Crowdfunding in Football-The Modern “Sugar Daddy”?

crowdfunding

Evaluating how much football fans invest in their beloved clubs is difficult to measure. There are some indicators such as fans who pay for season tickets and merchandise of the club. However, it is also possible to look at travel expenses, paying for sports packages on TV and so on, but those expenses don’t go directly to the club. Whilst the fan paying for them feels that he is spending his money for the club.

There is also the option of buying shares if a certain club is floated on the exchange market which allows a different level of involvement and investing. But what if fans had the option to invest directly in a specific project where the end product of their investment is known? Well, fortunately, it exists.

Samindra Kunti from insideworldfootball.com published earlier this year, that Austrian club Admira Wacker Modling , had their fans investing in the club’s academy. Belgian club, Saint Truidense, used the help of their fans finances to fund player transfers. This was made available through an app called Kickrs. Like in every investment, a return is expected. In Admira Wacker’s case, the fans receive a coupon and bonus payments if the club meets the targets it set.

More recently, Liverpool’s successful re-development of Anfield’s main stand has got people asking if now is the time to shift the focus towards redeveloping the Anfield Road end. In response, Liverpool F.C’s CEO, Ian ayre, has told the Liverpool Echo that the club is seeking for the right economic model in order to progress. This statement triggered a reaction from Graham Smith, a member of the official Liverpool FC supporters committee, saying that the supporters could help fund the project if the club is willing to discuss the matter. (Liverpool ECHO).

According to Chance Barnett from Forbes,crowdfunding is a growing power as a source of investment and raising capital, expected to overcome the venture capital industry in 2016. The crowdfunding industry has generated a 34.4 billion USD in 2015.

It is proven that when it comes to investors and owners footballs fans are very sensitive. Just looking at situations at Charlton Athletic and Coventry City which recently resulted in a joint protest against the owners and their running of the clubs. There are endless examples of fans that wish to take matters into their own hands in order to protect their club and its values.

Real Madrid has 92 million page likes on Facebook. Just imagine if at some point this 660.6 million Euros revenue generating powerhouse will need to rely on supporters funding. If each one of the people behind those page likes contributes with 1 euro, well I’ll let you do the math.

Crowdfunding in football may raise another issue. Why should a club who generates that much money (like Real Madrid) would ask for money from its fans? If it gets to a situation like this, then clearly something is wrong with the management of the club. In contrary, it’s a different case when the decision to pump funds into the club comes from the fans themselves.

With all those scenarios feeding the imagination, crowdfunding in football should be examined by the club stature, resources, and most important, fan base and it’s attitudes. Does this platform of funding and investments has the potential to reshape football economics in the future?

 

*Photo Credit:http://www.nonprofitlawblog.com/assets/Crowdfunding.png

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