ICO News: Newcastle United and Cardiff City to raise funds via ICO

Two British Premier League football clubs who’ve run into financial problems are reportedly turning to cryptocurrency to save their skins, so to speak.

ICO News: Newcastle United and Cardiff City to raise funds via ICO

SportCo to the rescue

Newcastle United and Cardiff City, who both compete in the Premier League, are currently in talks with a decentralized sporting investment and funding platform named SportCo who help sports clubs raise funds via ICOs (initial coin offerings).

SportCo has earlier partnered with Avaí Futebol Clube to raise them about $20 million via a public sale of AVAI tokens.

The partnership would enable the clubs to begin the sale of their private digitized tokens as securities/utilities.

As interested participants purchase these tokens, they would either gain a particular stake in the clubs’ revenue or receive additional benefits for using the token on game-related purchases.

The Mag highlights the poor financial health of both Newcastle United and Cardiff City.

While Newcastle United has famously lost profits thanks to poor managerial decisions – those taken by the club owner Mike Ashley – Cardiff City is facing a debt burden of over $150 million, the bulk of which they owe to Vincent Tan, a Malaysian investment tycoon.

Cardiff even cut the wage bill to £20.6m, 18% lower than the previous year.

Fighting for survival

Both Newcastle United and Cardiff City have admitted that they are fighting for survival with lower budgets.

Sir John Madejski, a prominent figure in the Premier League, once said that running a football club is not for faint-hearted; that one has to have deep pockets to run them smoothly especially when most clubs run at a loss.

Some common issues prevent football clubs from governing their finances properly.

The wages of footballers are considered too high and paying unnecessarily hefty commissions to their agents adds up to the overall profit-deficit.

Understanding that running a football club cannot always be a one-rich-man show, football clubs are waking up to the possibility of going public.

ICOs

ICOs simplify the process by allowing organizations to raise funds by selling digitized tokens that could either be used as proof-of-ownership or tools to avail discounts and offers from the issuers.

The digitized crowdfunding method, so far, has appealed to startups that look to raise funds to build blockchain-enabled applications.

“Money raised from the crowd sale goes straight into club infrastructure which will stay with the club forever,” Marko Filej, SportyCo’s co-founder, stated. “With this initial money offer, we are opening a new chapter in football and the sports industry in general.”

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