Formula 1 Team Looks To Get Racing With Crowdfunding Rescue Deal

Expert Says It’s The Latest Sign Of Growing Popularity Of Alternative Funding Routes

07.11.2014

David Shirt, Press Officer | 0161 838 3094

Financially-stricken Formula 1 team, Caterham, has launched a crowdfunding project to rescue the team and help it return to racing at the Abu Dhabi GP later this month.

The team is aiming to raise £2.35m by November 14 as a short-term measure whilst it also seeks a new team owner and investment to take it out of Administration.

Finbarr O'Connell, administrator and interim Caterham team principal, said: "We are working non-stop to get the team back racing, initially in Abu Dhabi. But hopefully that will be just a stepping stone to get it back racing on a permanent basis, under new ownership. In order to achieve that one of our most useful, innovative and effective options right now is crowd-funding."

Speaking about Caterham’s announcement today, Sky Sports Formula 1 correspondent ’s Ted Kravitz said: “Caterham are starting a crowdfunding operation to try and get them back racing in Abu Dhabi. If you want to, apparently, your minimum spend only has to be £10. But if you’re a millionaire out there who wants to have his name on the side of the Caterham and provide them with that money, well, get in touch.”

News of the project follows the announcement that another Formula 1 team, Marussia, has ceased trading. Marrussia went into administration last month and had hoped to return for the last race of the season.

Andrea Cropley, Corporate Partner at national law firm Irwin Mitchell and Crowdfunding specialist, said:

Expert Opinion
Once again we are seeing the growing popularity and flexibility of crowdfunding. Alternative forms of funding, such as this, are moving into the mainstream and this is another high profile example. This isn’t the first time crowdfunding has been used in sport and not all attempts have been successful. The deadline is very tight but Formula 1 has some very loyal fans and I wouldn't be surprised if it was well supported.”
Andrea Cropley, Partner

Earlier this year, Irwin Mitchell conducted its own research into crowdfunding. The national law firm’s survey found that in the next 12 months, crowdfunding was the most likely option for raising finance amongst one third of start-up businesses. Despite its flexibility, however, 31% revealed concerns that in certain situations it offered little protection to investors.