Fan ownership, why won't it work? (4 Viewers)

[skybluetony176]

The club isn't being run on a break even model but on a cash flow neutral basis - that's it's priority.

Whatever. The point stands. The important thing is the application. If you start from a point of isolating, bad communication, miscommunication and upsetting your customer base while franchising out your services and selling your assets which reduces the quality of your end product then I would think that even you must admit that that is a course of self perpetuating decline. However if you start from a place of positivity Tha embraces your customer base and encourages a sense of ownership in the product that encourages growth of turn over rather than decline then you are less likely to need to asset strip thus increasing the quality of your product becoming a self perpetuating growth to within a more natural ceiling limit which is a point of maximum growth.

I'm not talking champions league football and I fully accept that the natural ceiling is likely to be league one/league 2 but tell me how that isn't better than what we're currently facing?

 

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[skybluetony176]

Portsmouth are no longer majority fan owned. Having been unable to get out of L2 they needed extra investment which diluted their shareholding below 50%

AFC Wimbledon is a one off situation that should never happen again.

That just leaves Wycombe and Exeter, while both are to be applauded neither could be classed as an unqualified success.
Wycombe have nearly dropped out of the league on more than one occasion and Exeter had further financial issues and needed a loan from the PFA to stay in business.

This was pointed out by the Pompey chap at the Trust meeting but totally ignored.

Completely agree with this. I know you can't have every little detail but there should be a vague idea of what will happen. Where will the money come from, what would happen about the academy, where would we play. All things that can be addressed at this point.

We've been told the Trust have been quiet because they have spent the last two years working on this yet at the Trust meeting there was zero information. It was essentially a presentation on what Pompey did which is nothing like the situation we have now or are likely to have in the future.

But they did have a plan, as you go on to say they planned for all possible scenarios and this was discussed regularly with their members. They started work in Sep 09, they didn't go into admin until the start of 12 and were in admin for over a year!

7 figure loan from the council who also changed planning restrictions to allow them to sell their car park to Tesco. They also had a very sympathetic administrator and the FL stating they would not issue the golden share to anyone but the Trust.

Fan ownership is a great concept but it needs huge changes to the game in this country for it to become a viable way forward. At the moment its just a way of treading water waiting for a better option.

Just to correct you on one point. They didn't have a sympathetic administrator. The administrator actually tried to gazump them during the taxi journey to their offices to sign the deal and it took a statement from the FL to state that they'd only issue the golden share to the trust thus making the trust the only acceptable bidder. This all happened in the course of an afternoon IIRC and in the end the administrators reluctantly signed the club over to the trust on the same afternoon it was supposed to happen in the first place.

 

[skybluetony176]

Portsmouth are no longer majority fan owned. Having been unable to get out of L2 they needed extra investment which diluted their shareholding below 50%

AFC Wimbledon is a one off situation that should never happen again.

That just leaves Wycombe and Exeter, while both are to be applauded neither could be classed as an unqualified success.
Wycombe have nearly dropped out of the league on more than one occasion and Exeter had further financial issues and needed a loan from the PFA to stay in business.

This was pointed out by the Pompey chap at the Trust meeting but totally ignored.

Completely agree with this. I know you can't have every little detail but there should be a vague idea of what will happen. Where will the money come from, what would happen about the academy, where would we play. All things that can be addressed at this point.

We've been told the Trust have been quiet because they have spent the last two years working on this yet at the Trust meeting there was zero information. It was essentially a presentation on what Pompey did which is nothing like the situation we have now or are likely to have in the future.

But they did have a plan, as you go on to say they planned for all possible scenarios and this was discussed regularly with their members. They started work in Sep 09, they didn't go into admin until the start of 12 and were in admin for over a year!

7 figure loan from the council who also changed planning restrictions to allow them to sell their car park to Tesco. They also had a very sympathetic administrator and the FL stating they would not issue the golden share to anyone but the Trust.

Fan ownership is a great concept but it needs huge changes to the game in this country for it to become a viable way forward. At the moment its just a way of treading water waiting for a better option.

Just to correct you on a second thing. I don't think you're right on the Tesco development either. Read this Proposed Tesco Development at Fratton Park - Past, Present & Future - Pompey Supporters Trust

 

[skybluetony176]

Portsmouth are no longer majority fan owned. Having been unable to get out of L2 they needed extra investment which diluted their shareholding below 50%

AFC Wimbledon is a one off situation that should never happen again.

That just leaves Wycombe and Exeter, while both are to be applauded neither could be classed as an unqualified success.
Wycombe have nearly dropped out of the league on more than one occasion and Exeter had further financial issues and needed a loan from the PFA to stay in business.

This was pointed out by the Pompey chap at the Trust meeting but totally ignored.

Completely agree with this. I know you can't have every little detail but there should be a vague idea of what will happen. Where will the money come from, what would happen about the academy, where would we play. All things that can be addressed at this point.

We've been told the Trust have been quiet because they have spent the last two years working on this yet at the Trust meeting there was zero information. It was essentially a presentation on what Pompey did which is nothing like the situation we have now or are likely to have in the future.

But they did have a plan, as you go on to say they planned for all possible scenarios and this was discussed regularly with their members. They started work in Sep 09, they didn't go into admin until the start of 12 and were in admin for over a year!

7 figure loan from the council who also changed planning restrictions to allow them to sell their car park to Tesco. They also had a very sympathetic administrator and the FL stating they would not issue the golden share to anyone but the Trust.

Fan ownership is a great concept but it needs huge changes to the game in this country for it to become a viable way forward. At the moment its just a way of treading water waiting for a better option.

Maybe to correct you on a third thing I don't think PST ever were the major share holder, rather just the largest out of four share holders IIRC. I don't think they ever owned more than 50% at any point.

 

[Warwickhunt]

Our only hope that a perspective buyer sees the fan base potential from the Wembly appearance - any business needs to look at its source income and understand how to grow that income by investment. they will see 45K supporters on the day and think to themselves we could get 25k to every home game at a average of £21 x 24 games = £12.6Million its unfortuneate that our Knobs of owners dont see that

 

[Grendel]

It's hugely misleading to quote league clubs anyway as a measure of likely standing.

There are easily over 30 cluns you could call fan owned. They are low non league clubs in the main.

As Dave says in his powerful arguments this isn't a way forward.

 

[Mild-Mannered Janitor]

Portsmouth was £1,000 investment, a guy at work invested but they still have a majority shareholder with wealth, the other fan elements are token gestures to give seats at the board and a say in the running of the club. The council also helped them out with the ground etc
Two factors not in play for us.
Third factor is our failed unity in the groups set up and their attempts around club involvement/anti-sisu etc You need full unity behind one group to be viable
Fourth - The club is not up for sale so SISU can do what they like with it, they owe us nothing sadly. Our only action is starving them of our money, dropping to Nuneaton level, administration and then a buy back

If only the 45,000 going to Wembley had a spare £1,000 to invest.....would be interesting but why would we want to buy a debt, after last nights game, I value our assets as a complete liability and worth nothing. Headless chickens, the whole lot. Not one player is worth anything on last nights performance.

 

[chiefdave]

Just to correct you on one point. They didn't have a sympathetic administrator. The administrator actually tried to gazump them during the taxi journey to their offices to sign the deal and it took a statement from the FL to state that they'd only issue the golden share to the trust thus making the trust the only acceptable bidder. This all happened in the course of an afternoon IIRC and in the end the administrators reluctantly signed the club over to the trust on the same afternoon it was supposed to happen in the first place.

The administrator ran the club for over a year giving the Trust time to raise the money, do you think Appleton would have done that for us? It wasn't the administrator didn't gazump them he received another offer which would have seen a better return to those owed money than the PST bid. There was concern that by accepting the PST bid he could be in breach of his duties at which point an agreement was made with the FL where they publically stated they would only issue the golden share to the Trust.

Just to correct you on a second thing. I don't think you're right on the Tesco development either.

The land in question was the Fratton Park car park. It had a restriction in place on it so that it could not be used for anything non-football related to stop any owner of the club selling it off for their own benefit. As part of the deal to purchase the club one of the HNW's (a Spurs supporting property developer) invested on the basis that he would be sold the ground and the restriction removed. The Trust and Council did just that and planning permission was waved through despite a lot of local opposition.

Maybe to correct you on a third thing I don't think PST ever were the major share holder, rather just the largest out of four share holders IIRC. I don't think they ever owned more than 50% at any point.

They owned 51% at the point they tookover. It now stands at 48%.

 

[oldfiver]

Proof of funds for what amount? How are they supposed to provide proof of funds when they don't know how much money they need to raise to be able to provide proof of funds?

There's nothing stopping SISU discussing the basics with the trust including an amount to be agreed, it could all be done within a confidentiality agreement so no discussion other than the amount required will come out once an agreement is made in principle and proof of funds is required to continue.

Proof of funds at this stage is a deliberate unnecessary barrier being put up. Remember from the Higgs court case that no proof of funds were shown during negotiations. Proof of funds were only asked for once SISU came back with their "charitable" offer. A lack of proof of funds in the early stages of negotiations is not unusual or necessary. SISU understand how the trust intend to raise the capital and therefore understand how futile asking for proof of fund's is before even sitting down and discussing the prospect in the first place.

When the shareholders of a business put their shares up for sale, then it is expected they provide all the information required to make a judgement for potential purchasers
The vendors do NOT always give a guide price and will ask for offers. Sometimes before even sending out any documentation they take up a reference on the potential purchaser and their financial status.

If a business is not openly on the market then then it is not unreasonable for the target company to seek background and funding to establish the seriousness of the intended purchaser

 

[oldfiver]

Portsmouth was £1,000 investment, a guy at work invested but they still have a majority shareholder with wealth, the other fan elements are token gestures to give seats at the board and a say in the running of the club. The council also helped them out with the ground etc
Two factors not in play for us.
Third factor is our failed unity in the groups set up and their attempts around club involvement/anti-sisu etc You need full unity behind one group to be viable
Fourth - The club is not up for sale so SISU can do what they like with it, they owe us nothing sadly. Our only action is starving them of our money, dropping to Nuneaton level, administration and then a buy back

If only the 45,000 going to Wembley had a spare £1,000 to invest.....would be interesting but why would we want to buy a debt, after last nights game, I value our assets as a complete liability and worth nothing. Headless chickens, the whole lot. Not one player is worth anything on last nights performance.

Should not take long for a purchaser to come to a value to offer SISU then will it
Assets - £Nil ?
Break even profit therefore Value £Nil ?
Only thing left is FL Share - £no idea as it is based a lot on sentiment, its commercial value would depend on what the purchaser could do with it.

 

[Seamus1]

It could work if the volume of people is sufficient to attend the matches as at League 1 or 2 level the costs such as wages could be covered by having a strong home attendance. I think we generated a small loss a couple of seasons ago, based on generated revenue of around £6 million (I have not talked about last season as we know that the Maddison sale was what made the club profitable). As suggested earlier, however, as you climb the leagues, with player wages increasing massively, fan ownership/ticket revenue alone would not be sufficient, and you would need to look at other businesses investing, leading to potential debt and all kinds of trouble. In turn, you will then inevitably see people becoming angry at no fan wishing to spunk eleventy billion pounds in to signing higher quality players to compete at Championship level...even though most fans involved in the ownership would not have that kind of money to splash out on a football club anyway.
For what it's worth, I think fan ownership could steady the ship and get us back in to League One and challenging at the top end. It might also work as a way of generating a small profit, enough to start paying off SISU to a level where a bigger owner could then come in and see what potential the club has on a consistent basis, week in week out.

 

[singers_pore]

Fan ownership would have to be run on a break-even model.
The essential differnce between that and SISU would be that the "owners" would be supportive of running a succesful football club, rather than a non-loss business.
It might be the best model for saving the club and the right thing to do in the short term, but it is not the model for ambition beyond Div3 and 4 as I see it.
However we have to stop the rot before we can improve so I wouldn't oppose it in the short term.

The club isn't being run on a break even model but on a cash flow neutral basis - that's it's priority.

Cash flow neutral and breakeven are exactly the same over a long horizon.

 

[Grendel]

Cash flow neutral and breakeven are exactly the same over a long horizon.

It's not that though is it? The primary position is to have cash in match or exceed cash out all the time.

A club can make £5 million profit but actually be cash flow negative nearly all year. Here we need to balance that every single week so actually in the summer will he'd to be at a "profit" to fund the non revenue period.

 

[singers_pore]

Under SISU our attendances will continue to drop, we will continue moving down the leagues, and our relations with key stakeholders in the city will continue to get worse.

I think a fan ownership model can stop the rot and get us back to L1. However to compete in the Championship we would need to find an investor with deep pockets.

Bottom line is that no fans group would run the club worse than SISU/Fisher.

The Trust should start by setting up an escrow with deposits for future share ownership.

 

[oldfiver]

Under SISU our attendances will continue to drop, we will continue moving down the leagues, and our relations with key stakeholders in the city will continue to get worse.

I think a fan ownership model can stop the rot and get us back to L1. However to compete in the Championship we would need to find an investor with deep pockets.

Bottom line is that no fans group would run the club worse than SISU/Fisher.

The Trust should start by setting up an escrow with deposits for future share ownership.

The last sentence is a slight fantasy

How much? How long for ? Can you withdraw? Terms on which funds can be used ? Who can use them? and so on

 

[oldfiver]

Cash flow neutral and breakeven are exactly the same over a long horizon.

But most businesses work either on credit, large investor working capital or day to day hand to mouth
There is always a time lag between profit and cash. Wages etc need paying every week/month not in the long horizon

 

[torchomatic]

Only 20K signed the CT petition yet 45K are going to Wembley.

Even if SISU promised to leave for a decent offer there's no way enough fans would put their hands in their pockets.

 

[oldfiver]

Only 20K signed the CT petition yet 45K are going to Wembley.

Even if SISU promised to leave for a decent offer there's no way enough fans would put their hands in their pockets.

And how many of the 20k were "real" and / or "fans"?

 

[torchomatic]

And how many of the 20k were "real" and / or "fans"?

And how many of the 45K?

 

[oldfiver]

less than 20K ?

or the square root of minus 1?

 

[Travs]

I've only scanned this thread so apologies if I've repeated anything...

But I don't think anybody is saying it cant work, but it's highly likely that it won't work.

As mentioned above, where do we start? How many people are required, how much will it cost individuals. Where will we play in the short and medium term. Where will we train. Who will be in charge? Nobody knows these answers, but would expect the Sky Blue Trust as spokespersons to form some kind of plan here. But last time I heard them on the radio, the interviewee politely reversed out of any questions regarding fan ownership.

Then the question of is there enough support to make it work? Say we have 45000 fans... How many of them can be counted on to turn up each week if we are in this division (or lower) for the foreseeable future? Maybe 8-10000. How many of them will be willing to part with a chunk of cash to become shareholders? 5000,would be a magnificent achievement, probably a massive over estimation, considering we're only likely to sell 2-3k season tickets next season.

The notion that we'll suddenly be getting 20000 fans turn up just because we are fan owned is completely false. I'd go as far as saying, should we ever get back in the premier league the novelty will wear off and we'd be getting 22k most weeks within half a season.

And finally, and probably the most controversial point, is it won't work because we are too divided as a fan group. Who is going to lead us and make the decisions. We can't even agree on managers, players, etc. Personally for me, do I really want to hand my cash over to someone who may well think I'm a 'scab' or thinks that Wasps are a good thing for the city (and I'm sure the feeling is mutual).

 

[win9nut]

Under fan ownership we will spend the rest of our days in the bottom 2 divisions.

Better that than not existing, which COULD occur if Sisu decide to pull the plug

 

[dongonzalos]

Wycombe, L2, 11th, 52 points
Exeter City, L2, 7th, 57 points
Portsmouth, L2, 3rd, 65 points

AFC Wimbledon, L1, 12th, 50 points

When you consider demographic, history and potential you could only really say that Portsmouth are misplaced and not only did they have a big rebuilding job to do in every area including getting the ground safe so it could be fully opened (a big investment that initially took funds away from the team) they also look set to pass us on the way up while we are on the way down.

So how will fan ownership not work for us?

Why are sections of our fan base abrasive to it?

How is it not a better alternative to disappearing into oblivion under a hedge fund ownership model?

Surely it must now have dawned on us all that is the only possible outcome of continued hedge fund ownership?

As Nick inadvertently pointed out in the is this where MR is getting investment from thread the only investment that is coming into the club is that made by the fan base so why do we need a hedge fund?

Fan ownership wouldn't change the basics of the business model but it would change the approach meaning that the club would be run by people who have a vested interest in making sure that the club is run in the best interest of the club.

I'm not suggesting that it will be a bed of roses and/or guarantee success and promotions, that would be naive. What I would suggest is that in the all too clear unavailable sugar daddy/massive corporation saviour we don't have it is realistically our best and only chance to save the club from oblivion.

Same situation as we have now, have to breakeven, only difference you will have people making decisions who put the club first. The club will not play second fiddle to another business that the owners have,
The people running the business are more likely to get help from other people such as the council.
If someone was considering buying or investing in the club, they would more likely be prepared to deal with fan ownership than trying to deal with a hedgefund (all is just my opinion of course)

 

[chiefdave]

The last sentence is a slight fantasy

How much? How long for ? Can you withdraw? Terms on which funds can be used ? Who can use them? and so on

Why not? That's exactly what Pompey did to show intent. They started collecting the £100 pledges in March 2012, the takeover wasn't until over a year later.

 

[Grendel]

I have to be honest and say I'd have huge concerns if the trust was involved at all. The hierarchy did nothing to support fans who attended sixfields and fell over themselves to get Nick Eastwoods autograph when he came into town.

I wouldn't support anything that involved decision making of any description by their board. Now, I know that's inviting the usual abuse and mud slinging from you know who but perhaps - just perhaps - other people should indulge in self reflection and think why would someone say that.

 

[Astute]

Our club isn't for sale. But I am selling a dead budgie. Not sure how much I want for it. But it certainly won't be going cheep.

 

[fernandopartridge]

The club isn't being actively marketed but is of course for sale, Fisher basically said as much with his last public announcement.

“Sitting here as chairman of the club, it’s my clear understanding there has been no credible approach with a view to taking over the club.

“In any event, an approach would have to be accompanied by proof of funds and a transparent look-through to the ultimate end-investor. This has never happened.

 

[win9nut]

I have to be honest and say I'd have huge concerns if the trust was involved at all. The hierarchy did nothing to support fans who attended sixfields and fell over themselves to get Nick Eastwoods autograph when he came into town.

I wouldn't support anything that involved decision making of any description by their board. Now, I know that's inviting the usual abuse and mud slinging from you know who but perhaps - just perhaps - other people should indulge in self reflection and think why would someone say that.

I feel that a takeover needs to happen and we're the only ones interested. (I hope I'm wrong!)

I do tend to agree that I am concerned for the professionalism and wisdom of the Trust's board, especially the naive way they acted when Wasp's turned up...

However, I do feel that the Trust are the only 'body' that could potentially pull this off. I think that a fresh perspective may be needed on the board. However, I don't think many people will volunteer.

There has to be someone in Coventry, with a good business background, good common sense, not afraid to say things how they are, that would be willing to fight for something they believe in...

Anyone?

 

[Astute]

There will be people interested. But not at the price SISU will want. And the lower we go the less likely it will be.

 

[oldfiver]

Why not? That's exactly what Pompey did to show intent. They started collecting the £100 pledges in March 2012, the takeover wasn't until over a year later.

Do we know how many £100's they got and what proportion of the final offer they totalled?
Without reading it all - did they at least have an option on a ground?
Also it was £100 not £1000 as suggested on here

 

[shmmeee]

The club isn't being actively marketed but is of course for sale, Fisher basically said as much with his last public announcement.

By that quote we never should have let Otium buy the club out of admin.

 

[GaryPendrysEyes]

The option of fan ownership absolutely should be taken further by the Trust. At least exploring a bridging ownership to get rid of Sisu and the threat of extinction, keeping us going under our control while looking for other options.

My fear would be a Sisu have destroyed much of the core fan base who would actually put their hand in their pocket. Has there ever been a poll asking who on here would stump up say £200 for a share in the club?
Looking at the response to this thread I guess not many would be interested....

 

[Ian1779]

If someone can come up with a viable response to 'who pay the bills in the off-season' and 'who pays for a manager to be able to sign a player, pay a signing on fee/transfer and for a contract longer than 12 months' than you may have far more people behind the notion.

 

[Ian1779]

I have to be honest and say I'd have huge concerns if the trust was involved at all. The hierarchy did nothing to support fans who attended sixfields and fell over themselves to get Nick Eastwoods autograph when he came into town.

I wouldn't support anything that involved decision making of any description by their board. Now, I know that's inviting the usual abuse and mud slinging from you know who but perhaps - just perhaps - other people should indulge in self reflection and think why would someone say that.

I think any potential fan led takeover would have to be led by people not part of the Trust/protest group hierarchy now or in the recent past.

 

[Ian1779]

Wycombe, L2, 11th, 52 points
Exeter City, L2, 7th, 57 points
Portsmouth, L2, 3rd, 65 points

AFC Wimbledon, L1, 12th, 50 points

When you consider demographic, history and potential you could only really say that Portsmouth are misplaced and not only did they have a big rebuilding job to do in every area including getting the ground safe so it could be fully opened (a big investment that initially took funds away from the team) they also look set to pass us on the way up while we are on the way down.

So how will fan ownership not work for us?

Why are sections of our fan base abrasive to it?

How is it not a better alternative to disappearing into oblivion under a hedge fund ownership model?

Surely it must now have dawned on us all that is the only possible outcome of continued hedge fund ownership?

As Nick inadvertently pointed out in the is this where MR is getting investment from thread the only investment that is coming into the club is that made by the fan base so why do we need a hedge fund?

Fan ownership wouldn't change the basics of the business model but it would change the approach meaning that the club would be run by people who have a vested interest in making sure that the club is run in the best interest of the club.

I'm not suggesting that it will be a bed of roses and/or guarantee success and promotions, that would be naive. What I would suggest is that in the all too clear unavailable sugar daddy/massive corporation saviour we don't have it is realistically our best and only chance to save the club from oblivion.

Just to quantify - Rushden and Diamonds - extinct.