Is Pegasus Dead?
First off I’d like to say that I have nothing but respect for what Chris White, the CEO of Pegasus Racing, is trying to achieve. What he’s attempting to do with Australian cycling is a tremendous effort and I applaud him for that. Getting a pro team together is a massive undertaking and Chris has had the guts to go out on a limb and make it this far. Unfortunately things don’t seem to be progressing as smoothly as we would hope.
Last month it was announced that Pegasus was not granted a ProTeam license by the UCI. Today the Pro Continental teams were listed and Pegasus was not included. According to cyclingnews:
The UCI has revealed the names of the Professional Continental teams registered for 2011 but the Australian Pegasus Sports team has again failed to satisfy the application requirements.
The team failed to secure a ProTeam licence in November and the UCI Licence Commission has given the team until December 15 to submit all the required documentation. If they fail to do so, the team could be forced to accept a Continental licence and would be limited in its race programme and team structure for 2011.
The “official reason” for the ProTeam exclusion was because of incomplete documentation in the application. After the announcement I began to wonder if it was because of a lack of sponsorship.Wasn’t this supposed to be announced at the World Championships? The fact that they keep delaying to announce their major sponsor raises questions.
Now that their Pro Continental license has been delayed I’m beginning to wonder if their much anticipated sponsor actually exists. Chris White said in an interview with on Velonation:
If we don’t succeed with our Pro Tour application then we’ll automatically achieve Pro Continental status. The team will be committed to a European programme and we’ll be fully involved in the blood passport scheme.
From my understanding, what Chris is talking about is with regards to a rule that the UCI has upon submission for a license. Basically, if an application for a ProTeam license is lodged and rejected, the team may still be obligated to put in a Pro Continental team if called upon by the UCI. My question is, where is the funding going to come from if sponsorship cannot be secured?
We recently saw some good media coverage that Pegasus received with the team gathering in Noosa where I also had the opportunity to interview Darren Lapthorne who had just signed. Among the rumoured sponsors there have been a few companies thrown around. Virgin, News Corporation (which never made sense), 3M, Gillette, and a consortium of small companies have all been talked about. From what I understand, none of these have come to fruition.
I’ve heard that some riders don’t even have a Pegasus’ signature on their contracts yet. People I’ve spoken with say there are a lot of riders who are getting nervous and thinking about plan B. There was also a good article posted on Velonation that talks about this. There are a lot of things that don’t add up.
If there is any truth to this it would be heartbreaking for many people. First and foremost, the riders. There are some world class riders they’ve signed who won’t be racing much this season if this doesn’t go ahead. This type of thing has been known to ruin careers. The riders always lose out.
The business environment is very unpalatable at the moment. There’s a chicken and egg thing going on. A bit of background on the checkboxes that need to be ticked off for the UCI to grant a ProTeam license:
1. Financial Obligation. Sponsors need to be secured for an application to be successful. The difficulty with this is that all financial liability is left up to the sponsors if the team falls over. Would you want to be a sponsor signing a four year deal and have the team fall over in the first season? You can see how difficult getting a sponsor would be.
2. Sufficient quality riders need to be signed (based on a points system)
3. Due diligence and corporate governance.
4. Race program. It’s hard to decide on a race program without any guarantee of the races you would be invited to.
Something tells me the UCI would be an absolute nightmare to deal with…
We read on cyclingnews last week Vroomen talk about his frustration with the uncertainty of getting into the big races such as the Tour de France.
After two years of racing at the top of the sport with his own Cervélo TestTeam, Vroomen is sad to reach the end of the road and warned that cycling must to do more in order to make sure sponsors are encouraged into the sport.
“One thing that’s holding the sport back, and Jonathan Vaughters and Bob Stapleton have both commented on this, is the uncertainly that’s involved in sponsoring a team. It’s very hard to find a sponsor when you can not guarantee them that you’ll be in the Tour de France,”
There is also speculation that Geox is considering ending their sponsorship as a result of not being guaranteed entry into the top events on the World Calendar. Jonathan Vaughters wrote a good article on this called “The Geox Paradox“.
Imagine you’re the VP of marketing in a multi-national company and you get a proposal to sponsor a cycling team. My guess is this proposal would be similar to the ones we at Slipstream Sports are constantly pitching. In this proposal, it’s clear that your team will participate in all the top races in the world, a few medium-sized ones in key areas for your company, and, of course, Le Tour. After a look at the demographics cycling fans cover, the total television audiences, the number of countries TV coverage goes to, the total volume of “all in” media coverage, you decide investment makes sense. Your CPT (cost per thousand) for viewership crushes any other sport in efficiency – you’ll probably get a raise!
However, one small item: did you check to see that you’ll actually get invited to all these races? Probably not, as why would this come in to question at all with a former Tour winner on the team you’re looking at? Well, just in case, its best to put a clause in the contract that states: “…the team must race in the Tour de France or contract may be terminated.”
I wish Pegasus all the best and truly hope everything works out in their favor. For the riders’ sake, I hope we aren’t seeing another Linda McCartney debacle taking shape.