The following column appeared in CG167, October 2010
As Bradford City’s early season form went from bad to worse during September, it was not surprising to see everyone and everything blamed for the club’s continuing slump. Players and management were the obvious targets for frustration; there was even plenty of debate over the nature of support offered by fans. Also getting more than a few mentions and the subject of numerous arguments were the club’s joint owners – Julian Rhodes and Mark Lawn.
Not for the first (or last) time, feelings of disappointment were expressed over why City can’t attract outside investment which could make such a difference to a club which can compete at this level, but which doesn’t have the level of resources befitting its stature as the biggest in the division. Why is no one willing to take over and help the club to realise its potential? – has been the cry. At the same time criticisms over the job Rhodes and Lawn have done have raged, with Rhodes’ involvement in the club prior to administration in 2002, and his record thereafter, coming under scrutiny. Since investing in 2007, Lawn’s enthusiasm and ideas have so far been unable to lift the Bantams upwards. And after a particularly dispiriting home defeat to Morecambe in early October, which left City languishing 91st out of 92 clubs, it became difficult to avoid fearing things might have got even worse.
Yet the mantra of being careful what you wish for should apply when envious eyes become fixated upon other clubs which have attracted wealthy investors, in recent times. Over recent weeks the problems with Liverpool’s ownership took a series of remarkable twists that left English football’s most successful club facing the prospect of relegation and administration. As the drama switched from Anfield to the High Court, a happy ending of sorts eventually arrived and unpopular owners Tom Hicks and George Gillett lost control of the club and lost millions of pounds. Many lessons to take on board for everyone involved.
And problems over club ownership don’t end on Merseyside. There’s Manchester United, Newcastle and Portsmouth, who would surely wish to turn back the clock. QPR and Leeds, who both have owners’ raising ticket prices to ridiculous levels and not caring about their less well-off supporters. Hull City, Notts County and Sheffield Wednesday, where previous owners left others to clear up the over-spending mess they’d left behind. Wycombe, Stockport and Rotherham, who have endured significant stadium issues. Chester City, who went bust and started out all over again.
And that’s just the tip of the iceberg.
The difficulties of modern football club ownership is that the intentions of investors and expectations of supporters are so widely different – and the latter group often seem to struggle to understand the former’s motives. Unless these investors are already supporters of the club, why would they want to take control? These are rich people who have got to where they are in life through making huge sums of money, but the perception that they are taking over a football club to spend their fortune on buying footballers as some form of ‘hobby’ remains widespread and accepted. There are exceptions, such as the mega-rich Man City owners, but even if a new owner parts with a lot of cash for the manager to spend on new players when they first arrive, the intention of most owners is to ultimately become even richer.
In the Premier League the rewards for investing are obvious – TV money from around the world will raise £1.4bn alone over the next three years, and that’s before we consider sponsorship, gate revenue and merchandise. Even the poorer relations of the Championship are now earning greater revenue, with the Premier League’s solidarity payment scheme – taking effect this season – meaning each member of England’s second tier receives £2.2m per season. The current Football League TV deal, collectively worth £264m, is heavily weighed in favour of Championship clubs. Meanwhile clubs relegated to it from the Premier League receive a whopping £48m worth of parachute payments over four years.
So it seems most clubs in England’s top two divisions make for an attractive investment opportunity. Even clubs in Leagues One and Two carry the potential for investors to one day benefit from Championship revenue, by spending money to get promoted before recuperating it and making a profit in the long-term.
If this sounds cynical, it’s worth pausing to consider why anyone would want to invest their money in anything. The intention in 99% of cases is to receive a greater return for their money in the long run, earning a level of reward that more conventional ways of placing money – such as in a bank savings account – couldn’t achieve, in return for the level of risk the money is exposed to. Gillett and Hicks invested their money in Liverpool to become richer; but as they lapped up the media acclaim and stood on the Anfield pitch with red scarves back in 2007, proclaiming their loyalty to an institution they had previously had no involvement with or affection towards, it’s arguably easy to understand why supporters were fooled into believing it was something different. The fact the pair have reportedly been left £140m out of pocket from it all going wrong shows the level of risk that was involved; but had Rafa Benitez spent his budget a little wiser the rewards could have been immense.
It is the same with most of football’s modern investors. Whereas the traditional model for football club ownership was a local businessman-made-good trying to give something back to their community – signing players from his own pocket but always watching the pennies – increasingly these people have sold up for a handsome profit and the club has been put into the hands of people who don’t necessarily judge success by how many times the open top bus is deployed to parade the players around town. More situations like Liverpool and maybe the penny will drop. But for now we observe their supporters firstly holding up banners proclaiming ‘Yanks go home’ and then two minutes later are welcoming another American owner, who will remain popular so long as the manager has money to spend during the transfer window.
Which takes us back to Bradford City – and the question of why the club can’t attract investors of this nature? On the face of it the set up at City is ideal for a would-be investor: a sizeable fan base, a large stadium which won’t require redevelopment work anytime soon and only two divisions below the relative high financial rewards of the Championship. However a close inspection quickly shows why it’s a less attractive option compared to others.
The Valley Parade ownership issue is a huge millstone around the club’s neck. Gordon Gibb – and now there’s an investor who it appears is getting richer from the Bantams – is a happy landlord seemingly unwilling to change the set-up which sees City pay some £600k rent per year for the right to use their home of over 100 years. Gibb paid £5 million to buy Valley Parade in 2003 and, since the rent payments to his pension fund kicked in, is well on his way to recuperating that and making a handsome profit as the years go by – especially given the saleable value of the land. When you throw in a reported £600k annual running costs for the stadium, and then inspect the loans Lawn at least has put into the club to keep it operating, which apparently one day must be paid back, it’s obvious why any investor with no affinity for City but a desire to get richer would run a mile from BD8.
The reality is that the risk is too high to be considered an attractive investment. Any new owner would have to pay these huge costs before they’ve even got to looking at the transfer budgets. The revenues coming back in are limited, particularly bearing in mind City’s catering and club shop streams are leased out to third parties. They could put ticket prices up of course, but to get a team out onto the pitch that would be good enough to get City promoted twice would result in sizeable losses initially. And even then the higher levels of TV and solitary payment money available from getting to the Championship would struggle to be enough for any investor to earn a sufficiently high return on their money. Finally there’s the huge level of risk involved – football history is littered with clubs who spent big on players failing to achieve their objectives. A high level of risk, a lot of up front investment, a meagre return; to quote Duncan Bannatyne: “I’m out”.
Unless there are any rich Bradford City supporters out there willing to lose some of their fortune in return for the glory of their team achieving success, it’s unlikely there’ll be any investors rocking up to Valley Parade anytime soon. Ken Morrison is often mentioned at times like these (and has been again) with the usual criticisms of why doesn’t the self-made millionaire give something back to the local area. But if he has no affection for football, why should we expect him to do so? The fact is there are far more important causes in the Bradford area which deserve financial support than a football club which has at least become self-sufficient again in recent times.
All of which leaves us with Rhodes and Lawn, and all of which should leave us thankful for the pair. Rhodes is continually criticised during difficult times like this September, as his reign in charge has almost entirely seen failure on the field. Some friends even argue to me that Gibb should have been allowed to run the football club instead of Rhodes when the pair fell out in 2003, despite the obvious lack of affection Gibb is proven to hold for the club. Yet the sacrifices the Rhodes family have made – and continue to undertake – for the club should not be dismissed so readily. Without the Rhodeses, there would be no football club to fret about – at least not a Football League club. It should never be forgotten they were the only people willing or able to save the club in 2004 – and that commitment for Julian included remortgaging his own house. It’s true the Rhodeses did collect large dividend payments along with Geoffrey Richmond during the boom days, but they’ve had to reinvest it back and then some. No one can deny that joining the Bradford City board back in 1998 has negatively impacted on their financial wellbeing.
Lawn too has put significant amounts of money into the club and has helped it to operate on a much sounder footing. When Jake Speight was signed for £25k this summer no one really battered any eyelid, yet for many years City were unable to pay a transfer fee for anyone. During the season before Lawn invested (2006-07) a significant part of City’s team had to be made up of loan players. Today City do not have the level of resources opposition managers often claim they do, but we are among the most financially-equipped teams in the division and for that we have Lawn to thank.
We are fortunate that we have two owners who care deeply about the club, and who are not here to get richer. The lure of outside investment might still seem appealing, and if someone was to come in and throw a lot of money at the club to get it back up the leagues we would probably all be thankful even if we knew their motives were to achieve a personal profit. But to know that we have owners who genuinely understand the ethos of the club and care deeply – well, even Liverpool supporters might feel envious of us.
Of course it’s not perfect. For a while it seemed there was big ambition and new ideas, but it’s all gone a bit quiet from the boardroom these days. A year ago Lawn loosely talked about getting City into the Championship in five years, but if there is a blueprint for how this might be achieved we fans are yet to be privy to it. In a sense too much emphasis is placed on whoever is the manager, with the rise and fall of the club’s fortunes almost entirely attributed to how good a job they are doing. Peter Taylor made certain investment demands when agreeing a one year contract last April, most notably training facilities, but this wasn’t delivered by the Board. This was perhaps as close to a public-stated strategy as we’ve seen – Taylor’s advice on what the club needed to do in order to become successful again. But the fact only a one-year contract was offered to Taylor suggests it was not a plan the Chairmen believed in enough.
The upshot is that Taylor came very close to losing his job at the start of October and whatever strategy was in place would have been torn up. Back-to-back wins over Barnet and Cheltenham have eased that pressure for the moment, but it seems the reality is that Taylor must deliver promotion this season or he’ll be out of the job. And then the responsibility or reviving the club will belong to someone else, who will have their own ideas that need implementing from scratch. The fact that some will argue every manager since Paul Jewell has been a failure would suggest this strategy of placing all the onus on who is in charge of the first team isn’t working.
So in difficult times Rhodes and Lawn face criticism and some fans openly wishing someone else would take over instead. But the financial economics and the motivations of your average modern-day investor don’t make Bradford City an attractive proposition, and so we must retain our faith that the pair – supporters at heart – can find the answers to achieve the sort of on-the-field success that wouldn’t look that amazing on a balance sheet, but would mean everything to all of us.
