Supporters Direct have given their opinion to the SaveEdgarStreet blog (http://saveedgarstreet.com/) about how Hereford FC is being set up.
Here's a copy of their e-mail. (Please note it was written before tonight's answers from Hereford FC)
I’ll be honest with you whilst I have absolutely no reason to believe that people involved in the ‘benefactors group’ are anything but loyal, qualified and good people if this model (http://bullsnews.blogspot.co.uk/2015/01/hust-to-hold- open-meeting-and-member.html) goes ahead we would be disappointed that an opportunity has been missed for a community (or supporter) ownership model.
We have got the benefit of 14 years’ experience helping to reform clubs that have had to start again, and whilst it would be wrong of me to suggest it’s all bread and roses being a supporter owned club our record does stand up well – particularly when you compare it to other clubs over the same period who have reformed as privately owned clubs.
I’m not entirely sure what the rationale is for not going down the community ownership route (by community ownership I mean this http://clubdevelopment.coop/homepage/clubs-network-area/the-community- club-network/), but would suggest that these are the questions that are raised at the open meeting. For example:
- If it’s about start up finance, well you don’t actually need that much as a community ownership model can work nicely with people being able to invest more money for working capital with the potential of being paid back as the club begins to make money (which you should do given you will be the biggest club in the league for a few seasons)
- If it’s concerns about the number of people making decisions in a community ownership model, well a bit of work with the governance model can quickly solve that so that there is a clear distinction between the governing board and people making operational decisions. As long as those decisions are made within the framework set by the members then it works fine. Surely that is a price worth paying so that there is some accountability and genuine member involvement in the direction of the club.
Our position all along, which includes meeting with the Trust and
representatives of the benefactors group has been surely it would be
better to work together under a genuine community ownership model. Why
split people into groups – Trust/Benefactors – and cause divisions? We
think there are a number of business advantages to the model too –
http://clubdevelopment.coop/homepage/about-us/research/briefing-papers/
The flipside is well how will the model that has been tabled work? – Who will hold the benefactors to account?
- Why would you relinquish control of the club to a self-selecting group like this, particularly if as above you don’t need the money?
- If you do need more start-up capital then we are experienced in raising money through something called community shares (the same method that has helped communities buy pubs and shops) and have been successful in gaining tax incentives for investors which wouldn’t work under the proposal that has been offered.
-The idea of capping individual shareholding is noble but it doesn’t work. It is very rare that all individuals will stick to the same philosophy of growing the club sustainably and will look for cash injections to boost the club. If these can’t go in as shares then they will most likely go in as loans and the troubles will re-emerge as you’ll be dependent on the individual with the loan. This is a problem that we see time and time again at football clubs.
-Who will bear the expectation of success for the club? My guess it will quickly be the person who holds the most shares/the benefactors. Again with community ownership, the key is for that burden to be shared equally amongst the members
Finally this decision really does go against the tide of both how clubs are reforming and what clubs are considering. The number of community owned clubs in the UK numbers 40, and we are working with a number of others (of similar size to Hereford) to move away from the type of model proposed to one of community ownership.
Unfortunately this may sound a little bleak but I need to be honest
Ultimately it’s not our decision to make, I just hope people are properly aware of this alternative model of ownership.
The flipside is well how will the model that has been tabled work? – Who will hold the benefactors to account?
- Why would you relinquish control of the club to a self-selecting group like this, particularly if as above you don’t need the money?
- If you do need more start-up capital then we are experienced in raising money through something called community shares (the same method that has helped communities buy pubs and shops) and have been successful in gaining tax incentives for investors which wouldn’t work under the proposal that has been offered.
-The idea of capping individual shareholding is noble but it doesn’t work. It is very rare that all individuals will stick to the same philosophy of growing the club sustainably and will look for cash injections to boost the club. If these can’t go in as shares then they will most likely go in as loans and the troubles will re-emerge as you’ll be dependent on the individual with the loan. This is a problem that we see time and time again at football clubs.
-Who will bear the expectation of success for the club? My guess it will quickly be the person who holds the most shares/the benefactors. Again with community ownership, the key is for that burden to be shared equally amongst the members
Finally this decision really does go against the tide of both how clubs are reforming and what clubs are considering. The number of community owned clubs in the UK numbers 40, and we are working with a number of others (of similar size to Hereford) to move away from the type of model proposed to one of community ownership.
Unfortunately this may sound a little bleak but I need to be honest
Ultimately it’s not our decision to make, I just hope people are properly aware of this alternative model of ownership.
I’ll forward this to the Trust Vice Chair Martin Watson to be
transparent – who I should add has been incredible in getting things to
this stage. I’ve also text the Trust Chair who I’ve not met before to
see if I can meet to explain SD’s thoughts.
Please let us know how things move forward
XXXXX XXXXX
SD Club Development Manager t: (0) 20 xxxxxxxxx m: (0) 79 XXXXXXXXXX e: XXXXX@clubdevelopment.coop w: www.clubdevelopment.coop
a: 1st Floor, CAN Mezzanine, 49-51 East Road, London, N1 6AH
Please let us know how things move forward
XXXXX XXXXX
SD Club Development Manager t: (0) 20 xxxxxxxxx m: (0) 79 XXXXXXXXXX e: XXXXX@clubdevelopment.coop w: www.clubdevelopment.coop
a: 1st Floor, CAN Mezzanine, 49-51 East Road, London, N1 6AH