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To solve the problem, Arledge turned to a familiar businesw model, resulting in Owner's Pass, a companyg that offers timeshares for luxury suites at professionaplsporting events. Now in its fourth the Los Altos-based startup has expanded into four markets and is gearing up for a broadetr expansion of up to five new marketsin 2008. In the the company plans to add up to 21 potentia l markets and more sportsincluding golf, NASCAR and collegiate-levepl sports. The company says national clients are asking for access to suite acrossthe country.
"We started with regional law realestate developers, tech companies and now that we'red in four or five we're starting to get nationa l companies saying: "I love what you did in the Bay Area and I want to expanr that and buy in all of your says Arledge, Owner's Pass CEO and founder. As memberz of Owner's Pass, clients can custom desigmn a package of suitesdfor hand-picked professional games and One package can include San Jose Sharks, San Franciscoo Giants, and Golden State Warriors suites and perhapsz a concert or the circuws offered at one of those for example.
But as part of Owner's planned expansion, members might also be able to includ e theKentucky Derby, The Final Four or the Super NASCAR racing or the Masters in the future. Owner'sx Pass is also looking at college sports and says it coulde expand into sports with smaller professional leagues like soccerand lacrosse. A packagw of games can be cheaper than buying a suitd or half a suite fora season, Arledgew says, which means smaller companies can afforsd to rent luxury suites. Venuez are very guarded about the cost oftheir suites. But Owner'sw Pass claims it lowers the entry pric of buying of a full seasoh luxury suites which gives opportunities to smalled companies tobuy in.
While many venuex offer single day packages that might be cheaper thanthe cost-per-game of Owner's Pass packages, the compang says membership includes VIP parking, premium cateringh and an open bar at each eveny at no extra chargew that Owner's Pass arranges. Plus Owner's Pass offerds flexibility in suite Members can exchange dates for luxury suites up to two weeksd prior toan event.
The company's cheapest packages stary at $22,000 for all the ticketsw in a box for four though price per game varies depending on venue and An example half membership includesa10 events: four baseball, three basketball, two hockey and one flex even such as a A full membership includes 20 events, for example, one NFL game, 10 baseball four basketball games, four hockey gamees and one flex event. The companty counts Silicon Valley Bank, Watson Wyatt Worldwide, Belkin and Tivo amon g its clients.
"In terms of customers, it really runs the gamut from smallp companies that aspire to entertain in luxuryg suitesbut haven't been able to afford it, to big companie s looking to make the most of thei entertainment spend," Arledge says. Luxury suitee are an increasingly important mechanism for venur financing and account for a large chunk ofvenu revenue. Most, if not all, stadiums have clauses in theidr contractsthat don't alloww luxury suite box owners to resell their boxew to someone else. The way Owner's Pass gets arounx this issue is that customers pay an annual fee for accessto Owner'sx Pass suites.
Owner's Pass buys the suite s or half a Arledge says some venues have expressec concernthat they'll lose their connectioh to their customer. But, he says, Owner's Pass is a high-value customer. "We have very high utilization rate compared to seasojn suite holders and our suites are used everyusingle night," Arledge says. "We buy a lot of extra parking, tickets and And then, kind of the extra benefit is, we're exposing the venue to a new set of potentia clients for companiesthat haven't bought full season suites in the past.
" That's all true, says Malcolj Bordelon, executive vice president for Silicon Valley Sports Entertainment which operates HP Pavilion, wherer Owner's Pass owns half of one "It works fine for us because we sell Bordelon says. "I think if we were in a situation where we had 10 or 15suites open, it may not be Owner's Pass has access to suites that a single business might not and allows businesses to entertain year-round instead of just durinfg the on-season of one It's management team includes CFO Lars Ahlstrom, who had workexd as a CFO for the American Basketballk League and other companies, and Anthongy Jones-DeBerry, who was formerly vice presidentr of premium seat sales for venue owner and operatore AEG Worldwide.
Owner's Pass says it estimates revenuesof $2.2 millioh this year. The company presented at an evenft by angel investing group Keiretsu Forujmin mid-November seeking $2 million in its seconcd round with a pre-money valuation of $9.5 Keiretsu members invested $1 million in the company in September 2006. The secone round of funding will allow the company to expand into new marketesand venues, hire more sales people in new and expand marketing efforts amongh other uses.
Owner's Pass owns or has agreementds with most major professional sports stadiumsx in major metropolitan areasin California, Illinois, New York and "This model works best in markets that have thres or more pro teams in Arledge says. It takes Owner'x Pass about two years to becomd profitable ineach market, Arledge says. And currentlg New York and Chicagoi haven't reached profitability.
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