Xavi - Se Queda

March 19, 2023. 90th minute in the second league Clasico of the season. Game tied at 1:1. Frank Kessie, who comes in as a substitute in the 76th minute, takes Alejandro Balde's cut back and slots it home past Thibaut Courtois sending Barca 12 points clear of Madrid and effectively winning La Liga after 4 seasons of failure.

Xavi Hernandez, wins the league for Barcelona in his first full season as a coach.

But sport, they say, is a great leveller.

One year later. April 21, 2024. Second Clasico in the league with the game tied at 2:2, Brahim and Joselu combined superbly to send Bellingham free who beats Ter Stegen at the near post in the 92nd minute. Madrid win 3:2, sending Barca 11 points behind in the league table, effectively ending their season and in the process, winning La Liga.

Controversy, debate and drama ensue. "Team of the regime" and "Negreira," each fanbase blaming the other, the usual banter.

Sure, refereeing decisions do sometimes affect games, but almost every team benefits and suffers from them. For those of us who watch Barca every week, this is more or less what Barca deserved their season to be. A trophy-less season for performances that, more often than not, did not warrant more than that.

Our general knee jerk reaction to failure is to deviate to the mean and that "mean", is a person we can blame. Once we apportion blame, we somehow find solace and peace.So of course it was Xavi or Laporta or the players. But let's be honest.What were our odds? With a set of talented 17 year olds from our academy and a couple of 30 plus overpaid elite players did we really believe in the illusion that we would just sweep the awards ceremony?

That we were just a good coach away from winning titles?

Laporta's entire second term has only been about one objective and narrative. And that is around "saving" the club from ruin and giving it a new beginning with a stronger financial foundation. If there is one thing he has prioritised for his own legacy and also for the club, it has been around clipping the tail-end of the golden generation, starting the reconstruction project and putting the foundation blocks for the next chapter in FC Barcelona's history. This time the chapter, however, is not one of sporting glory like his first term. This time the chapter is about crafting the economic and cultural foundation of its second innings. A new stadium. A new economic and social endeavour with Espai Barca and a new cultural edifice for Catalonia.

Politics and sport blending together.

Covid and mismanagement had killed the club. True. But the rot had started long before. The price of keeping the best player in the world happy, needed finances that had made the club stretch far beyond its limit for years. Coupled with that, there had been shocking squad planning and player scouting. Hundreds of millions had been poured into shiny names to keep the team competitive. But while signing these names emptied the coffers, they failed to deliver anything of repute on the pitch. Barca started becoming irrelevant in Europe. Wins dried up. Earnings stalled and expenses crept up.

For 9 years the team has ghosted in the Champions League with two Europa league instalments. From a top club, Barca has slipped to top 5 and then to top 10. Currently they are 12th in the UEFA rankings below Dortmund and Manchester United. Even with the best player in the world and an average team salary outlay of more than EUR 700 million a year Barca failed to win the Champions league or even reach the final between 2015 and 2021.

This could have only gone on for so long at a club which mostly runs on advertising, TV revenue and ticket sales. There was and still is an abject need to push the reset button and start afresh. But success has a price to pay and impatient fans to appease. Striking the balance between popularity and efficacy is never easy for populist leaders and Barca missed the bus on this.Thankfully, Covid forced what the club should have done three years before its onset.

State of Barca's finances when Xavi and Laporta decided to Tango

This was the state of Barca when Laporta rolled in for this second soiree. The numbers below should give any sane person a clear understanding of what the priority needed to be for the club president.

• Gross debt of €1.35B with €731M for repayment within 12 months
• € 673M owed to banks in short term debt
• € 390M owed in unpaid player salaries
• € 90M in litigation
• € 80M in advance TV rights
• € 55M in infra projects

On top of it the club had a negative equity of over €353M.

To solve for this Barca (and Laporta) did a lot of things

• June 2021 Barca financed a €80M bridge loan (for treasury guarantee on their debt)
• They took a further loan of €561M with a maximum term of 15 years on an interest rate of 3%.
• They restructured the short-term debt which gave the club, room to breathe and to be financially solvent
• This also saw the repayment of the bridge loan of €80M advanced by Goldman Sachs to cover the treasury obligations
• But loans to cover debts would not be enough. There was dire need to increase earnings beyond TV, ticket sales and advertising.
• New real estate assets needed to be built which could be rented for compounded earnings over the years to come
• In December 2021, Barca went to take on another loan of €1.5B notably to remodel Camp Nou, build Espai Barca and the new Palau. Net-new real estate assets. Assets which could be rented out for earnings.

But no. it didn't end just in that. There was also a need to cut down on player salaries and amortisations. So Laporta did what he had to do to start the process of winding down the golden generation. Over the period of the next two years legends like Messi, Pique, Busquets and Alba departed. Players with extreme high salaries which Barca could not afford anymore. Many leaving their unpaid salaries behind. Some still being paid for what was left unpaid.

Restructuring however, needs a lot of quick capital infusion to balance the debt structure and spread it over a longer period of time at lower interests rates whereby currency depreciation over time and compounded earnings makes the debt repayment more manageable. The best way to service a loan debt is to create a a parallel source of income which can repay the yearly interest rates and capital payments without dipping into budgeted earnings.For a Soci led club (and no Laporta won't change this because of political reasons) going public is not an easy step to take.

• So - to keep it stupidly simple, Barca sold retail and future earnings media assets (La Liga TV rights) which were booked under two consecutive fiscal budgets in (2021/22) and (2022/23) for €344M and €443M. In total €787M.
• Part of it was used to repay defaulted transfer fees, buy some players and part to repay some short-term debt.
• No, Barca did not go lever pulling just to "buy players." It was mostly to adhere to the restructured short-term debt.
• No they did not go palanca happy to kick the can down the road. There simply was no road left and no can to kick

Barca's loans and its interest rates

• €561M at 3% payable over 15 years
• €1.5B at 6% over 37 years (Barca want to renegotiate this interest rate after 5 years)

Barca's average earnings per season (budgeted) based on yearly ARR (in today's time frame)

• Between €800M - €900M depending on competition wins, trophies, player sales, ticket sales, TV revenue and sponsorships

If anyone pays close attention to where Laporta has paid maximum attention in his entire second term - it is on the above. EUR 700M on short term debt and short term accruals. Not around creating a winning team. Sure some big earners have left Camp Nou , but the wage bill hasn't been curtailed to the effect where it balances FFP. In 2022 player salaries across all of Barca's sporting institutions was over EUR 670M. (See figure above on expenses)

Sure it has been decreased but there are high earning members in the men's football teams who over the next three seasons will have to be paid close to EUR 639M in salaries. Add the interest from debt, non paid salaries, non paid transfer fees, club maintenance costs and Barca's challenges in FFP become evident.

So, while on-field Barca has not been bereft of drama (and fans and critics have waxed a billion theories) the one place where work has progressed without drama, at speed and in relative silence, is around the remodelling of Camp Nou. Not much said, but a lot more done with the team expected to return to the new stadium with 60,000 capacity by the end of this year.

The primary focus of Laporta's second term

Laporta is THE consummate politician and lawyer. Yes, you can accuse him of nepotism and what not and you can disagree with him and his methods but he won a populist election fair and square and took the mandate for Barca's economic revival on himself. Those who question him can always rise against him and call for new elections.

His primary aim from day one of his second tenure has been to create the new stadium and kickstart the Espai Barca project to coincide with the clubs 125 year ceremony and give Barca the continuity it needs over the next decade. A perfect story of how a man made the club a reference point for the sport (first tenure) and how he saved the club from financial ruin to start its second innings (second tenure).Whether he is successful or not only time will tell, but he was never quite focused on elite sports management in his second term. He had been in his last term where he had people like Ferran and Txiki running the club. But perhaps, in his second term he wanted to keep a functional and relevant team on the ground with the main focus being on reviving the clubs finances and fast tracking the build of its real estate assets.

A much more difficult and political task for a member-owned club running on vibes and advertising revenue.

Xavi Hernandez didn't become the first team coach because he was an elite manager. He became the first team coach because of what his name meant to the fans. Because he could be trusted to support the president and make do with minimal resources and academy players without criticising management in the media and so on.Xavi Hernandez also knew he would not get a call from a so called "big club" after 2 seasons of coaching Al Saad in Qatar. There was a win-win situation for both club and coach.No one sacrificed. No one was a victim. No one did anyone any favours. No one took decisions based on emotions. Those are just narratives on social media.

At this level, decisions are not based on emotions.

And to be entirely honest, it was exactly what the club needed. And still needs - given its financial situation. Barca may be in a position to spend a few millions on an elite coach but they simply do not have the financial capacity to fulfil the demands of an elite coach for squad building, season after season until they find parallel sources of income. Yes fans are impatient, rightfully so. But the club simply does not have the fiscal balance to run operations like that, as of yet. And, after 9 seasons of not winning the Champions League, 2 more seasons of not winning one will hardly make a dent in the history of a club that has survived over 100 years. But in those 2 years if the finances can be made better it would serve the club a lot better in the long term.Laporta probably anchors on this. So do those grey-haired people in the finance and back offices whom we as fans deride for knowing nothing.

So what has all this got to do with Barca's dismal season?

In short, everything. Last year's surprise league win made Barca fans delirious. But it was honestly a bit of luck. Goals conceded in Xavi's two full seasons fluctuate wildly even though the xG against in both seasons was quite similar. Ter Stegen having an unreal season and teams fluffing their lines helped Barca win a league.

Laporta spent around €150M from the various asset sales, to buy a few players to keep the team competitive in the league, but there were glaring holes in the team structure which if keyboard tacticos like us could figure out, rest assured the people running the club already knew.

However, Xavi overachieved albeit with a bit of the rub of the green.

Common sense would suggest that a winning project would have been backed with more funds, but Laporta's largesse of supporting Xavi with new players only lasted for one season. For a league winning team, the club last year only spent a mere €3.5M in new player acquisition when the season started with another €40M spent in December for a young unproven Vitor Roque. The club also removed Alemany and Jordi Cryuff, leaders who were close to Xavi. A large part of it was because the club still had a lot of high earners in the ranks even after the departure of Messi, Busquets and so on. Offloading them was not something Barca was very successful at.Operations like Philip Coutinho and Antoine Griezmann resulted in heavy losses.Critical positions like a solid defensive midfielder, an elite left back, an elite forward and an elite winger were left uncovered.

Let's take a moment to look at total player sales and total player incoming spends across Laporta's second tenure.

• 2021
  • Player Sales - €70.76M
  • Player purchase - €69.50M
• 2022
  • Player Sales - €39.50M
  • Player Purchase - €158 M
• 2023
  • Player Sales - €107.44M
  • Player Purchase: €43.4M
• Total in Player Sales: - €217.7M
• Total in Player Purchase: - €270.9M
• Net Spend: €53.2M

Barca Wage Bill for 2023-24

So over 3 seasons of Laporta's tenure, FC Barcelona has had a net spend of €53.2M in player acquisition after losing / letting go of players like Messi, Pique, Alba, Busquets, Griezmann, Coutinho and Dembele to name a few. Hardly the most resolute action to rebuild a team after losing talent like that, just using La Masia and players on free transfers.

Having said that though, the reason why Barca hasn't been able to spend on new player acquisition is the wage bill which has remained fairly high with amounts owed over the next three years at EUR 639.5 Million (rounded). Unless this is lowered significantly, at Barca's current ARR of EUR 800-900M, it would be almost impossible for Barca to spend more given its debt commitments.

Given the Fair Play implications, with such a high wage bill, clearly the club was and still is in no financial position to splash the cash and bring in differential players, unless some players depart. Clearly Laporta did not have the capacity amidst all the Palanca pulling to spend beyond this. Arguments can also be raised that with a wage bill of this amount, perhaps Barca should be performing better than results suggest. And if not, maybe some of these players need to be revalued for those who can bring success on the pitch.

Rarely does a club season suffer for a coach alone. There are multiple reasons which need to be studied with nuance.

Yes we may debate that since we have LaMasia we don't need to spend and there is merit in that argument (perhaps), but to be realistic 16, 17 year olds in their first season of pro football can hardly be blamed for not winning trophies galore, when the more established elite roster of players are not delivering to their promise.

With an ageing Robert Lewandowski leading the line, no real defensive midfielder, no elite left back, no real right back either (Kounde was converted), or a differential winger (Lamine is 17 years old while Raphinha at best is inconsistent and on the same wing as Lamine), it should not have been a big surprise to witness the dysfunction fans have seen. Couple it with a coach who clearly needs more time and experience to grow into his role, and the struggle was evident from Match day 1.

There were maybe five or six games in the entire season where Barca won convincingly. In the easiest Champions League draw in decades, Barca struggled to qualify the group stages while in the league the writing was on the wall as early as January after the defeat to Villareal (5-3).

Yet fans continued to dream. A string of wins post Xavi's announcement to leave at the end of the season and defeating Napoli in the round of 16 added fuel to these dreams. A first round win against PSG had the fanbase hyperventilating about a potential final at Wembley.

Then came the dose of reality. One week. 2 games.

Barca lost to PSG after losing their heads with a 4-2 aggregate score in their favour and 60 minutes left to play. Following this they lost to Real Madrid, giving up a 2-1 lead in the 75th minute and conceding a third in the 92nd minute. That was the end of their season. None of this was unexplainable or surprising to those who have really watched Barca play every game this season. Yes Xavi can be blamed, but that's just massively oversimplifying it. The team has stuttered in the face of quality opposition. Xavi still needs time to figure out on how to adjust in case his plan A fails. The players need a lot more time to gel together as a cohesive unit because there is no clear structure of play. And some players simply need to leave.

From player management to game play to on-field game strategy - FC Barca are nowhere near the elite, and it has shown up time and again this season.

Xavi will leave. Xavi will stay

When Xavi announced in January that he would be leaving the club, there was drama, confusion, disbelief and also a pragmatic air of acceptance among some fans that Barca could use this situation to bring in a coach who could teach the the youngsters how to play better football. Media and tacticos went into overdrive. Including our own little blog. From Flick to Nagelsmann to DeZerbi everyone was analysed.

Reports were written, inferences were drawn, verdicts were given.

Curiously, the people who needed to show some urgency towards replacing the head coach showed very little. Laporta and Barca's board showed next to no urgency in solving the coaching situation. Xavi kept religiously repeating in every press conference that he would leave. Rafa Yuste and Laporta repeatedly kept saying they believed in Xavi to complete his contract terms and this went on for 4 months.

Quite strange if you look at it objectively. If there was any seriousness to any of this - with plenty of elite coaches warming the benches - there was simply no need to keep Xavi in the job for half a season after resigning. History shows that a team barely performs well with a coach who has resigned but is still holding on to the reigns.

There was also no need for Xavi to carry on. Surely the wages paid by FC Barcelona weren't princely enough to keep him for an extra 6 months. So why did he decide to stay until the end of the season? Why did Yuste and Laporta agree to that and not bring in a replacement immediately. One school of thought is that the right coaches were not available. But is that really true? Or was it a bit more practical reasoning.

Let's assume we got a Flick or a Nagelsmann or a Motta. Could Barca really afford to build a stacked team to support these coaches? Or buy players to their liking? Remove players they did not need? Could Laporta truly support his new coach who would optimise towards winning over adjustments that needed to be made given the club's precarious financial condition?

Would that coach be happy in such a situation? Coaching Barca is a tenuous job at any time for anyone. How much more difficult would it be with this added complexity? We can criticise Laporta for all we want, but in both his tenures he gave his full support to the coach he hired. But can Barca do it this time around until they balance their finances which will easily take two to three more years at a minimum?

The simple answer is no. Not for a few more years.

Yes, it would have been great to hire a coach who could mould our core of youngsters and play attractive football. But add the media circus around Barca, the non-ending comparison with Madrid, the pressure of always winning, an extremely vocal and opinionated fanbase, the lack of funds and the off-field political aspects. The trials and tribulations of the Barca coaching job extend far beyond the pitch. The only way to silence it is perennial success on the pitch and Barca are not there yet.

Neither will they be next season.

An elite coach is not enough to create an elite team. It is one of the most important ingredients, but you also need the right players and profiles who can play 60 games a season without dropping a beat supported by a state of the art sports management system. Within the given context thereby, maybe there was no real option beyond Xavi for Barca and Laporta to bet on. None, that would tick all the boxes important to Laporta for the immediate future. As fans we only care about the football and want our team to play well, but the club is deeply political in the way it's run and it's always been that way.

It also needs to pay salaries, keep the lights on, pay staff and keep the pitches watered. Something that we as fans don't need to do.

No wonder, from January to April the board made not a whole lot of visible effort to woo coaches who could replace Xavi. The party line was clear. In Xavi we trust. Even when Xavi was saying "I am done. I want to go."

Dystopian. Yet very much Barca.

So now Xavi stays. After 13 press conferences and 4 months of denial he has decided to reverse his decision and will lead the bench when the season starts next season.

Se Queda , invoking the spirit of Pique. And maybe the only realistic solution Barca had.

So,what in reality can we expect from Barca, next season ?

Well there is no magic switch. The team has been dire on multiple occasions this season and it has many issues regarding player profiling and balance. Xavi simply does not have the players he needs to play the way he wants to. To compensate for that he has often used players out of position to make do.

A suboptimal solution for everyone concerned.

Fixing this would take a few seasons since the financials need to stabilise. Till then fans will possibly continue to witness a dysfunctional Barca from time to time on the pitch.

Expecting Barca to be consistent credible contenders in Europe for the next two seasons is a fever dream. The club should ideally focus on the league and domestic cups. The squad thereby should be optimised in a way which can help achieve that. Almost four years into its tenure, the board also needs to show accountability in its financial progress and call out the key goals of the season during the Gamper.

Manage clear expectations within the fan base. Media sound-bytes like "This is Barca, we have to win everything" when we clearly are not there only goes on to create more media scrutiny and churn. Noise and decibels.

Barca have an economic lever of EUR 100M missing from the Libero deal. Closing the shirt sponsorship deal with a sign on bonus (both Nike and Puma are offering north of 100M) can help them make up for this loss and achieve 1:1 parity in financial fair play. This will be a highly critical part of the summer planning along with signings and departures. If they can get a favourable deal with a shirt sponsor, Barca should probably look to get at least 2 world class players in the form of a DM and Left winger. Xavi should probably turn his focus on coaching the young core to become the foundation of Barca for the years to come. Returning to Camp Nou by December (even with a 60k capacity ) should be the next priority given it's relevance to on-ground fan support and increased ticket sales.

Depending on Mbappe's transfer to Madrid in the summer, LaPorta would have to counter that in some way, shape or form, from the optics perspective. For this, the critical aspect would be player sales. This is inescapable even though highly polarising. While we as fans may debate on the merit of the players and who deserves to be in the team, fact remains that at such a high wage bill with no sporting success, no club can survive unless it has billionaire owners. Almost 4 years into its tenure, the board has to find a way to curtail this staggering wage bill, which truly isn't delivering the silverware that should come with this kind of spend. Football is a business whether we as fans like it or not and the club can only spend based on what it earns.

There are a ton of names on the roster, many of whom are transferrable on paper, but none of whom actually want to leave, in reality. Hence, there might be a need to make a couple of painful sales (irrespective of fan hysteria) to bring in profiles that Xavi needs as well as players who can deliver on the pitch immediately. Apart from that Barca would probably need to depend on smart, inexpensive recruitment and their academy. Pretty much like what they have been doing lately due to financial constraints.

So much so for the off-field priorities. A similar set of focus areas remain on field.

It's been almost 3 years and against elite teams Barca still crumble easily and repeatedly. It always feels like we are using our players in positions they are not the best at, and hence there seems to be a need to establish patterns of play which can optimise for the profiles that we actually have.There is also a need to improve on formation plays, set pieces, and contingency plans when Plan A does not work. Can Xavi do it? I believe he can, but he needs the space to be able to do so.If the focus was on improving the team and not on treating literally every game as a "Final", it would probably be more beneficial. It's not like Barca is winning a lot with the clarion call to arms for a "final" every match-day.

There is only one thing worse than losing. And that is becoming irrelevant. Barca is not yet bordering irrelevancy, but opposing teams do not fear Barca anymore on the pitch. Off-field controversies have rubbed the sheen of the brand. So since we are not winning the big tournaments anyway, why not adhere to a principle of play that at least entertains the fans and creates an identity? What if we accepted that our focus would be just playing well for the next two years and building the foundations of a team without all the drama around being the best club in the world and winning everything?

Clearly we are far away from that at this moment. Is it not ?How worse would it be, than what it already is?

If it ain't broken, don't fix it. But what if it is visibly broken? I love Xavi the player, Xavi the thinker and Xavi the Barca fan. That man is a legend and he bleeds Barca and his last season as a coach should be one of joy and happy memories. And that is possible. With a bit of pragmatism. Astute scouting. Data driven recruitment and managing expectations.

Can Barca do it? Yes. Will they do it? The next few months will give the answer.