OT - Top Golf Worth $4 Billion?

[David_Tepper]

Who says it is hard to make money in the golf business?

https://www.bloomberg.com/news/articles/2020-01-06/topgolf-is-said-to-work-with-morgan-stanley-on-u-s-ipo?srnd=premium

And Callaway owns about 20%.

[Eric Smith]

You can own the real estate at this Top Golf location:


https://www.loopnet.com/Listing/5539-N-Loop-1604-W-San-Antonio-TX/17494733/

[Peter Pallotta]

Douglas Fairbanks, asked if he thought he was worth the fortune he was making during the Depression, answered: "Before God I'm worth a dollar and a half; before Hollywood I'm worth whatever my agent can get me".
I never understood these IPO 'valuations'; nowadays I understand them even less. And then I remember that Douglas Fairbanks line.   

[Jim Sherma]

if SoftBank is investing it might be... for a while at least.


On a more mundane line of thought: I wonder what the maintenance carry cost will be to keep everything fresh inside one of these.

[jeffwarne]

Hopefully a euphoric IPO.


Then a good short....

[Steve Lapper]

Hopefully a euphoric IPO.


Then a good short....

  I actually suspect it'll be the other way around.


  TG's Free Cash Flows (FCF) are very high and they are growing quite nicely across several platforms. Nowhere yet have they outright failed or started tracking negative single-site growth.

[John Handley]

The Top Golf in Austin had been the #1 grossing alcohol establishment in the city for multiple years until finally beaten out by the JW Marriott recently.  So it's not just about golf at Top Golf.

[JESII]

John, is it at all about the golf?


My impression is that it’s a new scene for a bar, with well placed shops...no?

[John Handley]

Jim - It is up in the Domain area in north Austin.  I'm sure there is some sort of scene but that area is not in a lack of bars/restaurants.  I do believe that golfers and non-golfers have embraced the fun of golf without the fuss.  Good food, cocktails, and hitting balls to targets....what's not to like?

[David Harshbarger]

Good food, cocktails, and hitting balls to targets....what's not to like?

There's a reasonable mind-set that could argue that this is an improvement on golf-in-the-wild.   More swings in less time; more friends can mingle while playing; play coincides with normal evening free-time, better beer selection, possibly even a decent mixologist...and where resources are concerned less land needed and vastly fewer inputs of water, (petroleum based) fertilizer, and (plant and insect) poison.

[Jeff Schley]

Top Golf I think has a good model and will be here quite a while.  They have some competition and that is good.  I don't see it as a threat to golf itself, but an expansion of it to create a safe and fun first experience perhaps for many to hold and swing a club. A savy integration could be for public courses in the area to have a partnership with Top Golf by saying if you spend more than $100 bucks at Top Golf, get a coupon for 1/2 off greens fees during the week or whatever at a local course.

Miniature golf was big when I was growing up and I have fond memories of doing miniature golf, hitting balls at the driving range, going to batting cages, playing video games and getting ice cream all at the same place.

[John Kavanaugh]

Good food, cocktails, and hitting balls to targets....what's not to like?

There's a reasonable mind-set that could argue that this is an improvement on golf-in-the-wild.   More swings in less time; more friends can mingle while playing; play coincides with normal evening free-time, better beer selection, possibly even a decent mixologist...and where resources are concerned less land needed and vastly fewer inputs of water, (petroleum based) fertilizer, and (plant and insect) poison.

With apologies I find the visual pollution created by Top Golf facilities more offensive than a funny tasting piece of fish.

[David Harshbarger]

Top Golf I think has a good model and will be here quite a while.  They have some competition and that is good.  I don't see it as a threat to golf itself, but an expansion of it to create a safe and fun first experience perhaps for many to hold and swing a club. A savy integration could be for public courses in the area to have a partnership with Top Golf by saying if you spend more than $100 bucks at Top Golf, get a coupon for 1/2 off greens fees during the week or whatever at a local course.

Miniature golf was big when I was growing up and I have fond memories of doing miniature golf, hitting balls at the driving range, going to batting cages, playing video games and getting ice cream all at the same place.

Sounds right to me. Maybe those are the places that will TopGolf will displace.  (A local entertainment facility with that exact mix of activities just closed around here, though I don't think TopGolf is in the area).  Lucky Strike has a presence around here with bowling/shooting/billiards and seems to do well.

[Kalen Braley]

I think Top Golf is nothing more than a fad, like Bungee Jumping, arcades, or putt putt golf.


I tried it 3-4 times and found it to be mediocre on several levels.  Overpriced food and crappy mixed drinks, buggy software for counting shots,  odd pricing tiers based on time of day, etc.  Never mind the first time someone is over served and falls off one of the top tiers.  As for more "hitting the ball", i found it to be quite the opposite as most aren't ready to take thier turn, or too busy eating their greasy nachos, or trying to get a game going on the non user friendly consoles.

[John Kavanaugh]

I think Top Golf is nothing more than a fad, like Bungee Jumping, arcades, or putt putt golf.


I tried it 3-4 times and found it to be mediocre on several levels.  Overpriced food and crappy mixed drinks, buggy software for counting shots,  odd pricing tiers based on time of day, etc.  Never mind the first time someone is over served and falls off one of the top tiers.  As for more "hitting the ball", i found it to be quite the opposite as most aren't ready to take thier turn, or too busy eating their greasy nachos, or trying to get a game going on the non user friendly consoles.

Exactly which demographic are you in that would interest an investor?

[JESII]

Stodgy old white guy...


Isn't that why Cialis is the top advertiser when the Sr and Regular Tours are on?


Wait...umm...

[Kalen Braley]

Barney,

I'm a Gen X'er myself, so I'm guessing there are lots of investors/advertisers interested in our group.

But don't get me wrong about Top Golf, I think the concept is interesting, its the execution and value proposition that i'm not a big fan of.  Perhaps it'll improve, but until then, i'll be spending my discretionary dollars elsewhere.

[John Kavanaugh]

Streamsong cost me over $100/hr yesterday to play. How is Top Golf not a value.


Btw. The Blue course was in the best condition of any course I have ever played. Ever!!!

[Kalen Braley]

Streamsong cost me over $100/hr yesterday to play. How is Top Golf not a value.


Btw. The Blue course was in the best condition of any course I have ever played. Ever!!!

Barney,


Its been said time and time again in these threads, but i'll say it again.  Top Golf vs actual golf is apples and oranges.  A better comparison is going to the driving range with some buddies and a few beers and see who can hit it closest to the 100 yard pin.  Would you pay anywhere near $100/hr for that?

[John Kavanaugh]

Absolutely. But then again I really love beer and buddies.

[Kalen Braley]

Absolutely. But then again I really love beer and buddies.

Barney,


I'm glad that works for you.  Given that, sounds like Top Golf is right up your alley!

[Eric Smith]

The Blue course was in the best condition of any course I have ever played. Ever!!!

[John Kavanaugh]

On that note I just started a new trend at one of my clubs. The drink girl driving range drive by. I can’t believe this type of thing has been reserved for special occasions in the past.


I’ve never been to Top Golf. It really doesn’t fit my game.

[Eric Smith]

I tried it 3-4 times

i'll be spending my discretionary dollars elsewhere

LOL Kalen you've more Top Golf visits than anyone i know.

[Kalen Braley]

I tried it 3-4 times

i'll be spending my discretionary dollars elsewhere

LOL Kalen you've more Top Golf visits than anyone i know.

Awesome Eric,

Full disclosure, on two occasions, it was a work team-building type event, so I wasn't paying.  That changes the value equation entirely! 

But in all seriousness, I really wanted to give it a chance.  Maybe the over priced Applebees-like food and buggy software was just a one off...nope, it was the norm.