Image Courtesy of Daniel Mick

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Guest Feature: Minneapolis City Chairman’s Year in Review

by on 22 September 2016

Editor’s Note: Minneapolis City SC is a non-profit, semi-professional team that was founded in late 2015 as part of the Stegman’s organization. In this guest feature, Minneapolis City Chairman Dan Hoedeman offers a unique perspective on the practical realities of starting and running a lower-division team in America, outside the fully-professional realm of the top three divisions.


by DAN HOEDEMAN
Minneapolis City SC Chairman
@hoedeman

“You guys should join the Premier League of America with us.”
~Milwaukee Bavarians

We founded Minneapolis City SC, a non-profit community soccer club that plays in the Premier League of America, in November or December of 2015.

It was an idea that had been with us for a long time. Along with two of my friends, Jon Bisswurm and Nick Sindt, I started the men’s league club Stegman’s Old Boys in 2010. Though our beginnings were extraordinarily humble — we found most of our players from the internet, and played our first season in the Minnesota Recreational Soccer League’s third division — our organization, recruitment, and marketing were pretty good, and we had a vision.

We wanted to create a club that would outlast us.

That vision was part Milwaukee Bavarians. From the stadium to the beer hall, the history to the national titles, the generations who played in the club, and its standing as an institution, these were things that we wanted.1 It seemed incredible that nothing like that existed in Minneapolis or St. Paul.

It was part Minnesota Thunder. It didn’t get better than a Minnesota all-star team being, possibly, the best team in the country. Local guys our age knocking off MLS teams. A team so ingrained in the community, and so delightfully ramshackle, that after games you just sort of walked on the field to say hello to the players and chat a little.2

On top of all of that, we had this idea that a community club focused on community players could be a force for good in, well, our community. We had a positive shared interest, geographic proximity, and motivated people who wanted to make a difference. What if we could wield that opportunity for good?

So we took Bavarians’ suggestion and joined the PLA.

Then, we began recruiting Minnesota’s best amateur players.

After that, we started our Twitter account.

Next, we started doodling logos and kit designs.

Finally, there was a break in the fun for us to try to figure out how we would afford all this.

Chairman Dan Hoedeman speaks at Minneapolis City's annual members meeting. Image courtesy of Daniel Mick.

Chairman Dan Hoedeman speaks at Minneapolis City’s annual members meeting. Image courtesy of Daniel Mick.

“Nobody sets out to be the low-budget team.”
~City Forward Andy Lorei

We expected to lose money our first year.

Though, secretly, we had suspicions that we would be the exception, the brilliant outliers who made it all work from the get-go. We lost money our first year.

Given our background with Stegman’s, we had confidence in our ability to pull things together on the playing side. It was paying for it all that was daunting. Not knowing any better, but knowing that they were the one thing we could control, we started with costs. After writing down the league fees, which were concrete and static, we sat for a while and stared at our budget spreadsheet.

It was surprisingly difficult to figure out just how much everything was going to cost.

Having given ourselves a mere five months to get everything together before the season started in May3, and stuck at the first hurdle, we started reaching out to clubs that we admire and to people who know things about soccer. Overwhelmingly, everyone we spoke with was generous with their time and their information and yet, after hours of talking, we still weren’t sure what our budget should look like. Or even what it could look like.

Until John Pannebaker, the guy behind totally-worth-your-time American Pyramid blog, shared with us a framework budget from the legendary Peter Wilt.

We used that budget as a baseline and made adjustments to it that reflected the facts and assumptions that we had about our club, our league, and the reality of sharing a market with Minnesota United.

Peter Wilt’s Budget4 Year One   Our Forecast5 Year One
REVENUE     REVENUE  
Sponsors  15,000   Sponsors  6,000
Merchandise  -   Events  2,500
Game Day  32,950   Merchandise  -
      Game Day  12,000
TOTAL REVENUE  47,950   TOTAL REVENUE  20,500
         
EXPENSES     EXPENSES  
Team Travel  12,882   Sponsors Costs  500
Game Day & Facilities  5,970   Events Costs  800
Coaching  10,000   Merchandise Costs  -
Team Equipment  10,060   Game Day Costs  2,500
Marketing  800   Facilities  2,800
Merchandise  1,415   Community  2,000
League Fees  14,500   Team Travel  5,000
      Team Equipment  6,500
      League Fees  5,310
      Mktg & Misc  1,000
TOTAL EXPENSES  55,627   TOTAL EXPENSES  25,410
         
NET INCOME (LOSS)  (7,677)   NET INCOME (LOSS)  (4,910)

From our conversations with people who had done it before, from Peter Wilt’s example, and from what similar leagues suggested, we should have budgeted for $40,000 to $50,000 in operating costs. That struck us as expensive, particularly because it was real money for us in a way that it isn’t for m/b/trillionaire owners, and especially because we had no idea what our revenue would be.

We couldn’t really control revenue anyway, but we could manage costs.6

We had some structural advantages. As the only high-level amateur team based in Minneapolis, probably America’s most fun city in the summer, we did not need to provide housing or otherwise financially support our players’ living situations (though we did in cases of need). It was a great: our mission is to give opportunities to local players. We did that as a sort of Athletic Bilbao of the North, and that also kept costs low. TROPHY EMOJI.

Also, two of our founders work at an advertising agency. That gave us a leg up on the whole marketing and promotion side of things. It also gave us access to a really nice color printer, and the conference room needed to record a podcast. DOUBLE TROPHY EMOJI.

Advantages considered, this is still lower division soccer.

The real trick, because nobody wants to start — and certainly nobody wants to play for — the low-budget team, was managing to keep our costs like Walmart while looking like Neiman-Marcus. Maybe Nordstrom? At least Target.

There were three decisions we made that, in hindsight, seem like the critical ones:

First, we chose our league well. In addition to a high level of play, the Premier League of America has low entry and yearly fees, regional rivalry games, and — critically — had a spot for us in a division where our longest road trip was five-plus hours to Milwaukee, and we only needed to stay overnight twice.7

Second, we used social media to build awareness and generate interest. In a major league town like ours, getting noticed isn’t easy. We used cat memes, GIFs, and the fauxback thing to be interesting in our own right and pick up followers without resorting to a big paid campaign.

Third, we could answer the question “why does the world need another soccer club?” We had a reason to exist. We exist to provide local kids an opportunity to play high-level, organized soccer from the first team to first timers. We do it with a non-profit, member-funded organization that relies on people to get involved and make a difference.

It made us… interesting.

Interesting was the most important thing that we did.

Interesting attracted people to what we were building. Then we invited them into the club itself, to help us build it. They did. We got as a labor of love what other clubs had to pay for.

Our visual identity — real and fauxback — was designed by Trent Edwards and Matthew Wolff respectively. Sarah Schreier let us use her merchandise truck before taking over that whole operation. Nate Morales ran the PA at games and co-hosted and produced our podcast. Leslie Oskey, Keith Martinson, Tim Singleton, and all the other volunteers and interns helped us execute gameday operations, host events, and run free clinics for kids. We found coaches who just wanted do something good for the community. And our members put up the money to make the club run and created the atmosphere that made every single player want to return next season. Nothing helps a budget more than a bunch of important line items that price out at zero.

And nothing helps a club be sustainable like a large group of people who, rightly, see it as their club, as having built the club themselves.

So, in the end, we did shoot to be the low-budget team, but thoughtfully. It’s easy to spend a lot more than we did.

It’s also easy to lose all your money and go out of business.

We’re happy to say that we will be back next year.

Even though we did lose money.8

What Really Happened in 20169

Forecast Year One Actual Year one
REVENUE REVENUE
Sponsors  6,000 Sponsors  3,800
Events  2,500 Events  2,815
Merchandise  -   Merchandise  5,573
Game Day  12,000 Game Day  15,791
TOTAL REVENUE  20,500 TOTAL REVENUE  27,979
EXPENSES EXPENSES
Sponsors Costs  500 Sponsors Costs  337
Events Costs  800 Events Costs  1,536
Merchandise Costs  -   Merch Costs  3,917
Game Day Costs  2,500 Game Day Costs  2,690
Facilities  2,800 Facilities  2,639
Community  2,000 Coaching  2,000
Team Travel  5,000 Team Travel  4,308
Team Equipment  6,500 Team Equipment  10,083
League Fees  5,310 League Fees  5,293
Mktg & Misc  1,000 Mktg & Misc  1,814
TOTAL EXPENSES  25,410 TOTAL EXPENSES  32,804
NET INCOME (LOSS)  (4,910) NET INCOME (LOSS)  (4,825)

We did a good job of managing costs.

Adding the cost for merchandise, which we hadn’t originally included, and the cost for buying those surprisingly popular fauxback kits that we didn’t really need but fell in love with, and you just about get to the variance between estimate and actual.

We made more money that we thought we might.

Merchandise sure helped. In hindsight, it’s probably a bad idea to leave out a major line item in your budget forecast. In this case, our incompetence resulted in a happy surprise. If only it always worked out that way.

To get self-critical for a moment, it seems impossible that we did such a bad job with sponsorships.10 Happily, we have all offseason to beat ourselves up about it get better at it.

What did we learn?

More than anything, we learned how to stay in business.11

Staying in business is primarily about managing costs. Yes, we are going to work hard to increase our revenue — and with the momentum that we have, the committed supporters we have, the foundation we have, we absolutely will — but all the revenue in the world does nothing if spending outstrips costs.12

So at the same time we can say that we provided a top tier, professionally amateur experience for our players, it’s fair to say that we did it affordably. Even, dare we say, sustainably.

So what comes next?

We want to continue our mission on the field, building a club that is successful, fun to follow, and provides a development platform for Minnesota’s top players. As for goals, that means a league title and maybe a little run in the U.S. Open Cup. Sure would be fun to see a player or two move on to play at a higher level. And we need a better home field.

Also, we want to continue our mission in the community, using soccer to impact kids’ lives on a larger scale. As for goals, we want tighter partnerships with community groups and inner city youth clubs and to be able to help their infrastructure, their coaching, and their kids. We have a good foundation, we just want to do more.

It’s a one-year-at-a-time thing right now and hopefully after a few of those we’ll be established and looking to build our own stadium and beer hall. Until then, we are a group of real people, dreamers and doers, grinding away to keep this club going and make a difference. If this sounds like your thing, send us a note. We need the help. It won’t ever be easy. That’s what makes it so much fun.

#NonLeagueLife


1. In other words, everything but the lederhosen.

2. This only seems weird in retrospect.

3. This was not enough time, as everyone told us. The moral of the story: fuck it.

4. Just focusing here on year one. Suffice to say that Mr. Wilt’s version and ours included a hopeful progression from red to black.

5. We had no idea where to start with merchandise so we just left it blank, for some reason hoping, like the SAT, that is less bad than putting in the wrong answer. Clearly, we are budding titans of industry.

6. When I was graduating college, I asked my dad for advice, for him to give me the pearls of wisdom that would make me successful in the world. He paused, and considered the question for a little while. Then he sort of gruffly said, “Don’t spend more than you make,” and moved on to the buffet line with my grandmother. It’s good advice. I plan to give it to my kids someday, hopefully while in close proximity to a buffet line.

7. Take THAT budget!

8. Sorry dad.

9. With the caveat that this is a snapshot in time and we fully expect additional revenue from merchandise in stock, from sponsorship agreements over multiple years, and from the money fairy who will no doubt bless us eventually, and hopefully before the end of December, 2016.

10. If someone out there could write a blog post with details on how to do the whole sponsorship attraction thing, that would be great.

11. And we learned that my dad was right, as always.

12. Seems basic. It is in theory, it isn’t in practice.

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