The Board of Directors wish to announce the Club’s 2016 fundraising initiatives.
Darlington Football Club have the generosity of a number of investors to thank for raising the capital to rescue the club in 2012 and also to re-capitalise it at various points when necessary on our journey to date. Had it not been for them we may not have a Football Club to enjoy today.
The previous major fund raising carried out by the Club (apart from the launch of the DFC500 and Vice Presidents Clubs which was specifically dedicated and designed to fund the capital build infrastructure at Blackwell Meadows in March 2015) was the Square Knot equity initiatives in January 2014. It is therefore two years since the owners, you the supporters, of the Club have been asked to fund the working capital and running costs of the football club.
It is imperative that the club is run as a business within its means but there will still be occasions whereby capital needs to be raised for ad-hoc projects outside of the usual budget remit. The move back to Darlington and into Blackwell Meadows is a prime example of this.
Two promotions in three seasons and currently on course for a third in four, knocking on the door of the National League North represents an almost complete turnaround for the football club since that fateful day in 2012.
Huge credit must go to everyone who has played a part in the journey so far, from the management to the stewards all working on a volunteer basis and of course, YOU, the fans. Everyone has played a vital role in dragging this great football club back towards where it belongs – here we stand, on the brink of a return to OUR town, and WE have achieved this, TOGETHER, without help from any major benefactor – what an achievement.
The debt which we inherited from the purchase of the Darlington Football Club assets has now been cleared and we have a real solid foundation to build upon. In order to move forwards there is now a need for a capital injection which is required to complete the move back to Blackwell Meadows, Darlington. The move back to the town allows the club to really start to grow off the pitch and exploit revenue streams that were previously compromised by our physical location as well as delivering community benefits from its permanent base in the town.
The increased revenue as a result will enable us to set a competitive budget but also crucially allow us to build headroom into the budget to allow for contingencies which up until now has been difficult if we also wanted to remain competitive on the pitch.
As we have now agreed the commercial lease with Darlington Rugby Football Club we are in a position to formally launch our fundraising initiatives. We are also expecting a positive decision on the outcome of the Football Stadia Improvement Funding (FSIF) grant re-application on 30th March 2016. In order to complete this project we are asking for your help.
Background and context
The full background and context to this fundraising initiative can be found in the Annual Review, Directors’ Report and Financial Statements for the year ended 30 June 2015, which were discussed with shareholders at the Club’s AGM on 5thNovember 2015 and also discussed with supporters at the Fans’ Forum on 11th November 2015.
Financial stability is an imperative for this Club. Many fans may argue that this ranks as more important than short term success on the pitch. The rebuilding of the Club was never envisaged to be achieved in a short timescale – fans’ expectations to demand as much would undoubtedly impose additional financial stress on the Club.
The Board of Directors want to emphasise to all supporters that it is carrying out regular and extensive reviews of all costs incurred by the Club, including playing and coaching costs. Key areas of expenditure being direct football costs and costs associated with providing commercial offerings to the fans, i.e. retail goods, hospitality etc. There is then of course the rental agreement with BAFC. The club is also looking at ways in which short term cash flow issues caused by fixture postponements can be better managed going forwards.
The ongoing commercial impact of playing our home games outside Darlington continues to be significant. There is little doubt that both attendances and our ability to attract local businesses to invest in the Club, particularly on match days, has suffered as a result – despite the success that has been achieved on the pitch during the last three seasons. Attendances have fallen on average by 200 since our Northern League season despite playing at a higher level and whilst ticket prices have increased as a result of the step up, the playing budget has also had to increase to remain competitive; we also face much higher travel costs than those incurred by the majority of teams in our league due to our geographical location.
A key aspect of our revenue underperformance this season has been the inability to host home games on a Saturday due to the inclement weather over the autumn and winter period. We have only managed one solitary Saturday home fixture in four months when we expected to play as many as ten. As midweek fixtures are typically supported by around 20% less people this has had a direct impact on our major revenue stream. Losing our Boxing Day fixture at home to Whitby and our other festive fixture at home to Ilkeston on 2nd January, where attendances are traditionally much higher, has also meant a lower than expected income from gate receipts this season. The Whitby game alone is estimated to have cost the club in the region of £5,000.
The attendance versus Salford was a great reminder to the Board that interest in the Club still remains and if you cannot afford to support the club in terms of capital investment then please come along to the remaining home games, not only does it give the Club a significant cash boost but it also spurs the lads on to greatness as we witnessed against Salford. If we’re to take the title we need every ounce of backing we can get.
Over the last three years, the actual net playing costs (after transfers) have been within 3% of the allocated budget. Notwithstanding injuries to contracted players at various times, overall the playing and coaching budget continues to be well managed. The agreement of budgets is a balance between this aspiration and the expected revenues from all sources at that time. The challenge for the Board of Directors is to determine if, and when, any reduction to the playing budget needs to be imposed as a result of anticipated revenue fluctuations. With the Club pushing for an automatic promotion place, there is always the risk of a negative impact on attendances if such a decision was imposed and certainly the Club’s overall aspirations would be brought heavily under the spotlight.
Whilst we do not budget for unexpected income such as player transfer fees or cup competition prize money, it is no secret in previous years our revenue has received a boost from such fees which have allowed us to offset unforeseen revenue decay or expenditure, unfortunately this season there have been no such payments.
Had the return to Darlington at Blackwell Meadows not been delayed the requirement for funding would be nil. Any potential impact on the playing and coaching would also be nil, as the budget was agreed in advance, assuming we would be playing back in Darlington by late autumn 2015 at the latest.
How much do we need to raise?
There are two separate elements to the Club’s fundraising initiative. Firstly, there is a need to replace the lost revenue the Club has faced annually since playing at Bishop Auckland, for the reasons stated above. The fundraising target for this is in the region of £52,000 and this will allow the club to have working capital to fund operating costs, again described above, until the 2016-17 season tickets are launched in May 2016.
Secondly, there is a need to raise £78,000 to fund the developments required to bring the football club home to Blackwell Meadows, Darlington. This is made up of £48,000 to replenish the escrow account, plus an additional £30,000 which will allow Blackwell Meadows to be brought up to ground grading category B which will allow the club to play football up to an including the National League North. The Board feels that with the club challenging for promotion this season that it is imperative for this grading to be achieved from the outset.
With fan-ownership rights comes fan-ownership responsibilities in terms of funding, and the Board of Directors would make a plea to everyone to dig deep for your Club’s fund raiser. Let’s remain positive and if you want to be an integral part of owning and funding the Club’s exciting plans and progression, particularly over the next few months, don’t miss out – and do your bit to ensure others don’t miss out either!
After discussions with the DFCSG, private shareholders, companies and individuals, the Board of Directors have planned a range of fund raising opportunities which are fully inclusive of all supporters, and hopefully provides a framework for everyone to contribute, no matter how large or small.
The full range of fund raising opportunities is described in detail below.
DFC 500 Club Membership
The popular initiative secured over £200,000 of investment when first launched in 2014 and allowed fans to purchase a 5 year season ticket frozen at current prices. A significant number of existing DFC500 club members have contacted the Board and offered to extend their DFC500 five-year season ticket by a further season. To show loyalty to those DFC500 members your Club is therefore offering another season at the same price of a 2015/16 season ticket, meaning you will get five years of watching the football club back in its home town as was originally intended. This represents a generous saving against purchasing the same ticket in five years’ time.
In addition we are also rolling out a limited number of brand new 5 year memberships for those who couldn’t take advantage last time around. These will be standing packages only. The number of packages available will be strictly limited to 50 on a first come, first served basis.
If you are interested in extending your DFC500 club membership by one season, simply complete the application form and return to the club. Payment can either be made by cash, cheque or bank transfer.
Here’s the link:
Darlington Football Club Supporters Group
Community Shares Offer (Target £100,000)
As we progress as a fan owned club we will need to raise capital funds for special projects, the first of these is the move to Blackwell Meadows. Community Shares are a great way of financing such projects as the revenue is crowd sourced from the local community and then paid back to investors at a later date, often with additional interest allowing the Club to quickly raise funds which can be repaid over a longer period.
DFCSG are launching a Community Shares offer to raise £100,000 which will be loaned to the football club in order to facilitate the move back to Darlington. The loan will be paid back by the football club over a 25 year period which will then allow the DFCSG to remunerate the investors on an annual basis.
Community shares issued by a community benefit society (CBS), such as DFCSG, are different to shares issued by a private company. We think they are more appropriate offer for investors for the following reasons:
- Community Shares do not change in value.
- Community Shares are withdrawable on request after a minimum investment period at the discretion of the CBS Board. This offers an exit route to the investor which is not available to shares in a private company.
- Community Shares can attract interest at the discretion of the CBS Board.
- Subject to personal circumstances and DFCSG reaching the target to own 90% of the share equity in DFC 1883 Ltd, Investors may be eligible for 30% tax relief on their investments.
Buying community shares is not a donation: should the investor want to be repaid, the CBS Board can authorise this after the minimum investment period, as long as it judges that the CBS can afford it. As previously stated our plan is to set aside a portion of the surplus each year to repay investors. The minimum investment for Community Shares is £100.
In the interests of fairness we plan to extend the Community Shares offer to individual shareholders in DFC 1883 Ltd Shareholders by giving them the opportunity to exchange their shares for Community Shares in DFCSG to the same value. This will also enable DFCSG to get closer to our objective of owning 90% of the shares in Darlington Football Club.
We think that Community Shares offers fantastic incentives to invest and buy shares in DFCSG and through that support Darlington Football Club and the local community.
We believe that this is an exciting offer that will open up investment to a wider group of investors who may otherwise not have considered investing in Darlington Football Club. For full information please consult the additional Community Share prospectus.
You can access the online share platform at fundraising.darlingtonfcsupportersgroup.org
Joining the Darlington FC Supporters Group (Target 1,000 members)
A revenue stream that can often be overlooked – membership of the DFCSG allows fans and even non-fans of the club who are interested in supporting a club offering a benefit to the local community, to join for only £2 a month payable by standing order.
We have a target of reaching 1,000 members by the end of 2016 – membership currently stands at around 430. This is an ambitious target but with a regular fan base of 1,000 we feel that, as long as we can demonstrate that the group is playing an instrumental part in driving the club forwards and increasing member participation, it is achievable.
Should we reach our 1,000 target this alone will deliver up to £20,000 of additional revenue of which the majority, after some small administration costs, will be used to safeguard the long term future of the club and by supporting success and growth on and off the football field. This year alone we’ve invested £10,000 into the football club through equity purchase.
Not only will your contribution be supporting the club but it also gives you a say in how the club is run. With the DFCSG now taking a hands-on role in the strategic direction and governance of the football club there has never been a better time to make your voice heard. As well as a vote on the direction of the club there is also a great package of membership benefits .
Joining the DFC Lottery
For as little as £5 per month you can have the chance of winning the £50 weekly draw and also the opportunity to win the monthly Superdraw and win even more!
For more details, visit the DFCSG’s website by following the link below
To enter simply set up a standing order with your bank and send your contact details to the Lottery organiser, either by post to the address shown at the bottom of the form or by email to:
Donations to the Club can either be by regular contributions made by Standing Order or a one-off donation.
If you choose to make regular donations by Standing Order, there are several advantages to this method of funding. There is an automatic guaranteed money transfer made directly to the Club with speedy payment without visiting bank regularly. Standing Orders also offer the opportunity to change amount, date, frequency, account details at any time.
Simply set up a standing order with your bank and send your contact details to the Club, either by hand at Quaker Retail or at the fans table during home games, or by post to the address shown at the bottom of the form or by email to:[email protected]
A one off donation can be made by either cheque or BACS. If you wish to make a donation by cheque, please make the cheque payable to Darlington 1883 Ltd and either hand deliver it to Quaker Retail in the Dolphin Centre, Darlington, or post it to Darlington Football Club, Blackwell Meadows, Grange Road, Darlington, DL1 5NR. Please write your name and phone no. on the back of the cheque.
Please give your full name as the payment reference if paying by BACS.
What happens next?
The online platform for Community Shares will be launched on Thursday 24th March at 10pm and there will be an opportunity to buy face-to-face from the Dolphin Centre, dates to be communicated shortly. There will be regular updates on the amount raised via the online platform and local media.
The offer window for Community Shares closes on 31st May 2016, after which 7 days’ notice will be given and any monies debited.
Any monies due for DFC 500 club memberships will be payable immediately and will used towards funding the development costs for Blackwell Meadows.
We hope we have put together packages to suits all tastes and pocket sizes, if you would like to discuss any elements further please contact John Tempest.
The Board intends to close all fundraising packages at midnight on 31st May 2016.