It’s tough to really say whats up with the situation, as we only have a single point of view. Many of us are biased from working within FIRST for so long - we see things a certain way, but that’s not to say that what we look for in a team is the only way it should be done.
Many of us in FIRST have a strong opinion that teams should be run for the benefit of the student. That it’s about inspiring students, not winning competitions (although winning can help!). That’s what we see as a core part of FIRST, and something that I think FIRST pushes as well.
But this is rather rare in the extra-curricular world. In sports, you push your team to win. Even in things like debate team, band, math team, or chess club, there’s a focus on winning. A focus on putting the best people out there, with sufficient preparation, to win the event.
It’s normal, in the sports world, to see people cut or benched for performance issues. To see captains demoted if there are issues and new leaders promoted. It sounds like the mentor in this situation is handling the team along similar lines.
I won’t say that I like it - I don’t. It’s put that individual student in a tough spot, and it sounds like it has been the opposite of inspiring to the two former captains. But it also sounds like there wouldn’t be a team without this mentors financial contribution. That makes it a difficult and delicate situation. Come at him too hard, and he could just pack up and leave.
The best thing to do would be to get this mentor involved in the broader FIRST community. Get mentors from teams around him to interact with him on a regular basis. Something as simple as a weekly breakfast or dinner with a group of mentors, where people talk about their teams and challenges, could help this mentor to change his views, over time, and improve his program by doing so. It’s a soft approach, but that may be whats called for here.