A beautiful mess is still a mess
A beautiful mess is still a mess
As CanPL moves from plucky start-up to established league so must the coverage
The Canadian Premier League has had some wonderful moments of strong play and a fun, frantic battle to name a champion.
The Canadian Premier League has a team that looks close to folding and another two that are ready to walk away if things don’t change soon.
Both statements can be true at the same time. In fact, if you listen to the people that I listen to, both statements are true right now. Many of you will choose to believe otherwise — and that’s fine — but doing so is to choose what evidence to ignore so that you can maintain a positive narrative.
I say this with the understanding that it’s exhausting to constantly have to defend the very concept and need for a CanPL to people. You’re sick of it and sick of those people laughing at you and arguing that it’s sure to fail.
You want to throw their words back into their face. I get it. Truly.
And by all means, hold onto the positive stories that are being created by the CanPL. The play, most of all. It has exceeded our expectations and we should all be excited by how much quality there has been and how much it improves each year.
But, to ignore the negative is to do no one a favour. Least of all the league’s leadership itself, which is clearly not without fault. The more that comes out about the Edmonton situation, the worse the choices look, for instance.
We know now that the team was allowed to enter the league with significant debt — I’ve been told it is as much as $30 million — and that significantly handicapped the team’s ability to compete. That, in turn, hurt attendance. A vicious circle, really.
But what’s worse is what is coming out now. Namely, that there is also a clause in the deal CanPL made with the Faths (the owners) that prevents the league from starting a new team in the market (or city limits, at least) without waving their territorial rights.
Further, what’s now being suggested to me is that not only does the club hold that much debt — and not only do the Faths have the right to refuse a new team coming into the city — but that money that is owed is owed to the Faths themselves. They lent it to a company they set up so that they would have an option to recoup it at a later date.
It’s that date now.
So, to say that the sale of FC Edmonton is complicated is an understatement.
And more than a little frustrating that we are only learning about things like this now. This deal, if true, was clearly not in the best interest of fans in Edmonton, or fans of the CanPL.
See, we don’t learn about things like this without the work of journalists covering the league as, well, journalists.
Right now, we have content writers covering the league and they have a mandate to spin things positively. That’s not on them - they do what they do well — but it’s not journalism. It’s marketing.
And, when independent journalists do try and cover the league in a more serious way, they tend to get shouted down by people that do not want to face the possibility that things are not as rosy as they’d like. Another vicious circle, that.
Look, we all want the CanPL to thrive. Truly. But, it can’t without people keeping a critical eye on it.
The next post here will be positive. It will celebrate the final and the players that have entertained us again. But, as we enter into season 5 on the league, let’s stop treating it like a plucky start-up that needs to be sheltered from criticism and instead demand that it be the established first division league it tells us it is.
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Thanks Duane for bringing the actual debt figure into wider circulation. I've heard the story about the large debt load many times, but had never seen or heard anyone put a number to it. It is daunting, especially for a market that has the attendance and stability record it does (I grew up there, and most of my family is there; I'm not trying to crap on my hometown, but it's professional soccer history and attendance numbers and soccer business culture are what they are).
The investigative possibilities of the FCE story are vast. I don't see a path forward for FCE in the short term. Are you able, at some point over the winter maybe, to lay out the realistic paths? I have to imagine they are something like:
1) CSB continues to help the club limp along.
--Presumably similar to this season in providing travel costs, loanees with salaries paid by the parent clubs, etc.
--Unlikely if the CSB finances aren’t great, and if doing so would provide for an odd number of teams after VanFC enters, creating scheduling headaches.
--They would also need to put in some marketing money to drive bigger gates, which seems like something that wasn't done this year.
2) FCE goes dormant.
--Do we know if a dormant club would continue to receive, in full or in part, whatever revenue sharing exists in CSB/CanPL?
--Would doing this mostly eliminate their expenditures and allow them to slowly recoup some of the club’s debt to themselves? How long would it take to bring the debt down to a level that might be palatable to a new investor?
--With a debt that large, there had to have been some kind of long-term revenue projections from CSB that made everyone comfortable with the Fath’s entering with such a burden, right? Bueller?
3) CSB buys the Fath brothers out.
--The other owners (CSB) decide to swallow some bitter medicine, buy out the Faths, spread out / finance the debt, and seek new ownership with FCE’s restructured debt a collective liability instead of a singlular burden that a new owner is stuck with.
--Unless a new owner is ready to come in immediately, this operation probably also involves the club going dormant for a time.
Folding FCE doesn’t seem like a realistic possibility. The Faths presumably want some way to recoup their losses, and holding the guillotine over a new CanPL club in the sixth largest market in the country (and sixth largest by quite a gap over seventh, if we’re ranking by CMA size) is the tool they have (willingly given to them by the other owners). They aren’t going to walk away empty handed, right?
Moving the club to another market also seems like a non-starter. CSB have already granted the rights to clubs to other groups/individuals in other prospective markets, and I imagine the idea of heavily-indebted Edmontonians owning the club playing in, say, Kitchener-Waterloo-Cambridge, or London, ON (for argument’s sake), or Quebec City or Greater Montreal (for an even wilder thought experiment), but siphoning the first $30 million in profit back to Edmonton, would be less popular than a fart in a stuck elevator.
And even if they did move it, would the Faths still have a veto over another club/owner coming into the Edmonton market? Would they give that up? Would it expire if club moved? Would it only expire with their consent, regardless of other facts on the ground?
The question seems to be: how does CSB get out from under this albatross? Someone is going to have to eat substantial financial pain. It seems that it won’t be the Faths. Do the CSB owners think hoping for and doing a deal with a devil (insert unsavoury sovereign wealth fund here) is preferable to eating the Fath debt and spreading it out?
What a mess indeed.
A sad state of affairs, that's for sure. And, oh, so familiar.