Canadians R. Stewart Thompson and Jason Neale are moving up in the soccer world.
Peterborough United FC, the team they combined to buy a 50-per-cent share of in March 2018, has won promotion to England’s second-tier.
Peterborough (26-11-9) secured promotion to the Sky Bet Championship on May 1 when it rallied from a 3-0 deficit after 65 minutes to tie Lincoln City 3-3. Jonson Clarke-Harris’ 96th-minute penalty secured the point that left Peterborough with 87, meaning it could not be dislodged from second place which carries automatic promotion.
“Just incredible,” said Thompson, who along with Neale was on hand to see their team storm its way to promotion. “I don’t cry at a lot of things but I was in tears – just emotionally drained.”
Tears soon turned into cheers after the Saturday match. Then it was back to business.
“I’m not going to lie, it was probably a four-day celebration,” said Thompson. “But it was Wednesday morning and everybody’s kind of hungover with their voices still hoarse and it was like ‘OK, who’s on our buying list for next year? Who’s not staying? What’s our budget look like and what are we going to do about this?”’
Fans were not allowed into Weston Homes Stadium, some 120 kilometres north of London, due to the pandemic. But they gathered outside, complete with flares, as players came out to join the celebration – from a suitable distance.
“That parking lot party went long into the night,” said Thompson.
League-leader Hull City (27-11-8) also won automatic promotion. The third team to go up will be decided Sunday in a Wembley Stadium playoff between Blackpool and Lincoln City.
Thompson, 56, and Neale, 52, have an entrepreneurial history together. They are managing partners of OKR Financial, a debt and venture finance company they co-founded.
Thompson is also the founder and chief executive of Calgary-based Valhalla Private Capital.
Neale, a dual citizen who came to Canada from the U.K. in 1999 and now makes his home in Kelowna, B.C., is a business turnaround specialist who also co-owns Kelowna-based Bluestar Coachlines.
Both are passionate soccer fans who liked to travel and watch the game. That led to discussions about the business of football, which Thompson likens to tech investing
He saw lower-league teams as a kind of a startup – with plenty of promise but in need of a plan. No strangers to helping businesses blossom, the duo started looking at a possible acquisition.
“As soon as the brokers in the U.K. found two Canadians were looking for football, it was like piranhas on a cow,” said Thompson. “We were probably taking two calls a day.”
They ended up buying half of Peterborough owner Darragh MacAnthony’s stake in the club. The Sky Bet League One team ticked a lot of boxes with Thompson saying the 45-year-old MacAnthony, an Irish native, has “a venture capital eye for talent,” with a track record of shrewdly buying and selling players.
One example is striker Ivan Toney. Bought by Peterborough for a reported 350,000 pounds (C$598,600), he went to Championship side Brentford last August for a reported 10 million pounds ($17.1 million).
With MacAnthony and veteran director of football Barry Fry taking care of the soccer side, Thompson and Neale were able to learn the bottom line.
“I think that partnership’s been super-solid the last 3 1/2 years and really built us a foundation to get to where we ended up (May 1) Jason loves digging into the operations and I love the business development side,” said Thompson.
“It’s finding the balance between wanting to dig in and letting people do their jobs,” he added, referencing the role of co-owner.
Peterborough, which was also in the Championship in 2009-10 and 2011-13, is managed by Darren Ferguson, son of the legendary Sir Alex Ferguson.
Thompson says you can make money with a football team. But it starts with a thesis.
“Our thesis is that every football club can be run like a solid business operation. It may not be a venture (capital) thing where we’re going to make 11 times our money, (but) there’s no excuse for not running break even or mildly profitable every year,” he said.
Even during a pandemic.
Selling Toney helped. Some government programs assisted the commercial side. To help with cash flow, they asked their fans not to take their ticket refund back all at the same time.
They also asked players to take a pay cut, a request that was rejected. But they worked together on things like when to pay out bonuses.
“We had to put all our skills to work. It was a really really difficult year,” said Thompson,
Thompson says the club was valued at about 12 million pounds ($20.5 million) when they bought in. He believes it will be worth around 30 million pounds ($51.3 million) in the Championship.
They were prepared for the initial purchase cost, knowing some of that money would come back in transfer fees. The operating costs were more of a challenge.
“Anybody who has a daughter who owns a horse understands that buying the horse is the easiest part about that. It’s the trainer and the trailer and the hay and the acreage and everything else after that’s actually more expensive than the initial outlay,” said Thompson.
A healthy bump in TV revenue from being in the Championship will help pay the bills.
The club averaged 6,000 to 9,000 fans in League One. They are hoping for 10,000 to 13,000 in the Championship.
The two Canadian co-owners took in their team as often as possible, about every six weeks pre-pandemic, according to Thompson. This year, he took in a week of training camp and then the last three games of the regular-season. He streamed the rest, mostly via the English Football Championship’s iFollow service.
Peterborough, which has 91,200 followers on Twitter and 43,500 on Instagram, hopes to stream its own games next season.
The club has bought its aging 15,000-capacity stadium back from the city, with the intention of building a new one. In the meantime, they had to seek government permission to have one more year of use of its all-standing terrace, which is not allowed in the Championship. They are also facing questions like where can they squeeze in a media room.
Another ongoing project involves developing the team’s academy, a venture close to Neale’s heart. The hope is to bring in some Canadian talent at some point.
Thompson and Neale have looked at investing in the Canadian Premier League, saying they like the Manchester City structure which includes feeder clubs in other countries.
The ambition is to remain in the Championship for the next 24 months, to allow the club to stabilize and improve its foundation.
The real bottom line is they are having fun, said Thompson. “It’s using up all of my skill set.”
Canadian Ryan Reynolds and fellow actor Rob McElhenney have also got in the football business, taking over Wrexham AFC, a Welsh club that competes in the National League, the fifth tier of the English football.
[relatedlinks]
