Jake Odorizzi, What's going on w/ him?

[terrydactyls]

There is a big difference between spending money and being crazy.  I put Snyder in the crazy category.  I just think that now is the time to increase the salary budget by 10% and bring home some playoff success.

 

It's fun to play with other people's money, but the people that have the money didn't get and/or keep the money by making those sorts of 'business' decisions. Some of the worst professional sports owners have been these types of 'hobby' owners who don't care about business metrics and throw money and caution to the winds. Dan Snyder of the Washington Football Team types.

 

[Major League Ready]

 

I don't think owners should operate teams at a loss (though I wouldn't complain if they did, as owning a team is often a status purchase and every ownership group sees a massive windfall when they sell) but it'd be cool if they operated closer to where they're supposed to operate, which is just over 50% of revenue going to payroll.

 

But ownership groups cook the books so heavily that most don't actually get anywhere near that percentage.

 

That 50% number is an old sound bite that fans cling to with very little thought. For starters, I bet that fans define that 50% differently than teams, companies in general or the tax code. Fans take player salaries and divide by revenue. The cost of personnel includes payroll taxes, medical benefits and retirement plans. It also includes. Draft bonuses and international signing bonuses. So, when this sound bite was anointed as the measure by which to live by fans, nobody stopped to ask how payroll costs were defined.

 

That number was also derived prior to substantial additions in personnel related to analytics and development practices. Shifts in how businesses invest in personnel, systems, and practices is common across most industries and it changes this type of metric.

 

What really throws me is that so many people continue to point to this principal assuming it would help the Twins without any actual thought as to the impact on payroll if this practice was followed. If all the owners followed this practice, the result would be that disparity in spending between top and bottom markets would grow. This is not an opinion it’s a very basic mathematical certainty. If you don’t believe me, calculate the difference in payroll among the top 5 revenue teams for the past 5 years. Then, calculate the difference based on 50% of revenue.

[adjacent]

All this discussion above made me with for a different success model for a baseball team. I model that not consist in tanking for 5 years (at least) to have the opportunity to be successful in a 3-year window.

[tony&rodney]

I wonder if there will be special discounts on free agents today?

[ashbury]

I wonder if there will be special discounts on free agents today?

We missed the Black Friday sales shortly after the World Series. Some good merchandise is still available, but anything at a very low price might be only the picked-over stuff on clearance by now.

 

[Mike Sixel]

 

That 50% number is an old sound bite that fans cling to with very little thought. For starters, I bet that fans define that 50% differently than teams, companies in general or the tax code. Fans take player salaries and divide by revenue. The cost of personnel includes payroll taxes, medical benefits and retirement plans. It also includes. Draft bonuses and international signing bonuses. So, when this sound bite was anointed as the measure by which to live by fans, nobody stopped to ask how payroll costs were defined.

 

That number was also derived prior to substantial additions in personnel related to analytics and development practices. Shifts in how businesses invest in personnel, systems, and practices is common across most industries and it changes this type of metric.

 

What really throws me is that so many people continue to point to this principal assuming it would help the Twins without any actual thought as to the impact on payroll if this practice was followed. If all the owners followed this practice, the result would be that disparity in spending between top and bottom markets would grow. This is not an opinion it’s a very basic mathematical certainty. If you don’t believe me, calculate the difference in payroll among the top 5 revenue teams for the past 5 years. Then, calculate the difference based on 50% of revenue.

 

Record revenue the last 5 years before this, while payroll actually dropped last year......so, it's pretty easy to see if the teams are spending more or less on players. Oh, and teams in all sports keep selling for record amounts, including the Mets just in the last month or so.....and how many analytics people would need to be hired to equal on real FA at 5-10 million? Lots and lots.......Also, more teams are building businesses and parking lots and other things THAT LITERALLY only exist as extensions to the team, and that revenue doesn't count in MLB revenue......

[Brock Beauchamp]

 

That 50% number is an old sound bite that fans cling to with very little thought. For starters, I bet that fans define that 50% differently than teams, companies in general or the tax code. Fans take player salaries and divide by revenue. The cost of personnel includes payroll taxes, medical benefits and retirement plans. It also includes. Draft bonuses and international signing bonuses. So, when this sound bite was anointed as the measure by which to live by fans, nobody stopped to ask how payroll costs were defined.

 

That number was also derived prior to substantial additions in personnel related to analytics and development practices. Shifts in how businesses invest in personnel, systems, and practices is common across most industries and it changes this type of metric.

 

What really throws me is that so many people continue to point to this principal assuming it would help the Twins without any actual thought as to the impact on payroll if this practice was followed. If all the owners followed this practice, the result would be that disparity in spending between top and bottom markets would grow. This is not an opinion it’s a very basic mathematical certainty. If you don’t believe me, calculate the difference in payroll among the top 5 revenue teams for the past 5 years. Then, calculate the difference based on 50% of revenue.

Why do you carry so much water for billionaires that sell teams for literal multitudes more than they paid for them?

 

The Pohlads bought the Twins for roughly $40m in... 1984? Going from memory here.

 

But the Twins would sell for roughly $1b today.

 

No big deal. That's only several tens of millions gain. Per year. For 40 years.

 

No biggie. You're totally right. 

[twinsfansd]

 

Why do you carry so much water for billionaires that sell teams for literal multitudes more than they paid for them?

 

The Pohlads bought the Twins for roughly $40m in... 1984? Going from memory here.

 

But the Twins would sell for roughly $1b today.

 

No big deal. That's only several tens of millions gain. Per year. For 40 years.

 

No biggie. You're totally right. 

Here's another way to look at an investment, My goal in my retirement accounts is to have my money double every seven years. That's a pretty nice return, but for the most part it has pretty much played out that way over the years. I'm sure most businesses look to have their investments pay off even better.

 

Take Pohlad's original investment of $36M and double that every 7 years. What do you get? Way more than the projected current value of the Twins at $670M.

[tony&rodney]

from NY Times - Aug. 16, 1984

"... Pohlad purchased Calvin Griffith's 52-percent share of the Twins for an estimated total of $32 million, marking the end of an era for Griffith, the last big-league owner to make his living solely on baseball ...."

"... Pohlad bought an additional 42 percent of the club's stock from H. Gabriel Murphy through the Tampa Bay Baseball Group, an organization of businessmen who agreed to sell Pohlad, for a reported $11.5 million, the shares they purchased from Murphy last April."

 

According to Forbes - In 2020, the franchise had an estimated value of 1.3 billion U.S. dollars.

 

The Twins original investment was $5 million down, the remainder financed. MLB is an invite only club.

 

Why do we care? The history of communities funding the costs for stadiums across the United States is well documented. The economic system of our country has a long history of such expenditures.

 

Nobody needs to support the Pohlads, They are doing just fine. 

Nobody needs to attack the Pohlads. It is pointless.

 

What Odorizzi is looking for is some semblance of a contract which will either set him up to pitch for a team that both pays him well and gives him the support to be successful, or he would look to sign a multi-year contract for a substantial figure, say about $40-50 million.

The Twins have to decide whether Odorizzi is going to be one of their major signings this offseason. In the meantime, the team is poking around trades and potential fits like Kluber.

All of baseball is held back by the specter of a reduced schedule, a change in public policy to allow for full stadiums, continued improvements in the Covid world, and general owner-player peace.

Meanwhile, winter hot stove arguments should continue and we can all keep the dreams alive for next season.

Odorizzi, like us, is waiting for some solutions to the current situation.

[Brock Beauchamp]

 

Here's another way to look at an investment, My goal in my retirement accounts is to have my money double every seven years. That's a pretty nice return, but for the most part it has pretty much played out that way over the years. I'm sure most businesses look to have their investments pay off even better.

 

Take Pohlad's original investment of $36M and double that every 7 years. What do you get? Way more than the projected current value of the Twins at $670M.

Forbes valued the Twins at $1.3b earlier this year.

[tony&rodney]

 

Forbes valued the Twins at $1.3b earlier this year.

.... and that is on their investment of $5 million .... so a pretty decent return. But absolutely none of us could have purchased the Twins, even for cash. As John Prine says, That's The Way The World Goes Round.

Thus, we dream of Hendriks, Realmuto, and sugar plums; it's all good and keeps me content.

[Doctor Gast]

 

.... and that is on their investment of $5 million .... so a pretty decent return. But absolutely none of us could have purchased the Twins, even for cash. As John Prine says, That's The Way The World Goes Round.

Thus, we dream of Hendriks, Realmuto, and sugar plums; it's all good and keeps me content.

Just to be fair the $5M is their initial investment. I'm sure they've invested much more during their run. But I'd dare to say that they've probably still came out like bandits 

[Danchat]

 

 

Ken Rosenthal of The Athletic hears from a team in contact with Jake Odorizzi that the free agent starter "expects to land a three-year contract in the $36 million to $42 million range."

That might seem like a lofty expectation for a guy who threw just 13 2/3 innings last year due to injuries and who wasn't particularly effective when healthy, but the free agent market for starting pitchers is quite thin beyond top dog Trevor Bauer. Odorizzi isn't tied to draft pick compensation either after accepting the Twins' qualifying offer last winter, so that may widen his appeal a bit.

 

[Vanimal46]

Those aren’t unreasonable expectations for a new contract. I’m ambivalent about Odorizzi. We’ve probably seen the peak of his MLB performance, and it’s good. 95 accurate pitches and getting a couple of outs into the 6th inning. Maybe completing 7 innings if his pitch count is down. I shouldn’t downplay that because it wasn’t long ago we were clamoring for anyone who could throw 4 good innings in a row.

 

But... I also can’t help thinking about being more risky with the money and shoot for more upside. Like Corey Kluber, or making a trade for a pitcher like Sonny Gray.

[Brock Beauchamp]

 

Those aren’t unreasonable expectations for a new contract. I’m ambivalent about Odorizzi. We’ve probably seen the peak of his MLB performance, and it’s good. 95 accurate pitches and getting a couple of outs into the 6th inning. Maybe completing 7 innings if his pitch count is down. I shouldn’t downplay that because it wasn’t long ago we were clamoring for anyone who could throw 4 good innings in a row.

But... I also can’t help thinking about being more risky with the money and shoot for more upside. Like Corey Kluber, or making a trade for a pitcher like Sonny Gray.

It's not an easy decision. Personally, I'd prefer to see the Twins aim higher and go for more of a sure thing but I'm also okay with bringing back Jake.

[diehardtwinsfan]

 

It's not an easy decision. Personally, I'd prefer to see the Twins aim higher and go for more of a sure thing but I'm also okay with bringing back Jake.

not against it, but I'm probably thinking the same in what ownership thinks in that I'm not guaranteeing him multiple years... he was pretty good in 2019, but also outperformed his peripherals... Not a bad guy to do a 1 year make good pact with, but I'm guessing he's not signing at the moment because every team in baseball is thinking the same way. 

[howeda7]

The only way I bring Odo back is if it's a one year deal for less than $10 million. I'm just not a fan and never have been. He would be our #4 starter. I'd rather aim higher or take a shot on upside with Kluber or someone else. 2nd half 2019 Odo is likely what you're getting. And that is meh.

[Doctor Gast]

Looks like the Mets are no longer interested in Odo, since they got Carrasco

[mnfireman]

 

The only way I bring Odo back is if it's a one year deal for less than $10 million. I'm just not a fan and never have been. He would be our #4 starter. I'd rather aim higher or take a shot on upside with Kluber or someone else. 2nd half 2019 Odo is likely what you're getting. And that is meh.

 

Odorizzi's 2nd half wasn't as bad as you might think. Take out the 4 IP, 9 ER clunker against the Yankees and he was 5-2 with a 2.98 ERA. He was actually very good in Aug/Sep, posting a 3.04 ERA with 65 K's in 50.1 innings. That being said, I don't know if he worth $13+ MM a season at this stage of his career.

 

 

[Thegrin]

Offer him 2 yr for 22 million, and settle with 3 years for 30 million and I bet he'll take it in this market. 

[The Wise One]

 

Here's another way to look at an investment, My goal in my retirement accounts is to have my money double every seven years. That's a pretty nice return, but for the most part it has pretty much played out that way over the years. I'm sure most businesses look to have their investments pay off even better.

 

Take Pohlad's original investment of $36M and double that every 7 years. What do you get? Way more than the projected current value of the Twins at $670M.

 

 

Why do you carry so much water for billionaires that sell teams for literal multitudes more than they paid for them?

 

The Pohlads bought the Twins for roughly $40m in... 1984? Going from memory here.

 

But the Twins would sell for roughly $1b today.

 

No big deal. That's only several tens of millions gain. Per year. For 40 years.

 

No biggie. You're totally right. 

https://www.officialdata.org/us/stocks/s-p-500/1984

32 million invested in the S&P 500 would be now 1.8 billion. The money he spent years later would be more to that total. The 180 million or so they invested in Target field  would be a lot of money 10 years  later.  There can be no doubt that the Twins are way more valuable than what Pohlad paid for them. On the other hand, more money could have been made elsewhere

[tony&rodney]

Rehashed too many times ... the Pohlads initially invested $5 million in the Twins and then have made payments, improvements, contributed generously to the community, etc., etc., etc.

The comparisons are a moot point because while you could have bought Tesla stock or invested in whatever retirement fund, you could not buy a baseball team no matter your net worth without permission from MLB. The books are closed and the public knows virtually nothing about a club's financial portrait.

When the Twins were threatening to move, they turned down offers to sell the team. It's a business and these guys know how accounting works. We never need to defend the owners. We can speculate.

Whether the Twins choose to sign Jake Odorizzi is more based on the other options available to improve the team going forward than the exact monies spent. Odorizzi should get close to $45 million over 3-4 years. Do we prefer that contract or should the Twins take a shot at Kluber and Hill this year for $11 million? Remember that the team still has Dobnak, Smeltzer, Thorpe, Duran, and Balazovic around too.

 

[Major League Ready]

 

The books are closed and the public knows virtually nothing about a club's financial portrait.

 

 

That’s not exactly an enlightened position.

 

1) We know the revenue with a high degree of accuracy. This is a very different case than many private companies and of course it’s crucial to understanding profitability.
2) We have a very accurate estimate of Player expense. This includes Salary + benefits and payroll tax, draft bonuses, etc. This expense represents 50+ percent of revenue and roughly 60% of operating cost.
3) Variable operating costs such as travel / hotel / meals / etc can also be estimated quite accurately.
4) Stadium cost is public record and stadium maintenance is another cost that can be estimated with a high degree of accuracy
5) Non-player personnel is the largest operating cost. All you would need is an employee roster with positions and you could estimate personnel cost with a fair degree of accuracy. I am not sure payroll taxes payments are probably public. This would also aid in estimating personnel costs with reasonable accuracy.
6) Equipment (training equipment / computers, etc) would be the hardest part to estimate. However, those costs are less than 1 percent of revenue.

 

So, we have a very accurate view of 100% of the revenue and over 60% of operating cost. If the other 40% can be estimated with 90% accuracy, and it can, that would mean we can estimate the Twins net profit to +/- $10M or 3% of revenue. So, it’s not an accurate portrayal to say the public knows nothing. It’s more accurate to say that the public elects to take an uniformed position.

[tony&rodney]

Well argued response to quite effectively state we can guess pretty good. 

The discussions about profit/ loss .... 

Your last sentence is truly unenlightened. 

My basic position is that Twins Daily does well to discuss and speculate on baseball rosters and possibilities and such. The articles on a player's attitude or the owner's profits are personally not necessary. Finally, I must say that it is true that because I'm not interested in such conversations I should not comment on other's opinions of such and will refrain from comment in the future.

[Brandon]

back to the Odorizzi discussion.  With the Players Union agreement up at the end of the year, Finding an Odorizzi replacement on a 1 year deal.  Garret Richards could be had on a shorter contract.  I suspect he could be had on a 1 year with mutual option contract.  I bet he would be as good as Odorizzi.  I like Odorizzi because he likes playing for Minnesota and is solid.  But if we can find a better value or if he can get a better deal....

[Trov]

My thoughts are every team and player are waiting for more info.  They are waiting to know how likely butts will be in seats, and how much will players or other teams be willing to pay.  It is odd off season.  Teams will want to see what pitching is going for, and Bauer will be first to go, then others will go next.  Some players may take some deals before Bauer to know what they are getting.  Right now a lot of game of chicken going on. 

[Dodecahedron]

I agree that we have seen the peak of Odorizzi. My initial thoughts were that the Twins should move on, but realistically I don't think the Twins would target anyone better.

 

If he comes back, great. If not, we have to hope the Twins bring in someone comparable. In this case, it may be a #3/#4 guy.

[nicksaviking]

The kind of deal that Odorizzi is looking for and the kind he'll probably get, are my least favorite kinds of deals for pitchers. These 3-4 year contracts for mid-level starters tend to become a negative value immediately after the pitcher signs. The kinds of pitchers who get these deals are vets who have already hit their ceilings so you can't later move them without eating most of the remaining money, and they'd have to continue to pitch at that ceiling for the contract to be worth it for your club. These guys so often never end up pitching any better than a replacement level guy.

 

I prefer big money deals for a front end starter, or a 1 + an-option year deal for rebound pitchers. Those rebound guys seem to just as often perform as well as those mid-level guys on the 3-4 year deals, plus they also tend to have a higher ceiling. But the best part about them is that if they don't work out, it's easy to cut bait.

[Major League Ready]

 

Rehashed too many times ... the Pohlads initially invested $5 million in the Twins and then have made payments, improvements, contributed generously to the community, etc., etc., etc.

The comparisons are a moot point because while you could have bought Tesla stock or invested in whatever retirement fund, you could not buy a baseball team no matter your net worth without permission from MLB. The books are closed and the public knows virtually nothing about a club's financial portrait.

When the Twins were threatening to move, they turned down offers to sell the team. It's a business and these guys know how accounting works. We never need to defend the owners. We can speculate.

Whether the Twins choose to sign Jake Odorizzi is more based on the other options available to improve the team going forward than the exact monies spent. Odorizzi should get close to $45 million over 3-4 years. Do we prefer that contract or should the Twins take a shot at Kluber and Hill this year for $11 million? Remember that the team still has Dobnak, Smeltzer, Thorpe, Duran, and Balazovic around too.

 

I am never exactly sure what people are trying to argue where profits are concerned. So, what exactly is the argument? The common inference is that because MLB owners are rich that they should be willing to operate at break-even or even a loss. The other inference seems to be that because increases in team valuations have been very high they should be willing to operate at b/e or a loss. I guess the overlying inference is that we could afford elite FAs if only owners were willing to forgo profits. What exactly is the point of constantly point in pointing back at owner's profit?

[Dodecahedron]

 

I am never exactly sure what people are trying to argue where profits are concerned. So, what exactly is the argument? The common inference is that because MLB owners are rich that they should be willing to operate at break-even or even a loss. The other inference seems to be that because increases in team valuations have been very high they should be willing to operate at b/e or a loss. I guess the overlying inference is that we could afford elite FAs if only owners were willing to forgo profits. What exactly is the point of constantly point in pointing back at owner's profit?

 

Well, yes, they should operate the team at break-even. That's what I would do. Wouldn't you?

 

You are already a billionaire, you can already live whatever lifestyle you want. You have other ventures making money. Beyond keeping a reserve of funds for the team (which yes should probably be enough to operate the team for at least a full year -- heck, 5 years), why not operate the team as a break-even venture? This would zero out your taxes and be a heck of a lot more fun. In the United States, wages are 100% tax deductible.

 

Isn't sports about having fun? If running a team is a headache, sell the team! If counting beans is what drives you in life, stay in real estate.