The Business Model Of A Cambodian Football Club – Angkor City FC

Gareth Johnson

Just under a year ago Cambodia Investment Review ran a follow-up story on Next Step FC at the time the newest club in professional football. After completing one full season. So, where do the club, now rebranded as Angkor City FC currently sit?

In 2022 Cambodia switched from a 13 team C-League to the Cambodian Premier League (CPL). The newly branded league was planned to not only increase club participation, but also professionalism and overall revenue.

This meant creating an eight-team top-tier, as well as for the first time a 12 team second-tier (CPL 2). An overall increase of seven newly established or promoted sides. One of them being Siem Reap based Next Step FC.

Finances of the first CPL season

With the intention of increasing professionalism and indeed revenue for the new league it had started with extremely grand plans. Sponsorship, which had amounted to an estimated $500,000 in 2021 was to be increased greatly to $3 million through a mixture of essentially selling more adds and tapping into broadcasting rights. Broadcasting rights being a chief source of income in many national leagues.

Sadly and perhaps due to lack of timing, or proof of concept not only was a main sponsor for the league not found, but no one was prepared to pay for broadcasting rights – this meant for all intents the league started without enough money.

For Next Step FC, as well as other clubs that lacked rich benefactors, which accounted for most of the division, this meant struggling to pay even basic bills, let alone make a profit.

According to Next Step FC owner Charlie Pomroy the problems were evident from the start “All we were receiving from the federation was $550 for each home game and $650 for an away game, which with us at times having to travel as far afield as Koh Kong made it impossible to break even”.

At the time this meant the club losing anywhere from a minimum of $500 a month, up to the thousands with Pomroy stating “It was costing us at least $2,500 a month to run the club, and that is without taking salaries into account”.

The club did though manage to finish the season, although coming second from bottom (11th), but also amassing $12,000 in debt. At this point continuation was touch, or go.

Next Step FC though were not the only club to find themselves either facing bankruptcy, in serious debt, or facing closure. These problems were only confounded by the decision of the CPL to move to a split season (August to May), rather than a calendar season (March to November).

The reasoning being to put the Kingdom in line with other countries throughout the region and indeed world. The choice though to do it over one season, rather than stager it was to prove not only a controversial one, but also a costly one as it ground professional football to a halt.

The next seven months were to thus prove a nightmare for the league with six clubs either declaring bankruptcy or dropping out of the second-tier of Cambodian football. This also occurred after the CPL had decided to promote the two richest clubs from the second-tier, creating a 10 team CPL

Said promotions and club closures initially led to instability around if the second-tier would take place at all, with the latest fix being to include B teams from the largest clubs in the country.

Next Step FC managed to not only weather this storm, but in some respects actually thrive, which has now led not only to their rebranding, but also them being labelled as one of the favorites for promotion going into the season.

Creating Angkor City FC

After coming second bottom and finding themselves in $12,000 of debt – Coach Pomroy was the first to admit things did not look good “We got the owners together at the end of last season and looked at the options. We needed a way to not only pay back the debt, but also somehow survive eight months without competitive football and an income. Of course we wanted to continue, but we also had to look seriously at winding up the company and the club”.

The catalyst for keeping the club going was the intervention of Cambodian businessman Savin Mao, who not only invested in the club, but also brought about an air of professionalism in his role as Chairman. A board of directors was formed and the club was treated as a professional ongoing concern, rather than just a football club.

The club though knew it could only go so far without money, so it was at this point that they utilized their local and international contacts to raise funds for the club. Sponsorship deals were done with BPVE, Desportol and Young Pioneer Tours among others, with the club managing to raise over $40,000, less than the $200,000 Pomroy said he needed to “win the division”, but more than enough to clear all debts and set the club on a sound financial footing.

“Many of our sponsors pay us monthly and when the seasons starts we will have not only money coming in from the league, but also advertising related to the billboards at the games, as well as gate receipts. The financial model of the club now is that we only spend within our means, which gives us the ability to be an ongoing concern, while also allocating extra income to developing the football side of the club,” Pomroy said.

“Another reason for the clubs intent on going forward and indeed the interest of sponsors was the hope that the CPL would eventually agree a television broadcasting deal. A deal that was finally announced last week and as well as hopefully bringing in more income to clubs directly, would lead to more sponsorship money being generated,” he added.

It was this combination of factors, alongside club licensing that led to Next Step FC rebranding the club as “Angkor City FC” with Pomroy stating: ““We began Next Step FC as a developmental side, but since then have transitioned into a professional club taking part in the Cambodian league system. With this in mind we wanted to change our name in order to not only project, but create a more professional environment and team”

Enough money to challenge

The name change has already seemingly borne fruit with the club having since signed a sponsorship Memorandum of Understanding with tech innovators Wonderpass and their parent company Haystack, to add to the already long list of illustrious partners.

What was the long-term aim? On this Pomroy was extremely clear: “We are now financially solvent, so what we want the most is success on the pitch. Right now we have enough money to challenge, but I feel with one more sponsor and the money that brings we can not only win the division, but also achieve all the criteria needed for CPL club licensing”.

And where would that sponsor be? “Currently we are looking for a main shirt sponsor, with said sponsor getting the chance to have their name seen by millions both domestically and internationally”. No price was quoted by the club, but it is known that teams at the top of the league can charge into the hundreds of thousands, with Pomroy merely stating the fee was negotiable,” he added.

But, even if the club do not gain promotion, or even a sponsor for the coming season, that they have weathered such big changes within local football and are now a viable business is in itself a huge success.