NASL commissioner Q&A: Rishi Sehgal talks Division II, the Cosmos and more
LOS ANGELES -- After serving as the North American Soccer League's Director of Business Development and Legal Affairs, Rishi Sehgal has taken on the role of interim commissioner for the NASL.
These have been difficult times indeed for the NASL. For much of the back half of 2016, the league teetered on the brink of extinction. Two clubs, the Ottawa Fury and the Tampa Bay Rowdies, left for the USL. Others folded or flirted with bankruptcy. But thanks in part to the U.S. Soccer Federation's decision to let the NASL retain its Division II sanctioning, the league has survived and is hoping to eventually thrive.
There are numerous challenges ahead, however. But it's something that Sehgal was more than willing to discuss.
This interview has been edited for clarity and brevity.
ESPN FC: What have these last few months been like for you?
RS: The last few months have been pretty trying. We went through a process. Last year was really difficult. We had a lot of different types of issues within the league. They were challenging, but they were good because they forced our owners to ask a lot of hard questions of themselves and of the league staff. And we got to a place that the league is stronger. It's not like we got to November and found there were issues. We knew there were issues starting earlier in the year, and were working to address. One of the issues we had was the ongoing relationship with Traffic Sports, where they had a majority investment in a startup investment vehicle that provided initial capital to the league. But it became a challenge to grow, and it became a challenge with some of our existing teams. And it caused some internal strife within the board. Fortunately we solved it, and became very focused and started to solve [other] issues.
We really put our heads down to get through the issues. It's been a trying seven months. But -- and I hate to sound like a politician -- our best days are ahead of us. We solved the biggest issues which were holding us down in the past, which was the Traffic investment and this perception of instability. We have very well-established ownership groups now that focused on a vision. Full credit to everybody. The teams stuck together through a dark time.
ESPN FC: How did the Traffic issue get fixed?
RS: We were ultimately able to engage them in a strategic negotiation. We said, 'Look, this needs to end or this is going to be very difficult to move forward.'
ESPN FC: What were some of the challenges the league faced?
RS: A big one was Traffic. Another one was we recognized we needed to take a more measured approach to expansion. We needed to be more collaborative with some of the other stakeholders in soccer. And then there was the financial sustainability. Last year we saw obviously issues with a couple of the clubs where we had real problems. The league had to step into certain situations and assist. We got to a place where the Cosmos at the end of the year had some well-publicized financial issues. All of those issues have either been resolved or are on a clear pathway to resolution.
So we came through this whirlwind process. The owners came back together and recommitted to the business model, acknowledged that we needed to make adjustments, and so now as we move forward we have these new pillars that we're living by today. We also recognize that's not enough and we're going to keep working to strengthen the league, but right now we're focusing on collaborating with everybody else, taking a more rigorous look at expansion, and developing our financial sustainability, which we've already put in place some measures to accomplish. And over the course of the next 3-6 months we're going to take another hard look and get some more definition there and come together.
ESPN FC: Given the problems in Ft. Lauderdale and Oklahoma City, what are you doing differently with expansion in terms of vetting ownership groups?
RS: We've put in place an expansion committee. We'll announce more details in the coming days, but that was put in place this week. They are working with the league office to establish a clear process. It's hard to create a checklist, but we are creating a clear plan. These are the things we need to see before we bring it back to the Board of Governors. If a club or a prospective ownership group can't meet those requirements, that's going to tell us that this isn't the right decision, not only for them but for us. So there will really be meat to what we're saying in taking a rigorous approach. We're not going to go willy-nilly into markets. We're going to take a hard look at every market, and decide if it's a place that we should be. If it's a case where there are existing teams, be it USL or MLS or the NPSL or the PDL, those will be taken into consideration to say, 'Is this the best place for us to be given that there are other stakeholders here who have been working establishing the market?' We don't want to be combative and destructive. It's more: Can we do something with a prospective ownership group that is accretive to our common goal, which is growing the game?
ESPN FC: So what's going on in Ft. Lauderdale?
RS: So there are multiple groups looking at acquiring the Strikers. We have not rushed that process. We are putting those groups through the same expansion process, and there's one deal that could happen.
ESPN FC: Is Paris Saint-Germain's interest legitimate?
RS: There is one group affiliated with PSG that has a legitimate interest.
ESPN FC: And Oklahoma City?
RS: We're working to resolve those issues, but Rayo OKC will not be on the field next year.
ESPN FC: So expansion, what is the plan going forward?
RS: There is not a hard and fast timetable, other than we want to be compliant and we need to be compliant with the Division II standards by 2018. But we're not going to make rash decisions and rush markets in. They could have done that going into the sanctioning process, and considered different thoughts on it. But they said, 'No, we're going to go with eight teams that we believe in, and we think that's the best approach because it will allow us to be sustainable.' So we're going to work with each of these groups through this process that we haven't fully finalized. Then we're going run them through. I think there's a realistic chance that we could make an expansion announcement soon. It's hard to put a timetable on it. We don't want to put artificial deadlines on ourselves, or on clubs. But clearly there is time pressure because we need to get up to 12 teams. And it's not that the standards are our guideline. We don't want to be an eight-team league either, or even a 12-team league. Over time, we want to have more teams. I don't know what that looks like, but a 12-team league isn't the end game.
ESPN FC: You said you didn't want to rush things, yet Rocco Commisso comes in and buys the Cosmos. Did that feel a little rushed? Were the Cosmos a special case?
RS: The Cosmos were an established brand, so that's not like admitting a new team to a new market and building a brand. There's a lot of work to be done there. But I'll say this about Rocco: He's the perfect owner for the Cosmos. He has a deep passion for it. He has a business where being in professional sports is accretive to his other business.
ESPN FC: It seemed like there was a distinct lack of alignment among the owners of what the NASL was and the best way to go forward. To what extent do you feel like there is a common vision among the owners now?
RS: I think it's very high right now. There's a clear common vision among the owners, and there will always be differing opinions, but through this process each of our existing ownership groups had to look at options for what was in the best interest of their club. Each of our ownership groups look at the investment in the sport as an investment in the community. They're deeply committed to that. Even though in many cases they created their club, they're caretakers of that club as well. So they had to look at other options.
Through the process of looking at other options together, they've come back and articulated a common vision. It started going into that summit in Atlanta. We have a big opportunity to live up to that common vision. That will be a big challenge for the board, it can't be just words. You'll start to see the way that we operate, where the clubs will work together more and working with other parties more to really not just grow the game in general but grow the league and grow the individual clubs.
ESPN FC: To what extent are you going to try to collaborate with USL and MLS and how that might look?
RS: The leagues have collaborated in the past as it relates to soccer on the field, which is the thing we all have in common. We will look to do that more this year and continuing into the future. The areas off the field, those are areas we can collaborate as well. We're going to kick around some ideas about how we can organize the U.S. Open Cup a bit better, so that it makes it more accretive to all the stakeholders, be it the professional leagues, but also the amateur side of the game. There are some business relationships that we can forge, but it's going to take a willingness from MLS, the USL, and all the other stakeholders to collaborate as well. We will put forth every effort to work in concert as long as it's growing the game.
ESPN FC: What's the story with Jacksonville?
RS: Jacksonville is a very demonstrable example of our commitment to expansion with a more rational and rigorous approach. There are multiple parties who are interested in buying the Armada. We could have allowed one of those transactions to go through before the sanctioning deadline. Instead we decided we weren't fully comfortable with any of the groups, so the league and the owners said, 'We believe in the Jacksonville market, it's a fantastic market. We will buy the Armada. We will commit to operating and running it.' We're going to continue the process with the groups that are interested, and when we're comfortable with one that is the right one, we'll transition to that group and we'll be off and running.
ESPN FC: Is the transaction with Jacksonville and the league done?
RS: It's closing very soon, within the next month.
ESPN FC: How concerned are you about MLS moving into NASL markets?
RS: I think that's going to require an effort of collaboration. I think there are places where we can collaborate on some issues. But I think if we focus on building our brands and creating real value with our clubs, our clubs will stay committed to us. That said, if it's in someone's best interests to join MLS, there will be a pathway for them to do it. We're trying not to live in fear, because ultimately as a league we can't control that. There will always be a pathway to do something different. That's our country, that's our business society that we live in. So all we can do is focus on what we can control. And I can tell you that's how the league got through the last 60 days, focusing on what we can control and what we can do together. That will be the way we operate going forward. We hope there will be some collaboration and some partnership spirit amongst the leagues by looking at what's in the best interests of the sport, and not going in and taking markets away from each other and trying to hurt other leagues. I don't think that's the case, and I don't think it has been the case. We're going to trust that it's not the case and we'll keep working alongside all of them and continue to grow.
ESPN FC: There have been rumors about NASL expanding into San Diego, but the same is true for MLS. North Carolina has been clear about their MLS ambitions. David Beckham is looming on the horizon in Miami where you have a team. So you're not concerned about that eroding the value of the clubs and the league?
RS: I'd say we're concerned about it, but it gives us motivation to focus on building value for our clubs.
ESPN FC: How do you do that?
RS: We focus on building them from the ground up, the grassroots efforts and winning the hearts and minds of our fans, that this sport matters. That's how sports survive. We have to focus not so much on the future and the 30,000-foot view, we have to focus on the ground game and showing fans what we're doing is compelling. We are giving players opportunities, there's a compelling story here. It's up to us to communicate it. I think if you look at every city in the country, there are people who want to invest in soccer, be it at the MLS level, the NASL level, the USL level, the NPSL, the PDL, whatever.
ESPN FC: How much is the hope of promotion and relegation on your radar?
RS: I think pro/rel is an interesting idea. I think everyone connected to the sport knows there is such an amazing competitive aspect to it; that cutthroat aspect of living and dying on the way you perform on the field and go out and prove it every day is incredible. But I think everyone acknowledges that we're not there yet. If that's going to happen in the future, we're going to have to do things differently. But it can't be a focus for today. It can be a focus in terms of saying we need to build more sustainable clubs and building the foundation of the professional game in this country and growing it. You can't have pro/rel with 22 clubs in one division, eight clubs in another, and 22 clubs in another. That's not going to work, even if you were to take all of Division II leagues and put them in one division. We're not there today. There could be a pathway there in the future, but there's a lot of work to be done before that even becomes a discussion.
Jeff Carlisle covers MLS and the U.S. national team for ESPN FC. Follow him on Twitter @JeffreyCarlisle.