Traffic Sports USA to Take over Carolina RailHawks Next Week
Neil Morris of the Triangle Offense reported yesterday that court documents point to the dissolving of the Carolina RailHawks organization called Triangle Professional Sports, L.L.C. Morris reports that the organization originally founded by Chris Economides now includes Selby Wellman, Atlanta Silverbacks’ Boris Jerkunica, Bob Young and Dr. Paul Singh.
The dissolving of the LLC that funded the RailHawks seems to signal that Traffic USA will be taking over a majority ownership and quite possibly they will own the team outright; which is something that might not have been in Wellman’s original plan when he asked Traffic Sports to step in and help the team financially. In fact several unconfirmed stories circulating this week report there’s been a falling out between Wellman and Traffic during the negotiations.
WakeMed Park, the home of the RailHawks, is owned by the city of Cary but was sublet to Wellman’s LLC in 2006 running through the year 2011. It’s not yet known what happens to that agreement if Wellman dissolves Professional Sports, L.L.C.
Brian Wellman would not comment on the situation but he did tell Morris in an email that the sale of ownership should be finalized by the end of next week.
Please see the Triangle Offense story complete with the court documents.
Officials from the North American Soccer League and staff from its member teams are gathered this week at the NSCAA Convention in Baltimore, Maryland. NASL CEO Aaron Davidson told IMS last week that some major decisions will be made at the league meetings in Baltimore that concern the league and will allow the NASL to start moving forward with plans for the 2011 season.
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Whoah! It gets more interesting just when it looks like the dust is settling.
Mad props to Neil Morris for his work. I had enjoyed the two games that I have seen down in Cary.
The possibility of Wellman and Traffic falling out–I never saw that one coming.
Yeah, wow. Since the breakaway, I always figured Traffic, Saputo, and Wellman would all be in the same corner for the long haul. Very surprised by this development. All I think I can feel comfortable about saying at this point is, I believe Traffic is 1000% committed to making NASL work. There is no way they are fronting all this cash to get this league running for only one season, what would be the point of that?
I have to guess that they have decided, ok, we are going to do whatever it takes now to get this off the ground, and give it as good a chance as we can to start growing. I’m going to guess it’s a three year plan. If after the 2013 season they are still having to fund half this league, that might be enough for them. Then I’m guessing they would just do what USL did, drop down to D3 and try to re-organize somehow with whoever is left. There is no way ever that Traffic takes any of its teams back to USL.
I’ll throw this out as another possible angle. They might just be playing a waiting game with the Strikers. Fund this league while you “experiment” with trying to build the Strikers into the next Portland/Vancouver/Seattle “old” NASL squad to make a jump from D2 to MLS. If Traffic goes all out to market this team properly to this area and names it properly as the Ft. Lauderdale Strikers, people like Kenn T. are going to be eating humble pie with their, yeah maybe they’ll bump up to 2,000 in average attendance. All the factors are in place for a very strong rebirth of the Strikers if the proper money and work is put in now. Garber said it plainly himself last week (with Davidson invited to speak on the point as well I might add) – support the Strikers if you want a shot at MLS.
Morris does very good work as did David Fellerath when he was covering the team. They’re both good reporters.
BQ, you stated:
” NASL CEO Aaron Davidson told IMS last week that some major decisions will be made at the league meetings in Baltimore that concern the league and will allow the NASL to start moving forward with plans for the 2011 season….”
What do you mean by decisions that will allow NASL to move forward with plans for the 2011 season? I thought, based upon Davidson’s public comments that this was a done deal and all that was left was a minor follow vote by the USSF board?
Is it possible that due to all these recent actions, Carolina included, that USSF may have second thoughts about the eligibity of the NASL application in contrast with the new Professional standards?
Just league details, Bart. Nothing of the sort you thinking. Decisions on names, personal etc… After these meetings we should start hearing a lot more from the league and teams on details.
@BQ – Thanks for the insight here. We’ve all been wondering what the holdup is with the Strikers rebrand getting finalized and moving forward. I guess the answer is they’ve been busy dealing with league matters first. Understandable. But I have to think urgency now HAS to be THE order of the day. Traffic is into the NASL up to its neck now. They HAVE to have the league get off to a good start THIS year. I’m guessing they will be happy with baby steps at first, such as a gain in average attendance for a majority of league teams, and building relationships with at least a few new sponsors, even if they are smaller ones.
There has to be positives right off the bat, and that means they need to get to work now, every day they are not out in the public working at this point has the potential to cost them for this season I think, with kickoff being less than three months away. I know Davidson made a point of saying to you numerous times about the frustrations of t he lateness of sanctioning decision and how it has put them behind the 8 ball a bit in getting down to the business of the 2011 season. But it’s time. If what he is saying is true, I would fully expect to see the Strikers rebrand details become official by the end of next week at the latest, and for the league to release its schedule very soon as well, assuming there are no last minute deals being worked on to get St. Louis back in, which at this point seems like a dead possibility.
So….can we officially forget about the NASL being a “owner operated” league like they’ve always claimed to be? Traffic now owns 50% of the teams? Ironic that this league supposedly started to get away from having a league controlled by a single entity. Wonder how the important votes will go now.
@Bart: is it possible that you could clarify your comments regarding
(my) “USL bashing and NASL proganda” (either here or in the Garber goes to Miami to Hang With the Ultras thread?)
Thanks!
@Oskar Blue – I think you are making a correlation where there should not be one, and I sincerely hope there isn’t one. The Minnesota Stars we already no for sure are not being “controlled” by Traffic. Djorn and Lagos are running that team. I have not seen anything to contradict the notion that Jerkunica will be controlling the Silverbacks. It sounds as if Wellman is going to be stepping away from Carolina, so I guess we’ll just have to wait and see what happens there.
But the point is, just because Traffic fronts the cash to keep a club running, doesn’t mean they are calling the shots about the team, it’s players, or anything else. I don’t think that is what Traffic wants. I think they are simply providing what is needed to make sure there are 8 teams that can operate in the league in 2011, which is cash. Actually I think they are probably committed to a minimum of three years to see if the league can grow and hopefully take on new investors. Beyond that it’s anyone’s guess. But I think your implication that Traffic is “controlling” half the league is wrong, and it is certainly not substantiated at this point at least.
I understand what you’re saying, Strikers, but can you honestly envision that a team would vote against the wishes of it’s owner in an important board of governors vote? That’s just not realistic. Therefore, I think my point is completely valid.
It is a bad thing to have somebody with deep pockets put a large investment into this young league, though? That’s how MLS got started, after all.
Or maybe I’m completely misunderstanding the situation.
Strikes Return
Your comments regarding Traffice are a little naive. Traffic is not some altruistic not for profit organization that exists for the greater good of the game here in the US. Traffic is a for profit entity that is focused on profits.
There is no way that Traffic would be funding up to $6,000,000 a year for a 3 year period without having some form of control on how the league is structured and operates. Further, there is no way that for the three year anticipated $18,000,000 investment, Traffic will not structure a mechanism for a priority return on its money.
For that matter, no other business entity would either. The issue here is whether Traffic really will be committed for a three year period, and can convince USSF that this is the case. Otherwise, NASL will suffer the same fallout rate that USL1 did, and the D2 problem will not have been solved with the revised Professional Standards.
If every team that Traffic is funding has the individual ability to make its own operating budget, including marketing and sales, each team has essentially a blank check from Traffic to do what is wants to, and that will never happen.
This is minor league soccer, not the beginning of MLS. For the risk Traffic is undertaking, there has to be reward/return as well.
I’m not sure if that comment is directed at me, but if it is I am not sure if you are trying to agree or disagree with me.
If Traffic is basically bankrolling the NASL right now, it is obviously in that company’s interests to create a sustainable product and earn money on their investment. I’m not sure how that is a bad thing?
I want to second the “mad props” to both Morris & Fellerath. Without them, and THIS excellent site, I would know squat about my local team and its league. I’m feeling nervous about the upcoming season. What happens with both NASL & USL are the most important bellwethers for the future of pro soccer in this region IMHO.
@Oskar & Bart – I’m not being naive or altruistic at all. If you see one of my last posts over on the Garber goes to Miami story (I think that’s where I put it) you’ll see that’s not the case at all. I think Traffic is 100% committed to making NASL work as a practical matter of their business. How many Traffic players do you envision getting into a USL run league at this point? They might not be black-balled, but I’m sure USL brass will make it tough on owners who work with Traffic.
Traffic must have a reason to be fronting so much cash to keep NASL afloat. They must believe that ultimately NASL serves a purpose for them. I don’t think there is any harm at all in thinking that perhaps a small part of it might be some love of the sport and seeing it grow here in this country. But anyway, if there aim was simply to own teams and put their players on it, I’m sure they could do that anywhere in the world.
Chros is right. Traffic must somehow think that either A) by backing the league now, they believe it will be successful long term and will recover their investment plus some or B) they are propping up the league as a showcase for the Strikers, hoping they become the next Seattle/Portland/Vancouver/Montreal. To me, those are the two most likely scenarios. We definitely agree Traffic isn’t doing this for purely philanthropic reasons. But that doesn’t mean their reasons are somehow nefarious. Although if it is B), that would kind of suck for everyone except Strikers fans. But hey, if they could find a way to accomplish A) while accomplishing B) as well, that would work for everyone. Maybe that’s their pie in the sky scenario. Who knows?
Plus, I don’t think Traffic is directly funding Minnesota. Maybe BQ can give better insight on this. All that’s been said is that the Stars are “league owned” right? Speculation was running awhile back that whoever the mystery 2013 franchise is (Ottawa?) it was their monies (ie. – expansion fees) that are being used to operate the Stars for the time being.
And Bart, your point about the standards is a good one. I believe the true purpose of them is to see if D2 is even viable. It might just turn out that it isn’t.
I think it should be said that, while the original MLS owners knew they were going to lose a lot of money up front, it wasn’t a purely philanthropic venture. I’m sure the intent was to prop the league up long enough to make a profit. That is the impression I’ve always gotten, at least.
“There is no way they are fronting all this cash to get this league running for only one season, what would be the point of that?”
You do know that people with the best of intentions – who build things that they intend to last a long time – find those things don’t work out financially and, despite their hard work and capital, they have to move on. Do you think Economides et al fronted all the cash they did with the intent of having the RailHawks only last four years? I mean, what would be the point of THAT?
The NASL may very well have a long and successful life, that’s not what I’m saying. What I’m saying is the amount of cash poured into something says absolutely nothing about how long that thing will last. No matter what their intentions are. Your optimism in that regard is unfounded.
“All that’s been said is that the Stars are “league owned” right?”
Who do you think “the league” is at this point?
Wow!!! I glade they found some one to back them, but traffic better have a second plane and make it quick. If they are relying to back the league up for three years it can be a huge loss and if they are backing up the league just to see the Striker make MLS for say that can be a big loss and a waist of time seeing that their are other city that had bigger backing and bigger attendance than them. Like Tampa how has a team and has old NASL history not including ST Louise an Austin which don’t have a team but can be perfect cold starts like Philadelphia. The sanction the were give was only temporarily that’s what the second vote is for if I remember correctly not say they wont get it but it going to be fun to watch how ever this thing turn out.
How many people here think Bart is a bitter douchebag who probably works for USL?
Good points KT.
Jacques, make your points but refrain from name calling here please.
@KT – Kenn, you took my sentence out of its context which changed its meaning. What you said was exactly part of the point I was trying to make. I don’t deny at all that Traffic is in business, like all businesses, to make money. I also think they feel like they’re going about things the right way for the league too in that they are trying to do things differently from USL.
You may like Traffic or not. You may think they know what they’re doing or not. But I don’t think anyone can say in all seriousness that they are so dumb as to not recognize what it would take to continue what they are doing this year for another one or two more, and thus make a decision right up front about whether or not to follow through with it. I’m sure they are HOPEFUL that at least one new investor comes along this year and takes some of the financial burden off of them. But I can’t see anyone with any kind of sound judgment not being able to recognize the situation for what it is.
My comments were meant to suggest that my hypothesis is they have right now a three year plan they are working from. Does that mean something won’t happen this year that could cause them to drastically alter, or even abandon that plan? Of course not. But I think they are at least clever enough to have a plan in place to try and see through. Actually, I’m sure they probably had to have one they could provide the USSF with to review as part of their sanctioning bid as well. Notice they did include San Antonio as part of that package.
This could be the best thing to happen to the Railhawks. I.E. getting Wellman completely out of the fold.
@BQ – Have you received any information that seems to refute Mr. Davidson’s claim that the Stars are “league owned” rather then Traffic owned or backed? I know Kenn loves to be snarky and wise guyish, but now I think he is the one making an unfounded accusation. Traffic has had no trouble being open about the teams they have or are about to back financially in Atlanta and Carolina. Why would they turn around and lie about Minnesota? Doesn’t make sense to me. Didn’t Davidson say that the funds to run the team were coming from the league, not Traffic specifically?
@Steve – How so?
Strikers Return. If you watch the video interviews I did with Davidson even he doesn’t really try to split hairs and often talks about Traffic supporting the league. Lets be honest, there would be no D2 soccer league this year if it wasn’t for Traffic. MN is a league owned team, but Traffic owns Miami FC/Stikers/whatevertheirnameis, part of Atlanta and could own all of Carolina. So, when they are a league owned team they are in a large part owned by Traffic.Of coursed Saputo and others will also have their control but for the most part it’s Traffic.
Jacques
How many people here think Bart is a bitter douchebag who probably works for USL?
Jacques,
Nice try, but as someone previously pointed out, I am a retired, fat bald guy, whose wife beats me on a regular basis.
Having extra income from USL would be nice, but I don’t think I fit in their culture at all.
How is Canada treating you these days?
Bart,
I hear it’s cold there this time of year, but I should talk. BTW, Jacques Bart doesn’t live around USL HQ so that one doesn’t work.
“Nice try, but as someone previously pointed out, I am a retired, fat bald guy, whose wife beats me on a regular basis.”
Bart, you sort of enjoyed that comment didn’t you.
“How is Canada treating you these days?”
@Bart
Not bad considering I broke my ankle playing soccer last week and went to the
hospital and they didn’t hand me a bill…
How’s the USA treating you these days?
Peace and futbol, boyz.
Please don’t bring this forum down to the level of MANY others in the blogosphere. BQ has been bringing us all the news of D2 that NO ONE else has been reporting, so let’s be civil, and enjoy our different points of view.
Well said Neal. I have really enjoyed getting information about these leagues and North American soccer quickly and well written. Also, I like the humbleness on this specific blog. Brian will take back something he said if the contrary is pointed out. No hurt feelings or drama, just staying on top of current soccer news.
If the blog itself is this way, then I hope the comments section can copy that trend.
As has been pointed out, in the big world of soccer $6 mil is the price of one world class player. If traffic can own a whole league in the most fertile sports country in the world and sign a couple world class players over the next decade it will pay for itself. Heck, $6 mil will not get your name on the 24 car for a year. This could get them on the sports pages of 8 media markets across the country. I didn’t know who they were until the Rowdies joined the league. They may feel this is just advertising money well spent.
Good points FSUFigi. Only thing is, I think a lot of us wonder if a big talent will ever be found in D2. Most talent in the US is rooted out these days by the time they are 16 or 17.
Lightning Striker brings common sense to this discuss. We do not have to disagree, but let’s debate issues without ad hominem attacks. I am stoked there will be soccer this summer at the Nessy.
@FSUFiji – You are forgetting that league is D2 and needs sanctioning from the USSF. They won’t allow it to be Traffic’s playpen. It’s a minor league with rules. And if there are ever world class players in the U.S., they’ll be in MLS and not D2. Common sense please.
Traffic’s intentions are NOT to own the whole league and control everything. The costs would be ridiculous. Don’t you think Traffic would love to find investors for these teams if they could? As was pointed out, without Traffic, there would be no NASL.
Traffic are in the agent business. Soccer clubs in North America, outside of MLS, are bad investments. They are being forced to prop up the clubs since there wouldn’t be a NASL otherwise. But this is only a short term solution and a very dangerous one at that. You can’t compare it to the early days of MLS.
@Steve – Good thing? The payroll is being slashed by Traffic. We already lost our best players to MLS. That didn’t happen last year.
Dave.
You were said to have had the one of the highest payrolls in the league. You cannot continue to sustain a team at the D2 level with only 2 to 3 thousand people in the stands and hope to make a profit. As stated here many times Peter Wilt will tell you that drawing fans isn’t about spending a lot of money to put the best team on the field. It’s about putting a competitive team on the field and marketing and selling, selling, selling tickets. I pretty much guarantee you that no matter who would have taken over the team they would have had to cut your payroll.
Secondly, MLS has expanded and added to the rosters with their reserves. The players have to come from somewhere and I think you will continue to see D2 players from different teams get signed this winter.
Lastly, Traffic is not just in the player “agent business.” These days a big part of their business is TV rights and they also own several other teams in other countries.
It was clear that Wellman was not putting his money in the right direction. Yes a lot of money went to player payroll but in the grand scheme of things, I don’t think the fans in NC go to see the best team on the field. Is that what they would love to see…of course, but they go for the experience. Ask anybody that has gone to a Durham Bulls game in the past 5 years and I bet that a majority of them could not tell you how the team did on the field (besides all of the coverage they got for winning the Triple A title two years ago). This is because the Bulls provide one of the best fan experiences than most MiLB teams do. Wellman put all his money into the payroll and did not put money into marketing the team in Wake County. You can look at the team directory and even see that they have one of the smallest staffs in the league.
@Steve – I’ve said all along that the biggest problem with attendance in the lower levels of soccer is marketing the teams. It is something of a chicken and the egg scenario though with ownership groups saying they can’t afford the cost, but that means less attendance. Marketing certainly raises that number, but then you’re outlaying a lot of cash to do it. To this point clubs have not wanted to take the risk.
Davidson says that will change this year with NASL. They contracted PMI to work with each league club. Maybe this is where we finally see if spending more for marketing your clubs does pay off with enough additional attendance to make it worthwhile. The balance between money spent on payroll and money spent on marketing and fan experience is a tough one, but I think you’re on the right track. I think the ultimate goal of the league for year one should be making their best effort in utilizing PMI to help each club try and grow its attendance figures over last year. If the money is spent and the work is done, I think this is certainly a viable goal.