According to an article by Sports Illustrated, LIV Golf spent around $784 million in its first season as the Saudi Arabia-back breakaway split opinion amongst golf's elite.
Major golf pros such as Dustin Johnson, Phil Mickelson, Lee Westwood, and Brooks Koepka are believed to be earning a combined total of over $500 million in player contracts. Not to mention the $225 million in prizemoney and expenses, including the caddies, inflating the net spend.
The controversial breakaway tour has divided opinions across the game, as LIV Golf converts have opened themselves to criticism due to the huge sums of money involved. The scrutiny stems from the involvement of Saudi Arabia’s Public Investment Fund (PIF) who financial back LIV Golf.
PIF currently has more than $600 billion in assets under its management, including the ownership of Newcastle United. Yasir Al-Rumayyan, PIF governor, is reported to be heavily involved in the tour and reports directly to Mohammed Bin Salman, the crown prince of Saudi Arabia.
LIV Golf currently consists of eight events but is looking to increase to 14 next year which will come at a greater cost. Whilst they continue to tempt PGA Tour stars with enormous sums of money, the cost of running next year’s tour could exceed $1 billion.
As the tour currently lack a major broadcasting deal or any other significant commercial partnerships for that matter, PIF will have to ultimately cough up. They could opt to purchase airtime show events in America, as it’s reported that LIV Golf is currently negotiating with Fox to arrange a deal.
A team format could also be introduced next year as a strategy to raise revenue with the intention to sell teams using a franchise model. Team captains would gain equity stakes in their teams, with other team members sharing revenue and profits. The cost of the franchise fees has not been announced and neither have any commercial opportunities been offered to buyers.
Teams currently earn a small amount of the total prizemoney with $5 million of the $25 million pots going to teams, whilst the winning team takes home $3 million, split amongst players.
Captain of the Iron heads, Kevin Na said the format is “successful” and is excited about the prospect of commercial partners joining forces with the tour.
When he spoke to Sports Illustrated he said: “I think it’s created a lot of buzz around the golf world.
“Even the players as well; we feel very excited about who’s going to be on our team, who’s going to be our sponsor. We’re constantly talking about who to recruit.”
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