This morning's very detailed letter from the chairman of Hereford FC, Jon Hale, contains the news that a fourth benefactor has agreed to pump money into the new club, always assuming the club is granted the leases on Edgar Street.
Another significant Hereford United supporting benefactor has come
forward who understands and supports the strict ‘no return, and all
profits to the club’ policy.
Given the first three benefactors are reported to be putting up £50K each, then it's presumed that the fourth will do the same.
If so that brings the total of money pledged to £200K, which is very creditable at this stage.
However the new club has stated that it hopes to have £500K of share capital with half of that put up by the Supporters Trust (HUST).
At it stands the club needs just another £50K from benefactors/supporters. However if two supporters would like to put up £10K each, that leaves very little for every one else.
The minimum investment is £1000 so, at the most, just 30 remaining supporters could buy a shareholding.
And if even more supporters would like to buy their own shareholding, after all there is nothing like owning something in ones own name as opposed to through a group, what will be the reaction of the club be?
On the one hand they might turn around and say we would like as many supporters as possible to become shareholders and so will raise the initial amount to, for example, £600K.
But on the other hand, they will know full well that the higher the initial capital invested means a bigger problem for HUST in raising cash to purchase their shareholding.
One way around this would be to have a time limit for buying shares and then if more than the required amount is requested then requests would need to be scaled down.
Howver that poses another question. Would any scaling down include the initial benefactors? Not an easy decision to take.
In many ways having plenty of support in cash is just what any new club wants, and in the case of Hereford FC will help them prove to the FA and Herefordshire Council just how much support there is for this new venture.
And if it is to be a 'community club' it needs to allow as many supporters as possible to buy shares. Having four 'benefactors' own 40% of the club may not give the impression.
Perhaps an increase in the share capital should be considered?