Sports agents: Living on a smile, a shake and a $1 million foot
So begins their busy season, packed with long meetings, seemingly endless negotiations and parades of signing ceremonies. It’s a commodities market for sports stardom.
Sports agents are responsible for seeking sponsorship deals and commercial endorsements for athletes, as well as negotiating deals, marketing broadcasting rights, planning career paths and conducting public relations. Once a relatively unknown part of the industry, the 1996 hit movie “Jerry Maguire,” which cast Tom Cruise as an agent for an athlete played by Cuba Gooding, Jr., brought agents to the public’s attention.
Sports agencies that specialize in soccer have seen rapid growth since the 2002 World Cup, especially after Korean athletes, such as Park Ji-sung, started playing abroad. The Korea Football Association, which received its commission from FIFA to issue agent licenses in 2001, has issued 99 licenses as of March 2006. (FIFA-related teams and organizations agree to deal only with agents licensed by the association.)
In the meantime, soccer agents have been ― pardon the pun ― having a field day. Kim Dong-jin and Lee Ho, both of whom were on the 2006 national team, have joined Zenit St. Petersburg, a Russian soccer club, along with the former national soccer coach, Dick Advocaat. Last week, Reading of the English Premier League said that it intends to enlist Seol Ki-hyeon, currently of Wolverhampton Wanderers. Rumors abound that other Korean players will soon be joining European clubs.
Lee Dong-yeop, 35, the president of Tenplus Sports, is one of the FIFA license holders here. Since he returned from Germany after Korea’s exit from the World Cup, Mr. Lee has been furiously promoting his client, 21-year-old Park Chu-young of FC Seoul; he thinks he can snag Park a spot in a prominent European league.
“Several European clubs have shown interest in Park Chu-young, though they haven’t made an offer yet,” he said.
Mr. Lee added, however, that Park’s chances of joining a European club would have been higher if Park had scored a goal in Germany. Unfortunately, Park played for only a short while during the game against Switzerland, in which Korea lost 2-0. FC Seoul, Park’s club, said it is willing to relinquish Park for the “right” offer. What makes an offer “right,” of course, is enough money to offset the loss for the club in terms of star power and popularity, not to mention goals.
After all, a transfer involves a lot of money. Reportedly, Wolverhampton Wanderers will receive 1.7 billion won ($1,789,000) from Reading for Seol Ki-hyeon’s transfer. There is speculation that Zenit St. Petersburg paid almost double that amount ― each ― to FC Seoul and Ulsan Hyundai for the transfers of Kim Dong-jin and Lee Ho.
In July 2005, Guus Hiddink, the former coach of PSV Eindhoven, told the media that the club was willing to pay 2.5 billion won, or 2 million Euros, to recruit Park Chu-young. Mr. Lee said Mr. Hiddink was playing a media game and trying to negotiate a lower price, but FC Seoul didn’t respond to the offer. The club figured the offer was too low, and it is often difficult to persuade a club to agree to an amount offered by interested clubs for a transfer, Mr. Lee said.
An FC Seoul spokesman denied that the club received an offer from Mr. Hiddink for Park; other newspapers in Korea and fan sites reported rumors of the negotiations, however.
“It’s difficult to mediate between a client and his club,” Mr. Lee said. “I would try to mediate the deal to the advantage of my client, but the club needs to consider the fairness [of a deal] in comparison to other players, and I need to take my business relationship with the club into account.”
If a club is interested and negotiations are launched, agents must prepare presentation materials about their clients’ successful plays, marketing value, media coverage and other records. It then turns into a series of offers and counteroffers. “Sometimes [the sticking point] is the market standard,” said Joe Park, manager of the golf division at IMG Korea. “At least, they want what other players are getting. We don’t want to undersell or oversell our product. At the end of the day, the players will make the decisions.”
Mr. Park is a sports agent in a narrower sense ― he acts as a representative, while sales, contracts and legal issues are dealt with by the team of specialists in Korea and at the headquarters in the United States. Unlike local sports agencies, multinational companies such as IMG have many divisions and specialized staff roles. IMG Korea is simply the national branch, with the corporate headquarters in Cleveland; it represents mostly Korean golfers, including K.J. Choi and Pak Se-ri, and arranges appearances and merchandising deals in Korea for them as it does for clients such as Maria Sharapova and Jack Nicklaus. Mr. Park, a Korean national who speaks fluent English, was recruited by IMG Korea four years ago to become a sports agent.
“Knowing sports is a big plus, but the more important part is business,” Mr. Park said. “Sports are only a tool. The product can be an event or player. In the end, you need to be able to sell intangible products. But if you don’t like sports, you can’t do this.”
It’s not easy for a Korean to get a job as an agent at IMG, for two reasons: One, the company rarely hires, and two, it represents only a handful of golfers, all of whom play in the United States.
Mr. Lee did public relations for Nike Korea before he joined GSEN, the agency that represents Lee Young-pyo, who plays for Tottenham Hotspur, about four years ago. Before that, he received a master’s degrees in advertising in the United States. He later left GSEN, went independent and formed an agency called Sports House, which he left two years ago to pursue further studies.
Mr. Lee also has a partner in Britain who is well connected to European soccer clubs and serves as a mediator. Though he expects his partner to bring soccer clubs to the table, he takes charge of the negotiations on his own, Mr. Lee said. If Korean agencies build up enough experience in making deals with European clubs and more players play abroad, they would be able to make deals for themselves someday, he said.
Being a sports agent is not as glamorous as some people might think. They are not managers, although at times both serve similar functions.
“We try not to do that, but there are times when I need to provide what clients need. If a client needs water, you get water for the client. When American clients come to Korea, they sometimes ask for small things, like razors. That’s not our main job, but we make sure our clients are happy. What’s important is for us to take care of our clients so that they can concentrate on playing sports,” Mr. Park said.
Soccer agents spend much of their time near the pitch. Mr. Lee usually reserves tickets to local games for his clients’ parents. For Park Chu-young, he also purchases tickets for the athlete’s girlfriend and minister. When the World Cup was underway, Mr. Lee escorted Park’s and Baek’s parents and arranged for their accommodations in Germany.
Sports agents often act as a mediator not only between teams and players, but also with parents. Few parents, after all, are willing to accept that their son or daughter is not the greatest athlete in the world.
“If their sons sit on the bench and are not given a chance to play, it can be difficult for the parents to understand why. Most parents seek ways to solve this problem through agents, and if the situation does not improve, they think that the agents are incompetent,” said Seo Tae-won, an executive at GSEN.
“It would be impolite to ask the coach to let your client have more playing time. That’s really up to the coach,” Mr. Lee said.
Mr. Lee said even though he was well acquainted with Mr. Advocaat, he never made such a request. He only jokingly mentioned that he wanted to see Park play more while they were in Germany. Advocaat, he said, merely grinned.
Sports agencies mostly rely on client fees ― 10 percent of the salary ― and commercial endorsements ― 20 percent of the deal ― for their income. Ten percent might not sound like much, but if a player’s annual salary is 3.6 billion won ($3.8 million), the agency would earn 360 million won a year. An agency can stay afloat even if it has only one client.
The prospects for big deals with big fees mean sports agents have to be aggressive about going after players, something that can wind up causing problems for teams. In some cases, an agency with only four or five people will try to manage as many as 80 athletes. Most agents say that they have problems handling more than three clients.
“Sports agents have been viewed negatively, as the equivalent of brokers,” Mr. Seo said. “Some players think that sports agents are only into the money. But I believe good agents think about things from the client’s perspective and try to figure out what’s best for the players.”
The bigger problems are that agents often do not communicate well with players and parents. Some agents even make decisions and sign contracts without their client’s consent, or their parents’, and notify them afterwards.
“Most typical disputes between clients and agents occur because the negotiation processes are not transparent for clients,” Mr. Lee said.
Most players sign a contract with their agents, but can break the tie at any time. Agents don’t give their clients a “signing bonus,” either. “It’s only a piece of paper,” Mr. Lee said of the contracts. “In the end, what matters is trust.”
If agents are passionate and treat their clients well, business is good. After Mr. Lee quit his former sports agency to pursue a degree in sports marketing, Park and Park’s parents contacted him and asked him to continue to act as an agent, saying they did not want any other people to represent Park. It was then that Mr. Lee to set up his own company, Tenplus Sports, in March. Soon another client came along: Baek Ji-hoon, another FC Seoul player.
Baek’s parents asked Mr. Lee to serve as their agent, saying they were impressed with how sincere he was with Park.
For now, Mr. Lee has no income because all the contracts with clubs and television commercial appearance deals were made before he went independent, but he has no complaints. He has a small office and a secretary and has invested his own money and borrowed money to establish his company.
“I watched the film ‘Jerry Maguire’ six times,” Mr. Lee said. “Whenever I feel burned out and forget my intentions, I watch the movie. Then I remember that’s what a relation between an agent and player should be. If there is no trust between an agent and his clients, the relationship cannot last.”
by Limb Jae-un