After a very exceptional spring, with endless ideas and a number of adjusted event plans for how to make Toughest a Corona-safe event, we have now reached a dead end.
The way the authorities have enforced and interpreted the regulation of maximum 50 persons makes us unable to arrange any event in 2020. This is of course devastating, as we believe that our events are safer than others (held outdoors and can easily be divided into zones with fewer people) as opposed to going to any bigger mall/store or similar. It’s sad to see that the government doesn’t see the unfairness in this. We are frustrated, but unfortunately the decision isn’t ours to make.
Rest assured that we have tried. We really believe that our revised (and re-revised) plans, which we worked so hard on, were as safe as it gets. There would be no crowds, large control and strict hygiene regulations. But as for many other businesses (e.g. Swedish amusement parks which are now demanding 1,5 Billion SEK in compensation from the government, source SVT) there was no understanding nor interpretation of the regulations regarding closeness of people and no consideration on the surrounding factors (outdoors, size of area to name a few). The only thing that mattered was the number 50. For us, 50 people in a small store is a crowd. 50 people spread over several kilometers is not. Sick and elderly people indoors are a risk. Healthy relatively young people outdoors in small groups with lots of space are not. But as it is now the stores and restaurants are crowded. People cough and sneeze in public with no further regulation. But healthy people can’t go running in an organized event, even if separated in small groups. But it doesn’t matter what we think. It is what it is and hence we cannot host any normal events in 2020.
What will happen next one might ask. In the short term we will be able to deliver a digital event instead of a real event (more on that further down). Like many other event organizers, we will not be able push your registration to next year, nor are we able to issue refunds. Many of you will fully understand. But we know many don’t. So let us try to explain in full transparency:
Our business, alongside countless other event organizers, are using the very same business model. We rely on people signing up before the event. With the income from ticket sales, we are able to pay our rent, pay salaries to our staff, pay for costs related to event preparation etc. as well as eventually paying for the actual event production. Even though we have used every government issued “economic help package” which we have been entitled to, we still have a steady burn rate. This means that there is no money in our account to refund your ticket.
So, why are we not just transferring your ticket til next year? Well, the answer could be a bit tricky to understand. Let us try to explain. When you sign up for a race, that money ends up in our bank account, but it doesn’t end up in our (financial) books until we deliver the product (in this case the event). On the other hand, the costs end up in our books the same day we trigger them. This means that we have a lot of costs, but no income, until we actually deliver the event. The sad part of this is that we need to have the income this year (remember we need to deliver the event in order to register the income in our books) in order to cover our costs and stay alive. Without this, we will go bankrupt.
So why don’t we just register them this year and hand out free tickets to next year? If we do that, we will have no income next year, and that will put us out of business as well. Our Danish neighbours have understood this and the Danish government is now paying for all cancelled events due to Corona. We are very sorry the Swedish government still hasn’t understood the business model that all companies working with events are using – simply put: the Swedish government wants the individuals to pay for this…
We understand that this is far from an ideal situation, and we understand that some of you will be very frustrated with us and/or the government. Maybe a few of you will threaten us with lawsuits. Please understand that if this would go to court and you would be entitled to have your money back, that would force us into bankruptcy and thereby not resulting in the desired outcome.
ARN (Allmänna Reklamationsnämnden, The National Board for Consumer Disputes in Sweden) have issued a directive saying that Göteborgsvarvet doesn’t need to pay back the registration fee for their cancelled events (we can’t see any reason for other interpretations due to other legal structures as referred). We are leaning on that decision and think that it is the only valid interpretation without government bailout (again what happens in several other countries). There is nothing that we would want more than to host a real, physical Toughest event instead of a digital one. But just as the CEO of the biggest event/sports organization explained, “Marathon Gruppen” will go bankrupt if people claim their money back (source SVT). The same applies to us. If we don’t survive this pandemic, there won’t be any events, not now nor later. We believe that you, just as us, would prefer to have Toughest’s events back in 2021 and forward. Hence, this is the only choice we have.
This is a lose-lose situation and we are doing everything we possibly can to make something good out of this. As mentioned, we have decided to host a digital event and come up with some other initiatives/compensations. Initially we thought that there is no way a Toughest event can be held digitally. We still think that, but we have come up with a way to do this that we hope you will enjoy. We will go into details later on, but make sure you are ready mid/late September for this event.
Around mid august you will get an email from us, with instructions on how to move forward with this event. You will be getting a couple of choices of which you should tick one. The choices include a digital event as well as the best possible compensation packages at a level we can afford. And of course you will all get discounts on 2021 events. We hope this gives you some ease and we hope you understand that we do this to be able to continue our mission to help people beat their obstacles and deliver world class events!
As to communication please await further instructions (preliminary mid august) and we ask you not to email us right now. Since we have reduced both in numbers and in working hours due to Corona, we ask you to not send questions regarding the above, but wait until we publish more information. If you have something outside of this topic that needs handling please understand that the response times will be prolonged.
Again, we are very sorry for this to ever have happened. It’s not our decision and the health of our nation/globe is of course a higher priority. We hope we will see you again next year and when we stand there at the starting line, with music pumping, Brian pep talking, you guys jumping and high fiving, all set to get out there and face the course, we will all forget about 2020 and feel the adrenaline again!
Stay safe, see you at our digital event and hopefully we’ll meet you all for real at the starting line in 2021!
Nils & Adam,
CEO & Chairman
Since releasing this statement we have received a lot of questions. We will attempt to answer the most common ones on our FAQ page (see link below).
Please read these through before contacting our support as we will simply refer to the information on that page in case of any related questions. You’ll find the questions and answers under the “Corona” section.