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Trust Members cash injection

Even at this stage in ownership and even if Mr Harman were successful, should we be asking for Trust members to put their hands in the pockets and splash the cash to give the club some much needed cash. AP infrastructure is slowly falling apart and money needs spending on improvements. On first Appearance AH proposal doesn’t offer any huge cash injection to allow for such things. So if the Yankees don’t offer the cash injection. Should we do this anyway.

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Comments

  • edited February 5

    @TrueBlu said:
    Even at this stage in ownership and even if Mr Harman were successful, should we be asking for Trust members to put their hands in the pockets and splash the cash to give the club some much needed cash. AP infrastructure is slowly falling apart and money needs spending on improvements. On first Appearance AH proposal doesn’t offer any huge cash injection to allow for such things. So if the Yankees don’t offer the cash injection. Should we do this anyway.

    Woah there.

    Why would we want to give up ownership if the buyers arent providing funding to stabilise us?

    I'm personally not minded to give much more for someone else to potentially profit from. Will need to convincing that we are all in this together.

    Much more info required.

    A wider equity base is a good idea but it needs to include voting rights. Only way we'll see this if Harman and The Americans can be convinced to work together but that seems unlikely.

    Wandering around telling everyone you are the owner of a football club seems to be one of the few perks of owning one.

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  • Exactly strongest. AH ISNT pumping much money in at all. Well that’s what was initially suggested at the holiday inn. Hence I talk of crowd funding trust members. Who want a say in how the club runs and like the idea of ownership. But ab owner needs to take responsibility and maybe throw some coffers at it (more than £10 a year)!

    New roofs. Flood light bulbs, aren’t cheap. That’s just for starters

  • Trouble is @TrueBlu, they already tried this with the share scheme. You could do a fairly modest monthly amount but there weren’t that many takers in comparison with the number of Trust members.

    I understand the £10 a year thing is to encourage membership but can’t help but feel that it some cases it allows people to wax on about being a fan owner while contributing very little, either financially or by giving their time.

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  • The 500-18 Club attracted very little income in comparison with the initial version the previous season. Diminishing returns were to be expected but I think the fact that we had been told not long before that the finances were looking much healthier was also a major factor.

  • Also "share" scheme has no benefits attached for commiting more money and no chance of getting anything back.

  • I did the share scheme as a long distance supporter who can’t get down and give my time with practical help. I also thought it was the right way of helping the club’s cash flow over a longer period.

    The 500 club was a lot more exciting as a proposition, but I think it probably didn’t help the share scheme much.

  • What is disappointing is that we didn’t continue the 500 club, I guess a lot of supporters would be able to contribute regular payments, even more important now than ever.

  • I feel the 500 club would work every second year. With the right publicity and a couple of events to kickstart each drive you could set a target and give modestly paid supporters a breather in between.
    Now it’s looking likely that the club will change ownership in some way it still might have a place giving a new open supporters trust board financial clout in the boardroom but with all things these days we have to see what deal we’re offered.

  • edited February 6

    Yes @BuckinghamBlue, I'd agree with that. We can of course donate to the club at any stage but a focused appeal always seems more effective.

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  • The 500 club only works while we're a fan owned club, in my opinion

    Why should fans give money to increase the value of an asset which belongs to an already very rich individual?

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  • What Eric said.

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  • But Eric we want to fight to keep the fan owned part of the club and involvement even if it’s a minority share, without that we give up and become passengers again like in the Hayes era. I would put money in if it gave a new representative (certainly not anyone currently there who are damaged goods imo) an ability to defend our interests of course It depends on the deal we get presented with.

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  • @BuckinghamBlue said:
    But Eric we want to fight to keep the fan owned part of the club and involvement even if it’s a minority share, without that we give up and become passengers again like in the Hayes era. I would put money in if it gave a new representative (certainly not anyone currently there who are damaged goods imo) an ability to defend our interests of course It depends on the deal we get presented with.

    Some good comments above, I believe from the meetings the idea is that the new fc owners will pay rent to the trust for the stadium in order to keep that up and cover admin. They are definitely still going to want our help and money afterwards though, unless they have bottomless amounts of cash they are prepared to lose (they don't) and they aren't interested in spend and gates, its going to be important for them, whoever they end up being, (and excuse the linked in business jargon) to build a relationship with fans and successfully demonstrate that they are also putting in their own money in a trustworthy manner and that its being used in the right way and helping.
    Interesting to look at the case of Salford where lots more money has come in but they still have volunteers so they have done things like improve the tea bars and facilities and tools that the volunteers use.
    Another interesting one is folks volunteering for things like the world cup that make dodgy officials millions, there is an idea there that the tournament (should) help the local areas for years to come whilst also training, developing and involving the local sports fans.

  • Obviously we don't yet know the details of the Luby bid nor the details of a Harman bid or indeed whether there ever will be. Those details will follow along in 4-6 weeks time.

    We can though make some reasonable assumptions especially around the Luby bid. (Harman may well be similar).

    On the stadium rent issue, I would be very surprised if the structure is not that the football club take out a fully repairing lease - giving the football club full responsibility for maintenance of the stadium - with rent paid to FALL set at a level just enough but no more to allow FALL to repay its debts as they fall due.

    on the equity/ fan/trust volunteer/contributions issue, it sounds like Luby would want a majority stake, existing loans may be converted to equity and the trust will retain a minority stake. Hypothetically not impossible that structure might be something along lines of Luby 60%, existing debt holders 20%, Trust 20%. Initially under the deal, funds will be injected by Luby but eventually that will come to an end, say after five years.

    Thereafter if the club is not yet breaking even (after transfer deals), it is possible that further funds may be required. Assuming Luby is happy to put more money in, there are three choices, 1) that money goes in as loans - not popular with some 2) Luby puts all the new money in for equity - in which case the Trust shareholding is diluted 3) Luby and the Trust put in new money for equity in proportion to their current shareholding - maintaining the Trust percentage share.

    If we prefer option 3), the Trust will have to find the money from somewhere, which realistically can only come from its members.

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  • @DevC said:
    Obviously we don't yet know the details of the Luby bid nor the details of a Harman bid or indeed whether there ever will be. Those details will follow along in 4-6 weeks time.

    We can though make some reasonable assumptions especially around the Luby bid. (Harman may well be similar).

    On the stadium rent issue, I would be very surprised if the structure is not that the football club take out a fully repairing lease - giving the football club full responsibility for maintenance of the stadium - with rent paid to FALL set at a level just enough but no more to allow FALL to repay its debts as they fall due.

    on the equity/ fan/trust volunteer/contributions issue, it sounds like Luby would want a majority stake, existing loans may be converted to equity and the trust will retain a minority stake. Hypothetically not impossible that structure might be something along lines of Luby 60%, existing debt holders 20%, Trust 20%. Initially under the deal, funds will be injected by Luby but eventually that will come to an end, say after five years.

    Thereafter if the club is not yet breaking even (after transfer deals), it is possible that further funds may be required. Assuming Luby is happy to put more money in, there are three choices, 1) that money goes in as loans - not popular with some 2) Luby puts all the new money in for equity - in which case the Trust shareholding is diluted 3) Luby and the Trust put in new money for equity in proportion to their current shareholding - maintaining the Trust percentage share.

    If we prefer option 3), the Trust will have to find the money from somewhere, which realistically can only come from its members.

    Rampant speculation.

  • Which is exactly what I said.

    On the rent issue, I would be surprised if that is not the structure - although time will tell.

    On the cash issue, assuming the Trust retains a minority share, once the initial investment runs out (in a few years time), there really aren't any other options for any further cash required - loan, dilution or all parties including trust contribute pro rata.

  • Will depend on the initial percentage, if its 49 as Harman suggested or 51 then if there were large challenges down the line then it might be reasonable to expect the trust in someway to stump up more by selling more shares.If the Americans buy a higher percentage then its down to them but could easily lead to them wanting to get out early.
    Very important to hear what the overall plan is, if the trust gets first or discounted rebuy options, what the intention is should we not be magically breaking rather than unsustainable.
    Few quid for summer transfer window to be repaid later isn't really going to cut it you'd like to hope.

  • You are making the assumption that Harman would have the appetite or capability of putting more in for more equity down the road if required @StrongestTeam (same applies to Luby to be fair).

    You are right though IMHO to consider the more distant as well as the immediate future - an owner is for life (well quite a while anyway) not just for Christmas.

  • There’s been very little reference, if any, in this balancing the books business, to the playing budget. £500,000 probably represents the income of about half a dozen of the more highly paid members of the squad. It would put at risk League 1 survival beyond next season if the size of the squad was reduced by more than two or three but I’m pretty sure it would make significant inroads into that much-touted loss figure, particularly if the proportion of young players with potential was increased.

  • Trouble is @micra , cut the playing budget by £500k and probably go back to lg2 and that cuts income (TV money etc) significantly. Remember we had one of the lowest budgets in Lg2 just last season and still lost £600k or so before one offs.

    So back in lg2 to break even we would need to cut another 6-10 experienced players from last years Lg2squad and probably slip into the national league.

    In the national league income is lower again, so we would need to cut the playing budget, perhaps by another 6-10 experienced players to break even and probably slip into national league south.

    In the national league south, income is lower again etc etc.....

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  • Have we been relegated twice Again. Been a few weeks since that last happened. There is a special place in hell for people who keep mentioning we'll have to sell Trevor Stroud and the Vere Suite and still be back in the Conference for the want of a few nice crisps.

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  • @DevC how do you know so much about League 2 and National League budgets? Are they published somewhere?

  • @peterparrotface - Dev's got them all on one of his famous spreadsheets!

  • TV money distribution is published Peter. There is around a £500k difference between Lg1 and Lg2 clubs and around a £900k difference between Lg2 and National league.

    We have a fair knowledge of Lg2 budgets. We were there for a long period ending only last year. We lost a minimum of £500k every year (excluding transfer and cup one offs) on by all accounts a very low budget for that league. if we are now to break even in Lg2, unless income can be raised, player budget would surely have to be cut significantly from even what we spent last year. Do you think with that level of cut, that would not have a significant impact on likelihood of avoiding relegation from lg2.

    if you seriously don't know how difficult it is to survive in the Conference without significant "owner subsidy", you really haven't been paying attention.

    Inconvenient truths are still truths.

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  • edited February 8

    What Dev is pointing out in a totally none patronising way is the plain truth...if we fail to agree investment we'll all be dead in a week. And if you cannot see that...well...what can I say.

  • edited February 8

    What Dev is pointing out is the reality of the finances, Wendover. It seems to be a gasroom tradition that when people don't like the reality, they instead "play the man".

    apart from abuse, do you have any evidence to the contrary?

  • @DevC you say by all accounts a very low budget but I'm trying to ask you by what accounts are these? Where can people see budgets for league 2 or National League clubs?

  • edited February 8

    No. No evidence to the contrary. I'm too busy preparing for Conferenceaggeddon...
    again. Sorry for all the abuse.

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  • I am genuinely struggling to understand what point you are trying to make, @peterparrotface

    Are you trying to argue that there isn't a massive difference in TV money between Lg1 and lg2 and lg2 and Conference?

    Or that we didn't have one of the lowest budgets in Lg2 last year and in recent seasons?

    Or that we didn't lose £500k plus in Lg2 (excluding transfers and cup one-offs) every year?

    Or that if we did cut £500k from what was already one of the lowest budgets in Lg2, that wouldn't make avoiding relegating to the national league very difficult?

    Or that trying to break even in the national league (with no tv money of note) would not make it very difficult to survive in that league too?

    If you can just clarify where we disagree and why, perhaps we can discuss rationally.

  • @DevC - I think your Armageddon prediction of a slide into non league obscurity if we don't sell the club is somewhat over the top. It might happen, but I personally don't think it's likely.

    As you state, we had one of the lowest playing budgets in the second division last year. However we still got promotion. Notts County have one of the largest playing budgets this season but are odds on to get relegated into the National League. Money doesn't guarantee success.

    Private ownership has its own risks as evidenced by the likes of Orient, Aldershot, Pompey etc.

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