Finance and Sponsorship for a Sports Facility

By Evelyn Tate

Whether you want to set up a small gym just for your team, a large indoor sports area for various programs, or a fully fitted facility for 10,000 private members, you’ll need some help getting started. Commonly, those who establish a sports facility, gym or indoor training area find that, while they have plenty of expertise regarding their sport, they are less equipped to deal with the financial and business end of things. This article will remedy that by looking at the most pressing and troublesomee areas of financing your new venture, with special attention given to sponsorship, legal regulations and budgeting.

Where Does the Money Come From?

The size of your venture will directly affect the size of your budget. If you are able to achieve everything you want with your own private funds then that’s great. For most of us, however, it is likely we’ll need outside help to reach the desired level of operation. This does not have to mean maxing out a bunch of credit cards or applying for a bank loan. There are other ways to get outside investment in your facility though they will require time, effort and, crucially, sound planning.

Fundraising relies upon the generosity of businesses and people in your local area and their willingness to see your venture come to fruition. Any fundraising event should be organised by a fundraising committee, made up of club members with an agreed mandate for what you wish to achieve. Be business-like about the entire venture, even if everyone on the committee is volunteering. Work out how much you need, when you need it by and what exact purpose each cent you raise will be serving and do all of this before you decide what shape your event should take.

How Do We Get Sponsorship?
While fundraising relies on people’s generosity, sponsorship is a strictly business relationship. You get either resources or capital from the sponsor. The sponsor gets exposure or good PR from you. Be sure you can actually provide the latter before you seek the former.

So think – what is the commercial advantage from the sponsor’s point of view for getting on board with your facility? Generally you should be able to offer at least two of the following to any private company who you would like to invest in your facility:
-          Improved Sales
-          Advantage Over Competitor
-          Change in Image
-          Improved Levels of Customer Awareness
-          Exclusivity (i.e. guaranteeing that a target market will only use their products)

If you can offer a sponsor none of these it is going to be impossible to get that kind of investment. You’ll either need to look further down the trough or to fundraising as your source of capital.  Before you begin to contact your sponsors it is highly advisable to work out a sponsorship policy within your own organisation. Consider who is responsible for the relationship with a sponsor, what your own objectives for the relationship are and what can and cannot be promised.

How Do We Keep A Sponsor Happy? The first thing to remember is that this is a relationship and all relationships require communication. Keep your sponsor informed. If they sink money into your facility and hear nothing back for two months they will start to think the worst. Designate someone in your organization who is in charge of keeping the lines of communication open and active at all times.

Furthermore, don’t forget about your sponsor as your facility grows in stature. Promote your sponsor and their products at every available opportunity. If you are being interviewed for the local paper, drop in the name of your sponsor. Invite representatives from your sponsor to any events you run at the facility.  Get to know everyone you can who works at the sponsor, to strengthen the ties they have to your club.  The more you do to keep the sponsor happy the longer they will continue to commit money to your operation.

How Do I Budget?
Budgeting is inestimably crucial to the process of running any organization. Shoddy or lazy budgeting at the outset will translate into financial chaos and bankruptcy later on. Designate someone to take care of the financial management of the facility from day one and make sure they are sure of their responsibilities. These should include managing profit and loss, business insurance and company credit and debit cards, as well as making the budget.

There are certain key considerations which any sports facility must take under consideration when they are setting up a budget. Even those who have drawn up budgets in other industries might not be aware of these points:
-          A great deal of your income will be based around membership dues. Consider the fact that, should these be set for payment on a certain month, there is likely to be a number of people who do not meet the payment on time. Always plan this into your budget.
-          Sponsorship might come monthly or annually or perhaps even just in a single, one off lump sum. Which suits the running of your business best?
-          How is the dollar doing? Are your expenses going to rise from year to year due to inflation? Keep an eye out for economic changes that may wreak havoc with your calculations.
-          Also, how are your expenses related to the number of groups or individuals you have using the facility? Work this out as an accurate percentage, not just a rough estimate.
-          Decide upon a minimum bank balance to deal with emergencies. Once it has been decided – stick to it!

Setting up a volleyball facility can be incredibly rewarding, financially, physically and personally. Yet doing it successfully is only possible with hard work, sound planning and, crucially, smart budgeting. Before you dive into the day to day running of the club, take plenty of time to understand the financial requirements and responsibilities which you will face. It will help guarantee the facility survives and thrives long into the future.

About the Author
Evelyn Tate is a freelance writer working with all kinds of businesses including a financial product comparison service.

Build Your Game AND Your Academics

By Matt Krebs, Founder of The Foundry, Redwood City, California

The Foundry is my brainchild.   I have been involved in volleyball since 1993, when I assisted Fred Lin with the Hillsdale College Women’s Volleyball team from 1993-1996.  A few years upon returning to Northern California, I started coaching club volleyball and in my second year of club, I founded Monsoon Volleyball.  After 3 years of directing, it became apparent to me that demand would exceed the three courts I had access to at the local high school.  This was the first factor that drove me to pursue my dream of opening up a sports facility dedicated to the sport of volleyball.

The need for quality indoor athletic space was apparent.  Unfortunately, the barriers to entry in Silicon Valley are greater than most areas.  Competitors had opened practice facilities in smaller, darker buildings but elite training facilities did not exist in Northern California.  I soon set out to change this.

I took a different approach to creating my dream facility.  Prior to securing funds, I assembled the team I wanted as well as an idea of the materials for the facility.  Once all of the research was completed and contracts were negotiated, I set out to raise the capital needed to build and support the facility.  After the acquisition of a 45,000 square foot building on Highway 101, the team set out to complete the improvements within an aggressive 45-day timeline.  The building was completed on time and on budget (which is rare) and the facility opened for club practice on December 3, 2011.

The facility currently has 3 full-time staff and a support staff of 15 coaches.  The Foundry features the very latest in indoor floor technology to create a playing surface that best simulates the response of a suspended wood floor. The use of millions of tiny rubber pellets allied to the stone underlay provides an added shock absorption not seen at other indoor centers. This not only enhances the playing experience for the athletes, but also reduces risk of injury.  Versatility is one of the facility’s greatest strengths.  There are 17 automated curtains, which allow the court space to be divided up into several areas if needed.  For example, any combination of volleyball, basketball, futsal, tennis and pickleball can be played at once under one roof.  Therefore, The Foundry can accommodate various leagues, teams and corporate events in addition to volleyball.

Another unique feature of The Foundry is the academic resource center where junior athletes can come in and study prior to and after their training sessions.  I wanted to create an environment that helps build the all-around student-athlete.  The facility offers a strong support system that assists junior athletes with staying on track with their goals, whether it is tutoring an athlete on a specific subject or assisting a student-athlete with the college recruiting process, the staff at The Foundry is there to help.  

In addition to a computer lab, the academic resource center features a well-lit, quiet lounge area equipped with IMacs where one can study or relax between training.   The full-service sports medicine center is directed by Nadine Waeghe, PT, ATC of Elevate Sports Performance and Physical Therapy.  All athletes have full access to the sports medicine center as they would in a professional sports environment.  The dues include these services, therefore all elite athletes have access to the academic resource center and sports performance and PT.

Currently, Monsoon Volleyball and Encore Volleyball both practice out of The Foundry.  Encore Volleyball offers both girls and boys junior volleyball.  There are 6 regulation volleyball courts with plenty of room around them for chasing down balls as well as a ceiling height of 30 feet.  There are over 115 lights allowing for 65-70 candle feet of lighting on the floor.  All 17 curtains are automated, allowing for ease of court separation.  There are new men’s and women’s locker rooms located at the rear of the gym.  A roof-mounted multi-directional camera system is currently being installed so that athletes can create recruiting videos.

 

A new 10,000 square foot circuit training area is being added that will feature plyometric equipment, suspension training equipment, cardio equipment as well as 3,000 square feet of speed turf.

Phil Dalhausser stopped in for a clinic at The Foundry

Phil blocking sans the jump