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IIn the 2019/20 season, Wolverhampton Wanderers were on the cusp of something special. The club finished seventh in the Premier League and impressed in the Europa League, reaching the quarterfinals. This was the highlight of their time under Fosun ownership. Only three years earlier, the Chinese company had acquired Wolves for £45 million and transformed them from a Championship club into a team playing European football at Molineux once again.
This rapid rise was largely due to the strong partnership between head coach Nuno Espírito Santo and the influential Portuguese agent Jorge Mendes. Mendes brought several players to Wolverhampton, resulting in a remarkable and strong squad.
However, the success didn't last. After Nuno's departure in 2021, things went downhill. Wolves went through five managers, lost a clear vision for their transfer policy, and continued to decline year after year. Wolves went from a club competing for European football to a team primarily focused on survival.
By December 2025, Wolves were bottom of the Premier League, with just two points from thirteen matches. They were already eight points behind 19th-placed Burnley. This was not only due to poor results on the pitch, but also to deeper problems. For years, the club underinvested in scouting, allowed the stadium to age, resulting in stagnant revenue, and failed to develop new commercial revenue streams. As a result, Wolves became increasingly reliant on player sales to maintain their financial health and avoid Profit & Sustainability Rules (PSR) issues.
This edition of Cleats and Cashflows delves deeper into the causes of this decline. One possible solution lies in allowing a private equity firm with a minority stake and real influence within the club. Such a move could accelerate necessary reforms and help Wolves rebuild a stable and sustainable future.
The golden age of Fosun: rise, peak and vulnerability.
The rise of Wolves
After being acquired by Fosun in July 2016, Wolves enjoyed three successful years. The club quickly rose through the ranks and positioned itself effectively within the Premier League. A key factor in this success was the partnership with influential Portuguese agent Jorge Mendes. His network allowed Wolves to attract players who would otherwise have been out of reach.
New signings like Rúben Neves, João Moutinho, Diogo Jota, and Pedro Neto gave the squad a clear boost in quality. With them, Wolves finished seventh in the Premier League twice in a row and reached a memorable Europa League quarter-final.
Fosun also tried to diversify its revenue streams off the pitch early on. For example, the club invested in e-sports, in an effort to become less dependent on Premier League TV revenue.
Yet, that success proved to be built on a fragile foundation. Progress relied heavily on personal relationships, while structural investment and a clear long-term vision were lacking. These shortcomings ultimately formed the breeding ground for Wolves' current decline.
The plateau and the decline
Wolves' continued decline can be traced to three structural problems under Fosun's ownership. First, the club lost its leading position in scouting and player recruitment. Second, years of underinvestment in infrastructure. And third, commercial revenue lagged behind.
A minority investment from a private equity firm, with real influence on operations, could steer the club in all these areas. Such a partner can bring financial discipline and a clear long-term vision to the club.
Loss of recruitment advantage
Under Fosun, Wolves never managed to build an independent and sustainable recruitment model. Instead, the club became increasingly reliant on external agencies, particularly the Portuguese superagent Jorge Mendes. This so-called "Mendes pipeline" initially produced exceptional talent and successful managers, but concealed a fundamental problem: Wolves lacked a strong in-house scouting and transfer team.
As Mendes's influence waned, so did his advantage in the transfer market. Transfer policy became increasingly reactive, focused on solving short-term problems and complying with PSR regulations, rather than on a well-thought-out long-term strategy. After the coronavirus crisis and the introduction of stricter financial regulations, Wolves found themselves on an increasingly difficult financial path.
To stay within the rules, the club was forced to sell key players. However, the replacements proved to be of a significantly lower caliber, causing the quality of the squad to rapidly decline.
This downward spiral was exacerbated by financial inefficiency. Despite player sales, both wage costs and transfer write-downs rose, particularly for signings linked to Mendes. In the 2023/24 season, Wolves' operating costs amounted to a staggering 117 percent of revenue, the second-highest percentage in the Premier League. Since 2020/21, this figure has been above 100 percent every season, with peaks of up to 133 percent. This points to a structurally unsound financial model.
Now that the Premier League is tightening its controls further, including the introduction of the Squad Cost Ratio (SCR), this cost structure poses a serious threat. The lack of an efficient, data-driven scouting network makes adapting to these new rules even more difficult.
Without drastic reforms, Wolves risks becoming trapped in a vicious cycle: a weak transfer policy leads to poorer performances, turning relegation from a theoretical risk into a real threat. Combined with an outdated stadium and stagnant commercial revenue, the club has become dangerously dependent on television revenue. Relegation could see this fragile system collapse.
Infrastructure: the neglected Molineux
Fosun's reluctance to invest in infrastructure is most evident at Molineux, Wolves' historic stadium. Although the stadium is a key part of the club's identity, it has received little investment for years. This has caused frustration among supporters and represents a missed commercial opportunity.
With a capacity of approximately 32,000, Molineux is small by Premier League standards. Demand for season tickets has outstripped supply for years, but plans for expansion or modernization have been elusive. The result is a stagnant stadium experience and limited revenue, especially for a club desperately needing other sources of income.
This passivity contrasts sharply with regional rivals. Birmingham City, playing in the Championship, recently unveiled plans for a new 62,000-seat stadium complex. Wolves are stagnant and therefore risk being overtaken regionally and financially in the long term, despite their current Premier League standings.
Wolves earns only around £25 per supporter, comparable to Bournemouth and Aston Villa. By comparison, Brighton earns £37 per fan. Wolves' annual matchday revenue is around £16 million, compared to Brighton's £28 million and Manchester United's whopping £137 million.
Matchday revenue accounts for less than 10 percent of Wolves' total revenue, a worryingly low share for a club that wants to become less reliant on player sales and television revenue. A modernized Molineux would not only generate more revenue from ticket sales and hospitality, but also offer new opportunities through concerts, events, and naming rights.
Moreover, financing such a project could have been feasible. An infrastructure loan of around £100 million, with the stadium or television revenue as collateral, is consistent with structures Wolves have used before. In a league where infrastructure is becoming increasingly important as a competitive advantage, the lack of investment is both a financial and strategic mistake.
Commercial standstill
In addition to the lack of stadium investment, Wolves' commercial growth has also lagged. In the 2023/24 season, the club generated only £27 million in commercial revenue, a fraction of what top clubs generate.
Manchester City topped the table with £345 million, while Aston Villa earned £55 million. The latter is noteworthy: Villa increased its commercial revenue by over £24 million in two seasons thanks to deals with global partners like Adidas and Betano.
Like Wolves, Aston Villa is owned by private investors, but Wolves may have even more untapped potential. The club almost completely dominates its region, and Fosun has strong Chinese networks, offering significant opportunities in Asian markets. Yet, that potential has hardly been tapped.
Instead, Fosun early on focused on esports as a growth model. However, that yielded little. In nine years, the team competed in over one hundred tournaments, netting only $10.4 million in prize money. In football terms, that's negligible and no substitute for strong sponsorship deals.
The time, money, and attention spent on this could also have been invested in brand building, regional sponsorship, and international partnerships. Those opportunities were largely missed.
As a result, Wolves' commercial revenue has barely grown: from £28m in 2018/19 to £27m in 2023/24. Five years of virtual stagnation.
Crude honesty: administrative chaos
Perhaps the most damaging shortcoming under Fosun lies in the boardroom. Not so much a lack of plans, but a disconnect between ambition and execution. Wolves attempted to combine caution and growth, but ended up in a situation where neither truly materialized.
A private equity partner with operational influence could quickly change this by enforcing clarity, discipline and long-term planning.
Fosun's policy went through two contradictory phases. Initially, the owner approved high expenditures, often on players from Mendes's network, without a solid sporting or organizational structure to back them up. Success relied on external relationships, not on internal systems.
As costs rose, Fosun abruptly shifted to austerity measures. Instead of targeted investment in modern structures, they made mainly reactive cuts. The transfer policy became desperate, the squad thinned out, and performance deteriorated.
Recently dismissed Executive Chairman Jeff Shi became the face of this strategy. His public pronouncements emphasized survival over ambition, underscoring the strategic confusion. Some of his most telling statements include:
- “If you're only after trophies or consistent European football, Wolves might not be the ideal choice.”
- “It's just like a bank: you have to have sufficient reserves... That's how we think about the long-term future.”
- "If you invest less, but enough... then you have more room to survive, grow, or achieve your goals."
The irony is clear: Fosun failed to invest sustainably, overpaid where smart construction could have been implemented, and became cautious when targeted investments were needed. The result is a model without real growth potential and without resilience.
Where are Wolves going?
However serious the crisis, it also offers a rare moment of reflection. Relegation doesn't have to be the end point, but can actually represent a necessary break from years of aimless policy.
If Wolves capitalizes on this phase, the club can be rebuilt based on data-driven systems, financial discipline, and a clear identity. The next edition of Cleats and Cashflows will provide a concrete roadmap for this reinvention, with a key role for a strategic minority investor who can provide the structure and accountability Wolves currently sorely lack.
