Super Rugby 2023
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@Kiwiwomble As I understand it correct me if I am wrong, that money was being dripfeed to grassroots.
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@Kiwiwomble the money coming in isn't classed as revenue (as it's not from 'normal operations'), but it has been classed as an expense when it's been dispersed around the country. So effectively every dollar spent thanks to Silver Lake is going to result in a one dollar loss for NZR - which is why just looking at the profit/loss for the year is not the best way of analysing the financial situation.
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@SBW1 said in Super Rugby 2023:
@Kiwiwomble As I understand it correct me if I am wrong, that money was being dripfeed to grassroots.
i never read too much of the details but thats on me but i assumed from the press the the grass roots were getting a boost as part of the deal but that the top level we're getting cash but maybe not?
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@Kiwiwomble said in Super Rugby 2023:
@SBW1 said in Super Rugby 2023:
@Kiwiwomble As I understand it correct me if I am wrong, that money was being dripfeed to grassroots.
i never read too much of the details but thats on me but i assumed from the press the the grass roots were getting a boost as part of the deal but that the top level we're getting cash but maybe not?
Cash reserves have gone up from the rest of the injected money.
Agree with @Mr-Fish above as well.
As for the stupid comments about 'return' from spending on Womens rugby ($20M) why isn't the same question asked about increased spending on the rest of the game (Men's) which was an extra $155M? The return from the womens side may just be bigger considering the investment has already won the hosting of the first WRXV. -
@Crucial said in Super Rugby 2023:
Anyone care to share the paywalled opinion piece?
I'll go and read some facts maybe. I trust my own opinion as much as Gregor Paul's (not saying much)
OPINION:
When it comes to evaluating private equity investment in professional sport, the trick is trying to determine whether the storytellers or financial managers are the real stars of the show.
Investments of the scale and nature such as the one into which New Zealand Rugby has entered with Silver Lake carry a level of complexity that makes it difficult even for financial experts to pick through the numbers in the annual report and fully understand what they are reading.
It ends up being an exercise in trust almost – that everyone simply has to hope that NZR’s upbeat, everything is on track response to the record $47m loss posted in 2022 is a triumph of strategic planning and investment nous, and not a victory for its communication team which managed to at least partly blame Covid and inflation for causing some of the deficit, while explaining that $21m had also been invested in the women’s game to support “ongoing participation growth”.
With a further $37m having been distributed to provincial unions as part of the Silver Lake investment, and $95m now parked in reserve, it seems more accurate to view the $47m gap in the accounts as a massive investment in the future growth of the game, rather than a massive loss.
And with the Black Ferns having won the World Cup at the end of last year, a 10-year strategic plan to grow women’s rugby having been signed off, and a further $100m coming from Silver Lake in July, there is enough evidence to suggest that the annual accounts are indeed a victory for the financial acumen of NZR and vindication of its decision to sell a stake in its business.
But to believe that NZR has made a major investment in the game, there has to be confidence that a return will be forthcoming.
And this is where it’s hard to be confident the financial results of 2022 are part of a long-term master plan that will save the game and not in fact a sign of a looming catastrophe, hidden by clever spin-doctoring.
Of all the arguments NZR made to support its proposal to sell equity to Silver Lake, the least powerful was the fact it would deliver an immediate provincial union cash windfall.
There’s little to no evidence to suggest that the $37m that has been pumped into the provincial game will deliver any significant increase in participation or profile.
Previous cash dumps, such as the one that the unions received from hosting the 2017 British and Irish Lions tour, have proven that money is not the panacea to the issues impacting community rugby.
No matter how much money has been thrown at the provinces, it hasn’t been able to arrest the decline in participation, which dropped another nine per cent in 2022 according to NZR’s financial statements, to 147,847.
That’s partly because money can’t stop kids from being scared of injury or feeling like the person coaching them is overbearingly intense, and partly because the unions haven’t been brilliant at investing strategically.
The Deloitte Sports Review: State of the Union report for 2017 showed that provinces only increased their spending on growing the game by 1.5 per cent after taking possession of their Lions windfall.
The $37m payout to the provinces will likely disappear with no tangible legacy benefits for the community game, and it should be seen for what it is - a sweetener from NZR to help gain approval for the equity sale to Silver Lake.
The communications team may have scored another victory in the presentation of the participation numbers as they pertain to the women’s game.
For all the positive statements made in the press release about growing female participation, the numbers posted tell a different story.
According to the financial statements, female participation declined nine per cent in 2022, from 27,562 women being involved in 2021, to 25,298 in 2022.
The growth story being promoted is based on registrations this year, which according to NZR projections, are likely to be 40 per cent up on last year, with the forecast that as many as 35,000 females will play rugby in 2023.
That’s a figure to be celebrated, but while it’s a 40 per cent increase on last year, the impact of Covid regulations must be considered as lockdowns and stricter protocols saw female participation drop from 31,000 in 2019 to 25,000 by 2022.
The numbers posted in 2023 represent only a 12 per cent increase on the pre-Covid peak in 2019.
The word only is being applied because everyone hoped that the Black Ferns World Cup victory in November last year would generate a huge participation boom, but a 12 per cent leap is in line with the annual growth rates that were posted between 2016 and 2019.
The Black Ferns were brilliant, the World Cup was brilliant, but they may not have inspired the next generation to take up the game in the sort of numbers NZR was hoping for.
One clear win for the communication team was in the promotion of now having $95m in cash reserves.
Some super anxious types will sleep easier knowing that there is a stack of cash tucked away in case of disaster, but this desire to take $262m of private equity money and mostly use it to build an enormous rainy-day fund has never made sense.
Presumably that money will be invested at short-term deposit rates, which will almost certainly deliver NZR less interest than the distribution payment they will have to return to Silver Lake next year.
Next year NZR will have to pay Silver Lake and other investors if they take up a capital raise offer later this year – up to 8.7 per cent of net commercial revenue.
And if revenue numbers are similar to this year, that means an estimated $20m will be flowing out to equity stakeholders, which is why it seems that NZR has given itself expensive access to an overdraft – one way bigger than it actually needs.
It would be great to sit back and trust that a $47m loss is all part of the grand plan, but there are too many red flags flying to be sure whether it’s the financial team or storytellers driving NZR’s commercial operation. -
Ok, I trust Gregor Paul's opinion less than my own.
So much poor analysis and narrow measures to create a 'story'.
I totally agree that investment needs to show results or benefits but these can come in many more forms than he describes.
He declares "no tangible legacy benefits for the community game". Has he checked how much money has gone into renewing and refreshing club grounds and clubhouses? Infrastructure that, if left alone, would have rotted the game alongside itself?
Halting decline is as valuable as increasing participation at the moment. Any increase is probably worth double.
Then he goes on the criticise impact from the WRWC on numbers when the season has barely started plus that bounce back from declining numbers is huge. -
@Crucial said in Super Rugby 2023:
He declares "no tangible legacy benefits for the community game". Has he checked how much money has gone into renewing and refreshing club grounds and clubhouses? Infrastructure that, if left alone, would have rotted the game alongside itself?
i see first hand what a difference that infrastructure has in keeping interest in the game, my clubs clubrooms are over a km away from where we play, we get a tent up for the bbq and that it....is see the crowds the other clubs get that have proper facilities and i understand why we struggle for numbers, hard to quantify but hugely important
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@Kiwiwomble said in Super Rugby 2023:
@Crucial said in Super Rugby 2023:
He declares "no tangible legacy benefits for the community game". Has he checked how much money has gone into renewing and refreshing club grounds and clubhouses? Infrastructure that, if left alone, would have rotted the game alongside itself?
i see first hand what a difference that infrastructure has in keeping interest in the game, my clubs clubrooms are over a km away from where we play, we get a tent up for the bbq and that it....is see the crowds the other clubs get that have proper facilities and i understand why we struggle for numbers, hard to quantify but hugely important
Some clubs have managed to add that money into, not only facility redevelopment, but the pitches as well. Surely better grounds make for better rugby and prepare better pathways?
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The whole women's rugby section was weird too. The numbers are going because of the WRWC, but not really because they went down because of Covid, but they are but by not as much what they said. WTF man.
Seriously if my interest in rugby is waning, it's not because of the rugby, or the comps (super ok/still love NPC), or because of league/soccer/AFL, it's waning because of all the negativity from the rugby media which is spilling over to everything (including forums).
I really think some people have just blocked the impact of Covid out of their heads. Even if you don't like the current NZR people they still had a shit show to deal with, and quite frankly it could have gone worse. They set up interim comps, they set up a new ongoing comp, and they did it without the supposed main revenue steam (Saffas) in a tiny market (NZ and what little of Oz still watches rugby). It may not be perfect, but it's not the disaster it's being made out to be.
Hmmm, maybe I should be posting this in the grumpy old man thread.
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@Crucial said in Super Rugby 2023:
@Kiwiwomble said in Super Rugby 2023:
@Crucial said in Super Rugby 2023:
He declares "no tangible legacy benefits for the community game". Has he checked how much money has gone into renewing and refreshing club grounds and clubhouses? Infrastructure that, if left alone, would have rotted the game alongside itself?
i see first hand what a difference that infrastructure has in keeping interest in the game, my clubs clubrooms are over a km away from where we play, we get a tent up for the bbq and that it....is see the crowds the other clubs get that have proper facilities and i understand why we struggle for numbers, hard to quantify but hugely important
Some clubs have managed to add that money into, not only facility redevelopment, but the pitches as well. Surely better grounds make for better rugby and prepare better pathways?
i admit my example is my club in melbourne so obviously nothing to do with Silverlake but definitely learnt some lessons around what goes into a club, we're waiting for some of the sweet sweet RWC money
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@Kiwiwomble said in Super Rugby 2023:
@Crucial said in Super Rugby 2023:
@Kiwiwomble said in Super Rugby 2023:
@Crucial said in Super Rugby 2023:
He declares "no tangible legacy benefits for the community game". Has he checked how much money has gone into renewing and refreshing club grounds and clubhouses? Infrastructure that, if left alone, would have rotted the game alongside itself?
i see first hand what a difference that infrastructure has in keeping interest in the game, my clubs clubrooms are over a km away from where we play, we get a tent up for the bbq and that it....is see the crowds the other clubs get that have proper facilities and i understand why we struggle for numbers, hard to quantify but hugely important
Some clubs have managed to add that money into, not only facility redevelopment, but the pitches as well. Surely better grounds make for better rugby and prepare better pathways?
i admit my example is my club in melbourne so obviously nothing to do with Silverlake but definitely learnt some lessons around what goes into a club, we're waiting for some of the sweet sweet RWC money
Last time Oz got some of that it was badly frittered away on league players instead of developing generations and spreading infrastructure outside of the existing NSW and QLD clubs
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@Crucial yeah, you would hope they wouldn't make the same mistake again......
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@Kiwiwomble said in Super Rugby 2023:
@Crucial yeah, you would hope they wouldn't make the same mistake again......
That would be a hope in vain I think when you look at the last few months ...
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@Nepia said in Super Rugby 2023:
The whole women's rugby section was weird too. The numbers are going because of the WRWC, but not really because they went down because of Covid, but they are but by not as much what they said. WTF man.
Seriously if my interest in rugby is waning, it's not because of the rugby, or the comps (super ok/still love NPC), or because of league/soccer/AFL, it's waning because of all the negativity from the rugby media which is spilling over to everything (including forums).
I really think some people have just blocked the impact of Covid out of their heads. Even if you don't like the current NZR people they still had a shit show to deal with, and quite frankly it could have gone worse. They set up interim comps, they set up a new ongoing comp, and they did it without the supposed main revenue steam (Saffas) in a tiny market (NZ and what little of Oz still watches rugby). It may not be perfect, but it's not the disaster it's being made out to be.
Hmmm, maybe I should be posting this in the grumpy old man thread.
Bang on Nepia, couldn't of put how I feel better if I tried.
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@kiwi_expat I see Clayton MacMillan was asked on the players to Aus thing and sums it up rather weLL I thought.
https://www.stuff.co.nz/sport/rugby/super-rugby/300868429/daft-draft-clayton-mcmillan-shoots-down-radical-super-rugby-pacific-proposal -
I think this would be the best outcome...
**One solution would be to go back to the future somewhat and cap the number of players Super Rugby franchises can sign or protect. Until the mid-2000s, New Zealand teams used to be able to protect a certain number of players from their catchment areas (remember those?) and then the rest would go into a player pool where franchises could patch up their sides with players from outside their border walls.
It’s an idea that could potentially work again now – if squad numbers were capped at a certain point, it would create more discussion around protected players and the NPC would have another factor as players fight to retain their Super Rugby contracts or put themselves in the prime spot for a draft spot.
Teams could still contract players long-term, but like a salary cap, they’d have to crunch the numbers and plan to make sure they have the right players retained. Get it wrong and you could be handing talent over to an opposition. Give the bottom-placed New Zealand side the first two picks of the unprotected players then work your way down the list from there. Some players would be picked up by their local franchises, but there’d be gems that the big franchises couldn’t protect that end up elsewhere.
Adding back in the old-style draft and throwing away border controls on All Blacks/Wallabies players would give the competition an instant lift. Whether New Zealand franchises have any interest in Australian players outside genuine superstars is still up for debate, but at least the option would be there.**
Why the Super Rugby draft idea is a stinker
Opinion: The Super Rugby draft is a fine idea to float, but it sinks on further analysis.
