Enabling Sport

Enabling Sport: objective

• Enabling Sport is a community interest company which:

facilitates the community ownership of football and other sporting clubs in a proactive, professional and planned manner

• particular focus on football clubs• creation of community sports clubs• rescue of failing sports clubs

Enabling Sport: current issues facing sports clubs• There are a number of failing football/sports clubs• Falling disposable income levels in current economy• Impact of top flight of football “sucking” funds from lower leagues with significant TV income

unavailable to FA or grass roots football• Debt levels unsustainable given difficulty in realising stadium values and falling revenues• Pressure that wage demands put on clubs and the “player gamble” – trying to buy

results/pressure to do so from fan base• Reduction in the number, capability and willingness of benefactors – now the reserve of

billionaires rather than millionaires!• Need for football but an increasing number falling into insolvency• Football is traditionally poor at developing external income streams – efforts to do so

sometimes hampered by league rules (eg. not allows to negotiate own TV deals)

Enabling Sport: problems

• Adverse consequences if an insolvency appointment occurs, whether administration or liquidation:

• Significant damage to club credibility• Ridicule from rivals• Points deducted from league standing (Leeds United, Portsmouth, Hearts plus many other

cases)• Possible relegation or demotion• Removed from leagues (Rangers)• Fan ownership – often the only remaining option as a last resort and an inevitable result to

save the club (but with its own key risks to both fans and club)

Risks

• the amount of cash required is difficult to raise sufficiently quickly and robustly (i.e. suitably impressed with sufficient credible governance protection

• unplanned/costed so ultimately insufficient funds raised leading to failure and loss of cash given

• control may sometimes rest with wrong individuals for long term• no likelihood of Football Associations taking ownership of this issue. The revamped

“fit and proper person” test failed to prevent clubs from falling into the hands of the wrong or “challenging owners”

• Supporters seen as funders of last resort – no current bank appetite to support new lending into football

Why choose community ownership? (being distinct from fan ownership)• Movement towards community

ownership• Relative success of German model• Increased profile of Supporters Direct• Better understanding of club business

now

• Sustainable model• Wider community engagement• Unlocks assets• Government support• Less controversial for businesses to support

engagement with this model

Given the appearance of a move towards community ownership and the appearance of community ownership in insolvency situations for sports clubs, all roads appears to lead to community ownership. If we accept inevitable move, then two options:

• Allow to happen via insolvency when no other route available• Pro actively plan and implement community ownership thereby

avoiding insolvency

Enabling Sport:

“Enabling Sport facilitates a managed process of dialogue between stakeholders to achieve a mutually acceptable business transition to a sustainable commercial model with community ownership at the core”

Enabling Sport acts as an intermediary/facilitator between banks, communities and owners:

Enabling Sport provides services to benefit those with a vested interest in the stability of sports clubs where community ownership may be appropriate/desired and provide a feasibility study which addresses whether community ownership is:• Possible• Viable• Affordable

This report introduces professionalism and a managed process, reversing the current trend of knee jerk fan ownership that finds post transaction life very difficult.

Who delivers?

• A select team of experienced professionals from legal and accountancy firms, Muckle LLP and Baker Tilly together with other sport experts, including football directors, national fan groups and sports business experts.

What will the report provide?

In its output, the report will aim to provide:• Business improvement recommendations• If appropriate, the change roadmap to prepare for community ownership• Key risks in community ownership and its delivery

The benefits of promoting engagement are:• Professionalism | Proactive planning• Protection of fan investment | Clear action points• Embedding community ownership in psyche of sports clubs• Sustainability for clubs, with robust business plans• Good PR for supporting organisations • Low cost solution creation for funders• Shifts value down to lower leagues • Promotes good football governance• Funders seen to be proactively seeking solutions

Split Benefits

Fan ClubFunder