Crowdfunding football: Buy this team, from The Economist 28/4/12
Fans don’t like clubs being run as businesses. The alternatives may be worse
FOOTBALL fans are used to being squeezed by their beloved clubs through rising ticket prices, regular strip changes and stiff charges for food and programmes. They have rarely been asked to bail out the clubs directly. In Britain—unlike Germany, say—football clubs are generally limited-liability companies, the top ones often owned by rich foreigners. But fans of Portsmouth Football Club hope to change that tradition.
Portsmouth was relegated from the Premier League in 2010, and will plunge to the third division next season. The club went into administration in February 2010 and again in February 2012. The Pompey Supporters Trust is now canvassing for interest in a takeover of the club by supporters. Fans are asked to put £100 ($160) into an escrow account. If enough do so, a community share scheme to buy the team will be created, with shares at £1,000.
Until an arrangement has been reached with creditors, it is not clear how much a community buy-out will cost. But a quick survey outside the team’s ground before a recent game found fans in theoretically generous mood: “£1,000” and “as much as I have” were common responses to the question of how much they would give. Similar moves are afoot elsewhere: Darlington fans are trying to rescue their club from administration with the help of Crowdcube, a crowdfunding website.
Subscribers not only elect a management team but also vote on which players to sign, how much a season ticket should cost and what colour the kit should be
Fans have controlled clubs before. In 2002 AFC Wimbledon was created by supporters of Wimbledon Football Club who were upset at that team’s move to Milton Keynes. The team is owned by the Dons Trust, whose members pay £25 a year and have a vote on big issues, such as moving the club or taking out a loan. They also elect the team’s directors. To raise over £2m to buy a ground, traditional leverage was combined with a share offer to fans. According to the Dons Trust chairman, Matthew Breach, crowdfunding generated not only money but also loyalty, which has been essential in maintaining support as the club has risen through the divisions.
A less happy example is provided by Ebbsfleet United. In 2008 three-quarters of Ebbsfleet was sold to MyFootballClub and its 27,000 subscribers, each paying £35. Subscribers not only elect a management team but also vote on which players to sign, how much a season ticket should cost and what colour the kit should be. At first members were allowed to vote on the team and its tactics, too, but this proved not conducive to effective management.
An excess of democracy is still a problem at Ebbsfleet, according to Charles Webster, a longstanding fan and match commentator, who describes the set-up as a “talking shop”. And, since fans only buy one year’s membership to MyFootballClub, they are left with nothing if they do not resubscribe. The initial ardour of the fans has cooled, bringing membership down from a peak of 32,000 to 1,400. The club’s budget has fallen correspondingly; Jessica McQueen, its director, has said another £50,000 is needed before the end of the season. In the circumstances, a foreign angel might be welcome.