five years, MLS had to expand substantially from 13 teams to a point where it was at a threshold for 20. The option also included a clause that Beckham could not put his expansion team in New York.

“I would tell you the likelihood that that would have happened if you were a betting person would be pretty damn close to zero,” Garber said in March. “And it happened.”

Beckham stayed all five years with the Galaxy, despite a difficult start. He arrived in the U.S. in 2007 with an ankle injury and played just five games for a bad Galaxy team that season. His first year in MLS was covered as much for disappointing the fans who paid for a chance to see him, only for Beckham to stay parked on the bench or not travel. ESPN The Magazine published a full-page photo illustration with the headline, “Bench It Like Beckham.”

Dallas fans mocking Beckham (Photo: Ronald Martinez/Getty Images)

In his second season in MLS, Beckham started 25 games and had five goals and 10 assists, but the Galaxy once again failed to make the playoffs. A loan stint at AC Milan in 2009 and ensuing drama — Beckham looked to stay on permanently in Italy — made for an unwelcome return to the Galaxy in the summer, with LA fans hanging, “Go Home Fraud” banners. Beckham, though, would help the Galaxy advance to MLS Cup, where they lost to Real Salt Lake on penalties.

Beckham missed much of the 2010 season after tearing his Achilles during a second loan with AC Milan, but he returned late in the year to help the Galaxy seal the Supporters’ Shield with MLS’ best regular-season record. He then helped the Galaxy to back-to-back MLS Cup wins in 2011 and 2012, playing 60 games (including playoff appearances) with nine goals and 27 assists across those title-winning seasons.

Those two MLS Cups were crucial to the legacy of the deal, Leiweke said.

“One thing above and beyond the business sense, you’ve got to find the right person,” Leiweke said. “The terms, there was economic upside, but you’ve got to have the personality to put the burden on your shoulders. David stayed with us for five years. It took us a while to win, but then we started winning championships. He knew it was more important than the expansion franchise (clause), the economic opportunities, the sponsorships. We had to win. If we didn’t win it was a failure. So start there…

“David knew that — it’s something he kept on chirping on back in the day, ‘We’ve got to win. We have to be focused on winning and everything else will take care of itself.’ He was hell-bent on making the experiment work and he had a chance to win trophies and build his legacy in the league. We’re not talking about (Messi) today without that. If David wouldn’t have won and it was just a publicity stunt, it’s different… David paved the way and convinced people like Messi that it works here.”

Beckham and the Galaxy celebrate the 2011 MLS Cup (Photo: Stephen Dunn/Getty Images)

Over Beckham’s five years in the league, MLS grew from 13 teams to 19 teams, returning to San Jose and expanding to Seattle, Philadelphia, Vancouver, Portland and Montreal. On February 5, 2014, shortly after retiring, Beckham exercised the option for an expansion team and announced he was going to Miami. It would take six years before that Miami team finally launched, but Beckham’s persistence — and the influence of his contract — once again has provided a pivotal moment in MLS history.

Like Leiweke working years to woo Beckham, Jorge Mas spent more than three years building a relationship that would eventually lure Messi to MLS. Beckham played a somewhat secondary role in the recruitment, multiple sources said, serving as more of a friend to Messi who could offer advice on what it’s like to move your family to the U.S. to play in MLS and the pressures that can come with it. There are few people as equipped to understand some of what Messi will experience, after all.

Messi’s deal will include an equity share in Inter Miami that kicks in after he is done playing — a hugely valuable asset considering Sportico’s $585 million valuation of the club. That valuation was determined before Messi signed and before the club’s $1 billion Miami Freedom Park stadium is built, indicating the upside still there for Messi in his post-playing days.

Messi is also negotiating partnerships with Apple and Fanatics, both of which are expected to include revenue sharing, and is in discussions with Adidas, with whom he has a lifetime contract, on incentives linked to his signing in MLS. Mas has pegged the value of the deal as being worth between $50 to $60 million per year, without including those corporate partnerships — a significant investment.

“I think the hero in this is Jorge Mas,” said Leiweke, who initially invested in Inter Miami but no longer has an ownership stake. “Brave, daring economic venture. This is Jorge’s risk. It’s a big risk. Far bigger than David because the stakes are higher now. This is a gutsy move and a brilliant move on his part. His team will break through now. Miami will now be one of the most important franchises not just in the league, not just in the marketplace, but on the planet. Brilliant. A stroke of genius, but it takes guts. He stayed at it and chewed on it for two years. Gutsy, gutsy, gutsy.”

There is very little resemblance between the MLS to which Beckham arrived in 2007 and the one in which Messi will play in 2023.

MLS had just 13 teams when Beckham signed with the LA Galaxy 16 years ago. There are 29 today. The most recent expansion team in 2007, Toronto FC, paid $10 million to enter the league. MLS will welcome its 30th team in San Diego in 2025 for a $500 million fee. At the time, MLS’ TV deal with ESPN paid $8 million annually. Their current contract with Apple pays $250 million per year and streams around the globe where Apple TV is available.

On the field, the product has shifted dramatically, too. The minimum reserve salary in 2007 was $12,900, just four players made $1 million or more and the median salary was $53,000. Teams flew commercial and stayed in substandard hotels — some so poor that the Galaxy ended up paying to upgrade to nicer accommodations. Beckham had teammates like Kyle Veris and Mike Randolph, who were making $17,700 per year and would go on to spend most of their careers in the lower divisions of American soccer. Beckham was making $6.5 million per year and his highest-paid teammate, Landon Donovan, was on $900,000. It created an awkward dynamic in the team with Beckham. In one of the more famous scenes from Wahl’s book, Beckham didn’t pick up the tab at a dinner with his teammates, highlighting the gulf in pay and the dynamics it created in the locker room. Beckham did, however, buy speakers for the team’s locker rooms in an attempt to bridge the gap.

Today’s MLS has minimum reserve salaries of $67,360, 101 players make a base salary of at least $1 million and the median salary is $250,000. Messi will fly on chartered team flights and stay in nice hotels — though Miami most certainly will evaluate each hotel in away markets to decide whether to find better accommodations. While he walks into a locker room that still has teenage “homegrown players” — developmental players signed from the team’s academy — making lower-end salaries, he’ll also have players like Busquets and highly-paid veterans like former MLS MVP Josef Martinez, who has scored more than 100 career goals in the league and is paid north of $4 million; former Premier League fullback and U.S. men’s national team World Cup veteran DeAndre Yedlin, who has earned millions across his career and makes north of $825,000 per year; and injured Brazilian midfielder Gregore, who arrived in Miami from Bahia on a fee reported at $4 million and with a salary of $725,000.

MLS has come a long way, in part due to the influence of Beckham’s arrival. Undoubtedly, though, there is room for improvement. Spending remains focused mostly on the top of the roster, and MLS continues to fight for respect in the global football hierarchy. It remains behind Mexico’s Liga MX for regional supremacy, as well.

The hope, though, is that Messi can have a similar impact on the league’s growth as Beckham did when he arrived 16 years ago. Leiweke believes the league owners will be ready to seize that moment.

“It’s different ownership today,” Leiweke said. “Remember there are 30 teams now, the owners are much more entrepreneurial. There are a lot of very young, self-starting entrepreneurs that own franchises. Teams are going for $500 million. There is wind in the sails on Messi that was not there on Beckham. When Beckham came, we were struggling and figuring out how to make the league survive and prosper in the long-term. The league is doing phenomenally now and the value of assets is huge… There’s just a different economic upside.”

(Top photo: Getty Images; design: Sam Richardson)