Buying a football club is a big deal.
Even in the lower leagues, it is an endeavour reserved for the rich and powerful that regular folk could never dream of achieving. At least, not on their own.
There is a quote somewhere in the bible that says, “My name is Legion, for we are many”. I’m not getting all religious on you (more power to you if that’s your thing), but the idea behind that quote is relevant here.
Fans are all individuals with limited means, but when they come together and pool their resources, they are legion, they are many.
This idea has resulted in more than a handful of clubs becoming fan-owned over the years.
Instead of having one person with their name above the door, the fans come together to create a company with a chairman that is voted in, and the club is essentially run by committee.
Anyone who has never been involved in this process may well wonder how fan owned football clubs work. It’s easy enough to imagine Jim Ratcliffe, a successful billionaire business owner sitting behind a desk and Manchester United and running the gaff, but Andy the carpet fitter from South London? What does he know about it?
That’s what we’re going to find out.
Supporters’ Trusts
When a large group of fans come together to create a formal body, run democratically and not-for-profit, they become a supporters’ trust.
They can call themselves whatever they like. For example Ranger’s fans called themselves Club 1872 because that is when the club was formed, while many others like the Luton fans go for something more vanilla, like Luton Town Supporters’ Trust.
A supporters’ trust always exists in order protect their club and strengthen the voice of fans when it comes to ow the club is run. Many trusts have a member on the board of the club, for example, giving the fans a voice in the room when big decisions are being made.
They are often but not always set up in response to the club going through financial difficulties. Supporters rally round and get organised in order to save their club from closure.
They don’t have to exist to take ownership of the club – Manchester United’s supporters’ trust has over 200,000 members but they have no chance of buying their club – but this can happen in the right circumstances. Portsmouth are probably the biggest club to have ever been fan owned, although they are not anymore.
In 2013, just 4 years after being relegated from the Premier League, they languished in League 2 on the brink of financial collapse. The Pompey Supporters’ Trust was formed to save them, and it took over the club until 2017, when Portsmouth were promoted to League 1. The trust sold the club to The Tornante Company, owned by Eric Eisner, the ex CEO of Disney.
Portsmouth would have been stuck without financial help from outside, which is why fan ownership is much more common in the lower leagues where clubs are less expensive to buy and easier to run.
Taking Ownership
In order to take ownership of the club, there are a couple of different possible routes.
If the club is in danger of collapse, the owner will probably want shut of it anyway as it will be a financial burden to them. This means they may not be asking for much, if anything, to offload it. Even if this is the case though, any new owner would have to take on the club’s debts and other financial commitments, so a large sum of money would be needed.
Fundraising, individual donations from fans, larger donations from local business or local people who have done well can all help to boost the coffers. Once enough money has been raised, the supporters can officially take ownership following the proper legal procedures. The FA may well help them with advice in how to do this.
Another way to do it is to gradually increase the trust’s shareholding. They will still need money to do it, but since this approach tends to be taken when clubs are in a stable position there is not the same sense of urgency. A trust can start with a 10% stake, rising gradually as time goes on until they hit the 50% + 1 vote mark, at which point they become the majority shareholder and the club is technically fan owned.
There may still be private investors with a large stake in the club, but as they don’t have the controlling share they are not able to force decisions through. The fans, on the other hand, can.
Lastly, there is the option to form a new club altogether. AFC Wimbledon are the best example of this. When the original Wimbledon FC was uplifted and rehomed 50 miles away in Milton Keynes, the supporters were understandably outraged. In response, they clubbed together and formed The Dons Trust, and founded AFC Wimbledon. FC of Manchester is another example, they were formed in protest to the Glazer’s takeover of Manchester United. These clubs were fan owned from the start, so while they are not technically the same clubs as before, their supporters think of them as such.
Running the Club
Taking control of the club is only the first hurdle, now the supporters’ trust has to run it.
The ownership structure can be as unique as the clubs themselves, but more often than not they follow fairly similar lines. How it works will be laid out is some sort of members handbook that goes into detail about governance.
Fans can buy into the trust for a set price each year. This price might change over time, but crucially, everyone contributes the same amount. This ensures a 1 person 1 vote system, so nobody can end up with more power or a bigger say than anybody else.
However, some trusts have thousands of members and they can’t all speak at meetings, so there must be a group of people who run the trust. The trust will run democratically, so these people can put themselves forward and everybody else votes on who they want at the top. Once a board has been voted in, they can set about either running the club themselves or finding someone to hire to run it for them.
This is where things vary a bit, because sometimes big decisions like hiring a CEO might fall to the board and other times it might be put out the a vote from the entire membership. The idea though is to allow the club to run effectively – so without every single member needing to vote on every little decision. To achieve this, at some point control has to be handed over to one person or a small team.
Decisions like hiring the manager or what beer to sell at the club bar will be taken by this person or group, but big decisions like redeveloping the ground or changing the club’s crest would probably be put to a wider vote including the whole trust.
If fans don’t like the way things are going they can vote board members out and vote in someone else, but clubs can run happily in this way indefinitely. As clubs get bigger though, they become much more difficult beasts to control and more people are needed to keep them running.
This is when a fan owned club might decide to sell back to a private owner.
Fans Selling Their Club to a Private Investor
In order to grow, football clubs need money. As a fan owned entity, this can be difficult.
Say the club’s stadium was falling down, or they needed a cash injection to upgrade the squad after a promotion. A club run as a traditional business would be able to raise or borrow that money much more easily than a supporters’ trust.
A club can become stagnant if it is financially restricted, and this is where a fan owned club might consider selling.
Usually there will be some sort of clause written into the contract stating the new owner is not allowed to rename the club, or move it to somewhere else or anything like that, but for all intents and purposes, the fans would be relinquishing control.
They may structure the deal so as to allow someone else to be a majority shareholder while the trust still owns 49%, but the trust still has a seat or two on the board, for example. This would mean the trust is still involved and has a voice, but the financial and operational side of things would be pretty much out of their control.
There have been situations where the club has been sold by the trust in order to save it too. Ebbsfleet are an interesting example. After taking over in 2008, the MyFootballClub trust struggled with the running of the club and it got into financial trouble. They were giving loads of control to fans, even voting on transfer decisions. It didn’t work. Membership dipped to all time lows, and eventually, the trust sold the club to KEH Sports Ltd, a private investment company.
Bundesliga a Special Case
If you were to ask how fan owned clubs worked in Germany, the people there might look at you funny.
You see, this is actually the norm in Bundesliga and the leagues below. In fact, it is written into the rules of the German FA due to the way the law works over there.
It isn’t legal for a football club to be majority owned by a single person or company. The 50% + 1 vote rule means he fans always have the majority stake in their clubs.
They elect a club President who resides over the running of the club from the top down, but the fans are sometimes invited to vote on things such as ticket price changes, stadium development, and even sponsorship deals. It depends on the specifics of the situation, but usually it will be to do with anything that could cause friction with the fans.
As a result, clubs in Germany are typically more responsibly run since it isn’t possible for private investors to keep throwing money at problems or siphon money out of the clubs. Fan engagement is also much higher, as is each club’s connection with its community. Ticket prices tend to be more affordable too.
So there are lots of benefits to clubs being fan owned, even at the top level, and there is a push for it to become more common here in the UK. I wouldn’t hold your breath for Premier League or the Championship teams though, there is way too much money involved at that level.