[BHoover]

I came across an article this morning on Geoff Shackleford's blog about the plans that the founder of GoDaddy.com has for his newly acquired Scottsdale National GC.  Pretty much everything in this article seems to be in direct contradiction to the types of things that many of us on this site support.  The plans call for a new clubhouse, more extravagant dining/food options, new carts with fancy new GPS systems, etc.  From what I can tell, the plan seems to be to create some type of ultra-exclusive national club.  But it seems to me that Mr. GoDaddy missed the boat on the market for these types of ultra-exclusive clubs by about 10 years.  

But the "best" part is the stuff about the members who use the club most being the ones who support the club the least.  The club is going to charge a $100 service fee for each day that a member is out at the club.  Guest fees also are going up.  Members will be limited to 30 rounds/year without hosting a guest.  

For those members who do not like the new policy, the owner is offering a "resignation opportunity" whereby he will pay a dollar-for-dollar refund of their initiation fee.  If I were a member, I'd be submitting my resignation letter ASAP and banking the cash.

Once he clears out the existing members, he's looking to invite a select group of national members.

Here is the link to the article:
http://www.geoffshackelford.com/homepage/2013/12/16/scottsdale-developer-to-members-who-play-too-much-resign.html

[Steve_ Shaffer]

Perhaps the club should now be named GoDaddy.com  GC. 

It's his club and he can do as he wants.

http://tbrpf.org/news/

[BHoover]

He absolutely can do what he wants.  I don't disagree with that.  I just question whether his business model is going to work.  Ten years ago, yes; now, I'm not so sure.

I do suggest that he hire a bunch of GoDaddy girls to work at his club.

[Steve_ Shaffer]

Brian,

I'm not sure either; however, if he changes the course and builds a new club house, etc and there is a negative cash flow, I'm sure he can make up the difference.

[Steve Lapper]

Interestingly, Due Process Stable GC in Colts Neck, NJ made a near identical move a few years back. The two owners, (Owner of AZ Ice Tea and pre-IPO partner at Goldman Sachs) took out every prior member at their original initiation number, then hand-picked a few new members, all but a fraction of the original number.

For them, it worked and the club seems to thrive under the current plan and was arguably in the best condition this past season, better  than it has enjoyed years back. A few other very wealthy dudes have sone this from time-to-time in golf and so long as they are willing to write the operating checks, they like it that way.....who are we to pass any judgement on this model?

[Andrew Buck]

Interestingly, Due Process Stable GC in Colts Neck, NJ made a near identical move a few years back. The two owners, (Owner of AZ Ice Tea and pre-IPO partner at Goldman Sachs) took out every prior member at their original initiation number, then hand-picked a few new members, all but a fraction of the original number.

For them, it worked and the club seems to thrive under the current plan and was arguably in the best condition this past season, better  than it has enjoyed years back. A few other very wealthy dudes have sone this from time-to-time in golf and so long as they are willing to write the operating checks, they like it that way.....who are we to pass any judgement on this model?

Yep.  I saw this at our club Christmas party Friday night. 

I'm sure this can work as a private playground for your friends or certain very niche markets to potentially break even. 

[Rick Shefchik]

It's interesting that your $110,000 initiation fee apparently puts you in the deadbeat category if you don't stick around to buy a beer and a sandwich after your round.

[JMEvensky]

I do suggest that he hire a bunch of GoDaddy girls to work at his club.

Danica Patrick driving the beer cart?

[Steve_ Shaffer]

Will Parsons maintain his membership at Whisper Rock?

Here's his story:


 http://www.baltimoremagazine.net/people/2011/02/hes-your-daddy

[Dave Givnish]

Unfortunately, a friend of mine was there. He decided to resign along with everyone that he knows there. Parsons sold the members on buying the club from Crown and then selling it to him. On hindsight, the deal was full of rainbows and unicorns. He bought the club for the cash ($600k isn) and the membership fee liability. All in, the club cost him about $7M or less. I think that is less than what the Crowns paid just to get water to the property.

Parsons is at Whisper Rock and at Estancia.

[Greg Tallman]

I came across an article this morning on Geoff Shackleford's blog about the plans that the founder of GoDaddy.com has for his newly acquired Scottsdale National GC.  Pretty much everything in this article seems to be in direct contradiction to the types of things that many of us on this site support.  The plans call for a new clubhouse, more extravagant dining/food options, new carts with fancy new GPS systems, etc.  From what I can tell, the plan seems to be to create some type of ultra-exclusive national club.  But it seems to me that Mr. GoDaddy missed the boat on the market for these types of ultra-exclusive clubs by about 10 years.  

But the "best" part is the stuff about the members who use the club most being the ones who support the club the least.  The club is going to charge a $100 service fee for each day that a member is out at the club.  Guest fees also are going up.  Members will be limited to 30 rounds/year without hosting a guest.  

For those members who do not like the new policy, the owner is offering a "resignation opportunity" whereby he will pay a dollar-for-dollar refund of their initiation fee.  If I were a member, I'd be submitting my resignation letter ASAP and banking the cash. And in doing so giving him exactly what he wants... rod of the previous membership

Once he clears out the existing members, he's looking to invite a select group of national members.

Here is the link to the article:
http://www.geoffshackelford.com/homepage/2013/12/16/scottsdale-developer-to-members-who-play-too-much-resign.html

[BHoover]

I came across an article this morning on Geoff Shackleford's blog about the plans that the founder of GoDaddy.com has for his newly acquired Scottsdale National GC.  Pretty much everything in this article seems to be in direct contradiction to the types of things that many of us on this site support.  The plans call for a new clubhouse, more extravagant dining/food options, new carts with fancy new GPS systems, etc.  From what I can tell, the plan seems to be to create some type of ultra-exclusive national club.  But it seems to me that Mr. GoDaddy missed the boat on the market for these types of ultra-exclusive clubs by about 10 years.  

But the "best" part is the stuff about the members who use the club most being the ones who support the club the least.  The club is going to charge a $100 service fee for each day that a member is out at the club.  Guest fees also are going up.  Members will be limited to 30 rounds/year without hosting a guest.  

For those members who do not like the new policy, the owner is offering a "resignation opportunity" whereby he will pay a dollar-for-dollar refund of their initiation fee.  If I were a member, I'd be submitting my resignation letter ASAP and banking the cash. And in doing so giving him exactly what he wants... rod of the previous membership

Once he clears out the existing members, he's looking to invite a select group of national members.

Here is the link to the article:
http://www.geoffshackelford.com/homepage/2013/12/16/scottsdale-developer-to-members-who-play-too-much-resign.html

I'd rather have the $110K in cash.

[JESII]

I'd stay!

Sounds like an opportunity to benefit from someone willing to make an investment with no expectation of a return.

What will my dues look like next year versus this year?

[Brett Wiesley]

Why didn't the membership buy the club.  Even if only 100 stuck it out, that's $6,000 per the 100 members, and even if the maintenance and facility budget were $1,000,000 they would all be in it for only $10,000 a year.  Crazy!!

[Paul OConnor]

I think this is a brilliant move by Parsons.  With 160 members, if half the existing members are in at $110k and the other half at $25k, it costs him $8.1 mil to get rid of everyone.  If he fixes the place up, and can sell 100 new memberships at $200k each, he just made almost $12 mil.  If he can only sell 50, he’s still ahead almost $2 mil. 

 Plus now his club is filled with his pals, perhaps a douche bag free membership, which is worth plenty.  And the place will be empty, my kind of course. 

If he has to eat a couple years of no dues, 160 members at $1,000 month comes out to around $2 mil/year range, what does he care, he just banked $2.2 billion or so on GoDaddy stock sale. 

If I won that lottery I’d do the same thing! 

[Tom Yost]

On the other hand, Parsons says he wants to redesign the closing holes to make for a "much more enjoyable walk."  

Does this course have potential to attract a national membership?

[Josh Tarble]

Easiest way to increase demand is to cut the supply.  

[BHoover]

It's always possible that this type of club could work.  But would I put money on it--nope.  Then again, if you have billions in the bank, what's a few million to buy and invest into your own personal golf club?

There no doubt will be some folks who want to be part of this...and if the course is any good, then the chances of success probably go up.  But it is an oddity in this day and age of clubs desperately looking for members, that this place is looking to cut its membership.

[Bill_McBride]

Tom, there is really only one hole that's tough to walk, the uphill 15th par 5.  The club leaves a stack of carts at that tee for walkers.  Otherwise the place is a breeze to walk.  I liked the course.  My nephew caddied out there for years, now is at Silverleaf and sometimes Whisper Rock.  

[Paul OConnor]

" But it is an oddity in this day and age of clubs desperately looking for members, that this place is looking to cut its membership."

This, however, is not a desperate club.  In two years, I suspect that this might be THE exclusive club to join in Scottsdale.  No shortage of guys with $200k looking to play great golf in the area.  And the worry about losing your downstroke is backstopped by Parsons, not a Board liable to do something dumb.  If I was in this place at $25k, I would without any doubt be sticking around.  

He's doing what any good business should do, but often finds nearly impossible:  fire all your lousy customers and focus on your best ones.  

[BHoover]

" But it is an oddity in this day and age of clubs desperately looking for members, that this place is looking to cut its membership."

This, however, is not a desperate club.  In two years, I suspect that this might be THE exclusive club to join in Scottsdale.  No shortage of guys with $200k looking to play great golf in the area.  And the worry about losing your downstroke is backstopped by Parsons, not a Board liable to do something dumb.  If I was in this place at $25k, I would without any doubt be sticking around.  

He's doing what any good business should do, but often finds nearly impossible:  fire all your lousy customers and focus on your best ones.  

Again, I said it is an oddity to be getting rid of members when you compare it to what many, many clubs are facing these days.  But I did not state that this is a desperate club.  Obviously, quite the opposite is true.  


Regardless, I'm fairly confident that I would not be the type of member he is looking for, so I'd happily take my refund and run.

[Paul OConnor]

Brian,

Where would you run?  To one of the desparate courses with all their financial uncertainty?  Or just to be a vagabond? I'm just saying, if the $25k meant more than playing at a great course, with new investment coming in, and rid of the d-bag members, then take it. But, if you wanted to play golf at a great course, and at someplace where the finances were backstopped by someone like Parsons, what would be a better choice?  

Of course this is theoretical, because I assume you do not belong there, and I do not either.  But if you wanted to play great golf in Scottsdale, what are the other options?  How much is Whisper Rock?

[BHoover]

Paul, I do not live in Scottsdale and know very little about the golf scene out there (except for the couple of times I have visited).  So I certainly cannot speak with any authority about what options there are as far as clubs.  In fact, I think the Scottsdale might be one of the few places where I'm not sure I'd even want to belong to a club given the choices for playing different courses (again, I say that as someone who is only going there as a visitor).

I do agree that it would be nice to have an owner with deep pockets to prop up the club and make it as good as can be.  But I would not want my number of rounds to be limited unless I bring in guest play.  I would join a club both for the quality/fun of the course and to be around a great group of fellow members.  I would not join simply with an eye to bringing in guest play.

[Tom Yost]

 If I was in this place at $25k, I would without any doubt be sticking around.  

Have to wonder if the $25K guys are the main target.

[Tom Yost]

Looking at the aerials of this place, I am correct in understanding that this course was developed without the real estate component that was typical of most clubs built in the area during the "boom" years?

Given that, it would seem the idea has a better chance to attract a national membership than would a course with houses lining the fairways.

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