Before astronomical transfer fees and bonkers spending became the norm, there was Roman Abramovich. And before Roman Abramovich, there was Chelsea — but not Chelsea.
When Abramovich bought the club for £140 million in 2003, Chelsea had finished in the top three of the English first division just once since 1970. In the late 1990s and early 2000s, the Blues had been on the rise, with financial commitment and international influence propelling them into the Premier League’s top six. But still, they weren’t Chelsea.
Then Abramovich came along, and everything changed. In the final year of the pre-Abramovich era, Chelsea didn’t spend a single pound on a transfer. The following summer alone, they sunk £108 million of Abramovich’s oil money into 10 new players. Their player sales totaled a paltry £200,000. The summer after that, nine incoming players cost £100 million; one outgoing player yielded £2.2 million.
Abramovich has lent over £1 billion to Chelsea since buying the club 14 years ago. His investment was the driving force behind Chelsea’s permanent leap into the Premier League’s elite, and behind the 14 trophies, including five league titles, the Blues have won since the takeover. Abramovich could probably even be credited with popularizing lucrative spending in European soccer.
But over the past four years, the Blues have changed their tune. It’s not that they’re no longer spending. It’s that they’re selling. Their transfer ledger is no longer wildly unbalanced. Their ability to recoup large sums of money for unwanted players has enabled both winning and financial stability in an age when the two rarely go hand in hand.
Chelsea has won two Premier League titles since 2014-15, but it has done so with a net spend over the past four seasons of just £34 million. That’s after it somehow coaxed a reported £53 million out of Atletico Madrid for exiled striker Diego Costa.
Meanwhile, Manchester United’s net spend in the same time frame is roughly £412 million. Manchester City’s is roughly £432 million. Even Arsenal’s is around £158 million.
There are three main reasons Chelsea’s number is so comparatively low. One is good fortune. The Blues lucked out when Chinese teams came calling with a combined £85 million pounds for Ramires and Oscar, both of whom had become squad players.
But the other two reasons are the products of club policies that have transformed the way Chelsea navigates the transfer market. One of those policies is currently the subject of an ongoing FIFA investigation, and has made Chelsea not only England’s best selling club, but its most controversial one.
The Chelsea loan network
The second reason is the club’s transfer strategy concerning youth players. Chelsea has made incremental profits by buying a boatload of teenagers from all over the world, loaning them out to clubs around Europe, and then selling off the former prospects who don’t develop into first-team talents.
Not every investment in a teenager nets a profit. But that’s exactly what these are: investments, and low-risk ones at that. The fees are small enough that the investments that don’t work out turn into footnotes; the ones that do turn into either stars, like Thibaut Courtois, or seven- or eight-figure transfer fees that more than offset the costs.
For example: The Blues spent approximately £3.8 million combined on Patrick Van Aanholt, Ryan Bertrand, Gael Kakuta, Thorgan Hazard, Stipe Perica, Patrick Bamford, Bertrand Traore and Nathan Ake when all eight players were teenagers. Four of the eight never made a single Premier League appearance for Chelsea. Only one of the eight made more than 10.
Yet, over the past three-plus years, the Blues have sold those eight players for roughly £64 million in deals that often include various add-ons, bonuses and buy-back clauses. Ake represents the best bit of business of the bunch. He cost Chelsea less than £1 million when he arrived from Feyenoord as a 16-year-old in 2011. Six years (and just seven EPL appearances in a Chelsea shirt) later, he netted the Blues £20 million.
After the initial purchases are made, two things keep the system humming. One is the loan network. Chelsea completed at least 34 outgoing loan deals in 2014-15, and at least 28 in 2015-16 – and probably more. At times, they’ve had the equivalent of two full matchday squads sprinkled around Europe. Back in London, the club has a specific department dedicated to monitoring the performance of all these players and tracking their progress.
Meanwhile, unless a player’s development has hit a standstill, the club negotiates contract extensions to preserve the value of its assets. The wages, though, don’t count against Chelsea’s books when a player is out on loan. In fact, some of the deals include loan fees, which partially or fully reimburse Chelsea for its original payment. And then when the right offer arrives for a permanent sale, the club cashes in.
Chelsea has essentially turned a video game hack into a profitable real-world strategy. The morality of the system has come into question in recent years. Some have accused Chelsea of building it as a mechanism to skirt Financial Fair Play.
FIFA, meanwhile, is investigating Chelsea’s courting of underage players – clubs aren’t allowed to sign under-18 players unless they meet specific criteria. It is the second time in eight years the sport’s international governing body has looked into Chelsea’s dealings. Back in 2009, Chelsea was initially hit with a transfer ban for its pursuit of Kakuta, but successfully appealed. Its signing of Traore from Auxerre has also been investigated.
But as long as Chelsea is found to comply with FIFA’s policies – and perhaps even if it hasn’t – the system has been an economic boon for a club that used to be notorious for its buying, not its selling.
Moving on from squad players
It isn’t just the loan network, though. Chelsea has developed a knack for gauging market forces and acting in accordance with them. The moment a player, regardless of age, slips on the depth chart at Stamford Bridge, he is more or less for sale. If a prospective buyer views that player as a first-11 regular, and therefore values him at a higher price, Chelsea hasn’t been hesitant to sell. Example 1A: Nemanja Matic.
Matic was a fixture alongside N’Golo Kante in an at-times impenetrable midfield last season. He started 30 of 38 games during the title-winning campaign. And yet Antonio Conte moved for Timoue Bakayoko early in the summer window, which made Matic expendable. Sure enough, he was shipped off to Manchester United for £40 million.
Matic, like many of the other prime-age players Chelsea has sold in recent years, would have had a sizable role in 2017-18 had a he stayed, especially with the Blues involved in four different competitions. Last summer, Conte called him “fantastic.” This summer, after the sale, he called the Serb “a great loss.” In fact, Conte was reportedly frustrated by the club’s transfer market activity. It wasn’t until deadline day that Chelsea parted with over £50 million for Danny Drinkwater and Davide Zappacosta.
But this is the new way at Stamford Bridge. Conte isn’t the most powerful person at the club — that’s Abramovich, of course. But he’s probably not the second-most powerful either. That title would fall to Marina Granovskaia, the guru behind much of Chelsea’s dealings of the past four summers.
Granovskaia was officially named to the club’s board of directors in 2013, and, working with technical director Michael Emanalo, has been an authority on recruitment and contract negotiations ever since. She is largely responsible for the youth policies outlined above, and has been integral in establishing the loan network throughout Europe. She has a keen sense of players’ value, and an unwavering ability to secure favorable deals. She probably helped squeeze a few million pounds extra out of Atletico for Costa.
So when the possibility of such a deal arose for the 29-year-old Matic, with his 22-year-old replacement having already arrived at the club, Conte could not stand in its way. The same principles likely guided the £50 million sale of David Luiz to PSG in 2014, the £24 million sale of Andre Schurrle to Wolfsburg the same year, and the sales of 29-year-old Felipe Luis and 33-year-old Petr Cech in 2015.
Costa is a slightly different story. His relationship with Conte had deteriorated, and Conte made it clear to the volatile striker that he was no longer part of Chelsea’s plans. Costa had accused the club of treating him like a criminal. But negotiating a princely sum for a striker who’ll turn 29 in October? That falls right in line with Chelsea’s new approach.
The downside of that approach is diminished depth. But the transfer tactics, on the whole, have been remarkably successful since they were instituted several years ago. Behind the scenes, the club seems to be as stable as it’s been in the Abramovich era. The Russian’s riches are no longer necessary to sustain it. Shrewd business has that covered.
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Henry Bushnell covers soccer – the U.S. national teams, the Premier League, and much, much more – for FC Yahoo and Yahoo Sports. Have a tip? Question? Comment? Email him at firstname.lastname@example.org or follow him on Twitter @HenryBushnell.