Charlie Methven; exclusive interview.
19th July 2023
This, finally is the long promised full transcript (less an off-the-record section at Mr Methven’s request) of the interview which we trailed back in mid-May. Its release has been so long delayed because once the EFL scrutiny process commenced it became clear that the EFL was now insisting on complete media silence during the process; we were happy to agree with Mr Methven that we should not release the interview until it was clear it would not risk incurring the EFL’s wrath to do so.
In the intervening time (over 8 weeks) there have been some developments regarding the make-up of the consortium and clarification of the name of the legal entity, so we have agreed with Mr Methven that we should insert updated information at each relevant point. These updates are shown in bold (without italics).
Right? So shall we go for it, then?
Go for it.
OK. So, as I said on email I thought, rather than getting bogged down in too much Sunderland stuff, I think the most important thing that people want to know is about your role in the consortium bid; which is currently for better or for worse, always referred to by Charlton fans, as the Methven Consortium, or the CM consortium, because of your profile, whereas everybody else is unknown. So what I think everybody would like to know is, assuming the bid is successful – and that’s the reason why we’re talking today- What is your role, at Charlton going forward?
I guess I’d probably end up …I’d be investing my own money to own something like 7%, something like that in a minority investor. But probably the only one of the investors who is or the only one of any significance, who’s based here in the UK, together, maybe with Simon Lenagan, and also, you know, certainly anyone who’s had any kind of involvement in running or helping to run English football clubs; so probably, like,to keep an eye on the joint investment for everybody. And it certainly wouldn’t be my full time job or an executive role. But as, I guess, if you imagine you have a TopCo, and then the football club, probably the person from TopCo, who is expected by the other investors in TopCo to be able to tell them what’s going on, sort of link between the chairman and the technical director and the investors because the investors are mostly pretty big players with much busier lives than me.
And, you know, probably this is a very small part of their portfolio, whereas for me, it’s quite a large part of mine. So I would be sort of, you know, asking questions on behalf of them. Probably. You know, that they that I imagine that they would turn up to some board meetings, but they probably wouldn’t be able to make all board meetings, etc. So it’s a sort of overseeing, asking questions on the one hand, and then the other hand, I think, probably trying to do what I do best. And I think one of the interesting things about my experiences at Oxford at Sunderland at Arsenal and Tottenham have been working out what I’m good at and what I’m not good at; and that’s what happens as you get older unfortunately, you start to become more aware of your own deficiencies
I’m very interested in this just from a professional point of view, how you’re, maybe you’ve changed your view of what you’re good at and what you want to do in the future.
I’m not much good at managing large numbers of people.
I come from a journalistic background, journalists are mostly quite firm individualists. And we’re mostly self starters, but not really sort of corporate people. And I think there is an element of a football club, which is almost a function of public diplomacy. And I’m not really a very diplomatic person, or particularly suited to those types of sort of roles so much as I think that overall and we’ll come on to in a moment, our record at Sunderland I think, stands scrutiny. But I think one thing which did become apparent is that dealing with the “frontman” elements of running a football club, are not something which I’m naturally suited to, but what I think I am naturally suited to is making money. I do bring in money, not just investors, but squad sponsors and advertisers and all that type of stuff. I’m hopefully reasonably well connected. I’m hopefully a reasonably commercial person. And, you know, historically, that’s something which at all the clubs I’ve been involved with, I’ve been able to bring money to the equation. So I think, an overseeing role on the one hand, and then helping whoever the commercial guy is to bring more commercial partners in and that type of stuff on the other hand, but yeah, definitely not like some sort of full time. executive role. Jim Rodwell would run the club on our behalf. As he ended up doing at Sunderland for us, and has done since then at other clubs; and the technical side of the club, I’ve never got involved in the football side of the club. Frankly, I’m definitely not qualified to do that.
Okay, so that basically all makes a lot of sense. Just to clarify then; at Sunderland. There was Stewart as the chairman and you as the CEO who basically ran the club. So what would be the situation, because at Charlton currently there is no CEO, and Thomas Sandgaard has played quite a hands on role up to now; what would it look like on an operational basis once you guys…
Yeah, so I think I’m not a big fan of the CEO role of football clubs. Because effectively, a football club has two separate businesses, not at all related, one of which is a mixed retail, commercial live events, ticketing business. And then the other one, which is a sports performance business. And the theory behind the CEO is that they should be able to look over and control the whole thing, but I’ve never met one who can do that. They either come from the football side and are hopeless commercially, or they come from the commercial side, and they make poor football decisions like Ed Woodward, for instance, that sort of thing.So I think our view is, is that Jim would oversee the running of the business of the club, albeit slightly unusually for managing director,he’s a former professional footballer, but he wouldn’t claim to be a technical department person. And then Andy Scott would oversee the technical running of the club. And, obviously, then you have a finance director who makes sure that the sums are adds up. And everyone’s held to account in terms of budgets and all that type of stuff. And those would be the three senior executive roles on a day to day basis.
Right. And to sort of use the language of the headhunting world, etc. Who would they report to ?Would they report to you?
Well, I mean, they’d report to the investors. I mean, obviously, fundamentally, the major investors on our bid who between them would add up, I’m sure to over 50%, would be Gabriel Brener and Joshua Friedman. (Update: Mr Methven told us that the *families* of messrs Brener and Friedman will hold more than 50%) So effectively, when you run any business, you run it on behalf of the shareholders. And if you’ve got any sense about you, you run it on behalf of the majority of the shareholders, you know, because they obviously are the ones who ultimately control your own futures as executives. So I think, you know, they would effectively report into the TopCo, which is where the investors would sit. And yeah, I think they wouldn’t report to me, but on a sort of day to day, week to week basis, probably if the investors at TopCo need to find something out, rather than bothering the executives all the time, they’d say to me, can you find out what’s happened here? Or what’s going on there? Whatever it might be. That’s what ended up happening at Sunderland. And it’s, I think, a reasonable way of doing it. What I think what you don’t want, ideally, are investors or owners who aren’t from a football industry background having a heavy day to day imprint on the running of the club. Any more than I think you’d want football, people having a heavy day to day to imprint on the running of their native business, whatever that might be. These are quite different industries. And I think probably the single most common mistake that is made at football clubs, is that people who have made a success of things elsewhere, think that that success will automatically translate into what is a totally different business. And that I think, one of the really useful things about Brener and Friedman is not only have they run a football club together, but have been through ups and downs with that, and have tried things that didn’t work, seeing things that didn’t work, had some success or success and failure. They also have stakes in other sports clubs and franchises. I can’t speak for what they were like when they started that journey. But in as much as they ever had that bug to want to try and run things, they certainly don’t have it now. And they are only interested in things being run on their behalf by competent executives. So part of my role, once they found me, part of my role was to introduce to them competent executives, because they expressed no desire at all to run any football club. On their own account.
Well, I think also under the new regulations, I think we preempt this but you know, we will be creating a shadow board, who the executives would also have to report into, I think that’s going to become mandatory within the year. So it makes sense to get ahead of that and set up that shadow board. I think it’s really useful as well, in terms of trying to have that conversation about the prioritisation of a club, before decisions are made. And to bring the more committed sort of focused fans into that conversation to gauge whether if certain decisions were made in a certain way, whether certain priorities were taken. I think priorities is the right way to think about these things because no club, well no normal club that’s not owned by a sovereign state, can prioritise everything you have to make this… “to govern is to choose”, I think is the phrase and I think it’s the same as running a football club, you have to decide what’s important and what’s not important. And I think to engage with in a structured continual way with senior stakeholders, obviously Supporters Trust representatives, sponsors, other supportive groups Community Trust, to have those bodies represented on a shadow board. And for them to be able to input into those choices and priorities at an early stage, but also perhaps to engage with..and this is something which I went through when I was running the Supporters Trust in Oxford – well I wasn’t running it actually, I was on the committee of the Supporters Trust at Oxford – is perhaps to engage in a process of mutual education, education of the executives and the board by the fans about what Charlton means, which is always different from club to club, the history, the culture is different from club to club, and perhaps some education from the other side in terms of just the realities of those choices, and what the implications of those choices are; you know, everybody might say, we want a category one Academy, we want a professional women’s team, we want to get promoted to the Premier League, we want to buy the stadium back and.. And therein lies bankruptcy. And, you know, Derby County, you know, Sunderland, etc. So clubs to be run sustainably have to make choices. And those choices need to be choices, which are smart choices, but also choices that run with the tide of the culture of that club, as opposed to against the tide of the culture of that club. I think that shadow board is very important.
Okay. And in those things you’ve just mentioned, would you say that messrs Friedman and Brener are looking to you to really set those priorities? will that fall on your shoulders too?
Well, I don’t think so. No, I think we’re all pretty united about the approach, which is that the executives must be empowered. You know, you can’t backseat drive, and then expect them to take responsibility for these decisions, you know that. Clearly, I think everyone can see, at least in our view, you can tell me if I’m wrong, that the number one priority of this football club has to be to get out of League One because it doesn’t work as a football club in League One. That’s not being arrogant. That’s just a reality. It doesn’t fit in League One; if you think about a club, like Wycombe Wanderers, my local club where I live here, Wycombe fits perfectly in League One; doesn’t have an academy, it doesn’t have a big stadium. It doesn’t have a professional women’s team, it doesn’t have any of these things. All it needs is just to be able to fund its playing budgets and a small number of off pitch staff. And they can do that from League One revenues. Its history is as mostly as a Conference club. So being in League One is fine, historically, culturally is all fine. That none of that is true for Charlton. Charlton doesn’t fit in League One. So I think, from all of our perspectives, I suspect, getting out of League One is just very, very important for the future sustainability of the club. Outside of that, I think you need to have that conversation with the stakeholders. And you need to have a very close look at what the implications of what the certain decisions would mean. And then those have to be fed back to both the other stakeholders and also to the investors by the executives. And I think it’s not helpful to have, as I said earlier on, owners who are backseat driving and making those decisions for executives, when the executives themselves were the ones who were held to account on them.So, you know, it’s that these things have to be done the right way.
Right. The owners are, obviously, business people and with their backgrounds, they’re naturally going to be very focused on the financials over a period of time. So are you able to say what sort of period of time messrs. Friedman and Brener have for seeing a return on their investment?
Well, I don’t really think this is being done for a return on investment. If you think about the proportion of their net worth that this would form, even if it became successful, would be small. That doesn’t mean that people want to lose money, it doesn’t mean that people want to fail, doesn’t mean that people are comfortable with failing, etc. And it doesn’t mean that people want to run vanity projects, bad businesses, etc. But, you know, if they wanted to make a return on investment, my goodness me there are easier ways to do it than this. You know, I don’t really think… That timescale, they haven’t even really discussed it with me, but I mean, it’s like, somewhere off in the far horizon. It’s absolutely no interest in coming in just getting it promoted, selling it, you know, flipping it, etc to make 10 or 15 million quid – whilst that’s very meaningful for people like me, for people like them, that just wouldn’t be interesting, exciting, etc.
Are they part of the trend that The Athletic in particular writes about for American business people to suddenly become very excited about owning an English football club, comes to seeing it as a not a fashion accessory, but very much, it’s a bit of a thing at the moment? Have they been caught up in this general enthusiasm amongst American big businessman for owning an English Football Club?
I think “caught up” is a pejorative phrase? Are they American businessmen who are excited about running an English Football Club? Yes. I think the difference between them and most of the other ones is that is that they’ve owned an American Football Club. So it’s not like they’re new to the football industry. But I say American football, I should say, an MLS club, rather than NFL club. So I think they took a view that the MLS (…) will speak on their behalf. But they maybe took a view that the MLS was quite highly valued, and maybe didn’t have electric growth prospects. And they’ve done it for a long time. And I think what you’re referring to there is a general perception in the market in America that the English Premier League, and therefore the English football pyramid, has become the place to be, if you are interested in investing in football for the long run. You know, there are plenty of good reasons why you might want to buy an Italian football club or a French club, whatever it might be. But it’s hard to make out really strong cases that they’re going to be the centre of the football universe in the next 10-20 years. So I think that’s one reason; I think another reason is the amount of time that investors spend in one geography as compared to another geography; it’s not much fun, owning a football club if you never get to watch them. And Gabriel Brener, in particular, is spending a lot of time in England at the moment. Okay. So, I think there are sort of multiple different reasons. But it’s really for them to talk about their motivations. But I would say that there’s never really been a very strong sort of focus on exit …and this, you know, when when we took over Sunderland, very different profile of investors. Younger, less wealthy, more, roll your sleeves up football industry, people, etc. That was a different thing. Here we’re talking about more long term type people who will put in.. probably they have hundreds of investments in different companies, they put executive teams in place. And then wait and see how things unfold over a period of time. I think what is healthy is that the amount required to run Charlton is not an unmanageable annual part of their overall piece, so they’re not going to be in that situation that a lot of English football club owners are in where you’re, where the football club’s living hand to mouth, you know, they are well capitalised. And that’s not to say they want to lose lots of money, but it is to say that they’re not going to be in a cash constrained position themselves, and that that, in turn affects the decision making at the football club. And that can be very, one of the hardest things in running a football club. And it is very common in the Football League, by the way, probably more common than not, when there’s no certainty over the future cash flow. And the executives have to make decisions, which they know are suboptimal, but which they have to do to maintain, just keep the nose above the water effectively. So if you think about the selling of young players who have broken through into the first team, you know, we all know that they really need to be sold at the optimal moment. Unfortunately, if a club is cash constrained, they often don’t get sold the optimum, they get sold the earliest moment, and the club concern loses out on the crucial delta, which comes from that player playing an extra season or two, and already proving that he is going to be a Premier League player. So if you think about, you know how Peterborough managed Ivan Toney, they held on to him until the point at which everyone could see that he was going to be a top player. And if they sold him a year earlier, they would have got half less than half as much.
Sure. And that hasn’t happened to Charlton for many years, and I think that everybody would be very happy if they felt that owners understand that point. But just stepping back a bit from that, just to clarify, overall, on their view of the finances of the club and the cash required to to achieve their goals: it looks like even if we disregard the actual outright criminals who owned the club for about eight months, the last three proper owners of the club, that’s to say Sandgaard, Duchatelet, and even the guys who came before that didn’t appear to have done due diligence, to the extent that they realise just what the cash calls of the football club would be if they wanted to achieve their expected goals on the football pitch. Have – it may seem a daft question to ask about to such successful American hedge fund managers as I gather they are – Has that due diligence been done? Are they absolutely clear about the financials behind the football goals they want to achieve?
I think that there are many things that can be levelled against me, within the football industry. I don’t think you’ll find anyone who thinks that I don’t understand the P&L and cash flow forecasting of a football club. I would hesitate… if there was a Mastermind on that topic, I think I would probably be pretty sound. You don’t get to turn around a football club that’s losing £27 million a year without understanding how the cash flows of a football club and the operational revenue lines and cost lines of football club work. The advantage that I have is I’m able to benchmark Charlton’s performance in every area against all of its League One competitors and Championship competitors, because I know all the people who run those clubs, and I’ve been involved with many of those clubs, Jim Rodwell, likewise. So we’re able to give them a very, very brutally clear picture of the realities of the situation and a conservative forecast about what could be required if things don’t go well. Because I think you have to start off from that position, and then everything from there is an improvement rather than the other direction, if you see what I mean. And, of course, you know, I wouldn’t be placing my own money into the club if I wasn’t painfully aware of the ongoing cash requirements of the club. You know,..It’s, it’s interesting… Richard, can this bit just be off the record? I just need to just discourse a little bit.
(Mr Methven addressed in some detail, with numbers, the issue of keeping a playing squad fit and injury free…)
Right, okay. Well, that, that that all sounds very positive. So just to confirm on the record, I mean, the, as I’ve mentioned that these rumours, well, this document, that was flying around Texas, for for whatever reason, referred to…
I have absolutely no idea. We don’t have a Texas investor, we don’t. I have absolutely no idea. I mean, you can see like, what Gabriel is Mexican, I guess that’s as close as it gets. I mean, Friedman and Brener come from California. There’s one other investor from New York. There’s no one from Texas at all. (Update; Mr Methven told us that he recently learnt that Josh Friedman has recently relocated his business to Texas)So we will have to be judged by the realities of what happened. Yeah. And the realities of what will happen will be that there will be investment in the academy. And that’s partially I think, because of what I’ve just said, in terms of the technical analysis of what needs to happen, but if you look at it from an investor point of view, generally speaking, and in businesses, you tend to double down on the stuff that works. And what Charlton have got in Andy Scott and Simon Lenagan’s analysis is outstanding Academy recruitment. So they, that team is able to… convince the parents of an extraordinary depth of talent, to come to Charlton and put their kids futures in the hands of Charlton. The question then is the club then has to make sure that it does everything it possibly can to then take those young children right the way through to playing Championship, Premier League football, if they possibly can. And that’s where I think there needs to be investment is to make sure that you don’t sort of having done the difficult bit which is getting the talent particularly within the competitive market, the London Academy market is obviously in a competitive market that you have to then make sure that you that you do the best by them.
Okay, great. So that’s all on the record about the academy. So that’s good. Just Just going back to the overall ownership…
So I should just put one further point on this, which is that I’m summarising the above as the view of the Technical director as accepted by the investors, right, this isn’t like me going, ‘this is what needs to happen, that’s what needs to happen. This is a Technical director who is used to overseeing these things, saying, Is it his analysis of the situation? This is what he thinks is required, and making that case to us as investors and us then accepting that.
Right, OK. so in the overall structure…Am I understanding it right that Global Football Partners is the vehicle wherein you sit plus Messrs. Friedman and Brener and the other person?
No, it’s me. This is me and other.. Me, Ed Warrick, the finance director, Simon Lenagan, so it’s sort of, call it loosely family and friends, it’s a sort of housing point for people who aren’t the major investors so that you don’t end up having loads and loads and loads of different entities all over the shareholding register, which makes it difficult for executives to manage. They can just say, okay, look, we’ve got Mr. Brener. We got Mr. Friedman, we’ve got Global Football Partners. That’s kind of you know…(Update. Mr Methven told us that “for EFL and legal structuring reasons, we do now all sit in Global Football Partners”)
okay. Is there anyone with a kind of Charlton background or history there in Global Football Partners?
(Update. Mr Methven told us that a Charlton fan, Gavin Carter, has joined GFP and will sit on the CAFC board. We have kept Mr Methven’s previous answer below, as he makes some interesting remarks)
No. No, I mean, we’d be delighted. For there to be so. I have asked a couple of people who I know. But I think probably they look on with such horror at what’s happened to recent ownerships and thinks like why would I want to do that? I totally understand it. I mean, the club that I grew up with, was a financial basket case throughout my teens and 20s. And if anyone said to any of us at that time, you should become …actually Simon and I did end up doing it in the end, but only out of sort of for one pound. I think I totally understand why Charlton fans aren’t necessarily overly keen. I think that’s quite common to all the bids I’ve heard of is that I don’t think any of them have got Charlton fans in them so clearly… because there are actually funnily enough, there are quite a few very wealthy Charlton fans. Perhaps not unsurprisingly, given its location. That they’ve obviously taken one look and thought, You know what, I’d rather just be a Charlton fan and hope that someone gets it right rather than put my head on the block. I funnily enough, I found it. I find it very, very difficult to be involved at the top end of Oxford, because it’s hard enough anyway, but when you bring in the emotional element of it, being your own club as well and your family, you know, it already ruins your weekend at the club, your team loses, it’s ruining everyone you know’s weekend as well. It’s kind of, you can’t get away from it. It just becomes very all enveloping. I’ve got a lot of admiration for those guys who have done that, like Matt Benham, these types of people, but personally, I would rather be an Oxford United fan, and not ever have a role in running it again.
Yeah, yeah, I understand. Okay, we’re running..we’re like three minutes left. So I think we’d better not even talk about Sunderland but I mean, I think that, one important question about going forward at Charlton, and I think you’ve already referred to it, but do you basically, subscribe and suggest all of your partners subscribe to the general principle of Structured Dialogue with with democratically elected fan groups as recommended by the Fan-Led review?
Yeah, and I think it’s gonna go well beyond that. I think the new regulator is gonna go well beyond that. I think structured dialogue is, funny enough. I don’t think it works. Because it doesn’t…it still preserves this slightly sort of antagonistic type of relationship. I think that the advantage of a Shadow Board is that they actually get access to the same papers and the same data that the board does, and therefore are much more able to, to be able to ask the right questions, able to see things happening in real time, rather than only be able to complain when things go wrong. You know, I think it’s a real development for the better and I think it’s going to be mandated. So our plan is just to do it anyway. Just go ahead. Just get it set up, as two or three clubs have done it. And I’ve spoken to them and they said it works really well.
Okay, great. Look, it’s telling me less than a minute but I think it’s a really good point to to end on. So I think that…
Just yeah just on the Sunderland point, right? You know, you can argue t the whys and wherefores the ins and outs etcetera. I think generally speaking ownership should be judged on where the club was before they got there compared to where it was after they left. And I think our record at Sunderland you know, leaving the club debt free. Operationally breakeven. With the men’s and women’s teams having been promoted and the Academy under 18 team being the national champions. I think that is a good record. I think we improved…..
(Zoom call cuts off)