Start-ups, Shut-downs and New Beginnings

While the main focus of this weekend’s Abu Dhabi Grand Prix will be on the duel between Lewis Hamilton and Nico Rosberg for the World Championship crown, yours truly will be focussed rather more on the action elsewhere. Both in Formula One and the support paddock it will be a weekend of firsts, and two of those bear the name Caterham.

In the case of Status Grand Prix there is the small matter of not only competing in the final round of the GP3 series but also making our debut in the senior category, GP2. In GP3 Status has enjoyed a strong fifth season, including two 1-2 finishes, and we go into the final round with high hopes for our drivers Richie Stanaway, Nick Yelloly and Alfonso Celis.

But you won’t see our name on the GP2 entry list, for this is the final outing of the team in its current guise; Caterham Racing.

The purchase was completed last month, the Caterham Racing staff moving into Status’s factory in Silverstone; it has all come together rather seamlessly. In some ways, however, it is nice that the personnel involved will have a final opportunity to say goodbye to GP2 as ‘Caterham’ before being rebranded in 2015. I don’t know if any of our GP2 staff will shed a tear, but I am sure they will reflect on the events of recent months when the path for Caterham’s GP2 employees was rather smoother than for those engaged in its Formula One programme. I hope they, and ‘our’ drivers Rio Haryanto and Pierre Gasly, have a fantastic weekend.

Elsewhere the simultaneous collapse of both the Caterham and Marussia Formula One teams has led to much hand wringing, recrimination and not a little hysteria. It is not surprising. In one fell swoop Formula One lost 2 of its 11 teams, diminishing the size and diversity of the entry list overnight. But the business cost is as nothing compared to the very real human misery caused to unpaid suppliers and hundreds of staff made redundant at the start of the festive season. I have heard a few tales in F1’s ‘silicon valley’ around Oxford, and it does not make for happy listening. Some of the former senior management, now quite silent, are only too willing to see their owners or Formula One Management blamed for these collapses.

My old boss Eddie Jordan once spoke about the ‘three S’s’; survival, stability, success. These, he said, should be the foundations of any Formula One business. I can vouch for the fact that every day he was in the office ‘EJ’ would sit down with his lieutenants at around 08.30am and discuss the revenue, costs and profitability Jordan Grand Prix required. There was a relentless focus on our own sales revenue, not hand-outs from FOM. You have to develop an attractive brand proposition, sell 24/7, nail every deal that generates revenue or reduces costs, and have both the management expertise, capability and focus to woo commercial sponsors with a 365 day Formula One activity. And ‘agents’ won’t do it for you. If you cannot sell your own proposition, don’t expect someone else to.

We knew that to raise between sixty and eighty million pounds we had to develop a compelling offer to attract our own customers; whether sponsors, engine suppliers, technical partners, licensees or fans. We wanted to be successful as a team, profitable as a company, but the over riding objective was to survive.

Which brings me neatly back to Caterham F1, for this weekend we will see the team resurrected by its administrator Smith & Williamson, led by Finbarr O’Connell.

There has been much comment about the innovative crowd funding programme launched by O’Connell’s company. In two short weeks a mechanism more commonly used to fund start-ups has been used to prevent a shut-down, giving the administrator cash and time to play with. At the time of writing the sum of £1,935,625 had been raised from 6095 backers, some way short of O’Connell’s target of £2.35m – but apparently sufficient for him to send the team to Abu Dhabi.

With the staff made redundant, and suppliers desperate for solutions, this initiative has taken everyone by surprise and raised a lot of questions. Many have been shocked that it attracted such a large amount of cash from supporters so quickly, others have queried the mechanism and particularly its benefit to former staff. It is hard to argue with those who question the wisdom of raising funds in this way, how it will be spent, and whether there is a future beyond one more weekend of racing at the back. Has crowd funding any place in F1 beyond this high end garage-sale?

And yet there is something remarkable in the actions of fans who have pledged money to see a team live to fight another day. Even if that day is under the scornful eyes of the team’s critics in Abu Dhabi. It shows that there are thousands of people willing, demanding, to play a more active role in the sport. Fans who want to access the inaccessible, achieve the unachievable and show the naysayers that the small teams are popular, do add something, are worth saving. Wouldn’t it be a good thing if a white knight did turn up, people got their jobs back, suppliers were finally paid? Unlikely, perhaps, but always possible.

It’s too soon to draw any conclusions. But I do know that on this final weekend for Caterham in GP2 its sister Formula One operation is preparing for an unexpected encore. Whether it will turn out to be a final flicker or see the team fanned back to life by newfound investors, only time will tell. Whatever the case it’s another twist in the tale of Formula One 2014, and a timely reminder that the fans of this sport care a great deal about its future.