New Investment Options

[steelboy]

2 hours ago, Kmcalpin said:

 

However, if it doesn't put the proposal to a vote, it has to come up with a credible alternative financial plan to put to members. 

 

Why?

The club's finances are sustainable, the manager has a budget that allows him to compete for Top 6 and the Well Society has £700,000 in reserves and has a charge on the club of £900,000.

If individual members want to put more money in no one is stopping them but there's no pressing need at the moment to lean on the membership for more funds. 

[StAndrew7]

I agree that any bid which is giving majority ownership for a pittance should rightly be thrown out before it even gets to the WS Members/Shareholders. Although, like others, I would want to understand the structure of any deal that's proposed and thrown out, because I think transparency in situations like this is often the best route to go down; it saves the rumour mill and the (occasionally baseless or ill-informed) accusations from going into overdrive.

As for why the WS should be putting forward their own vision, it's because that's all we've been hearing about since January and the much maligned investment video came out (if not before that). The new workstreams, the plans to generate more revenue, increase membership etc. Where is it?

I have no problem with the Society continuing with majority ownership and there being no external investment; I'm definitely not in the "investment at all costs" group. Like @steelboy says, the club is financially stable (which, somewhat ironically, is why we're attractive to investors) and the Society has a healthy enough bank balance to plug any shortfalls in the next 12-18 months. The level of funding needs to be maintained at a level to satisfy the Governing Bodies that we won't go out of business; so if we do have the plug the gap by x or y, the funds will need to be raised to replace them the following year to provide the same guarantee.

The doomsday scenario is that that any hole needs plugged two years in a row, or a couple of times over a 2-5 year period; building up £500-750k over a year or a couple of years isn't easy through asking for an increase in direct debits alone. Now, because we budget with a degree of common sense, the club (probably) won't have to do that; however, all it takes is a season like this one, but without the last minute goals, or a horrendous injury to Lennon Miller and we're (at least potentially) right in the shitter.

The biggest issue for me is that we're all discussing this based on rumoured values and figures from weeks, if not months ago. Given that over six weeks of exclusivity have passed, I would imagine we're a ways beyond the original figures/numbers that were floated about. The key thing, is that none of the investors were going to be offering transformational levels of cash; which is why giving up fan ownership shouldn't be considered in my view.

I want the club to remain fan owned; but if it can remain fan owned with a relatively well connected external investor who can support the WS with its growth and expansion targets, ultimately strengthening its position and the value of the club, why shouldn't we consider it?

It made sense to delay any announcement relating to or terms of potential deals until after the season was finished; now that we're done, I'd like to see that happen, or at the very least a formal update given as soon as possible.

[Kmcalpin]

16 minutes ago, StAndrew7 said:

The doomsday scenario is that that any hole needs plugged two years in a row, or a couple of times over a 2-5 year period; building up £500-750k over a year or a couple of years isn't easy through asking for an increase in direct debits alone. Now, because we budget with a degree of common sense, the club (probably) won't have to do that; however, all it takes is a season like this one, but without the last minute goals, or a horrendous injury to Lennon Miller and we're (at least potentially) right in the shitter.

Thats it for me. If the Society had to fork out £750K, for one year, the coffers would be empty and we could not meet any guarantee required. I'd guess, at current levels, the Society might be able to raise say £150K per year? We'd then be relying on player sales, which can be unpredicable. Thats why the Society needs an alternative proposal.  None of this takes into account the discretionary additional finances that might be required to keep us competitive with the likes of St Johnstone or St Mirren.

[StAndrew7]

19 minutes ago, Kmcalpin said:

Thats it for me. If the Society had to fork out £750K, for one year, the coffers would be empty and we could not meet any guarantee required. I'd guess, at current levels, the Society might be able to raise say £150K per year? We'd then be relying on player sales, which can be unpredicable. Thats why the Society needs an alternative proposal.  None of this takes into account the discretionary additional finances that might be required to keep us competitive with the likes of St Johnstone or St Mirren.

I think if people/fans are going to want to compete for top-6, realistically there needs to be an increase (not necessarily an immediate one) in how much the club can put into the first team.

The only way that's going to come is from one of, or a combination of the following:

• Selling Lennon Miller for £eleventy billion,
• Asking for the WS/its membership to raise more money to inject into the club periodically,
• Asking existing private shareholders to invest,
• Seeking outside investment

Otherwise, we'll all need to accept a drop off in our ability to sign players of a calibre that we've become accustomed to and that it will impact on the product on the pitch and, potentially at least, our top-flight status.

[David]

37 minutes ago, StAndrew7 said:

The doomsday scenario is that that any hole needs plugged two years in a row, or a couple of times over a 2-5 year period; building up £500-750k over a year or a couple of years isn't easy through asking for an increase in direct debits alone. Now, because we budget with a degree of common sense, the club (probably) won't have to do that; however, all it takes is a season like this one, but without the last minute goals, or a horrendous injury to Lennon Miller and we're (at least potentially) right in the shitter.

For me, the real doomsday scenario is us handing control of the club to someone because they've offered to throw us a few quid and a suggestion of a documentary, only for them to change their mind and decide they don't want to cover said hole that needs plugged.

At least as things are now, there's an element of transparency. If and when someone else takes majority control, they don't need to tell us anything if they don't want to, because it would be their club, not ours.

[texanwellfan]

I don’t think we can survive at premier league level relying on being fan owned club, unless the WS can come up with some ingenious plan where it can raise significant funds on a guaranteed basis. So hopefully we can find an investor on suitable terms. I appreciate WS efforts at fund raising and every little helps but I just don’t think it will be enough to help us compete against other clubs who have more investment. Even our model of being a selling club is pretty dodgy as we could hit a dry spell with respect to having and sellable players. 

[StAndrew7]

17 minutes ago, David said:

For me, the real doomsday scenario is us handing control of the club to someone because they've offered to throw us a few quid and a suggestion of a documentary, only for them to change their mind and decide they don't want to cover said hole that needs plugged.

At least as things are now, there's an element of transparency. If and when someone else takes majority control, they don't need to tell us anything if they don't want to, because it would be their club, not ours.

I'd say that's more like "Uber Doomsday: Return of the Horsemen".

But more seriously, I completely agree; I am absolutely against giving away majority control to anyone, despite what guarantees they provide or the levels of investment offered (unless it's truly transformational). But that's kind of my point though; we don't know if that's what is going to be tabled, or perhaps it has been and ongoing discussions mean that it hasn't?

The gap can happen to us whoever is in control; granted, I don't think it's particularly likely given how well run^TM we are, but shit can, and indeed does happen.

[StAndrew7]

9 minutes ago, wellgirl said:

I really agree with you here. We can't ask for Motherwell to be top six on a regular basis and have a good cup run with the funds we currently have. If we want to progress we need more investment.

I've seen it said online this season that this Motherwell team are the worst they've ever seen. If we want better players then the manager needs more money to spend. 

I just don't see how we can do that without outside investment 

I get what you're saying but I think I slightly disagree with your last statement.

I do think that the WS can raise funds more effectively than it has in the past and that the new board deserve their chance to prove they can provide a sustainable vision for fan ownership in its current guise. The issue is that it's been talked about for a long time without much of anything coming of it so far.

Also, if we sell Miller for the expected value (most would think in the region of what, £3m+ for him if not more?) and also Bair for a decent wedge, I think we'll be able to achieve that increase as well, which will hopefully bring a sustained period of higher prize money to continue to invest in the first team whilst also swelling the reserves/coffers a bit.

[Spiderpig]

1 minute ago, wellgirl said:

All there is is speculation at the moment. It would actually be good to know what the offer from the American investor was/is. 

Assuming that an actual firm offer has been made, as its all went very quiet over the last 6 weeks or so.

[StAndrew7]

24 minutes ago, wellgirl said:

How? Genuine question. Do you mean by asking people to raise subs or asking local businesses to invest?

I just think there's too much uncertainty around everything at the moment. Surely if the well society are going to put a proposal together then members and fans should know. All I am seeing at the moment is tweets about how great fan ownership is and not a lot more. All there is is speculation at the moment. It would actually be good to know what the offer from the American investor was/is. 

I think (somewhat ironically) the message in the investment video is quite a strong one that the Society should be looking to utilise. We are a unique club, with a really good story to tell.

And yes, I think there's definitely potential to speak to local businesses to sponsor the club/invest in it and various aspects of its work, or changing how membership works to allow companies to buy into the WS and the become partners at events, or opening up avenues for additional exposure for them to fans. Discounts for fans with local companies who buy in to the club to increase their sales/footfall.

International/regional partnerships as well; looking to tie in with other clubs and their models, understanding how they've made such a big success of it (someone shared a link earlier in the year to a particularly impressive model; I think it was a Scandinavian team but I forget which).

There's also looking at the membership in detail; a lot of fans will have made one contribution/payment and never changed to a DD. There's definitely quick wins there to be had, but also longer-term ideas to fit in with the vision.

Perfect example; I'm not a WS member, as I'm sure plenty of members here aren't either. Why not? Firstly, I couldn't afford it when it was established and when I could, never felt like there was a need to. Secondly, I've got my own private shares, so what's the realistic attraction for me? I think there is now but I'm holding back because I want to see what the vision is for the WS before committing to it.

I agree with you that fans/members should know about the plans; I've never said otherwise.

20 minutes ago, Spiderpig said:

Assuming that an actual firm offer has been made, as its all went very quiet over the last 6 weeks or so.

That's because we're in the exclusive negotiating period; it'll be covered by NDA/confidentiality agreements. That doesn't necessarily mean a firm offer will be made but it means the Exec Board saw enough in Barmack's offer for it to warrant consideration.

[David]

When I see the term investment thrown out there, I often wonder how many people who have put money into a Scottish football club have come away with a profit?

I believe Fergus McCann did back in the day, but taking the big two out of the equation, has anyone or any particular investment group come into Scottish football and made an actual profit?

[StAndrew7]

Just now, David said:

When I see the term investment thrown out there, I often wonder how many people who have put money into a Scottish football club have come away with a profit?

I believe Fergus McCann did back in the day, but taking the big two out of the equation, has anyone or any particular investment group come into Scottish football and made an actual profit?

Mike Ashley? 👀

I can't think of anyone who has, but equally, I also can't really think of anyone who has invested in a Scottish football club with that aim, or at least to make a profit over and above getting their initial money back. Perhaps the guy at Hibs, if he can add money and develop talent there and sell them on?

If EB/whoever wants to make a return on their investment and has a plan that looks plausible to do so, it'll be interesting to read it and udnerstand it. I would caveat that with wanting some sort of buy-back option/first refusal for the WS on any shares which are purchased if it doesn't work out at any point.

[David]

7 minutes ago, StAndrew7 said:

I can't think of anyone who has, but equally, I also can't really think of anyone who has invested in a Scottish football club with that aim, or at least to make a profit over and above getting their initial money back.

It's for this reason that I find it difficult to believe that anyone putting money into a football club, especially in Scotland, can see it as an investment. 

I work with investors regularly. They tend to make investments to increase their wealth, which is pretty much the definition of investment.

What we're looking for is someone to give us money for free. 

[StAndrew7]

18 minutes ago, David said:

It's for this reason that I find it difficult to believe that anyone putting money into a football club, especially in Scotland, can see it as an investment. 

I work with investors regularly. They tend to make investments to increase their wealth, which is pretty much the definition of investment.

What we're looking for is someone to give us money for free. 

Yeah, I do too and that's why I've taken a particular interest in things (aside from being a shareholder). We regularly look at ROI, IRR, NPV etc. on spend over a much longer term than you would for a football club in my line of work though (20-40 years, as I work in shipyard design), so I guess this will be over a far smaller window and a bit out of my understanding.

I think that's why I want to see/hear more about the ideas behind it; there may well be something unique in the proposals coming from Barmack - there's no reason why it couldn't succeed, even if it's a different approach to the more traditional investment models we've seen in football. I think his track record in developing sports documentaries certainly gives things a different angle; you'd find it difficult to argue that Drive To Survive hasn't increased interest in and the resulting revenues of Formula 1.

I'm still skeptical of it all, I agree, but there's a degree of intrigue that I just can't shake from it all. The devil, as ever, will be very much in the detail if/when it's provided to WS members and shareholders. Like I said on another post, though, I would be looking for some safeguards to be put in place on buying back shares/the WS having first refusal, should he want to pull out for whatever reason in a few seasons/years time.

There is also another consideration; that Barmack may well want to make a return, but over a fairly longer period of time and make things a real partnership between him and the Well Society/fan base to develop the club and its potential exposure to new markets/revenue streams etc.

Again, it's all just speculation until we know details.

[santheman]

As far as I can see  the only area where he would make any return would be from the Social Media angle although I fail to see what a documentary series or weekly blog on a wee team from Lanarkshire would generate in the way of major revenue to justify his investment.

In saying that you hear of people becoming millionaires purely on the utter shite they post on Tik Tok and similar platforms so who's to say that something similar couldn't happen with us.

My gut instinct says fire it into the sea but my curiosity is aroused to see what the actual proposal is.

[dennyc]

1 hour ago, David said:

It's for this reason that I find it difficult to believe that anyone putting money into a football club, especially in Scotland, can see it as an investment. 

I work with investors regularly. They tend to make investments to increase their wealth, which is pretty much the definition of investment.

What we're looking for is someone to give us money for free. 

And yet various clubs have succeeded in securing external finance, free or not I don't know. Not saying on terms that would be acceptable to MFC and it's fans, but clearly there are  financially astute people out there that find the Scottish football scene of interest. Until the terms of any offer are released we are all just guessing.

If someone was to inject funds on the understanding they get (say) 20% on any transfer income until such time as their funding is repaid, is that really an investment as you describe it. More of a non dated loan to my thinking.  Again, not saying such a deal is on the table, but it is another avenue that could provide funds without selling the family silver. 

I guess it all comes down to what you consider investment. Let's see what Barmack offers, if anything.

[steelboy]

Barmack's on Twitter getting his hoop licked by the usual suspects so it's obviously still ongoing.

[Stuwell2]

On the “investment/return” discussion I read something which was along the lines of a lot of well off Americans are purchasing/investing in foreign businesses including sports due to when Trump was in power he changed their tax laws to allow money invested abroad to be deductible and simply put this means that if someone pays out $1m then it’s $1m less they pay in tax so it’s basically free money for them to gamble/play with and they get something to add too their portfolio.

Now - being cynical here as I don’t believe he is but - for someone like Barmack being seen to be helping out a wee fan owned Scottish team could, if things go well, potentially get him and his company more publicity and kudos than spending the cash in advertising ever could. 

[David]

1 hour ago, Stuwell2 said:

Now - being cynical here as I don’t believe he is but - for someone like Barmack being seen to be helping out a wee fan owned Scottish team could, if things go well, potentially get him and his company more publicity and kudos than spending the cash in advertising ever could. 

Publicity and kudos from who though?

[steelboy]

I think the benefit to him comes from getting the club on the cheap and being able to produce a docuseries at minimal cost. The increase in value for his production company is far greater than the money he would be putting into us. 

McMahon's crackpot plan involves basically giving him the club for free so it's no real surprise he's enthusiastic. 

[Mccus28]

3 hours ago, steelboy said:

I think the benefit to him comes from getting the club on the cheap and being able to produce a docuseries at minimal cost. The increase in value for his production company is far greater than the money he would be putting into us. 

McMahon's crackpot plan involves basically giving him the club for free so it's no real surprise he's enthusiastic. 

Again....................you're just purely speculating and treating it as fact!!

Why don't you just wait and see what the actual deal involves before going full hatred on the proposal

[weeyin]

If you want to see what multi-millionaires can do to a club, look at Man Utd.

They bought everything without investing a penny of their own money, award themselves huge wads of cash every year while leaving the club servicing huge debts at high interest rates - debts that are secured by the clubs assets; not by the owners' assets.

I'm not saying that is what will happen here, but there are ways to invest in a club and there are "ways" to invest in a club.

As I've said before, the most important thing for me is the exit plan. What is going to happen when the investor leaves, runs out of money or gets bored? Are they going to take their money and run, will they sell to a property developer or will they leave a self-sustaining (or at least healthy) infrastructure behind.

[Spiderpig]

The only way i can see an investor potentially making money from a club like Motherwell is by having full control over all its assets etc. 

Yes they may see the cash they put in as a tax incentive, good advertising etc but multi millionaires don't give away cash with no prospect of a return. 

And as some of the current board have made it clear they want out, I can see us having new owners whether or not they have full control all depends on how the WS fits into the plans.

[Onthefringes]

42 minutes ago, Spiderpig said:

The only way i can see an investor potentially making money from a club like Motherwell is by having full control over all its assets etc. 

Yes they may see the cash they put in as a tax incentive, good advertising etc but multi millionaires don't give away cash with no prospect of a return. 

And as some of the current board have made it clear they want out, I can see us having new owners whether or not they have full control all depends on how the WS fits into the plans.

Point 1. Piffle. Look at the bigger picture.

Point 2. Stating the obvious. To the best of knowledge, that’s not his end game.

Point 3. Those making it clear they want out - you do realise current board cannot sell out despite their best endeavours to do so? The narrative being peddled by Society board members misguided or not is exactly that.

 

[David]

3 hours ago, weeyin said:

As I've said before, the most important thing for me is the exit plan.

This is key. We can all discuss future award-winning documentary series, Netflix, TikTok and so on, but we need to know what the actual angle here is. 

4 hours ago, wellgirl said:

BTW. He's a multi millionaire - I don't think he needs to do a docuseries on Motherwell fc to get him a few more quid in the bank.

You're 100% correct. Which begs the question...why? 

All questions that will need to be answered before I decide which way I'd vote, if asked. And I hope others do the same.