The Tennessee club sold more than $500,000 in shares in a month. They believe they have tapped into a market for fans who want a stake in their team
Stefan Szymanski is a professor of sport management at the University of Michigan, the author of the much-lauded Soccernomics, and a supporter of Detroit City FC of the semi-pro National Premier Soccer League (NPSL). So why has Szymanski, who moved to the United States from Britain eight years ago, invested in an NPSL rival, Chattanooga FC?
The answer lies in shares. Szymanski bought two in the club, at $125 each, so he will be far from a majority owner; in fact, he already has has more than 2,000 partners from 44 US states and 10 countries around the world. Chattanooga FC said they sold more than $500,000 in shares in a month, after they became the first American sports team to sell limited public stock since securities reform laws were passed in 2016.
The NPSL is in the lower tiers of US soccer, far from MLS. But Szymanski and others find something appealing about crowdsourcing support for a sports team. “I’m a big fan of community-based football in general,” Szymanski tells the Guardian. “In the UK there’s been a tendency toward polarization on these issues – you’re either for supporters’ groups or for big business – whereas actually I’m in favor of both. I think in the US the community-based teams are tapping into a demand from many fans who do not want a corporate, ‘Disneyfied’ version of the game.”
A $125 share entitles the owner to one vote and an invitation to the annual shareholders’ meeting in Chattanooga, a city of 180,000 in southeastern Tennessee. The owner also receives a lapel pin, a “CFC Owner” yard sign and a stock certificate. His or her name will be printed on CFC’s away shirt along with the names of all other shareholders.
In essence, Chattanooga FC, who open their season on 23 March with a friendly against Comunicaciones FC, a Guatemalan team, plan to use the money raised through the offering to move to a year-round operation. They also aim to use some professional players to participate in an 11-team NPSL Founders Cup.
“It’s a different culture to the tradition of major-league sports,” Szymanski says. “But I don’t see why it couldn’t work. If you go back far enough, this is how baseball started.”
Kyle Martino, the former US midfielder who is now an NBC analyst, is another Chattanooga shareholder. Martino, who also owns shares in community team in Spain, says the offering is “an incredible opportunity to be a part of any football club ownership.”
But could this be a wave of the future – and not just for soccer teams? Both Szymanski and Martino say the current franchise system in US professional sports is not necessarily broken, but community ownership could stimulate local interest in a team. “It is building a coalition of passionate and devoted soccer fans who think we should have an open system and an open competitive format,” says Martino, who campaigned for both in an unsuccessful run last year for president of the US Soccer Federation. “They want to have something that has a synergy.”
Chattanooga FC, founded in 2009, play their home games at Finley Stadium, the 20,000-seat home of the University of Tennessee at Chattanooga’s college football team. Chattanooga FC are one of the top-drawing clubs in the NPSL, averaging 3,500 fans per game over their existence. But the club’s crowdfunding effort has already drawn investors from 44 states and 10 countries.
“There was a broad range of conjecture of how we’d be received,” Tim Kelly, the club chairman, tells the Guardian. “We’re very pleased. It’s kind of a brave new world.”
Kelly says the club were inspired – and educated – by a giant of US sports, the Green Bay Packers, a publicly owned non-profit corporation that first offered 1,000 shares in the team at $5 each in 1923.
The Packers, the only major publicly owned sports team in the US, have issued stock four times since, most recently in 2011, and now have hundreds of thousands of owners all over the world. But the Packers, who play in Green Bay, the NFL’s smallest city by far, hold tight to their reputation as a “local” team. “That’s exactly what we had in mind when we did it – grassroots fan support,” Kelly says.
The “Chattahooligans,” members of Chattanooga FC’s independent supporters’ club, say they like the idea of raising money to bolster the finances of their hometown team and to strengthen the community’s bond to Chattanooga FC and to American soccer at large. “It could absolutely work elsewhere,” TJ Moore, a club member, says of the crowdfunding drive. “The outpouring of support from all across the globe shows that people have a desire for this supporter ownership model to succeed.”
When asked if crowdfunding might lead to more demanding crowds of part-owners, Kelly laughs and says, “It’s not crazy to listen to the bulk of the fans, because we do that now.”