McLaren earned the big bucks last season after winning its first Constructors’ Championship since 1998 but not too long ago, they were close to financial collapse. Zak Brown recently spoke about the same and revealed how he managed the situation as the CEO.
In the late 2010s, McLaren started showing cracks in its finances and the onset of the COVID-19 pandemic did not help. In 2020, the Woking-based squad had to eliminate around 1,200 jobs, after reporting a £13 million ($15 million at the current exchange rate) loss that year.
Brown, who had joined McLaren in 2016, admitted that they were close to being bankrupt. “We were definitely close to it,” he said to Motorsport. The papaya squad always ‘paid its bills,’ but Brown had no idea how many more months they would have been able to keep doing so.
2020 was the year McLaren was also making strides on the track. After years of struggling to get into the points due to the failed McLaren-Honda power unit partnership, they were finally looking competitive again and were having quite regular sniffs at the podium places.
“I had to protect the team from seeing it, so that everyone could stay in the very positive, energetic mood they were in,” Brown added. At one point, the situation was so bad that Brown had to sell the team’s state-of-the-art headquarters for $237 million just to cover employee salaries.
McLaren has completed a historic comeback.
Only a month or two away from bankruptcy, McLaren sold its UK headquarters, signing a 20-year leaseback agreement in order to pay its employees.
Now, they are world champions, profitable, and valued at $2.65 billion.
Crazy story! pic.twitter.com/jbsl3nFSFS
— Joe Pompliano (@JoePompliano) December 17, 2024
Had they not received a financial injection in the form of MSP Sports Capital buying 33% of the team’s shares, Brown is unsure if they would have survived. However, he remained confident that the team’s shareholders would never have allowed it to go bankrupt, although he admitted that “it was not a pleasant situation.”
Brown, the founder and owner of Just Marketing International, a motorsports marketing agency specializing in negotiating sponsorship deals, shifted his focus to making McLaren both popular and marketable.
It did not take him long to secure numerous sponsors, ultimately helping the Woking-based squad climb out of the difficult situation they were in. Today, those days of near-misery feel like a distant memory.
From near disaster to becoming Champions
Brown led McLaren’s comeback at a rapid pace, and in a matter of years, they became competitive at the sharp end of the grid. Under former Team Principal Andreas Seidl, there was progress and the British team became regular faces in the upper midfield, but Brown wanted more.
That’s why Brown brought in Andrea Stella in 2023, and with the Italian’s technical expertise, McLaren transformed into a race-winning outfit last season. They successfully achieved their goal of winning the Constructors’ title, earning $140 million in prize money.
However, their ambitions don’t stop there. Ahead of the 2025 season, McLaren is expected to be the favorite to retain the title, with hopes of also clinching the Drivers’ Championship.
Lando Norris, who finished second to Max Verstappen in 2024, will also be aiming to go one step further this year. Therefore, it is safe to say that McLaren don’t have to worry about going bankrupt again for a very long time.
