Posted by John Beech on December 5, 2009
Notwithstanding the emergence of Supporters Trusts, there has been relatively little experimentation with alternative forms of business structure in English football clubs.
One notable exception has been Ebbsfleet United, which allows democratic paricipation by its members through the use of the internet – see the club website and myfootballclub.co.uk. Both websites have been silent so far on some significant changes in the way the club is run, and I am dependent on the Gravesend Messenger for the latest news.
The ‘world’s first and only web-community owned club’ kicked off in February 2008 (1) with 28,000 members who had signed up by paying £35. Things have not always run smoothly since then, for reasons both to do with the organisational structure and unrelated reasons. Members participated in the decision to sell a player (2) in August that year, but by December manager Liam Daish was expressing concern that his budget might be cut if not enough members renewed (3).
In February this year, with memberships due for renewal, there were reports that numbers were significantly down (4), with numbers falling some 2,000 short of the targeted 12,000 (5). Cost-cutting measures were announced in March (6), but plans for a new stadium were published in April (7). This almost coincided with the resignation of Chief Executive David Davis (8), Chairman John Moules stepping into the role, before himself stepping down in July (9).
The club has also faced problems with its training ground (10).
The latest tweaking of the model has seen two significant changes. Firstly the club has bought out the MyFC Operating Agreement from founder Will Brooks for £15,000 (previously Brooks had taken 20% of subscriptions to run the website), and secondly the subscription has been raised from £35 to £100. The latter move is presumably on the assumption that the hardcore of supporters are relatively price insensitive, a risk unless some market research has been undertaken, although the fact that the decision “overwhelmingly backed by members in online votes last week” is encouraging for the club’s survival.
No doubt there will further tweaks as the club further explores this unique model, and it is certainly a model I watch with interest.
Another interesting development this week, albeit north of the Border, was the decision of Stenhousmuir to become a Community Interest Company (CIC) (11). According the official government website “Community Interest Companies are limited companies, with special additional features, created for the use of people who want to conduct a business or other activity for community benefit, and not purely for private advantage. This is achieved by a “community interest test” and “asset lock”, which ensure that the CIC is established for community purposes and the assets and profits are dedicated to these purposes. Registration of a company as a CIC has to be approved by the Regulator who also has a continuing monitoring and enforcement role” (12). A CIC is in many ways similar to a conventional company – it can be a public company limited by shares, a private company limited by shares or a company limited by guarantee, and will have the same benefits and obligations as other companies of its type, including registration at Companies House – but it must, among other obligations, only use its assets and profits for the community specified (or pass them to another body with similar features), and keep the community in touch with its activities. Sounds good to me – asset stripping of a stadium blocked, and mandatory community orientation; isn’t that just how a football club should be constrained?
As far as I can make out (the CIC website search function doesn’t seem to be working) the only English club to adopt this model so far is Eastbourne Borough (12) just over a year ago. Among the developments at this club is the offer of a directorship for £5,000, and, as the club points out with massive understatement, “You don’t get offers like this at the likes of Chelsea or Manchester United” (13). Mind you, there’s an idea for Portsmouth. 😉
I’d be interested to hear comments from any Eastbourne fans on how the CIC model has worked for the club, and from any Stenhousemuir fans on what prompted this change.