Sep
29

International Bonuses – Worth It?

I spent a lot of time preparing for this year’s MLB Amateur Draft and then following all of the news surrounding those selected leading up to the signing deadline of August 15th.  But MLB organizations are not only interested in players selected through the Amateur Draft.  There are also plenty of players outside of the United States and Puerto Rico who are not eligible for the draft and still command quite a bit of money in the form of signing bonuses.  We sweat the numbers that guys like Pedro Alvarez, Eric Hosmer, and Buster Posey received, but what about the even younger international players who are more of an unproven risk?

The Cincinnati Reds got the international signing period started when the club signed Juan Duran, born in September of 1991, for $2 million.  Yes, a 16-year-old received $2 million.  The guy is two years younger than any player selected in the first round of the 2008 MLB Amateur Draft.  $2 million is nothing, though.  The Oakland A’s paid $4.25 million for a 6?7 205 lbs 16-year old pitcher named Michael Inoa earlier this year.  No team has ever spent anywhere near that type of money for a non Cuban international amateur player.  However, plenty have paid bonuses greater than $2 million.  The Giants, Reds, and Padres shelled out 2+ million for international players this year and then Reds did so twice (the aforementioned Duran and Yorman Rodriguez).  Is there a method behind this madness?

Let’s look at how international amateur players who have received a $2 million+ bonus in the past have fared thus far…

  • Willy Mo Pena (1999) – $2.44 million – Currently injured on the Washington Nationals.  Has not lived up to expectations.  Low batting average, sub-par walk/strikeout ratio, and not much pop for someone who was pegged to be a power hitter.
  • Joel Guzman (2001) – $2.255 million – The guy is a 6’6 250lb 3B from the Dominican Republic.  At almost every level leading up to the majors, he was selected as an All-Star.  However, seven years after receiving the large signing bonus, he is still in Triple A with the Durham Bulls after a short stint in the majors.
  • Byung-Hyun Kim (1999) – $2.25 million – Kim should be considered in a somewhat different light.  When he received his large bonus, he was already 20-years-old, and thus more developed.  The Diamondbacks gave him a bonus that had much less risk attached to it.  He made is professional debut in 1999 and had what most would consider to be a very successful career up until 2007.
  • Chin-Hui Tsao (1999) – $2.2 million – Tsao’s last action in 2008 was with the Triple A Royals club.  In 2003, he made his professional debut with the Rockies and had a few years with little involvement.  In 2007, he found some action with the Dodgers.  Again, a lot paid to a guy who may have not lived up to his expectations.
  • Angel Villalona (2006) – $2.1 million – Still a young guy who is showing a lot of potential in the minors.  He had 17 home runs last year and may turn out to be one of the strongest guys on this list.

Overall, have the bonuses been justified?  Are these players worth more than a mid-to-top 1st round pick in the MLB Amateur Draft?  Will Duran and Inoa buck the trend?  Why do teams continue to pay so much for unproven, high-risk international players?

  • JaQay Carlyle

    I guess these would be more important if they were also getting huge contracts. If they havent sniffed the majors, they’re essentially living off that signing bonus right? Baseball’s not my specialty, but I thought that the signing bonus kind of held them over till they can make the big cash in the MLB. In the end if you spread that one-time bonus out over this time, it adds up to not be as substantial as thought… Similar to a signing bonus for the NFL being spread out for cap stuff. I’ve been wrong before though. I know you do baseball DH, what are your thoughts?

  • http://www.sportsagentblog.com Darren Heitner

    True…a signing bonus is just that…a bonus contingent on the initial signing. But why even spend that money up front without any proven track record…especially on such young guys? It takes money away from other guys who may have shown they have what it takes even though they were not “prospects”.