Ted Segal's goal is clear: Transform the Houston Dynamo Football Club.
Segal, the founder and president of New York-based real estate development firm EJS Group, acquired a majority ownership interest in HDFC in June 2021 when he was just 40 years old. That made him one of the youngest professional sports owners in the U.S. In August 2022, he increased his ownership stake by finalizes the buyout of three of the club’s minority owners, Gabriel Brener, Oscar De La Hoya and Ben Guill.
Ever since, Segal's game plan has been to invest in both people and infrastructure at the club, hoping to kick the franchise back into a winning team and prominent fixture in Houston.
The growth of soccer in the U.S. — with the expansions of both Major League Soccer and the National Women’s Soccer League and the return of the FIFA World Cup in 2026 — coupled with the growth of the Houston market and passion of its sports fans made investing in HDFC very compelling, Segal said.
“I’ve said this from the day I took over: the potential for the sport of soccer here in the United States is second to none,” Segal told the Houston Business Journal. “Houston is a proven, passionate sports market, especially passionate for the sport of soccer.”
Segal’s youth and his relative inexperience in sports business hasn’t stopped him from making significant investments immediately into the club. During his time so far, Segal has hired multiple key staff members on both the business and player sides of the organization, invested in various renovations at Shell Energy Stadium and constructed a new headquarters for the club. Segal’s infrastructure investments have totaled $27 million since November 2022.
That work hasn’t gone unnoticed.
“(Ted Segal) is the next generation of sports owners,” MLS Commissioner Don Garber told the Houston Business Journal. “If all owners in all sports, whether it's MLS or others, have the same level of ambition, optimism and enthusiasm (as Segal), they’re going to be successful.”
Despite the recent upgrades at the organization, HDFC seems like the often forgotten franchise in Houston when compared to the Astros, Rockets and Texans. The Astros are currently on a historic playoff run — culminating in two World Series Titles so far — and despite the relative lack of winning on the parts of the Rockets and Texans recently, they continue to be two of the most profitable sports teams in the world.
That leaves HDFC, the youngest of the four local professional franchises and the only women’s professional team in town, still competing to grow its loyal fanbase to become a greater fixture in the Houston sports market. It’s a task Segal is ready and willing to undertake.
“We have lofty ambitions here to make this a top flight organization within the league and then ultimately globally,” Segal said.
How the Dynamo first got started
After initially competing in the MLS as the San Jose Earthquakes, the franchise moved to Houston to become the Dynamo following the 2005 season.
Being a new team in an already competitive market meant the franchise needed to break through the clutter and build a fanbase organically, said Chris Canetti, who served as president of the Dynamo from 2006 until 2018. To do that, the organization started a grassroots campaign to introduce themselves to the city and grow its popularity.
Despite being the new kids on the block, the Dynamo also decided from the beginning to put themselves in the same category as the Astros, Rockets and Texans, marketing themselves as on par with the other three professional sports teams in town, not less than.
“We didn’t want to be seen as second class citizens or a minor league sport,” Canetti said. “We wanted to be one of the four major league teams in Houston.”
The team also made it a priority to put a successful team on the field, figuring it could grow its popularity through consistent success and having players local fans could connect to. Canetti said becoming a winning franchise would be key to the club’s growth in Houston.
And win, they did.
The Dynamo won the MLS title twice in their first two seasons in Houston — in 2006 and 2007. The team finished 2nd and 3rd overall in the league in 2008 and 2009, respectively, before finishing as a runner up to the MLS champion in both the 2011 and 2012 seasons. The Dynamo also won the U.S. Open Cup, which is U.S. Soccer’s premier knockout competition,in 2018.
The Dash, HDFC’s NWSL franchise, played its first season in the league in 2014. Less than 10 years into its existence, the club is still looking for consistent success on the field, but the past few seasons have been encouraging. The Dash won the NWSL Challenge Cup tournament in 2020 and made the playoffs for the first time in 2022, playing in front of a sold out crowd at Shell Energy Stadium.
Houston Dynamo Football Club
Segal said the club is fortunate to have that history, as not many other clubs have that kind of success to lean back on. However, it also creates a high level of expectations for Dynamo fans. In recent years, fans haven’t seen the success they became accustomed to in the early years, as the team finished 25th overall in the league standings in 2020, 2021 and 2022.
Segal doesn’t shy away from that history.
“I want our fans to expect us to be contending for titles because they’ve seen that happen before, they’ve turned out for that and they deserve it in the future,” Segal said.
Back to winning form
Segal has made clear from the beginning of his tenure that one of his main priorities for the club is to consistently compete for championships on both the men’s and women’s side.
That starts with investing in people both on and off the field. The club hired Pat Onstad as the Dynamo’s general manager in November 2021 and brought on Alex Singer as the Dash’s first-ever standalone general manager in August 2022 — both of whom are former professional players. Segal is also committed to spending money to bring in top-tier players to elevate both teams.
The Dynamo signed Mexican National Team captain Héctor Herrara to a team-record contract in March 2022. He’ll earn a guaranteed compensation of more than $5.24 million in 2023, the sixth-highest in MLS, according to the MLS Players Association. The Dynamo have also dramatically increased their overall team spending, going from a team payroll of $8.92 million in 2021 — 24th in MLS — to $14.64 million in 2022 and $12.63 million in 2023 — 11th and 12th in the league, respectively — according to soccer salary cap tracker Capology.
That’s led to tangible success on the field for the Dynamo. The club is having a resurgent 2023 campaign, sitting in fourth place in the Western Conference standings with an 12-7-11 (W-D-L) record as of Sept. 28. Houston also won the Lamar Hunt U.S. Open Cup tournament this year, the club's first title since 2018 and its fourth championship overall.
However, no matter who he hires or which players he brings in, Segal said he can’t guarantee wins. That’s where his second goal comes in, which is to create memorable experiences for fans whether the club wins or loses.
That starts with infrastructure. Segal has made a number of improvements to Shell Energy Stadium, including building safe standing space, replacing all of its seating with new mesh chairs and renovating the venue’s East Side Club. The club also brought in a host of new local restaurant partners ahead of the 2023 season, including Trill Burgers, concepts from James Beard Award-winning chef Hugo Ortega, Roostar Vietnamese Grill and Vinny’s.
“Some of these were just bare minimum things that we needed to do just as table steaks,” Segal said.
While creating positive fan experiences is key for Segal, he still loves to win. Segal said he’s highly competitive, so much so that a Dynamo or Dash loss ruins his week. Segal didn’t join the club’s ownership just as an investment opportunity, but to see the club have success on the field.
“Why would you even do this if you don’t care about the team’s success?” Segal said. “It’s more fun for me and it’s more fun for everyone when we’re winning.”
Growing the club’s profitability
The club’s efforts to grow its fanbase has a key benefit if successful: making HDFC a profitable franchise.
That wasn’t the case in 2022, according to Forbes. The Dynamo earned $39 million in revenue in 2022, but had an operating loss of $10 million. Segal declined to comment on the specifics of Forbes’ report, but said profitability is important for the club.
“Some of that is investing for the long term and it is possible that sometimes you have to spend for growth,” Segal said.
In addition to investment in infrastructure, Segal has also made a number of front office hires to grow the business side of the club. HDFC brought on Jessica O’Neill as president of the Dash in February 2022 before promoting her to COO of HDFC in November 2022. The club also hired SJ Luedtke as chief marketing officer in February and Jeff Stewart, former Astros vice president of corporate partnerships and special events, as chief revenue officer in March.
The dividends from the recent investments haven’t paid off just yet, but the club hasn’t expected it to, O’Neill said. Attendance for Dynamo and Dash homes games is flat year-over-year. O’Neill said the club is taking a long-term perspective and understands that generating sustained success on the business side can’t be fixed in one season.
Additionally, the club has been incorporating feedback from fans, partners, business owners and other community members as it makes changes throughout the organization and at the stadium, O’Neill said. As the club embarks on that journey, she said she expects it will see consistent improvement across the board in the coming years.
“Were we expecting to change this in six months? We weren’t,” O’Neill told the Houston Business Journal. “Are we expecting to change this by ourselves? No, we’re also not.”
Two metrics that have seen tangible improvements in 2023 are average ticket price and show rate — or the percentage of ticket holders that show up to matches. The club has been intentional in protecting the value of its tickets, especially for season ticket members and those who buy group tickets, O’Neill said. As such, HDFC changed some of its ticketing strategies for the 2023 season.
The club halted almost all discounted tickets and flash sales, she said. HDFC also dramatically reduced the number of 713 Nights at the stadium — where fans can buy $7 tickets, $1 hot dogs and $3 beers. The club plans to continue similar strategies to protect the value of its tickets in the upcoming season.
“When you tell the market that your tickets are $7, that makes it harder to sell tickets for $25 for a different game,” O’Neill said.
HDFC has already seen some encouraging signs on the ticketing front for 2024. Through mid-September, the number of new season ticket members for the upcoming season was significantly higher than through the same period in 2022, O’Neill said.
The club has also seen tangible improvements on the commercial side. O’Neill said the HDFC has seen an increase in businesses, both local and national and from every industry, interested in becoming partners of the organization.
The club added two major oil and gas companies as partners in 2023. HDFC and Shell Energy,a subsidiary of London-based Shell PLC (NYSE: SHEL), partnered for the naming rights of the club’s stadium in January, while HDFC unveiled a new partnership withHouston-based ConocoPhillips (NYSE: COP) in August.
“As we prioritize delivering value for our stakeholders — and our stakeholders in this case are our fans and our partners — that revenue growth comes with that added value,” O’Neill said. “The more that we can raise the visibility of the club and the more that we can develop relationships in the community, the revenue growth is an important piece of that.”
What’s next for the club
Segal made it clear that he will continue investing in the club to see his goals for HDFC come to fruition.
The last of his three goals for the organization is to have a meaningful impact on the community. Part of that was accomplished by moving the team’s headquarters from the George R. Brown Convention center downtown to a new 30,000 square-foot building just a block north of Shell Energy Stadium in EaDo. This was important for Segal because the club was disconnected at first, but now it works where it plays.
Houston Dynamo Football Club
Segal is also refocusing Dynamo and Dash Charities to have a greater impact locally. Two of the club’s newest partners, Shell Energy and ConocoPhillips, are helping in the endeavor. Shell Energy is pursuing a number of energy and decarbonization efforts at the stadium, while ConocoPhillips will help the club promote science, technology, engineering and math education in the local area.
In the upcoming offseason, the club also plans to revamp its field-side seating, replacing the current folding chairs with around 200 padded, recliner-style seats. HDFC is also looking to make changes to its concessions offerings for the 2024 season, Segal said.
Additionally, HDFC is looking to utilize Shell Energy Stadium more throughout the year, O’Neill said. That includes for events like concerts, sporting matches, corporate events and private rentals. The stadium hosted multiple Concacaf Gold Cup matches in 2023 and will host a free concert series for the College Football Playoff National Championship game in January 2024.
As the club looks ahead toward long-term sustained growth, it appears that the opportunity is there. Under the leadership of Segal, the opportunity may finally be realized.
“The Houston Dynamo are the sleeping giants right now. There’s massive potential for this franchise and organization,” Canetti said. “Ted is focused on doing all the right things and is highly motivated to make that happen.”
“I think (the Houston Dynamo’s) best days are still ahead,” added Garber.
