Tim: It got started when two of our board members (Krue Brock and Daryl Heald) met a third board member, Thomas Clark, who played in the NPSL in Birmingham. He approached two of our other members and said, "There is this great soccer league, but the team I played for in Birmingham wasn't great. Wouldn't it be cool if we could start a team in Chattanooga?"

They called a couple of friends who called a couple of friends, and that really became the founding board. I got involved because I knew the man who ran Finley Stadium, which was a big community stadium that wasn’t being used in the summertime. The facility was not being used to its potential and losing money. I called him and he said, "Sure. Nothing's going on there and anything that can generate revenue would be great." We put a business plan together and had a team on the field within a couple of months.

Tim: In the beginning, we said we would be happy if we had 500 fans at a game. Lo and behold, we had 1,600 in a thunderstorm at our first game. At that point, we knew we were onto something. A strong group of supporters formed quickly. They call themselves the Chattahooligans and over the course of ten years, they have distinguished themselves as one of the finest sports support groups in the United States.

Tim: The American sports landscape is dominated by a franchise sports oligarchy that owns franchises and moves them around from place to place depending on what deal they get. We operate in complete contrast to that.  We’ve said that we will never leave Chattanooga, for better or worse. We are a community-based club, and for the last ten years, we've been looking for the proper way to give fans ownership. It wasn't until crowdfunding was formed in 2016 that it even became possible.
People should understand that our community-based model is an existential threat to the franchise model. If we can be successful without paying franchise fees, it’s a big problem from the guy selling the franchise. The USL has announced that they're also going to put a team here to try to stop this in its tracks. So it’s really the perfect time for us to make the leap into the professional ranks.

The phrase that we've come up with to market ourselves in this period is "Built, not bought." That says it all. If you look at our social media and the way fans have reacted to that announcement, you see that our level of community support is pretty emphatic. We embrace a slow-growth, deep-rooted model that will ensure we’re here in 100 years. That’s our aim.
Peter: On a national level, there's a lot of other amateur clubs that look to Chattanooga Football Club. There's a lot of local context tied to Chattanooga, but there's also a national interest, especially among amateur clubs. They’re definitely looking at us to see what move we make next. That's why we think doing crowdfunding and giving people the opportunity to buy into the club is going to be the start of a significant trend.

Tim: We’ve set almost every attendance record for amateur soccer. Our average attendance is higher than many clubs in much larger cities and in higher divisions. In fact, we had a national championship game a few years back that had 18,000 people in attendance, and we've had a number of 11,000 and 12,000 games. Our average attendance last year was almost 4,000, and that was an off year.

Tim: We play in Finley Stadium, a 20k seat facility that's the largest in Chattanooga. I'm on the board of the Stadium Corporation that operates the stadium, but it does not belong to us. We've got a lot of equity built up with our fans, I think because we’ve always tried not to be extractive, and price things fairly. For years, we had a $5 ticket. We're up to $10 now, but part of this process will be to convert from a C-Corp to a Benefit Corp, because the fact is that we're not trying to wring every last dollar out of our fans. That said, we would love to have the latitude and the flexibility that our own stadium would bring us some day in the future, but at this point, we are in a city- and county-owned facility, and we'll be leasing from them under the best terms we can negotiate. We are proud of the fact that we’ve never asked for taxpayer dollars- on the contrary, by helping Finley stay profitable, we save the taxpayers money, because before we came along, the City and County had to fill the stadium’s operating deficits.

Tim: Well, life would be a lot easier if we had a viable second alternative, both from a scheduling standpoint and the ability to keep all revenue in house. So as I said, Finley is home for now, but we’d love to start exploring some alternate sites for exhibition games and dates where we might have a scheduling conflict at Finley.

We studied the Green Bay Packers model pretty extensively prior to the crowdfunding law passing and turned it over like a Rubik's cube about 1,000 times trying to figure out how we could do something like that. Just like the Packers, they've done three or four series of raises over the course of time. I think we could do a subsequent raise in a few years to help build our own stadium, but that's not in the cards right now.

Tim: The typical soccer team derives roughly equal parts of its revenue from sponsorship and ticket sales. Last year, as a purely amateur team playing three months out of the year, we were at basically 45/45 ticket sales and sponsorships and then roughly 10-15% for merchandise. Another small percentage comes from our youth soccer camps. 

Healthy merchandise can make the difference between profitability and loss. This last season we did about $750,000 in revenue. With most professional soccer teams, any surplus goes back into players, but if we play a fully professional, full season next year, we're looking at revenue projections that would be many times that.

Tim: Games are revenue events for us, so it's really about getting more games. The way we are doing things is not novel. It's only novel in this country.
This is just the way soccer is done in the rest of the world. There are a lot of people who are frustrated with the status quo in American soccer. We've found a lot of those folks will come out of the woodwork to buy our merchandise and buy tickets to our games in support of us.

By opening this up to a crowdfunded raise, we're not counting on purchasers from outside our immediate area, but I do think we'll have a fair number of people that will want to buy shares from outside the area for philosophical purposes or because they think they're supporting the good guys.

Tim: We're in the National Premier Soccer League, or the NPSL. The league is unofficially in the 4th tier of the U.S. soccer system and has 14 conferences in 4 regions.

There are 81 teams in our league. It's very difficult to win because it's a big country, there are a lot of divisions, and it's a grueling process to get through it. To try to win your way to the top of an 81-team league is a Herculean feat, and our fans care just as much if we win the league as NFL fans care if their team wins the Super Bowl.

The NPSL Pro, the league that we're joining with this raise, is projected to have probably eight teams in the league in the first year and then would grow from there as a lot of these amateur clubs move up. 

Peter: There's excitement in the top half of the division in a traditional promotion and relegation type system, and then there's excitement in the lower end of the division because you've got the risk that if you don't do well, you're going to go down. Whereas in MLS, you could get halfway through the season and not make the playoffs, but you're not losing anything at the end of the year. There are no consequences for poor performance.

Soccer is the biggest global sport, and it would be awesome to see if we can try and align ourselves better with all the other countries around the world that have promotion/relegation. We have a real opportunity here in the U.S. with all these other hundreds of amateur clubs around the country.

Tim: This is getting into the politics of U.S. soccer and the closed system versus the open system, but in order to get an MLS team, you have to write a check for $250 million, and you have to be in one the largest metro areas in the US. MLS would never allow a team in Chattanooga. If you want a team in the USL, the number is $7 million, and Chattanooga is really still too small based on the fact that it’s the 100th largest metro area in the US. So we are basically permanently relegated to lower division status just based on the fact that we live in a smaller city. This is the only country in the world where the sport works this way. In the rest of the world, you field a team and if you win your division, you get promoted to the next league up the following year. You either win your way up or lose your way down. The easiest way for people to understand that is a baseball analogy. If you're familiar with Major League Baseball, there is AAA, AA, and A. It would be like if the three worst teams in Major League Baseball got sent down to AAA the following year and the best three teams from AAA got promoted to the Major Leagues, and so on down the line. That's the way soccer works in every other country on the planet. We're not betting that that happens in the U.S. very soon,  but we hope that it happens eventually and think that it should happen. It would be a great thing for us if it did happen.

I think our target investors are people who believe in that David versus Goliath dream. If we were getting the chance to move up to to the MLS and we had the funding, we would probably do it, but what we'd rather see is an open system in the United States. We feel very strongly that it’s not only the right thing to do in general terms, but it’s the only way that American soccer is going to reach its full potential. We need a system of promotion and relegation to unleash the competitive forces and waves of investment that will get us there.

Tim: For full disclosure, there is an antitrust lawsuit pending against the U.S. Soccer Federation by the NASL, which was a rival league to the MLS and an advocate of the open system. We think the suit's got quite a bit of merit. So from an investor's viewpoint, it's a bet on the validity of that suit, because if the suit prevails and we get promotion-relegation like the rest of the world has, then the valuation of a club like ours would immediately go up based on the possibility that we could win our way up to a higher league. Conversely, if that doesn’t happen, things just will remain the same. So there isn’t a big downside risk there, but significant potential upside. 

And of course, with another team (USL D3 Chattanooga Red Wolves SC) coming in here to try to capitalize on our success, there is a chance they siphon off some of our fan base, which would make our business model more difficult that would hurt our revenue.

Tim: Currently, we don't pay the players. We make them as happy and comfortable as possible within NCAA or NAIA guidelines. A real point of this crowdfunded raise is to be able to afford a professional staff needed to run a professional team on a nine-month basis. 

Our operational budget with a professional player payroll  is projected to be about $1.3 million. You're talking about a player payroll of between $300,000 and $500,000 and front office and overhead staff for another $250,000 to $300,000. Then various administrative expenses and travel expenses make up the difference, as travel expenses are fairly significant.

Tim: If we can move up in leagues, whether we have to buy our way up or get promotion-relegation here, that would certainly draw more attention to our club. I think another really untapped piece of revenue is over-the-top media services. We think there's a great opportunity with streaming. We stream all our games now and had 30,000 viewers last season.

The other thing we're working on is a bet on the new league, and I'm on the committee that is helping put that together. We're working on putting together the right type of revenue-sharing deal with the league.

The authenticity of our type of soccer is the thing that sets it apart. We jokingly refer to the franchise soccer as McSoccer. It does not have the level of fan engagement and passion that ours does, and that is because it’s canned, pre-fab, where ours grew from the roots up.
In terms of butts in seats, we do well. Our key performance indicator is attendance per capita. Chattanooga has a market of about 550,000 people. If you can get 1% of the population in your stadium at any given time, you're doing well. For us, that would be 5,500 people. Is it possible to do more than that? Yeah. On an average basis, we think 6,000 to 7,000 fans a game would be ringing all the bells and bring more revenue.

What we’ve done already has been with an advertising budget of maybe $50,000. If we were better capitalized, we could more heavily promote the games, and certainly sell more tickets. In this new league, we'd be playing the New York Cosmos, Detroit, and Miami, some bigger markets. That would obviously be a more appealing draw for fans.

Peter: We have the ability to keep our ticket prices relatively low compared to another professional team that has to pay big franchise fees and all the rest of it. We've got more flexibility to not scare people away with high ticket prices, and that's a key thing for our community here in Chattanooga. And our ticket pricing model will always be flatter and simpler than our competitions. That philosophy reflects our general philosophy of an egalitarian, community feel.

Tim: There are a couple of college teams, but nobody that draws anything like we draw and certainly not over the course of the same season. There's a USL D3 team that is slated to start here, though, and they'll be our primary competition.

Tim: I think it's a little bit of both. A lot of people come to the games because it's a conduit for their strong sense of place and community pride, and then they fall in love with the soccer. Then it becomes a flywheel effect when they bring friends, but it is more about the community and about expressing their love than it is about the game itself. 

People are surprised to learn Nashville has a hockey team. They could be playing ping-pong and Nashville would show up, though, because what else are you going to root for? But the difference with a franchise operations so common in American sports  is that a franchise operation is exactly that. It lacks real authenticity because deep down people know that the franchise could change their team affiliation or could just pick up and leave if the owner is not getting a good return. That's where we are fundamentally different. We were founded by Chattanoogans for Chattanooga, and we're never leaving. This is not an uncommon thing in Europe where teams are deeply rooted in their communities.

Tim: Since the early days of the club, I have always been an advocate for what I jokingly refer to as the Chicago Cubs model (this was before the Cubs won the World Series, mind you), which I would sum up this way: if you have a great environment, passionate fans, and good branding, then you really don’t have to win a ton of games for people to show up and have fun. They will come for the love of that team and the experience. That being said, we have an overwhelmingly winning record, and we certainly want to win, but we have never relied on winning to put people in the stands.

This year was a good example. We only made the first playoff game. The team had a little trouble scoring goals, so not as exciting a team as we've had in some prior years, but we still met the attendance we wanted. It was still sufficient and the highest of any team in our league of 81 teams.

Tim: The conventional wisdom is that this is really about competitive choices. I would say that we've got a significant first-mover advantage over any team that comes after us. We know people form emotional connections with teams, and we've got plenty of fans with tattoos of our logo, which is the highest compliment, really. Our stickers are all over everything here. The depth of engagement is super strong. Basketball, just demographically, wouldn't be a huge threat. Hockey similarly would be expensive, and I imagine because of what's going on in Nashville it might cut into our games a little bit. We play concurrently now with the AA baseball team, and we've done everything we've been able to do over the course of ten years playing in parallel there.

Tim: We are somewhat worried about this other USL team coming in simply because our model is under threat. While we don't think they'll peel out many of our fans, they'll probably peel out a few, though on the other hand, having two teams might just grow the overall market for soccer in Chattanooga. The other thing would be the stadium issue. I'm just one board member on the stadium and at times we have a contentious relationship with them. They're worried about their bottom line, and we're worried about our bottom line. We need to negotiate a mutually beneficial contract, but we feel we can.

Tim: First and foremost, we have a ten year track record. Ten years ago, I would have had to rely on just general business experience, but what we've done over the course of the last ten years has been pretty extraordinary, and we have learned a tremendous amount from that experience. We've also gotten a fair amount of international attention because, as we've said, if soccer can make it here on the buckle of the Bible Belt, then soccer has truly made it in the United States.

We’ve learned a lot. We were a startup in 2010. I'm a serial entrepreneur and have owned and started quite a few businesses (7 and counting). My fellow board members and I bring a lot of varied background and experience to the project, and we know how to do it. Directly or indirectly, we've helped spawn four or five of the other large, independent teams in the United States. Our track record is fairly extensive and speaks for itself.

Peter runs the largest program within our foundation (Operation Get Active), and our foundation is a huge part of what we do. Part of what allows fans to really fall in love with us is our commitment to the community. It's not just photo-op commitment to the community. It's a real commitment.

Peter: I grew up supporting my local team in England. I'm an absolute soccer fanatic, and I still play the game. I was brought up in a country with a completely different system to what it is here. I would love to see soccer in the U.S. be more like it is in the rest of the world. That's from a personal standpoint. Then I'm involved in the club on our community side running an after-school soccer program called Operation Get Active. We're trying to get kids to simply be active through the game of soccer. We're working with 20 of our inner-city elementary schools, kids that don't get much opportunity to participate in recreation programs. We provide our program for $10 for a season, which is around ten weeks, and these kids practice twice a week after school. We're looking at close to 800 kids that will be participating in our program this fall. We also work with kids and adults with disabilities because we believe it’s really important that those people are included in what we're doing here in the club.

We're seeing some real talent in our community. There are a lot of kids who have strong abilities, but there's no path for them to go on and play for our first team. We're trying to make that for them so that we can see some kids that do our program at an elementary school, one day go on and play for Chattanooga Football Club and even look to make a career out of the game.

Tim: None of our community programs would be possible without our sponsors. The other thing that demonstrates the depth of engagement is sponsorship, and Volkswagen was our sponsor for our first year. We now have really solid corporate support, both on the team side and on the nonprofit side from Volkswagen.

I sold sponsorships personally for the first seven years, and then in the last couple of years have turned it over to a team that helps do it. We have not really had to quantify benefits for sponsors. We do occasionally have one represented by a third party ad firm that wants to know how many eyeballs they got and how many clicks the website got. One of the things we'll be able to do with a bigger staff is to quantify sponsor benefits better.

My main business through the course of my life has been the car business. As a car dealer, I'm usually on the other end of a sponsorship pitch. I've usually got people asking me for money. I'm very familiar with it and I'm familiar with what it takes for a business to feel as though they've gotten value for the dollar. Our mantra from the very beginning is to make sure that sponsors feel like they've gotten more than they've paid for. We've yet to lose a major sponsor in ten years. Part of that has to do with the level of engagement of our fans. Our fans are extremely passionate and they tend to patronize our sponsors and our sponsors see that.

Tim: I think the easiest way to understand that is to look at what Arthur Blank has done in Atlanta with the Atlanta United. Those guys came up to Chattanooga and took a look at our model because Darren Eales, their general manager, came from England and had heard what we did and wanted to see how a team in the American South- where most people didn’t think the sport would ever be popular because it’s SEC football country- was managing to energize soccer fans. In fact, the first game Atlanta United ever officially played was in Chattanooga against us.

Interest in baseball is waning among youth. We all know about the concussion issues with the NFL. The future belongs to soccer, but it's actually the stagnancy of the MLS/USL model that's holding it back. If soccer had an open system and more teams were able to render the depth of engagement that our fans have, soccer would be there a lot faster. That also has an impact on the success of the national team. An open system creates an investment dynamism that just can’t be simulated in a closed system.

Peter: We have the World Cup coming here in 2026. We've got huge buildup time for that where the world's attention is on U.S. soccer and the majority of the games will be played in the United States. That is another huge opportunity for us to further champion our cause of an open system here. It would be phenomenal if we can have it up and running and show that it's gaining momentum and the buildup to that.