How Red Bull Is Building a Profitable Football Empire

They Will Produce Stars in an Industrial Fashion, and Profit With It

It should come as no surprise that Red Bull (RB), the Austrian energy drink colossus, is investing in sports. After all, we are talking about a company that has two Formula 1 teams, two ice hockey clubs, and sponsors cricket players, rally racers, and the World Volleyball Tour. For years they even organized the peculiar Red Bull Air Race World Championship, an airplane race tournament.

What Red Bull is doing with Football, however, differs completely from all their sponsorships and various sports investments.

In other sports, the reason behind the investment is part of the RB marketing strategy. Branding efforts that keep their energy drink cans selling in almost 200 countries.

In Football, however, the Austrian Energy drink brand is seeking profit. In fact, they are building a network of clubs that will ensure finding, nurturing, and selling wunderkinds almost as a factory line. Here I will explain how this Red Bull is building a multicontinental football stars factory, where the products are players like Joshua Kimmich and Erling Haaland.

The First Move — FC Red Bull Salzburg

In 2005, the company Red Bull GmbH decided to purchase its first football team. Not surprisingly, it was a club from the city of Salzburg, only 24 kilometers from Fuschl am See, the village where the organization has its headquarters.

The SV Austria Salzburg was a middle-of-the-table football club from Salzburg, which during the 80s even was relegated to the second national division. Their highest point was three first division titles between 1994 and 1997. After buying SV Salzburg and renaming it FC Red Bull (how creative!), the energy drink company invested heavily in infrastructure and talent management.

The investment paid off quickly. FC Red Bull Salzburg achieved 2nd place in the 2005–06 national championship. In the next year, they got the title. From there, Die Roten Bullen won almost everything, reaching 14 titles in 17 tournaments played. In fact, since 2013, the club won every Austrian Football Bundesliga. This raises a serious concern about how the economic power of one of the biggest corporations in the country can damage sports competitiveness.

The success of purchasing the local team drove Red Bull to buy another football club. Or, in this case, should we say soccer club?

The Entrance in the Massive Us Market — New York Red Bulls

In 2006, Red Bull GmbH bought, in the USA, a middle-sized team, rebranded and renamed it, and made heavy investments in infrastructure and talent management. Have you seen that movie before? Yes, it is the same as they did with the SV Salzburg.

The greatest difference, in this case, was the innovation done by RB when they created the first cost-free program of junior football in Major League Soccer (American top football level). Young talents from the entire metropolitan area of New York, and beyond, could show their skills for Red Bull scouts. If approved, they would go through a multi-layered development system intended to later promote them to the other RB teams.

Tyler Adams, for example, was revealed by the youth-system from New York Red Bulls and now plays in the German Bundesliga, for the main team of this whole Red Bull network, which is…

The Last Stop — RB Leipzig

As much as it is cool to turn medium clubs into top contenders in the Austrian Bundesliga and in the North-American MLS, this would be the same to be the fastest horse in a poney race. So Red Bull GmbH wanted a club in a top European league.

Due to language and geographic proximity, the German Bundesliga appeared as a natural place to be. They attempted to take over clubs like the Hamburg-based FC St. Pauli, TSV 1860 Munich, and Fortuna Dusseldorf. Every time, however, either directors or supporters protested against the idea of a corporation completely taking over a team.

With no hopes of purchasing a larger football club, the company found a small team from a village thirteen kilometers from Leipzig, called SSV Markranstädt. This minor club had the right to play in the Oberliga, the fifth level of German football, and in a few weeks, they accepted to sell their rights to the Austrian energy drink brand.

Since german rules do not allow a team to change the name for a corporate brand, the team was renamed RB Leipzig, but in this case, RB does not mean Red Bull but RasenBallsport. Literally, “Lawn Ball Sports”. Silly, but a way to overcome the rule and keep the RB acronym.

Their ambitious plan was to elevate RB Leipzig from the fifth division to the top-level (the German Bundesliga) in only eight years. If they managed, it would be a record of fast ascension. A record they broke, because in 2016 RB Leipzig played their first Bundesliga match. In just their first season, they had a 13-game undefeated streak. They ended their first season at the top level at an unbelievable 2nd place.

The ambitious plan of creating a top club in one of the most prestigious European leagues was completed. To start profiting from it, would be enough to source talents in their clubs in Austria and the United States, send the best of them to their main club in Germany. With the visibility of a top league, they could sell the young stars later for other European clubs, profiting in the way.

As much as New York and Salzburg could source good players, they were still far from the Eldorado of undiscovered football stars: South-America. A problem they solved with…

The Talent Source — Red Bull Brasil and Red Bull Bragantino

The first effort from Red Bull to have a team in Brazil was the Red Bull Brasil (at this point I guess you are not surprised how the club names are so predictable). It quickly raised from the lower divisions of the São Paulo state football, but it faced plenty of out-of-field problems related to licenses (Brazilian bureaucracy is a scary thing, as I explained in this article), and needed to be closed.

In 2019, Red Bull made their second attempt into Brazilian football and purchased Bragantino, a small traditional team from a mountainous city in São Paulo. In just their first year, they won the Série B, the second tier of Brazilian football. In 2020 they invested heavily in very young players, “stealing” talents from much larger teams like Santos or Palmeiras.

What the future holds?

To say that Red Bull GmbH investments in Football will soon bear fruits is an understatement. It is already showing results, and here I do not mean the team results in their respective leagues, which are just a collateral result of the main goal: discover football talents and sell them. To name a few of those stars already revealed by the RB teams:

• Valentino Lazaro : Acquired by Red Bull Salzburg when he was 15 years old. Now playing at Borussia Mönchengladbach and for the Austrian national team.
• Lukas Klostermann : Graduated from RB Leipzig when he was 18 years old. Currently is part of the German national team.
• Sadio Mane : Red Bull Salzburg acquired him when he had 20 years. Now part of Liverpool in the Premier League.
• Erling Haaland : Arrived at Red Bull Salzburg at 18 years old, now a Borussia Dortmund star.
• Naby Keita: Like Sadio Mane, another Red Bull Salzburg former man that went to Liverpool.
• Stefan Lainer : Once a teenager from the youth of RB Salzburg, now part of Borussia Mönchengladbach and Austria national team.
• Joshua Kimmich : The Bayern right-back became professional at RB Leipzig. Now one of the Germany's biggest stars for the next World Cup.
• Timo Werner : Another Germany national team player, since his 20s he played for RB Leipzig, recently moving to Chelsea.

Other players nurtured in the RB teams across the world that in the next years of whom we may hear their names are Luan Candido, Artur, and Alerrandro from RB Bragantino; Mathias Jorgensen from New York RB; Dominik Szoboszlai, Sekou Koita, and Karim Adeyemi from RB Salzburg.

Probably not all those young promises will turn into world-class footballers. But if a handful of them turn into world-stage players, the profits of that will mount for the Austrian energy drink company. Once called the world's largest corporation with a single product, maybe soon Red Bull will double their portfolio, selling energy drinks and energetical topscorers.

Levi Borba is a Brazilian football fan, the CEO of expatriateconsultancy.com, and a best-selling author. You can check his books here and his other articles here