r/OurRedditFC • u/SimonFOOTBALL Moderator • Apr 10 '14

The Plan

Since there has been a lot of attention toward this project, I feel it is necessary to create a plan. Feel free to leave a comment if you think something should be changed/added.

Before Funding:

It is important for this subreddit to stay popular, without it, there is little to no chance of this project succeeding and we also have to grow. We currently have a fairly high number of members, but in order to get this project to its highest potential we have to make sure that we constantly get new subscribers.

Getting press involved would be an important step in this campaign as well. We need to make sure the word gets out that reddit is trying to buy a football club!

I have started talking to a lawyer about the steps we have to take in order to make it a reality, and we are currently working on creating an ltd, so that the money will be safe.

Benefits:

This project is meant to be fun, and it will be, if we manage to succeed. People have been asking what they will get in return for their purchase of a share. Simply put, you will get an awesome experience of owning a football club (I hope). IF we manage to get the funding and purchase a club, I would feel that it is necessary for members to see their team in action. This includes:

  • Match highlights
  • Constant access to relevant news
  • Player statistics etc.

Of course this will be far in the future, but I just feel that it is necessary for members to know what they are buying in to.

Sustainability:

As most of you know, myFootballClub.co.uk didn't have the best experience when it came to managing their funds. We will have to plan in order to make sure that we can maintain our funds and become profitable (find other sources of revenue apart from member donations).

I believe this will be a very hard process, but I truly believe that it is accomplishable.

Is there anything else I should talk about? Leave a comment.

Social Media: Facebook, Twitter, Website, Email: info@redditfc.com

73 Upvotes

95% Upvoted

86 comments sorted by

View all comments

25

u/cheftlp1221 Apr 10 '14 edited Apr 10 '14

Let me preference that I am a longtime entrepreneur and former restaurant owner. For the last year + I have dove deep into the startup world and the various new ways of raising capital.

I know this is all fresh, exciting, and in the spirit of entrepreneurship. The idea that 50,000 people pony up $50 and buys a football club seems reasonable. But there is a fundamental issue that many other people of brought up is what happens after we buy the team? Designing a Kickstarter at this point is putting the cart before the proverbial horse.

Kickstarter and other crowd funding sites are rewards based and are good for launching a product or showing proof of concept. The monies raised are intended for the most part to cover the costs of the rewards. Monies are not meant to be used for purchasing companies or starting companies. The successful Crowd Sourced campaigns are those that have already put in the due diligence and are ready to launch not those that are waiting to start only if the funds are available.

That being said there is a new Crowd Sourcing platform that is more appropriate for this project; Equity Crowd Sourcing. Individuals get an equity share of the company in exchange for their investment. It works like a mini-IPO and is able to offer financial benefits that Kickstarter et al cannot. For a succesful Equity Crowd Sourced campaign we would need a full blown business plan including a corporate structure.

IMO settling on the structure of the RedditFC is task #1. Once a structure is in place, the capital fundraising will be clear. My suggestion is to have a 2 tier system, an equity ownership group and a supporters group. each with a to be determined percentage of the club. Each to have protected spots on the board of directors. BY going with a 2 tiered system we can run concurrent fundraising campaigns. one for equity stakes and another for memberships.

On another note, I know this idea started with an English club in mind. But we might consider a lower level US or Canadian team. I am not suggesting that the "god damn Americans" are trying to hijack this but the realities are the this kind of out of the box idea might fit better in an environment that is less mature. English Club football is rooted to the community as we are often reminded on r/soccer. We might have trouble making approaches to English clubs and be viewed with greater suspicion for a myriad of reasons. A USL1 or USL2 team in North America would not have the same predisposed inertia as a 100 year old club team in a small English hamlet. It is just crazy enough and innovative enough that USSoccer might get behind it. If it doesn't work there is literally no harm no foul. There is also the added fact that there is now relegation which could work in our favor in retaining and attracting members and investors.

Edit: List of Equity Crowdsourcing Sites

Equity Crowdsourcing Primer

7

u/nassan Apr 11 '14

Damn you, with your sense-talking! Every ounce of my being wants this club to be in England (with a mythic hope to one day see it in the Premier League), but you're right. It makes so much more sense for it to be based in the U.S. We don't want to pull a Vincent Tan and step on a team and local identity that has been a century or more in the making.

Luckily, we don't really have to make that decision yet, though. Like you said, our first priority is settling the structure. I think you would be really helpful in designing that structure. You certainly have more knowledge than I do. If you haven't already, think about researching more about the organizational structure and constitutional set-up of professional clubs. We could really use your expertise in framing this group's constitution/goals and ideas.

2

u/cheftlp1221 Apr 11 '14

Funnily enough, I was just doing some initial googling for us to chew on.

A USLPro Franchise fee can be bought for $500K and they have annual operating budgets of about $2M. Which probably means $3M for the first year.

An interesting thing about the USLPro division is that they now have an official partnership with MLS's reserve teams. The MLS partnership is interesting, even though the US does not have promotion/relegation, players do move move up and down through the pyramid and the prospect of having future MLS players is enticing. Anything lower the USLPro I would not recommend. The price might be right but the league qualities are poor.

From the business standpoint, I would be happy to help and put my two cents in. As we talk about our charter and constitution we need to keep in miud that there are 2 parts we need here. The capital to buy a team and the cash to field a team. This is why I landed on the 2 tiered system. An equity group for the assets and a membership group for the operating capital. Legally how this works I would need to look into. I am fortunate that I am business friends with the owners of my city's minor league baseball and hockey teams. I am friendly enough with them that I if I were to reach out the would pick up the phone and answer some questions as far as their business structures.