LIV Golf finally enjoyed a moment of newsworthiness on Wednesday, albeit a near-death experience that must have distressed the bot farmers, bootlickers, broadcasters and bookies who’ve cheered the four years of Saudi profligacy now drawing to a close.
For the crypto bros drawn to LIV, it was their first experience of a run on the bank. On Tuesday evening, rumors were rampant that the struggling league would be shuttered. By the next morning, it was known that LIV’s players hadn’t been paid their guarantees for the first quarter — a multi-million dollar sum for many — and were threatening to down tools before Thursday’s first round in Mexico City. (Even Bernie Sanders would balk at supporting that stoppage since wealthy golfers aren’t exactly a downtrodden demographic).
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The Financial Times, Wall Street Journal and New York Times all cited sources saying the league’s owner, Saudi Arabia’s sovereign Public Investment Fund, was on the verge of pulling the plug. LIV Golf’s CEO, Scott O’Neil, didn’t immediately and forcefully deny the reports. Nor did he reassure employees, stakeholders and vendors about the future. He didn’t because he couldn’t, and he couldn’t because he didn’t know. And that’s the most damaging conclusion to be drawn from the entire fiasco: LIV’s boss is not familiar with the thinking of its backers at the PIF, and his business is not aligned with PIF’s future plans.
That became official the same day when Yasir Al-Rumayyan — the PIF governor and LIV’s sole supporter — laid out a new five-year plan to strengthen the Fund’s investments in six core areas. Leisure and Sports, part of the previous strategic agenda, was not mentioned. Al-Rumayyan did note that international investments, the bucket in which LIV sits, would be reduced from 30% of its portfolio to 20%, making it unlikely that funding a busload of washed-up professional golfers is going to be a priority.
Not until late Wednesday did O’Neil address the crisis engulfing his business, claiming financing had been secured. It was reported that he told players the league is funded “for the foreseeable future.” That’s unlikely to provide much comfort since O’Neil’s foresight didn’t seem to extend from Wednesday morning to Wednesday evening.
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“We have faced headwinds since the jump, and we’ve answered every time with resilience and grace,” he wrote in a memorandum to staff, with commendable bravado. “Now, we answer by doing what we do best: putting on the most compelling show in sports.”
Leaving aside the Kool-Aid conclusion, O’Neil’s challenges are enormous. Depending on who you ask, LIV’s losses range from $5 billion to north of $8 billion, if you include future commitments. That explains why his most daunting headwinds are now internal, from those financing the farce.
“Our season continues exactly as planned, uninterrupted and at full throttle,” O’Neil emphasized. Which is short of saying LIV is funded through the end of the schedule four months from now, and farther yet from previous claims that the league was solid through 2032. The emergency infusion obtained Wednesday seems less an investment than severance by another name, but it was sufficient to get players to work on Thursday. Meanwhile, LIV’s announcers opened the broadcast by blaming everything on media mischief — the kind of guff usually delivered while wearing a pink hanbok like Ri Chun-hee, the North Korean newsreader who has spawned many a mocking meme.
So what becomes of LIV? O’Neil can seek new financiers, but who would deem it a good investment to pay millions of dollars to guys like Talor Gooch or Caleb Surratt, or to sustain a burn rate reported at $100 million a month? And if the Saudis are no longer interested in spending in sport, and on his LIV enterprise in particular, what leverage does he have to secure a soft landing deal with the PGA Tour or its European counterpart? He has nothing to offer but a toxic product.
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Through four years of LIV’s existence, some things have been constant: bullishness that is often exposed as bullshit; metrics that never signal an upward trajectory; a victim mentality that blames its failures on a conspiracy against the league rather than on its own well-documented missteps; and a drool-speckled army on social media insisting that the Saudis have enough cash to cover LIV forever.
Thing is, though, no one likes setting money on fire, no matter how much of it they have. Which is why “forever” seems to have arrived.
Eamon Lynch is a columnist for Golfweek and a frequent contributor to Golf Channel.
This article originally appeared on Golfweek: LIV Golf proves even the Saudis have a spending limit: Eamon Lynch
