SHANGHAI (Reuters) - Max Chilton laughingly suggested that he would have happily cut off his right arm to secure his place on the Formula One starting grid.
That would have been counter-productive, of course, but fortunately for the glamour sport’s youngest and newest British racer, his father Grahame came up with an altogether less painful solution that could be the way of the future for Formula One.
He turned his son into a private company to raise the cash.
Chilton, three races into his rookie career with tail-enders Marussia, has effectively sold a cut of his future earnings to private investors willing to take a risk on a 21-year-old hopeful and gain tax benefits for doing so.
“With the current (financial) situation in Formula One, probably 75 percent plus of the drivers on this grid have to bring something to the team,” Chilton senior explained to Reuters at the Chinese Grand Prix on Friday.
“In the UK, you have what’s called an Enterprise Investment Scheme... and the new venture here is investing in a young and up-and-coming driver,” added the multi-millionaire who made his fortune in reinsurance.
Grahame Chilton said a group of some 35 to 40 investors had joined the EIS scheme to date, paying from 20,000 pounds ($30,800) to much greater sums with no individual allowed to contribute more than 20 percent of the invested funds.
Chilton senior has not invested anything, having paid enough already over the years to get his son to the threshold of Formula One.
“People have taken a share in his (Max‘s) potential future earnings and/or opportunities... I think in the F1 of tomorrow, many of the drivers will be making a greater part of their living out of the commercial backing that they get as opposed to the teams necessarily just paying them to be there,” he said.
Britain’s Justin Wilson formed himself into a public limited company (Plc) when he joined now-defunct Minardi in 2003, selling shares in his future to raise 1.2 million pounds, but he lasted only a season and the company has since been wound up.
Formula One has long been divided into ‘haves’ and ‘have nots’, but the dire economic climate in much of the world has exacerbated the situation.
There are the champions like Fernando Alonso, Lewis Hamilton, Sebastian Vettel, Jenson Button and Kimi Raikkonen, whose earnings are in the tens of millions of dollars.
And then there are the ‘pay drivers’, whose presence depends on what they can bring to the party through sponsorship or hard cash. Men like Chilton, desperate for a chance to show what they are made of.
“Obviously it’s not the dream way of doing it because you’re giving away part of your future,” added the blond Briton, tall and photogenic.
”But any driver on this grid would chop their right arm off to get the chance of being in F1. If doing what we’re doing now gives you a chance to get on the grid, that’s the way to go about it.
“It’s a good way of doing it and I think a lot of people will start doing it in the future.”
Marussia cannot afford to pay their drivers - they dispensed with Germany’s Timo Glock and his Brazilian replacement Luiz Razia for financial reasons before the season had started - in a sport where an annual team budget of $60 million is a pittance.
”We thought it was fairly important, and Max did, that actually we made this commercially viable,“ Chilton said. ”He didn’t want me to be just paying for his drive.
“You need to have the commercial nous to have people who wish to back you and I think Max is commercially attractive to sponsors potentially. He looks the part, he talks the part, but more importantly I think he drives the part.”
Before Max Chilton arrived in Formula One, rumors swirled that his father was bankrolling the drive and had even bought into the team.
The former chairman of re-insurers Aon Benfield laughed at the reports: “I know the team well, but I haven’t invested in the team,” he said.
What he has done is take joint ownership of Carlin Motorsport, a top team in various junior categories whose ex-drivers include some of those currently on the F1 grid, including triple world champion Vettel.
Max Chilton also raced there on his way up the ladder.
”I didn’t invest in it (Carlin) when Max drove for them because I didn’t feel that was appropriate,“ said Chilton. ”I invested post-Max being there in Formula Three.
“The company had some difficulties as a lot of motorsport companies do. I felt it was fairly important for British motorsport that we had a premier junior motorsport.”
($1 = 0.6496 British pounds)
Editing by John O'Brien