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The blurred lines of Livestrong - the spin bike sham

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Nov 17, 2009
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Dr. Maserati said:
Common sense would say that is why there was an increase of $700,000 in the LAF travel expenses.


So what you're saying... is that you are ASSUMING that. You're GUESSING. You're BETTING.



Sorry, I've given up with reasonable talk... I've decided just to do what you do.
 

Dr. Maserati

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kurtinsc said:
So what you're saying... is that you are ASSUMING that. You're GUESSING. You're BETTING.



Sorry, I've given up with reasonable talk... I've decided just to do what you do.

Oh good, you have finally started to read the links people provided like the 990's, the IPO and the various releases from the LAF, when you use all the avalable information its pretty logical really.
 
kurtinsc said:
So what you're saying... is that you are ASSUMING that. You're GUESSING. You're BETTING.
...

jimbob_in_co said:
Exactly right BB. Until they are forced to make public all the detailed expense information, we have no real proof.

I just know about all the needlessly travel I saw (and they still 'Tweet Out') in that organization.

Sorry, Kurt, but you are wrong.

First, Dr. M. is doing exactly what a well-trained financial analyst would do when evaluating the financial statements.

Livestrong has elected not to provide a Note that covers the increase in Travel. Nor have they provided any other disclosure.

The magnitude of the Travel expense (roughly 7% of overall expenses) alone is deserving of further explanation. This is very (!) material for any organization, let alone a charity.

The fact that it increased by as much as it did would further justify some additional explanation. This would be good practice and good governance.

It would be reasonable to expect that the audit committee should have flagged this as well as the auditors themselves (especially in the wake of Enron, Sarbanes Oxley, and the current global financial crisis). Not do so raises serious questions about Livestrong governance.

No accounting firm wants to be the next Arthur Andersen.

Second, we have an insider/whistle blower providing first-hand confirmation of the excessive travel. While this person has not supplied an accounting, the observation is adequate to support the assessment of the financials.

In saying nothing about these expenses, Livestrong is not and cannot be seen to have no issue. A valid issue has been raised that should already have been disclosed.

This issue will almost certainly be receiving further attention in the press and elsewhere. Livestrong can decide to be pro-active about this, and release more information. Or, they can wait for the sh** storm to arrive.

Dave.
 
kurtinsc said:
So what you're saying... is that you are ASSUMING that. You're GUESSING. You're BETTING.

Sorry, I've given up with reasonable talk... I've decided just to do what you do.

Should be, lower case, 'assuming, guessing, betting'

i.e. lower case.

A 'Forum' is a 'discussion.'

American Capitalism is based, loosely, on four basic themes:

1.) 'A sucker is born every minute.'

2.) A focus on theoretical 'Free Market Capitalism,' which is strengthened, if you can...

3.) Game the System, and...

4.) Maximize personal profit.

That's how we here in 'Merika (US) measure success.

LA, LiveStrong, LAF and all his other permutations are:

Gaming the System to Maximize Personal Profit.

Parenthetically, 'Because he thinks he has earned and deserves it' - America's latest 'Boy Wonder,' and/or he is selling a Horatio Alger story...

Which, is simply 'public relations' and marketing.

You, Are #1, and he is #3.

Live with it.

Just to reiterate... A Sucker is Born... and you are?

Doubt it? Do some research.

(sorry if I missed it Kurt and you were commenting to a fanboy?)
 
kurtinsc said:
The initiative began in 2008. It's at the beginning of their 2008 report. Prior to that their efforts were US based.

Travel in 2006 was about a million dollars.
Travel in 2007 was about a million dollars.
Travel in 2008 was 1.5 million dollars.
Travel in 2009 was 2 million dollars.

2008 and 2009 were when they started their global initiative.

That IS a major difference. Yes, it's possible Lance got the lions share of that increase in travel. It's also possible that he got little to none of that increase, and that it instead went to Livestrong people travelling in relation to their silly "global initiative".

I don't think their global awareness thing was a good idea. But I also am doubting that lance is siphoning money off to pay for his jet fuel.

right - so Livestrong come up with this 'global initiative' just when Lance needs to travel the world for his comeback. Coincidentally the charity chooses to host EVERY single one of these 'global events' just where Lance is planning to ride ..... but the increase in travel costs dont actually go to Lance at all. :rolleyes: Lance happens to travel to ALL of these events in his private jet .... but according to you that is just too hard a line to draw to conclude that the foundation is paying some or all of Lance's travel expenses of which a large portion is the costs of his jet. Expenses which form a material portion of a large CHARITY that he is supposted to sponsor.

(note - for those of use who dont seem to understand the concept - normally when you sponsor a charity, the money flows FROM you TO the charity - not the other way around.)



kurtinsc said:
Sorry, I've given up with reasonable talk... I've decided just to do what you do.

PMSL. Sorry - I have given up on the reasonable talk too. You just dont want to see the blingingly obvious :rolleyes:
 
Aug 13, 2009
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kurtinsc said:
The initiative began in 2008. It's at the beginning of their 2008 report. Prior to that their efforts were US based.

Travel in 2006 was about a million dollars.
Travel in 2007 was about a million dollars.
Travel in 2008 was 1.5 million dollars.
Travel in 2009 was 2 million dollars.

2008 and 2009 were when they started their global initiative.

That IS a major difference. Yes, it's possible Lance got the lions share of that increase in travel. It's also possible that he got little to none of that increase, and that it instead went to Livestrong people travelling in relation to their silly "global initiative".

I don't think their global awareness thing was a good idea. But I also am doubting that lance is siphoning money off to pay for his jet fuel.

2007 was when he spent $17,000,000 on this

dpj0qx.jpg
 
D-Queued said:
Some guys just go out and buy a fast car to address their shortcomings.

This sounds like a whole lot more compensation.

Dave.

agreed, D.

This sure doesn't look like philanthropy? or, its synonyn 'altruism.'

"Look at me, I have a jet! F**k You"!

TB

Show me the money! is more like it... and Look at me!
 
Race Radio said:
Yeah, that is an old Falcon they used for a photo shoot. Here is his actual plane.

G-IVSP

1zdcakx.jpg

In the Livestrong colours named N7LA and cost over 200k to fit out after purchase. Super machine.

It's so good the makers asked Lance to be their spokesperson on the timeshare units. He agreed.... for a fee.
 
Jul 14, 2009
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TubularBills said:
dpj0qx.jpg


One Ball. High School Education. Many Children.

Something to prove.

Look at me.

"King of the World"

Almost brings a tear...

I will bet that part of the Armstrong bunch is on public assitance. Lance runs with the under educated like Steve Jobs. If anybody has enough cake to skip the lines and hassle at the worlds worst airports..spend it. Armstrongs time is worth millions why waste it pleasing enviuos punks that dream of private air travel and VIP treatment everywhere they go. That USO trip he made was pure selfish. The guy has had a 20 year career of doing some awesome things on 2 wheels. His arrogance and bravado have made him a much bigger anti hero than imaginable. You got to step on toes to get to the top and Armstrongs stomp to get there have people talking of his testicle and graphics on his private jet..pretty pittiful. I wonder what the net/gross is for his flights..Spends 300k to make a couple of million. Even Mark McCormack of IMG/ What They Don't Teach You In Havard Business School fame would be proud of Lance.. Lance as you shift gears you should call Scott Boras to get you the rest of the money you deserve.
 
Dec 5, 2010
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Since October I've been going over all the Lance Armstrong Foundation annual returns that are available to the public. I'm doing this because I'm a) very interested how the money that comes in is spent and b) want to see exactly how much Lance gets paid (along with all the directors) for their work on behalf of the Charity.

I know, October to January (at the least) is a ridiculous amount of time to spend going over the returns but it's close to 650 pages of information written for accountants to understand. I'm getting there.

One thing I will say that jumped out as a worry from the start was that a (substantial) annual fund-raising event cost *exactly* as much to put on as it managed to raise. Every year. Without exception. That's not particularly efficient to say the least. So far, LAF have not responded to my request for information as to why this should be the case.

I don't want to say too much until I've completed all the returns and had my findings checked by someone who understands US tax returns and how 501c's work better than I do. For now I'll just say that there are several apparent sizeable discrepancies between declared annual incomes and what detailed accounting of those incomes says *should* be declared over (so far) 4 years. The worst example of this was for 2009 when the declared funding was $2 million LESS than what they actually took in & declared on their returns.

But hey, what's $2,000,000 between friends?

As for licensing: Demand own & operate Livestrong.com - an entity that didn't exist until Demand set it up in an agreement directly with Lance, not with LAF. The deal was that Armstrong would provide exclusive content for Livestrong.com and promote the website as a health / lifestyle portal *in partnership* with LAF & livestrong.org - Demand don't pay LAF for the use of the Livestrong brand. The payment comes from the stock options allocated to LAF which depend on a successful IPO. Lance is the only one in this agreement who gets a direct payment regardless of the IPO going ahead or not.

I Tweeted about the IPO and how Lance & Co will profit on November 4th -

- Demand Media, (owners of livestrong.com) of which Lance Armstrong is a major stakeholder, are set for IPO this month http://smij.in/u33

- Details of how Lance acquired a stake in Demand Media - through use of the Livestrong brand http://smij.in/2hb

- With Demand IPO valued between $1 - $1.5 Billion Lance, with 1,062,500 options @ $6/share is set to make $6,375,000 profit

- LAF with 1,250,000 options @ $6/share will make $7,500,000 - (only right that the Charity makes more than Lance does out of this).

- Remember Bart Knaggs & Bill Stapleton of Tailwind Sports (now CSE)? well they do OK from the Demand IPO as well with a $2,250,000 profit

- Lance & partners stand to clear over $8,600,000 between them for selling the 'goodwill' attached to the Livestrong brand to Demand Media.

I'm trying to get clarification on a number of other things (where did Armstrongs appearance fee go, did Australia pay travel expenses for him at TDU as well as the appearance fee and why, when Doug Ulman denied that LAF paid any of Armstrongs expenses for appearing at his comeback Tour de France did LAF then list them under promotional expenses). So far I'm running into a general unwillingness to discuss these questions from anyone at LAF, Livestrong.com or CSE.

Something else that I've questioned is the nature of the relationship between Nike, LAF and Livestrong. We all know that a portion of the proceeds from the sale of Livestrong branded products goes to the LAF but according to the wording of the licence agreement (click here to see it) LAF and the Better Business Bureau "requires full disclosure regarding the benefit to the organization when funds are raised through a consumer product purchase or promotion (e.g. $1 from the sale of each item) on all packaging, advertising and promotional materials in clear and unambiguous terms. Your company/organization must be able to comply with this requirement" IF this is a requirement, why does Nike not detail exactly how much from the sale of each Livestrong branded item goes to LAF? (The licensing agreement actually makes quite interesting reading if you've got a couple of minutes free and will make you question a number of Livestrong branding agreements).

There can be little doubt that Armstrong is profiting from the charity side of his business and branding efforts as well as doing quite nicely from all his personal endorsement deals. I'm not against the man making a profit, in the least, but I do think it's only right that there is full disclosure over exactly how being the figurehead for an organisation like LAF benefits Lance.
 
Velocentric said:
- Remember Bart Knaggs & Bill Stapleton of Tailwind Sports (now CSE)? well they do OK from the Demand IPO as well with a $2,250,000 profit

Good work.

This is outrageous. While people can make an argument that it is okay that Armstrong benefits if the LAF also makes money from the deal, how the heck does someone justify Knaggs and Stapleton getting a cut? And it is a pretty large cut, almost a third of what the LAF is getting.
 
Aug 13, 2009
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Velocentric said:
Since October I've been going over all the Lance Armstrong Foundation annual returns that are available to the public. I'm doing this because I'm a) very interested how the money that comes in is spent and b) want to see exactly how much Lance gets paid (along with all the directors) for their work on behalf of the Charity.

I know, October to January (at the least) is a ridiculous amount of time to spend going over the returns but it's close to 650 pages of information written for accountants to understand. I'm getting there.

One thing I will say that jumped out as a worry from the start was that a (substantial) annual fund-raising event cost *exactly* as much to put on as it managed to raise. Every year. Without exception. That's not particularly efficient to say the least. So far, LAF have not responded to my request for information as to why this should be the case.

I don't want to say too much until I've completed all the returns and had my findings checked by someone who understands US tax returns and how 501c's work better than I do. For now I'll just say that there are several apparent sizeable discrepancies between declared annual incomes and what detailed accounting of those incomes says *should* be declared over (so far) 4 years. The worst example of this was for 2009 when the declared funding was $2 million LESS than what they actually took in & declared on their returns.

But hey, what's $2,000,000 between friends?

As for licensing: Demand own & operate Livestrong.com - an entity that didn't exist until Demand set it up in an agreement directly with Lance, not with LAF. The deal was that Armstrong would provide exclusive content for Livestrong.com and promote the website as a health / lifestyle portal *in partnership* with LAF & livestrong.org - Demand don't pay LAF for the use of the Livestrong brand. The payment comes from the stock options allocated to LAF which depend on a successful IPO. Lance is the only one in this agreement who gets a direct payment regardless of the IPO going ahead or not.

I Tweeted about the IPO and how Lance & Co will profit on November 4th -

- Demand Media, (owners of livestrong.com) of which Lance Armstrong is a major stakeholder, are set for IPO this month http://smij.in/u33

- Details of how Lance acquired a stake in Demand Media - through use of the Livestrong brand http://smij.in/2hb

- With Demand IPO valued between $1 - $1.5 Billion Lance, with 1,062,500 options @ $6/share is set to make $6,375,000 profit

- LAF with 1,250,000 options @ $6/share will make $7,500,000 - (only right that the Charity makes more than Lance does out of this).

- Remember Bart Knaggs & Bill Stapleton of Tailwind Sports (now CSE)? well they do OK from the Demand IPO as well with a $2,250,000 profit

- Lance & partners stand to clear over $8,600,000 between them for selling the 'goodwill' attached to the Livestrong brand to Demand Media.

I'm trying to get clarification on a number of other things (where did Armstrongs appearance fee go, did Australia pay travel expenses for him at TDU as well as the appearance fee and why, when Doug Ulman denied that LAF paid any of Armstrongs expenses for appearing at his comeback Tour de France did LAF then list them under promotional expenses). So far I'm running into a general unwillingness to discuss these questions from anyone at LAF, Livestrong.com or CSE.

Something else that I've questioned is the nature of the relationship between Nike, LAF and Livestrong. We all know that a portion of the proceeds from the sale of Livestrong branded products goes to the LAF but according to the wording of the licence agreement (click here to see it) LAF and the Better Business Bureau "requires full disclosure regarding the benefit to the organization when funds are raised through a consumer product purchase or promotion (e.g. $1 from the sale of each item) on all packaging, advertising and promotional materials in clear and unambiguous terms. Your company/organization must be able to comply with this requirement" IF this is a requirement, why does Nike not detail exactly how much from the sale of each Livestrong branded item goes to LAF? (The licensing agreement actually makes quite interesting reading if you've got a couple of minutes free and will make you question a number of Livestrong branding agreements).

There can be little doubt that Armstrong is profiting from the charity side of his business and branding efforts as well as doing quite nicely from all his personal endorsement deals. I'm not against the man making a profit, in the least, but I do think it's only right that there is full disclosure over exactly how being the figurehead for an organisation like LAF benefits Lance.

Good review. A few other things.

-You might also want to review the Demand Media S-1. You will see that Armstrong and CSE make more the livestrong on the deal. Armstrong also gets $1,000,000 per year in cash for three years.

-Try to figure out what that +$3,000,000 charge for "Other" is

-Why are Livestrong's legal, advertising, and travel cost so high?

-Don't hold your breath on the Demand Media IPO. It is going sideways at the last minute with some of Demand's questionable accounting practices. It should be no surprise that Armstrong hangs out with spammers who have questionable books.

-At first the media was told Armstrong's appearance fee for the TDU was going to Livestrong. This was a lie. It all went to Armstrong

-Explore how many of their "Programs" Actually get off the ground

-Buy SI next week.

When you get it all together start another thread.....there will be lots more to talk about soon
 
thehog said:
In other words: "Stop looking at this stuff. It's much better if we think it's a charity. Just pretend it's a charity and we'll all be happy".

Don't put words in my mouth! But yeah, that was what I was trying to say.:D

Mitch was just trying to emulate Speedwobble who only likes to show up once in a while and try to prove he is better than all the regular posters here, because he doesn't care............about anything.

The classic, don't look at this, look over there.......rainbows, ahhhhh.
 
Velocentric said:
Since October I've been going over all the Lance Armstrong Foundation annual returns that are available to the public. ...

Thank you!

One thing I will say that jumped out as a worry from the start was that a (substantial) annual fund-raising event cost *exactly* as much to put on as it managed to raise. Every year. Without exception. That's not particularly efficient to say the least. So far, LAF have not responded to my request for information as to why this should be the case.

Fancy accounting practice.

... For now I'll just say that there are several apparent sizeable discrepancies between declared annual incomes and what detailed accounting of those incomes says *should* be declared over (so far) 4 years. The worst example of this was for 2009 when the declared funding was $2 million LESS than what they actually took in & declared on their returns.

Outrageous - $2m disappears?
....

- Remember Bart Knaggs & Bill Stapleton of Tailwind Sports (now CSE)? well they do OK from the Demand IPO as well with a $2,250,000 profit

- Lance & partners stand to clear over $8,600,000 between them for selling the 'goodwill' attached to the Livestrong brand to Demand Media.

Outrageous personal benefit from charity. Fortunately the IPO is apparently in danger. If nothing else, this horrendous accounting should draw negative attention to potential IPO investors and have them running for cover.

... So far I'm running into a general unwillingness to discuss these questions from anyone at LAF, Livestrong.com or CSE.

No surprise

Something else that I've questioned is the nature of the relationship between Nike, LAF and Livestrong.

Should be completely transparent
...

There can be little doubt that Armstrong is profiting from the charity ... but I do think it's only right that there is full disclosure over exactly how being the figurehead for an organisation like LAF benefits Lance.

Exactly
Awesome!

Thanks.

See notes inserted into the snipped post.

Dave.
 
Kennf1 said:
Not sure if this has been covered, but Demand Media's IPO is being delayed due to accounting concerns:

http://www.nytimes.com/external/ven...y-demand-media-70503.html?partner=rss&emc=rss

Thanks for the link. The link within the story expands on the detail. Shocking to think they're going to IPO. "low quality" is the theme they gets repeated. Sounds to me they're going to IPO make some cash then get bought out?

http://www.businessinsider.com/demand-media-2010-11

We don’t need to see those types of numbers from Demand, but one year of sustained and growing profits is a reasonable standard for a new issue.

There are a lot of legitimate complaints about the state of our public markets and the process of bringing new stock issues to that market. Investor’s focus on profits is not one of them.

The private investment community continues to grow and mature, providing several strong sources of growth capital for companies like Demand that are running important experiments of innovation in old tired industries. There are many private investors who will continue to fund Demand’s business until it generates consistent profits, and these investors can afford to lose all of their money if Demand’s experiment doesn’t work. As valuable as these experiments are they are also messy, and the public markets should not provide the laboratory.