Sorry for the Non NFL post. But this is important FBG business. If it doesn't interest you, please don't do anything and just move to the next post.Hey Guys,As most of you know, I sent an email out recently that stated the following “bad news”:
That was the extent of the comment in my email. I never had any intention of discussing our business dealings on the internet for open conversation. And especially not in a mass email. It’s my belief that most people couldn’t care less about the details or causes of a business deal that didn’t go through. And that they especially don’t want to see that kind of stuff in their email box.On Thursday 8/3/06, Greg Alan of FFTOC chose to disagree with that stance and sent a mass email blast to many of our customers attempting to “set the record” straight. Greg obviously believes it’s best to try and make a point taking this issue public and putting this discussion into the email boxes of our customers. We think dragging the customers into it via emails is a very poor idea as most simply don’t want the clutter. But many of our customers have asked me to respond. As I stated above in the email simply letting folks know things had changed with Footballguys and the FFTOC, I didn’t want to go into details that might be embarrassing for them. But we also will not be mischaracterized to our customers by a story that is only partially complete. Here is the full story as opposed to what we believe was a one sided partial view of this situation.It's pretty long, sort of boring, and definitely embarrassing from a business angle that Footballguys lost money a bunch of money here but it is what it is. When my partner, David Dodds and I decided to buy 50% of the FFTOC back in the spring, it was a several step process.We trusted Greg Alan to create the purchase document. He drafted a one page document, sent it to us and we signed it unfortunately without having it reviewed by our legal counsel. We did not have an operating agreement in place at that time and would work on the process of creating one as we dug into analysis further.Basically, the agreement was that once we paid the following, we would own 50% of the FFTOC.1st payment: $7,500 2nd payment: $12,500 (March 30)3rd payment: $12,500 (June 1)4th payment: $50,000 (July 15)Once we completed making all 4 payments, we would be 50% owners in the FFTOC. After making the first two payments, David and I started having serious reservations about the contest and the company and completing the purchase. There were a multitude of reasons for our concerns and we feel it’s not proper to discuss those reasons publicly. Let me just say that after an extremely close look at all the aspects of the FFTOC and their business model, it became clear to us that that we no longer felt comfortable being associated with the FFTOC.Most importantly, I couldn’t in good faith continue to recommend this contest or company to our customers. I came to the uncomfortable conclusion after deeper analysis that I’d been wrong to recommend it. Nevertheless, I had no intention of making public an attack on the FFTOC contest or company. We entered into discussions with Greg to simply not conclude the arrangement I discussed above. Our intention was to amicably and quietly part ways as I told folks in our email at the top: “We told you a while back that Footballguys was going to be a 50% owner in the FFTOC contests. Based on complications we don't plan on discussing publicly, that is not going to happen. We have no financial or business interests with regard to the FFTOC going forward.”By June 1, we had paid $32,500 (the first 3 payments) to Greg Alan / FFTOC.As we began to weigh the negatives, we were faced with a very tough decision: Do we complete the transaction and pay another $50,000 toward something that we were not comfortable being associated with and a product that was not something we could honestly recommend to our customers?David discussed these problems with FFTOC for two plus weeks but on June 29th, we made the very painful decision to not complete the purchase of 50% of the FFTOC. Greg Alan believes he has a viable business model and a good product. We disagreed with that opinion and chose not to complete the purchase. The $32,500 we’d paid to FFTOC remains in Greg Alan's account today as far as we know.We contacted Greg Alan about this money and Greg continued to operate the FFTOC. Since we received no benefit from this transaction, and obtained no ownership, we asked him about the possibility that a portion of the money we paid into the FFTOC might be returned on a timetable that would accommodate him and his cashflow. As of the day he sent the email, he had still not made a decision on that offer. His last response was that he would not decide on the offer until sometime in mid September after the season had started. We accept that.Footballguys never obtained ownership in the FFTOC. We gained absolutely nothing from the short time we were working towards the ownership of the FFTOC. So bottom line is we did not conclude the deal. We walked away from the deal with him holding $32,500 of our money. I stressed to him that I needed to know how we were parting ways as I needed to let our subscribers know at least the basics of what was going on. I was receiving a good bit of email asking about our ownership in the FFTOC. Finally, I couldn’t hold off any longer and sent the email out letting folks know we had parted ways. After telling our subscribers we’d intended to purchase the ownership stake, I felt obligated to be up front and let them know that didn’t happen.As you well know, there is also the issue of FFTOC using the email addresses from our Footballguys 2005 Subscriber Contest for their own promotional purposes. Something we feel they do not have permission to do. We paid them to run the contest for us. At no point do we feel they were authorized to take our subscriber email addresses and use them for their own marketing purposes.I stressed to him that we had never intended to allow him to have access to these email addresses for the purpose of advertising. His exact words to me in a telephone conversation were that the FFTOC sending emails to our customers was a “consequence” of us not completing the FFTOC purchase. Once again, I had no intention of discussing our business dealings publicly. However email lists are an extremely delicate subject and I did not want anyone to believe we’d sold or transferred their email address. Regardless of our dispute with FFTOC, there is no dispute that Footballguys paid FFTOC to run the contest, and only because we paid them to run the contest, was FFTOC able to obtain the information of the participants in our contest. After the private dispute, they unilaterally took the position that the email addresses were theirs that they could use them for any reason. As said before, we totally disagree.Anyways, that's the full inside scoop. It's embarrassing for us that we could pay that much money, receive zero for it, and will probably never see the money back. Even worse was that we enrich a competing company by that amount. They gave up absolutely nothing and had $32,500 fall out of the sky into their laps and they get to retain 100% of their company. As a business guy, I hang my head over that. Sheesh.Now the good part. This has done nothing but energize and motivate us more than ever to go out and do what we know how to do better than we’ve ever done it. Footballguys content is rolling bigger and better than it ever has. We’re making inroads into huge media venues including an upcoming regular feature with ESPN The Magazine. Our subscription numbers are way up and I couldn’t be more excited to be doing what we’re doing and bringing to our customers what we feel is the best football info on the planet.We want you to know that this will in no way shape or form affect what we offer you in terms of content or cost. We took one on the chin, but we’re more focused and motivated than ever to do a great job for you guys. For you two people that didn’t fall asleep reading this far, if you want to discuss this further offline, shoot me an email at Bryant@footballguys.com. Thanks.Joe and David **************************************************Joe Bryant and David Dodds Owners – www.Footballguys.com
) to another format... I'm all for it...
