July 16, 2026 • 31 mins
8AM Golf is a holding company whose portfolio includes 15 companies that touch nearly every aspect of golf. Started in 2018 by Howard Milstein, 8AM’s umbrella includes Golf Magazine, Miura Golf and a newly constructed course in Nashville built in partnership with Justin Timberlake. So, there is no one better to talk to about what is going on in the world of golf than the company’s CEO, Hoyt McGarity.
In this episode of The Deal, Hoyt dials in from St. Andrews to give Alex and Jason the inside scoop on running a holding company, including: what companies 8AM chooses to invest in, which ones they don’t and when they know it’s time to sell. Hoyt also shares his perspective on making golf more accessible to a new generation of golfers while also respecting the traditions of the old heads and what existential threats the sport is facing. Finally, Hoyt tells us why a golf course must be a “good hang” and about his personal trajectory from caddie to CEO.
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Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, Radio News.
Speaker 2 (00:12):
Welcome back to the DAL. I'm Jason Kelly alongside Alex Rodriguez.
Speaker 1 (00:15):
Coming up in the show. Hoyt mcgarritty, the president and
CEO of eight a M Golf.
Speaker 2 (00:19):
And you know, Alex, you and are both golfers of
varying degrees of skill. I am substantially at a disadvantage
having not been a professional athlete myself. I believe you
can probably outdrive me by somewhere between one hundred to
four hundred yards.
Speaker 1 (00:37):
But we love the.
Speaker 2 (00:38):
Game, and I think we've both been super interested in
just how much it's booming right now.
Speaker 1 (00:44):
I just feel like I see golf everywhere right.
Speaker 3 (00:47):
You're one hundred percent right, and I may outdrive you. You're
going to outscore me every time a lot more than
I am. I'm fascinating. I mean, look, what I took
away from the interview is how passionate he is about golf.
The fact that he grew up in the Hamptons. He
couldn't afford to get into these fancy clubs, so what
did he do. He was a caddy, so he kind
of reverse engineered his passion and he's been around golfer's
(01:11):
whole life. And now they're buying companies that are very
helpful and around the sport of golf, which is the moat,
And they're buying companies at cashlow because they like cash flow.
Then they grab that cash flow and keep scaling their business.
Very interesting model.
Speaker 2 (01:25):
Yeah, it is super interesting because I feel like, you know,
we talked so much to you know, team owners and
athletes and things like that. I feel like this is
a really inside look at how you build a business
around a sport that has has been lumpy over the years, right.
I mean you think about ten years ago, I think
people would say golf was in terminal decline. I wasn't playing,
(01:48):
you know, it was not of interest to a lot
of people, and I think most notably, it was not
of interest to my sons, who are now avowed like
golf sikos in their twenties. They consume the content and
that that's really what Hoit is going after. So I'm
fascinating to get some time with him coming up. Hot mcgarritty,
President and CEO of eight AM Golf.
Speaker 1 (02:20):
Welcome back to the deal.
Speaker 2 (02:20):
I'm Jason Kelly alongside Alex Rodriguez. So happy to have
with us. Hote mcgarritty. He's a buddy, and we were
all together sort of weirdly, you know, because as things
happen the first time we were all together, we're not
to get We're only together virtually here. We're together in
real life in Doha last year for a big sportic
conference with the Qatari, So it's fun to get to
(02:42):
know each other a little bit. Hoate you are joining
us from Saint Andrews because of course, and you're for
those who are only listening to us. Hoatee has the
sickest real background, much better than either of our so Hoite,
first of all, welcome to the show. Second of all,
what the heck are you doing there other than and
being an awesome golfer?
Speaker 1 (03:02):
Yeah? Well, first, thank you for having me both of you. Yeah.
Speaker 4 (03:05):
I actually I just flew into San Andrews this morning
from Nashville, and I'm here visiting one of our hospitality concepts,
t squared Social with Tiger and justin Timberlake. I saw
it under construction. I've not seen the finished product. So
today it was a good day to go go see
where we're at. We've got a winter under our belt
coming into a nice summer here, so it's good to
see it in full action.
Speaker 1 (03:27):
Exactly. We're talking to you.
Speaker 2 (03:28):
It's like seven o'clock at night and you probably could
go play thirty six holes after this if you want.
It's a good time to be in Scotland. Yes, absolutely, so, hoy.
Speaker 3 (03:37):
Help us our audience and Jason and I understand what
is eight AM in twenty nineteen, twenty eighteen. You know
when you guys opened this thing up, was it born
to be basically like a holding company? How many companies
do you have in that portfolio? Walk us through that?
Speaker 1 (03:54):
Yeah.
Speaker 4 (03:54):
I mean today we have about fifteen different golf companies,
but in twenty eighteen nineteen, we've probably were a round
six and we didn't really have a holding company. We
owned them individually and we thought, okay, we need to
put these in house, them somewhere, and we formed the
holding company called eight AM Golf and since then we've
been collecting brands in the sport that are you know,
(04:15):
invest in class. I think we're in every facet of
the game right. We've invested in everything from hospitality to equipment,
to media, to events, to travel, I mean, you name it.
We're pretty much in everything except for apparel. We sell
a lot of apparel through our e comms, but we
don't own apparel company. I think our closest thing to
that might be Painter now that we just bought a
position into Painter golf shoes, which we'll go into apparel.
(04:38):
So that was kind of our way of getting into
that one. But yeah, we've kind of thought, you know,
once you had one or two three investments, it's best
to surround them with other great investments, and even if
they're in different areas, they all can feed off one another.
And I think we've done a really good job of
creating this maybe one of the first golf holding companies.
Speaker 1 (04:56):
I don't know.
Speaker 4 (04:57):
I know people we own particular assets, but they might
I own fifteen different ones, right, and we've also are
big operators of our business. AT's say, of the eleven
of the fifteen we operate fully and we own one
hundred percent of. And then the ones we don't are
more on the hospitality side and different things. Because he
definitely needed partners and it's good to know when you
(05:17):
need partners, so.
Speaker 3 (05:19):
Let's stay in that theme right there. So you have
now around fifteen companies you can go anywhere in the
world of golf, Like, how do you decide what type
of business hospitality more connected to golf? And then once
you source those deals, how do you source them? And
then how do you capitalize them?
Speaker 4 (05:36):
Yeah, I mean it's a good question. I would say,
I start with how we source the deals. I mean,
when we first we're pretty heavy in the equipment space,
maybe because that was where my passion lies, right. So
you know, we have Mirror Golf, we have True Spec Golf,
we have Faarawey Jockey, we have McLaren Golf. But we
also noticed that more of our brands that were in
the premium side seem to hold steady and grow consistently
(06:00):
year over year. When I say that some of our
larger brands, I speak to millions of people. I feel
like there's a little bit more ebbs and flows there
in the business model versus the premium set. So when
we go out there and look at it, we try
to find these unique, best in class products that maybe
sit a bit more expensive or a bit above the rest, right,
And we're very pretty particular on that, And how we
(06:23):
source them is that, Honestly, we I don't think anyone's
looked at more golf companies than us in the last
you know, ten years. I mean I spend my days
from a venture startup with nothing to a massive, multi
billion dollar company. We're looking at it and we get
the phone call. So you can't do every deal, right,
and you know, we're not a fund, and so we've
(06:44):
been attempted to go down that path. We've been asked
to go down that path. I think we've built credibility
in the space to maybe go to the next step
there and raise them capital. But no, we just kind
of feeled them were very particular on the CEOs, the
operating side. Do we gel with them, do they fit in?
And you know, we try to surround our current businesses
(07:06):
with stronger businesses, right and and I think once you
get consistency and synergies between them all, you start to
see the effects of that. And I feel like we're
seeing that on a daily basis now.
Speaker 2 (07:18):
And to Alex's pointer, these mostly these are cash deals,
like how do you how do you capitalize them?
Speaker 1 (07:23):
Generally mostly cash deals.
Speaker 4 (07:26):
I mean you would say, like I said, we own
eleven of them, we own one hundred percent of the deal,
so we would have purchased them right. But we're also
big believers in the management. So even if we purchase it,
we tend to give back to the CEO and the
you know, the whole corporate structure of that team, because
we don't want to be they're the ones that got
it to a place, so you'd want to make sure
that they have upside and participating.
Speaker 1 (07:47):
We're pretty pretty hands on.
Speaker 4 (07:49):
I wouldn't say we're a board or a private equity
that like pops in, cuts a lot of costs and
then sells it.
Speaker 1 (07:53):
We very rarely sell a business.
Speaker 4 (07:55):
We like the operating cash flow and I think we've
done a really good job of creating consists. Think cashflow
across all the entities, and when you add them together,
it's you start to see that and you can have
the ability to do more with them.
Speaker 1 (08:08):
We did sell a business this last year in golf Logics.
Speaker 4 (08:11):
We also know, you know, everything's for sale if you
think about it for the right price and if it's
time to exit, and for us, it was a good
time to exit that business, so we kind of sent
a little message that we do sell things to It
just wasn't at an investment banker level. It was really
just me speaking to the group and saying, hey, there's
a good fit for you, it's a good fit for us.
The price was right, why don't need an investment banker?
(08:33):
And we kind of struck the deal from there. But yeah,
I mean I would say that's probably the best way
to explain it. We are, we're one source of capital,
right and now the companies are producing their own cash
flow that we're using that cashow to buy other companies.
And that's kind of how we've operated to this date. Now,
(08:54):
like I said, we've been approached every which way. I
think eight AM has created its own weird It was
supposed to not be known, you know, it's just a
holding company, and now it's like, hey, maybe we have
our own brand with these events we throw and different
things that people are willing to trust us or to
offer up capital into future investments if that's an SPV
(09:14):
or if that's us creating a fund.
Speaker 1 (09:16):
Right. We're kind of thinking through all that right now.
And it's so Hoyte. You know, you mentioned that you
got to St.
Speaker 2 (09:24):
Andrew's via Nashville, but those two were not necessarily always
you know, places that are in sync or mentioned in
the same breath, and yet it makes a lot of
sense for you. You guys, open a new golf course
down there, sort of long in the making, long anticipated.
Tell us about that, because it's a notable moment, certainly
(09:44):
for your company and for your partnership with Justin Tipperlake,
but also I think for golf it says something about
sort of where we are now.
Speaker 1 (09:51):
So walk us through that.
Speaker 4 (09:53):
Yeah, you know, it's honestly, I never thought we were
going to want a golf course or build one from scratch, right,
I mean that was like the dream if you think
about it, from growing up in the golf business. I
never thought we would get to it.
Speaker 1 (10:03):
I mean it's my dream. It's Alex's dream too, I bet,
like in a golf course. Yeah yeah.
Speaker 4 (10:08):
And this week was our first member member and we've
only been open just over a month, and I was
sitting there, I'm like, wow, I can't believe this actually happened.
Speaker 1 (10:15):
So this goes back to.
Speaker 4 (10:16):
Twenty one We've been in the design business. We knew
a lot about golf course architecture, we knew a lot
about golf, and Nashville was a little starved for golf
in general. And then Justin's connections to Tennessee. We kind
of found this incredible property off market in two thousand
and one Memorial Day.
Speaker 1 (10:34):
It was when I was there and.
Speaker 4 (10:37):
Now we opened up and it's it's a you know,
it's a private club. We have about one hundred and
forty ish members at this moment, mostly national based. I
would say one hundred of our members are from not
Tennessee or Nashville. And we're growing and honestly, we're only
a month in and it's pretty successful to get to
(10:57):
that number. I don't know where we'll app it out,
but we kind of like our number or one fifty
one sixty. I mean most clubs get to around three hundred.
But I think you do it the right way and
we're not in a rush for it.
Speaker 3 (11:08):
And HOI when you think about building a golf course,
that's quite an ambitious, time consuming resources. Are you thinking
about it from the prism of like this just a
great business on his own outside of eight Am, or
that throws off great cash flow and can grow over time,
or is it a real estate play or is it
just all of the above where it's also very complimentary
(11:29):
to the other portfolio companies.
Speaker 1 (11:31):
I think it was more complimentary. I mean, we didn't
get into it. We have.
Speaker 4 (11:37):
Probably one hundred and eighty acres extra in real estate,
don't get us wrong, Like we did buy extra acres
that doesn't sit on the course, so it wouldn't be
your traditional house on a golf course, right, But we
do within a gate have that ability, or we'll build
more golf. But honestly, we wun't. I would hate to
say it was a nonprofit because we don't, like, we
don't want to lose money doing things. But we knew
our numbers really well to be able to say, hey,
(11:59):
we can get this thing and get our money back
and then use it for all the other companies we
have and events that we have. So we thought it
was just a great thing.
Speaker 1 (12:10):
It was risky.
Speaker 4 (12:11):
I mean, let's be honest, golf courses are not cheap. Okay,
there's nothing about acquiring land, construction clubhouses, dealing with the
city states. I mean, nothing about it is easy. So yeah,
it was a bit of a headache, but it was
more of a passion play.
Speaker 1 (12:27):
But ultimately I think the real estate that if we do.
Speaker 4 (12:29):
Decide to trigger it, it pays for it multiple times over.
But we don't know what we'll do. I mean, it's
just nice to have that. And I think we acquired
that extra land after the initial wave, which was a
good investment and it kind of protects it and it
protects the neighborhood as well because it was growing pretty fast.
But yeah, I think it was more just because we're
(12:51):
not going anywhere and we'll keep growing and we have
all these incredible brands, and we started realizing we're throwing
events around the world or at different places and paying
all these prices. We're like, well, just stay them in Nashville, right,
It made more sense. There's nothing around. We're only twelve
minutes from downtown. It's unbelievable, Like we can't can't be closer. Yeah,
and Nashville, as you know, is growing like crazy and
(13:14):
people love going there, and we're just for chant to
have this incredible property that's so close to downtown.
Speaker 2 (13:33):
Wait, it's such a fascinating moment for the business of golf.
And you know, Alex and I talk about it all
the time. We talk about playing, we you know, talk
about our game, but we also you know, talk about
the fact that you know, my twenty one year old son,
my twenty three year old son like they love golf too,
and they love it, they love to play it, but
their entrance into it and experience with it is totally different.
(13:57):
The demos around golf right now are fatascinating to me.
Tell me about the prism through which you look at
that and this sort of like youth boom that seems
to be happening, especially in that kind of twenty something demographic.
Speaker 4 (14:13):
Yeah, I mean, look, golf is booming, and it was
a little nervous because it booms so much in twenty
twenty one, I mean got out of control there for
a bit, and for even looking at companies and evaluations
and everyone was entering the sports getting a little excited,
and I think it tapered off, but it's kind of
back again in a weird way. I'm looking at all
of our companies are up, and I'm sitting here going
(14:33):
to myself, like, all right, I thought we would have
tapered out a bit, but we're still seeing growth, you know,
somewhere up five percent. I'm up, We're up twenty five percent.
So it's good to see that there's in all areas
of the sport we're up. I think with the younger generation,
what you're seeing now is like I'm looking at today.
I was in T squared Social and I'm just looking around.
It's lunchtime in St Andrews, Scotland. There's not much going on,
(14:56):
and we've got kids in there from the university hitting
golf ball and the simulators.
Speaker 1 (15:01):
They're playing darts.
Speaker 4 (15:02):
They're just around the sport having fun with it in
a different way, which is something that maybe I wouldn't
have done when I.
Speaker 1 (15:08):
Was a kid.
Speaker 4 (15:09):
We didn't even have simulated golf right too much. And
this boom and simulated golf is massive and it's bringing
in a whole new wave and it's a lot less
threatening to hit a golf ball ten feet into a
screen than chase it around a golf course, especially as
a beginner.
Speaker 1 (15:25):
And I see this.
Speaker 4 (15:26):
I travel a lot around the world and Simulated Golf Korea,
like golf's on in Korea is one of the largest
golf companies in the world.
Speaker 1 (15:34):
And it's literally just in Korea right.
Speaker 4 (15:36):
It has more simulator they have more locations in Starbucks
in Korea for simulators, and it's a massive, multi billion
dollar company and it's all indoor golf.
Speaker 1 (15:47):
And I think you're seeing that boom.
Speaker 4 (15:49):
It's always been in Asia and now you're seeing it
come here and I think it's generating this interest level
of this younger generation. Obviously top golf, putt shack, pottery, swingers, popstra.
You know, you have a million miniature golf concepts that
have come to the game, and you have the indoor
golf that's come to the game. And the areas that
we invested were was the indoor golf. But Tiger when
(16:11):
we did T Squared, they didn't want it to be
just golf. They wanted it we have darts and duck
and bowling and golf. Golf was just the common thing
that they both loved. Obviously one was a little better
at it than the other, but the.
Speaker 1 (16:22):
Other is still good.
Speaker 4 (16:23):
And so that was like the thing that brought everyone
together and I hope that keeps going. I have to say,
it's a lot of screen golf. It's not the PGA
Tour or live or anything that that's all been a
lot more drama in the last couple of years, hopefully
tapering out. But the pottery, all this miniature golf, it
(16:45):
kind of gets you hooked and we all you guys
play golf, So it's like once you get going, then
you're like, oh, I want to go to the grass
with it, and then you've become addicted to it totally.
Speaker 1 (16:54):
I mean I am a full on golf sicko, as
Alex knows.
Speaker 2 (16:58):
I mean, Alex, what've I don't know if we've ever
really talked about this on air, but like, what's your
relationship with I mean, you didn't play as a kid.
You started playing as an adult, Like, how did you
come to it?
Speaker 1 (17:09):
Yeah?
Speaker 3 (17:09):
So when I was in Seattle in as a teenager
in early twenties, I would see Griffy and a lot
of our Jae Buner a lot of our pitchers would
play golf and I was like, hey, I'm getting a
little fomo here, like I want to play a little golf.
And I started playing. And my routine for fifteen years
was this. I would get back home sometime in October
(17:29):
November and I would play like five days a week.
I would take my handicap down to about ten or thirteen,
and then I would go back and redo it again.
I'll start of seventeen and go back and by the
time I had to go to spring training, I can
never break ten. And that got a little frustrating because
I had to fight my baseball swing. But to Hoyt's point, like,
I just fell in love with the game and I've
(17:50):
been in love ever since.
Speaker 2 (17:52):
Yeah, And so I mean, Hoyda, it's interesting you mentioned
the vibes around golf right now. You kind of see
that tension a little bit, right, you know, you sort
of see the old heads as it were, who you know,
we're very much the tuck in your shirt, wear a belt,
no music, and then you have a bunch of bros,
you know, screaming around in their golf carts playing loud music.
(18:15):
How do you sort of serve both simultaneously from a
growing the eight am golf portfolio perspective.
Speaker 4 (18:24):
Yeah, I mean it's a good point because there's very
different golf courses and it's come a long way. I mean, look,
I was never a member at a golf court. I
grew up in the Hamptons and I caddied at every
golf course just to have access to a golf course.
There wasn't even a public It was a Part three course,
but there wasn't really a public golf course. I could
play within forty minutes from where I lived, which made
it very difficult. So my only access was to Maidstones
(18:45):
and Shinnecock's and Nationals, which are unbelievable golf courses but
provide a particular experience, right, And that was it wasn't
very accessible, right. I mean unless you had the money
and you're a member or you had the pull to
get in, what do you do?
Speaker 1 (19:01):
Why would you enter it?
Speaker 4 (19:01):
Why would you go play golf without simulated golf, etc.
As of getting younger, I just think it's becoming culturally
more laid back. You see it from the apparel lines
that are out there, from maln to all these new
things that are coming. We're seeing it in Painter right now.
This more of a lifestyle, more fun, more of a
hang environment. And I think we can only translate it
(19:23):
to our companies or not necessarily all that, but we
do notice from like golf dot Comic, Golf magazine, all
of the YouTube, all of the content is a lot
more driven to a younger generation and fun. We still
have the content for generation. We still have a magazine
right that de caters to a particular group, But we
know the future was in this new wave and making
(19:44):
it fun.
Speaker 1 (19:45):
At Bounty Club, it was interesting where do we lie? Right?
Speaker 4 (19:48):
And we had to decide as a club, We're like, hey,
and it wasn't too hard to decide with Justin Nashville
and thinking, okay, well, we we wanted world class championship
golf course, but we want it to be fun. And
the one thing Justin always preached to us was listen,
you can have a great golf course but a terrible hang.
And you got a great golf course because you're gonna
(20:09):
have an okay golf course, but have an incredible hang,
and your people they will come there, be there, have
fun with it, and if you hit both, you've done
really well.
Speaker 1 (20:18):
Right special place.
Speaker 4 (20:19):
And so we actually that struck and I was like,
you know what, whisper Rocks of the world, like all
these great clubs that have a great hang. First, so
we focus on what we can control.
Speaker 1 (20:30):
And that was the hang. I think it's the only
only thing you can control.
Speaker 3 (20:34):
I want to just go back and double click on
one quick question when you look at is this sharing
metrics that you look when you buy a business obviously
has to be related with golf some sort. When you
think about it, does it have to have like at
least five or ten million dollars revenue? Are you thinking
about purchasing revenue multiples or ebit done multiples and is
(20:55):
it something you won't pay if it's over ten times
multiple VIBA, that would just that's too rich for us,
or is it depending on the deal and the growth
in everything else in between.
Speaker 4 (21:06):
Well, our chairman Howard Milstein's prettystricted on particular things. We've
always been much more of a cash flowing We don't
mind if it. First of all, we're you know, some
of it's part of a bank, so you're like always
love cash flow and what you can lend against et cetera,
in convertible notes and that type of structure. But you
can be making one hundred thousand dollars, but you can
(21:27):
be making five million dollars. We just knew we could
add to it if we were able to buy it.
So yes, Unfortunately we don't have a venture arm. Really
we probably should, we're just not structured for it, so
we pass on a lot of deals. We might flag
them and say, hey, keep an eye on these deals
because we liked the CEO, but it wasn't for us.
(21:48):
So we're much more looking for business or existing cash flow.
Best in class brands of any size. I would say
are at sweet spots. Yeah, if you can be in
the range from two to ten million e butit we
love that because we know we can the most value.
If do we see much larger deals of course, but
then you know, Jason and I spoke about this in Doha.
It was just trickier for us. You know, again, I'm
(22:10):
one source of capital. For me to go buy something
that's two three hundred million dollars, I better not miss right,
and you better be love that deal. I think that
we pass on a lot of deals that become very
successful when we knew they were great deals. We just
weren't structurally set up for that. And that's what I
think the next way it is, and we've created that
(22:31):
reputation and brand that you know, if we did a
capital behind us, like no one does better due diligences
in the sport of golf than us, we might as
well be like a Mackenzie amos So a group like that,
and just be hired to go do the due diligence
before you go buy one of the big We'll know
the CEO, will know every employee, we'll know the pros
and cons of it, and unfortunately they're not all great
(22:52):
in golf, so you have to be particular.
Speaker 1 (22:54):
They might look great.
Speaker 4 (22:55):
It goes to other businesses too, but it's they making
money is tough, right, And I've noticed that lots of revenue.
I see the apparel lines. I never understand it because
that trades off, has to trade off for multiple revenue.
I never never could get that in my head where
I'm like, Okay, so you sell one hundred million, but
you make no money. I don't even know how that's possible.
(23:16):
But let's talk about it. And then you're worth three
hundred million. I'm like, okay, So I don't live in
that world. I just want to see approve of it.
And that normally comes with good operating teams because they've
gotten it to a place of cash flowing. We don't
have too many revenue based business We have one that
lives on the line of like we have a company
called Faraway Jockey dot Com, which is just this website
(23:40):
and we're on pace to sell twenty million dollars this year.
And like custom golf clubs online, well you can go
on and build any set of golf clubes with any shaft,
any specs, and we're the only website in the world
that offers this, which is another weird thing to say
that we do not have one competitor in the entire space.
I don't think anyone would be crazy enough to have
the build shop and the things that we have.
Speaker 1 (23:58):
Already in place.
Speaker 4 (24:00):
But when we first bought it, we bought it to
kind of shelve it because it was a competitor and
it could hurt one of our other operating businesses. Then
we kind of let it loose. And this thing's going
to do twenty million dollars. I spend ten grand a
month on marketing. I don't even spend money on marketing.
We also now are like, maybe we should just get
to forty fifty. We're not looking at as okay, it
(24:20):
breaks evens, it makes a few million bucks.
Speaker 1 (24:22):
Who cares?
Speaker 4 (24:22):
Like this thing's going so fast, And we've gone from
nine to twenty in two years, right, And I'm like,
all right, this can go to forty to fifty fairly quickly.
Speaker 1 (24:32):
So why don't we.
Speaker 4 (24:32):
Let this one run a little bit and we'll spend
extra cash on it and we won't look at the
bottom line. Good, then you could pull that back at
a certain volume, at fifty million dollars starts stripping out
those costs. Next thing, you know, you can make it
very successful. But that's probably the only time we live
in that world. Howard would you know, be all over
me on that one. But he you know, we like,
(24:53):
he'd rather be small and make money.
Speaker 1 (24:55):
I get it.
Speaker 4 (24:55):
That's the goal here is like make these businesses profitable
and run them like reil businesses, because a lot of
golf companies are more of a friends and family like
cool deal, and you know, they're not structurally run like companies.
And I think that's what we've We were like, how
can we help these people bring that structure to them.
Speaker 1 (25:13):
I think that's where we do a really good job.
Speaker 2 (25:27):
And so, Hoyd, as we wrap up here, I mean,
I guess one sort of existential question I have for
you is, you know, we have experienced this boom, a
boom that didn't really as you said earlier in the conversation,
you know, didn't really slow down. And you know, the
content is growing, the audience is growing even and maybe
because of some of the live and PGA drama, and
(25:50):
you've got some good storylines in the on the professional level,
people are super into it. What sort of lurking out
there that could sort of dent golf because you know,
ten years ago, we wouldn't be talking to you, like,
we wouldn't be having this conversation because your company wouldn't
have existed, and golf was in what looked like terminal decline.
(26:13):
And now here we are. So what are the things
that could get in the way of this continuing on?
Speaker 4 (26:20):
Well, I would say, honestly, I think it's coming to
an end. It's probably the tours. Right, When if you
have what's happening in the sport of golf happened for
too long, you start to lose fans, You start to
lose people. It's all about money, money, money, money, money,
which is all sports. But it was getting like it
was taking over hours, right, and then you start you
just started getting upset with it, and then people wore
deterred from it. Normally wouldn't bother me, but when we
(26:43):
start seeing it trickle down into the.
Speaker 1 (26:45):
World of golf, now it bothers me.
Speaker 4 (26:47):
That's a problem, right, It was just so negative for
five years. I don't even sure how the sport is
still so healthy considering Yeah, that's where I was a
little nervous. In twenty three, twenty four twenty four like
it was. It was like we were going the other
way a little bit. You could see it. I think
it corrected itself in twenty five in a big way
into twenty six. But there was a time there I
(27:09):
was a little nervous because it was trickling down to
our businesses, which means if I'm feeling it tailor made,
everyone was feeling it right. So I think that's I
don't see any others. I mean, yeah, you could say,
like you know, the workforce, you could say it in
any business.
Speaker 1 (27:26):
AI, what's going to happen here? Like how many employees?
Speaker 4 (27:29):
I think businesses, I'm not even sure how business are
going to be traded soon. If you only have you know,
you're even the margin, you go from twenty to fifty
percent suddenly because you use technology.
Speaker 1 (27:39):
It's all going to change.
Speaker 4 (27:40):
And I think we look at it every day, and
I think golf tends to be the last one to
react to any of those things. We for sure don't
want to be that group, you know, we'd like to
be all over that, but that could have an effect too.
I think there's too many there's too many people in
the PGA of America. All these young pro looking for jobs.
(28:01):
But there's not there's not there's no jobs. There's not
that many jobs versus how many people are in those programs.
Speaker 1 (28:07):
It makes me a little nervous.
Speaker 4 (28:09):
You know, where you have this education, where are they
going to go use their tools to be successful?
Speaker 1 (28:15):
And sometimes I pinch myself. I'm very fortunate.
Speaker 4 (28:17):
I mean, like I said, from caddying to starting a
club fitting company to being where I am today. I mean,
sometimes I forget I'm in the sport of golf, and
I'm like, hey, hoy, this is pretty good, Like remember
where you are and so.
Speaker 1 (28:29):
You gotta I checked.
Speaker 3 (28:31):
So, hoy, what one final question for me, because I
know we're coming up on some time the question that
I have you talked about the future and really not
knowing what's going on in the future, a little bit
of the past and where we've been. I guess my
question is what's next in the next three to five years.
Speaker 1 (28:46):
If I was to say forecast.
Speaker 3 (28:49):
This for me, are you going to go from fifteen
companies to thirty as you grow your portfolio? Are you
maybe selling to a private equity group? Are you going IPO?
What's next for this company?
Speaker 1 (28:58):
Well?
Speaker 4 (28:59):
It just required three businesses in the last like four months,
so we really haven't slowed down or partnered up with
different businesses and made investments. I don't see its slowing down.
As long as we're cash flowing and doing the right things,
we will keep growing. I think that we will bring
in partners. I had no doubt in my mind that
that's probably the next step. But there, you know, like
(29:19):
I said, we built that respect and you got to
prove it first, and now we have something that we proved,
and I think it's a great front running brand. Quite frankly,
now it has this respect that if it had real capital.
We have real capital, but it's like, you know, another
level of capital. I think there's a lot of people
we get approached all the time, from pe firms to celebrity,
all sorts of people coming.
Speaker 1 (29:40):
To us like how do we get involved in this world?
Speaker 2 (29:43):
Right?
Speaker 4 (29:44):
So I think that I want to see growth. I
don't have no intentions to slow down. I'm young, you
know Howard's been great to me. His son Michael is
now the co CEO of the bank, and he's young
like I am, and he's hungry. So there's no real
slowing down as long as as they're good businesses. I
think we have to have discipline. We can't just get
you know, crazy, but like you have to have discipline.
(30:06):
I think if we keep doing that, we'll keep crying.
Speaker 1 (30:09):
All right, Well, we're gonna knock on your door at
Bounty Club at some point, and just like it, don't
come in August. It's a little hot there, stay away, yes,
summer exactly.
Speaker 2 (30:18):
Growing up in the South, I know better than to
go much south of New York during the summertimes. So hoyt,
good luck in St.
Speaker 1 (30:27):
Andrews.
Speaker 2 (30:27):
Good luck with all your travels. Great to spend some
time with you. We love the company, and uh, just
keep on trucking. Love to see them.
Speaker 1 (30:34):
Yeah, no, I appreciate you both having me on. That
was great.
Speaker 3 (30:37):
You got it.
Speaker 2 (30:42):
The Deal is a production from Bloomberg Podcast in Bloomberg Originals.
The Deal is hosted by Alex Rodriguez and me Jason Kelly.
The show was produced by Stacy Wong. Our senior producers
are alexis Hot and Animasarakis. Original music by Blake Maples.
Our booker is Paige Keffer. Our executive producers are Amy Keene,
(31:02):
Kelly Leferrier, and Ashley Zingaro. Special thanks to Rachel Carnivale,
Elena Los Angeles, and Nick Silva. You can also watch
this episode on The Deal on YouTube. Subscribe to the
Deal and leave us a review wherever you get your podcasts.
It helps other people find the show. Thanks for listening.
Bloomberg Audio Studios, Podcasts, Radio News.
Speaker 2 (00:12):
Welcome back to the DAL. I'm Jason Kelly alongside Alex Rodriguez.
Speaker 1 (00:15):
Coming up in the show. Hoyt mcgarritty, the president and
CEO of eight a M Golf.
Speaker 2 (00:19):
And you know, Alex, you and are both golfers of
varying degrees of skill. I am substantially at a disadvantage
having not been a professional athlete myself. I believe you
can probably outdrive me by somewhere between one hundred to
four hundred yards.
Speaker 1 (00:37):
But we love the.
Speaker 2 (00:38):
Game, and I think we've both been super interested in
just how much it's booming right now.
Speaker 1 (00:44):
I just feel like I see golf everywhere right.
Speaker 3 (00:47):
You're one hundred percent right, and I may outdrive you. You're
going to outscore me every time a lot more than
I am. I'm fascinating. I mean, look, what I took
away from the interview is how passionate he is about golf.
The fact that he grew up in the Hamptons. He
couldn't afford to get into these fancy clubs, so what
did he do. He was a caddy, so he kind
of reverse engineered his passion and he's been around golfer's
(01:11):
whole life. And now they're buying companies that are very
helpful and around the sport of golf, which is the moat,
And they're buying companies at cashlow because they like cash flow.
Then they grab that cash flow and keep scaling their business.
Very interesting model.
Speaker 2 (01:25):
Yeah, it is super interesting because I feel like, you know,
we talked so much to you know, team owners and
athletes and things like that. I feel like this is
a really inside look at how you build a business
around a sport that has has been lumpy over the years, right.
I mean you think about ten years ago, I think
people would say golf was in terminal decline. I wasn't playing,
(01:48):
you know, it was not of interest to a lot
of people, and I think most notably, it was not
of interest to my sons, who are now avowed like
golf sikos in their twenties. They consume the content and
that that's really what Hoit is going after. So I'm
fascinating to get some time with him coming up. Hot mcgarritty,
President and CEO of eight AM Golf.
Speaker 1 (02:20):
Welcome back to the deal.
Speaker 2 (02:20):
I'm Jason Kelly alongside Alex Rodriguez. So happy to have
with us. Hote mcgarritty. He's a buddy, and we were
all together sort of weirdly, you know, because as things
happen the first time we were all together, we're not
to get We're only together virtually here. We're together in
real life in Doha last year for a big sportic
conference with the Qatari, So it's fun to get to
(02:42):
know each other a little bit. Hoate you are joining
us from Saint Andrews because of course, and you're for
those who are only listening to us. Hoatee has the
sickest real background, much better than either of our so Hoite,
first of all, welcome to the show. Second of all,
what the heck are you doing there other than and
being an awesome golfer?
Speaker 1 (03:02):
Yeah? Well, first, thank you for having me both of you. Yeah.
Speaker 4 (03:05):
I actually I just flew into San Andrews this morning
from Nashville, and I'm here visiting one of our hospitality concepts,
t squared Social with Tiger and justin Timberlake. I saw
it under construction. I've not seen the finished product. So
today it was a good day to go go see
where we're at. We've got a winter under our belt
coming into a nice summer here, so it's good to
see it in full action.
Speaker 1 (03:27):
Exactly. We're talking to you.
Speaker 2 (03:28):
It's like seven o'clock at night and you probably could
go play thirty six holes after this if you want.
It's a good time to be in Scotland. Yes, absolutely, so, hoy.
Speaker 3 (03:37):
Help us our audience and Jason and I understand what
is eight AM in twenty nineteen, twenty eighteen. You know
when you guys opened this thing up, was it born
to be basically like a holding company? How many companies
do you have in that portfolio? Walk us through that?
Speaker 1 (03:54):
Yeah.
Speaker 4 (03:54):
I mean today we have about fifteen different golf companies,
but in twenty eighteen nineteen, we've probably were a round
six and we didn't really have a holding company. We
owned them individually and we thought, okay, we need to
put these in house, them somewhere, and we formed the
holding company called eight AM Golf and since then we've
been collecting brands in the sport that are you know,
(04:15):
invest in class. I think we're in every facet of
the game right. We've invested in everything from hospitality to equipment,
to media, to events, to travel, I mean, you name it.
We're pretty much in everything except for apparel. We sell
a lot of apparel through our e comms, but we
don't own apparel company. I think our closest thing to
that might be Painter now that we just bought a
position into Painter golf shoes, which we'll go into apparel.
(04:38):
So that was kind of our way of getting into
that one. But yeah, we've kind of thought, you know,
once you had one or two three investments, it's best
to surround them with other great investments, and even if
they're in different areas, they all can feed off one another.
And I think we've done a really good job of
creating this maybe one of the first golf holding companies.
Speaker 1 (04:56):
I don't know.
Speaker 4 (04:57):
I know people we own particular assets, but they might
I own fifteen different ones, right, and we've also are
big operators of our business. AT's say, of the eleven
of the fifteen we operate fully and we own one
hundred percent of. And then the ones we don't are
more on the hospitality side and different things. Because he
definitely needed partners and it's good to know when you
(05:17):
need partners, so.
Speaker 3 (05:19):
Let's stay in that theme right there. So you have
now around fifteen companies you can go anywhere in the
world of golf, Like, how do you decide what type
of business hospitality more connected to golf? And then once
you source those deals, how do you source them? And
then how do you capitalize them?
Speaker 4 (05:36):
Yeah, I mean it's a good question. I would say,
I start with how we source the deals. I mean,
when we first we're pretty heavy in the equipment space,
maybe because that was where my passion lies, right. So
you know, we have Mirror Golf, we have True Spec Golf,
we have Faarawey Jockey, we have McLaren Golf. But we
also noticed that more of our brands that were in
the premium side seem to hold steady and grow consistently
(06:00):
year over year. When I say that some of our
larger brands, I speak to millions of people. I feel
like there's a little bit more ebbs and flows there
in the business model versus the premium set. So when
we go out there and look at it, we try
to find these unique, best in class products that maybe
sit a bit more expensive or a bit above the rest, right,
And we're very pretty particular on that, And how we
(06:23):
source them is that, Honestly, we I don't think anyone's
looked at more golf companies than us in the last
you know, ten years. I mean I spend my days
from a venture startup with nothing to a massive, multi
billion dollar company. We're looking at it and we get
the phone call. So you can't do every deal, right,
and you know, we're not a fund, and so we've
(06:44):
been attempted to go down that path. We've been asked
to go down that path. I think we've built credibility
in the space to maybe go to the next step
there and raise them capital. But no, we just kind
of feeled them were very particular on the CEOs, the
operating side. Do we gel with them, do they fit in?
And you know, we try to surround our current businesses
(07:06):
with stronger businesses, right and and I think once you
get consistency and synergies between them all, you start to
see the effects of that. And I feel like we're
seeing that on a daily basis now.
Speaker 2 (07:18):
And to Alex's pointer, these mostly these are cash deals,
like how do you how do you capitalize them?
Speaker 1 (07:23):
Generally mostly cash deals.
Speaker 4 (07:26):
I mean you would say, like I said, we own
eleven of them, we own one hundred percent of the deal,
so we would have purchased them right. But we're also
big believers in the management. So even if we purchase it,
we tend to give back to the CEO and the
you know, the whole corporate structure of that team, because
we don't want to be they're the ones that got
it to a place, so you'd want to make sure
that they have upside and participating.
Speaker 1 (07:47):
We're pretty pretty hands on.
Speaker 4 (07:49):
I wouldn't say we're a board or a private equity
that like pops in, cuts a lot of costs and
then sells it.
Speaker 1 (07:53):
We very rarely sell a business.
Speaker 4 (07:55):
We like the operating cash flow and I think we've
done a really good job of creating consists. Think cashflow
across all the entities, and when you add them together,
it's you start to see that and you can have
the ability to do more with them.
Speaker 1 (08:08):
We did sell a business this last year in golf Logics.
Speaker 4 (08:11):
We also know, you know, everything's for sale if you
think about it for the right price and if it's
time to exit, and for us, it was a good
time to exit that business, so we kind of sent
a little message that we do sell things to It
just wasn't at an investment banker level. It was really
just me speaking to the group and saying, hey, there's
a good fit for you, it's a good fit for us.
The price was right, why don't need an investment banker?
(08:33):
And we kind of struck the deal from there. But yeah,
I mean I would say that's probably the best way
to explain it. We are, we're one source of capital,
right and now the companies are producing their own cash
flow that we're using that cashow to buy other companies.
And that's kind of how we've operated to this date. Now,
(08:54):
like I said, we've been approached every which way. I
think eight AM has created its own weird It was
supposed to not be known, you know, it's just a
holding company, and now it's like, hey, maybe we have
our own brand with these events we throw and different
things that people are willing to trust us or to
offer up capital into future investments if that's an SPV
(09:14):
or if that's us creating a fund.
Speaker 1 (09:16):
Right. We're kind of thinking through all that right now.
And it's so Hoyte. You know, you mentioned that you
got to St.
Speaker 2 (09:24):
Andrew's via Nashville, but those two were not necessarily always
you know, places that are in sync or mentioned in
the same breath, and yet it makes a lot of
sense for you. You guys, open a new golf course
down there, sort of long in the making, long anticipated.
Tell us about that, because it's a notable moment, certainly
(09:44):
for your company and for your partnership with Justin Tipperlake,
but also I think for golf it says something about
sort of where we are now.
Speaker 1 (09:51):
So walk us through that.
Speaker 4 (09:53):
Yeah, you know, it's honestly, I never thought we were
going to want a golf course or build one from scratch, right,
I mean that was like the dream if you think
about it, from growing up in the golf business. I
never thought we would get to it.
Speaker 1 (10:03):
I mean it's my dream. It's Alex's dream too, I bet,
like in a golf course. Yeah yeah.
Speaker 4 (10:08):
And this week was our first member member and we've
only been open just over a month, and I was
sitting there, I'm like, wow, I can't believe this actually happened.
Speaker 1 (10:15):
So this goes back to.
Speaker 4 (10:16):
Twenty one We've been in the design business. We knew
a lot about golf course architecture, we knew a lot
about golf, and Nashville was a little starved for golf
in general. And then Justin's connections to Tennessee. We kind
of found this incredible property off market in two thousand
and one Memorial Day.
Speaker 1 (10:34):
It was when I was there and.
Speaker 4 (10:37):
Now we opened up and it's it's a you know,
it's a private club. We have about one hundred and
forty ish members at this moment, mostly national based. I
would say one hundred of our members are from not
Tennessee or Nashville. And we're growing and honestly, we're only
a month in and it's pretty successful to get to
(10:57):
that number. I don't know where we'll app it out,
but we kind of like our number or one fifty
one sixty. I mean most clubs get to around three hundred.
But I think you do it the right way and
we're not in a rush for it.
Speaker 3 (11:08):
And HOI when you think about building a golf course,
that's quite an ambitious, time consuming resources. Are you thinking
about it from the prism of like this just a
great business on his own outside of eight Am, or
that throws off great cash flow and can grow over time,
or is it a real estate play or is it
just all of the above where it's also very complimentary
(11:29):
to the other portfolio companies.
Speaker 1 (11:31):
I think it was more complimentary. I mean, we didn't
get into it. We have.
Speaker 4 (11:37):
Probably one hundred and eighty acres extra in real estate,
don't get us wrong, Like we did buy extra acres
that doesn't sit on the course, so it wouldn't be
your traditional house on a golf course, right, But we
do within a gate have that ability, or we'll build
more golf. But honestly, we wun't. I would hate to
say it was a nonprofit because we don't, like, we
don't want to lose money doing things. But we knew
our numbers really well to be able to say, hey,
(11:59):
we can get this thing and get our money back
and then use it for all the other companies we
have and events that we have. So we thought it
was just a great thing.
Speaker 1 (12:10):
It was risky.
Speaker 4 (12:11):
I mean, let's be honest, golf courses are not cheap. Okay,
there's nothing about acquiring land, construction clubhouses, dealing with the
city states. I mean, nothing about it is easy. So yeah,
it was a bit of a headache, but it was
more of a passion play.
Speaker 1 (12:27):
But ultimately I think the real estate that if we do.
Speaker 4 (12:29):
Decide to trigger it, it pays for it multiple times over.
But we don't know what we'll do. I mean, it's
just nice to have that. And I think we acquired
that extra land after the initial wave, which was a
good investment and it kind of protects it and it
protects the neighborhood as well because it was growing pretty fast.
But yeah, I think it was more just because we're
(12:51):
not going anywhere and we'll keep growing and we have
all these incredible brands, and we started realizing we're throwing
events around the world or at different places and paying
all these prices. We're like, well, just stay them in Nashville, right,
It made more sense. There's nothing around. We're only twelve
minutes from downtown. It's unbelievable, Like we can't can't be closer. Yeah,
and Nashville, as you know, is growing like crazy and
(13:14):
people love going there, and we're just for chant to
have this incredible property that's so close to downtown.
Speaker 2 (13:33):
Wait, it's such a fascinating moment for the business of golf.
And you know, Alex and I talk about it all
the time. We talk about playing, we you know, talk
about our game, but we also you know, talk about
the fact that you know, my twenty one year old son,
my twenty three year old son like they love golf too,
and they love it, they love to play it, but
their entrance into it and experience with it is totally different.
(13:57):
The demos around golf right now are fatascinating to me.
Tell me about the prism through which you look at
that and this sort of like youth boom that seems
to be happening, especially in that kind of twenty something demographic.
Speaker 4 (14:13):
Yeah, I mean, look, golf is booming, and it was
a little nervous because it booms so much in twenty
twenty one, I mean got out of control there for
a bit, and for even looking at companies and evaluations
and everyone was entering the sports getting a little excited,
and I think it tapered off, but it's kind of
back again in a weird way. I'm looking at all
of our companies are up, and I'm sitting here going
(14:33):
to myself, like, all right, I thought we would have
tapered out a bit, but we're still seeing growth, you know,
somewhere up five percent. I'm up, We're up twenty five percent.
So it's good to see that there's in all areas
of the sport we're up. I think with the younger generation,
what you're seeing now is like I'm looking at today.
I was in T squared Social and I'm just looking around.
It's lunchtime in St Andrews, Scotland. There's not much going on,
(14:56):
and we've got kids in there from the university hitting
golf ball and the simulators.
Speaker 1 (15:01):
They're playing darts.
Speaker 4 (15:02):
They're just around the sport having fun with it in
a different way, which is something that maybe I wouldn't
have done when I.
Speaker 1 (15:08):
Was a kid.
Speaker 4 (15:09):
We didn't even have simulated golf right too much. And
this boom and simulated golf is massive and it's bringing
in a whole new wave and it's a lot less
threatening to hit a golf ball ten feet into a
screen than chase it around a golf course, especially as
a beginner.
Speaker 1 (15:25):
And I see this.
Speaker 4 (15:26):
I travel a lot around the world and Simulated Golf Korea,
like golf's on in Korea is one of the largest
golf companies in the world.
Speaker 1 (15:34):
And it's literally just in Korea right.
Speaker 4 (15:36):
It has more simulator they have more locations in Starbucks
in Korea for simulators, and it's a massive, multi billion
dollar company and it's all indoor golf.
Speaker 1 (15:47):
And I think you're seeing that boom.
Speaker 4 (15:49):
It's always been in Asia and now you're seeing it
come here and I think it's generating this interest level
of this younger generation. Obviously top golf, putt shack, pottery, swingers, popstra.
You know, you have a million miniature golf concepts that
have come to the game, and you have the indoor
golf that's come to the game. And the areas that
we invested were was the indoor golf. But Tiger when
(16:11):
we did T Squared, they didn't want it to be
just golf. They wanted it we have darts and duck
and bowling and golf. Golf was just the common thing
that they both loved. Obviously one was a little better
at it than the other, but the.
Speaker 1 (16:22):
Other is still good.
Speaker 4 (16:23):
And so that was like the thing that brought everyone
together and I hope that keeps going. I have to say,
it's a lot of screen golf. It's not the PGA
Tour or live or anything that that's all been a
lot more drama in the last couple of years, hopefully
tapering out. But the pottery, all this miniature golf, it
(16:45):
kind of gets you hooked and we all you guys
play golf, So it's like once you get going, then
you're like, oh, I want to go to the grass
with it, and then you've become addicted to it totally.
Speaker 1 (16:54):
I mean I am a full on golf sicko, as
Alex knows.
Speaker 2 (16:58):
I mean, Alex, what've I don't know if we've ever
really talked about this on air, but like, what's your
relationship with I mean, you didn't play as a kid.
You started playing as an adult, Like, how did you
come to it?
Speaker 1 (17:09):
Yeah?
Speaker 3 (17:09):
So when I was in Seattle in as a teenager
in early twenties, I would see Griffy and a lot
of our Jae Buner a lot of our pitchers would
play golf and I was like, hey, I'm getting a
little fomo here, like I want to play a little golf.
And I started playing. And my routine for fifteen years
was this. I would get back home sometime in October
(17:29):
November and I would play like five days a week.
I would take my handicap down to about ten or thirteen,
and then I would go back and redo it again.
I'll start of seventeen and go back and by the
time I had to go to spring training, I can
never break ten. And that got a little frustrating because
I had to fight my baseball swing. But to Hoyt's point, like,
I just fell in love with the game and I've
(17:50):
been in love ever since.
Speaker 2 (17:52):
Yeah, And so I mean, Hoyda, it's interesting you mentioned
the vibes around golf right now. You kind of see
that tension a little bit, right, you know, you sort
of see the old heads as it were, who you know,
we're very much the tuck in your shirt, wear a belt,
no music, and then you have a bunch of bros,
you know, screaming around in their golf carts playing loud music.
(18:15):
How do you sort of serve both simultaneously from a
growing the eight am golf portfolio perspective.
Speaker 4 (18:24):
Yeah, I mean it's a good point because there's very
different golf courses and it's come a long way. I mean, look,
I was never a member at a golf court. I
grew up in the Hamptons and I caddied at every
golf course just to have access to a golf course.
There wasn't even a public It was a Part three course,
but there wasn't really a public golf course. I could
play within forty minutes from where I lived, which made
it very difficult. So my only access was to Maidstones
(18:45):
and Shinnecock's and Nationals, which are unbelievable golf courses but
provide a particular experience, right, And that was it wasn't
very accessible, right. I mean unless you had the money
and you're a member or you had the pull to
get in, what do you do?
Speaker 1 (19:01):
Why would you enter it?
Speaker 4 (19:01):
Why would you go play golf without simulated golf, etc.
As of getting younger, I just think it's becoming culturally
more laid back. You see it from the apparel lines
that are out there, from maln to all these new
things that are coming. We're seeing it in Painter right now.
This more of a lifestyle, more fun, more of a
hang environment. And I think we can only translate it
(19:23):
to our companies or not necessarily all that, but we
do notice from like golf dot Comic, Golf magazine, all
of the YouTube, all of the content is a lot
more driven to a younger generation and fun. We still
have the content for generation. We still have a magazine
right that de caters to a particular group, But we
know the future was in this new wave and making
(19:44):
it fun.
Speaker 1 (19:45):
At Bounty Club, it was interesting where do we lie? Right?
Speaker 4 (19:48):
And we had to decide as a club, We're like, hey,
and it wasn't too hard to decide with Justin Nashville
and thinking, okay, well, we we wanted world class championship
golf course, but we want it to be fun. And
the one thing Justin always preached to us was listen,
you can have a great golf course but a terrible hang.
And you got a great golf course because you're gonna
(20:09):
have an okay golf course, but have an incredible hang,
and your people they will come there, be there, have
fun with it, and if you hit both, you've done
really well.
Speaker 1 (20:18):
Right special place.
Speaker 4 (20:19):
And so we actually that struck and I was like,
you know what, whisper Rocks of the world, like all
these great clubs that have a great hang. First, so
we focus on what we can control.
Speaker 1 (20:30):
And that was the hang. I think it's the only
only thing you can control.
Speaker 3 (20:34):
I want to just go back and double click on
one quick question when you look at is this sharing
metrics that you look when you buy a business obviously
has to be related with golf some sort. When you
think about it, does it have to have like at
least five or ten million dollars revenue? Are you thinking
about purchasing revenue multiples or ebit done multiples and is
(20:55):
it something you won't pay if it's over ten times
multiple VIBA, that would just that's too rich for us,
or is it depending on the deal and the growth
in everything else in between.
Speaker 4 (21:06):
Well, our chairman Howard Milstein's prettystricted on particular things. We've
always been much more of a cash flowing We don't
mind if it. First of all, we're you know, some
of it's part of a bank, so you're like always
love cash flow and what you can lend against et cetera,
in convertible notes and that type of structure. But you
can be making one hundred thousand dollars, but you can
(21:27):
be making five million dollars. We just knew we could
add to it if we were able to buy it.
So yes, Unfortunately we don't have a venture arm. Really
we probably should, we're just not structured for it, so
we pass on a lot of deals. We might flag
them and say, hey, keep an eye on these deals
because we liked the CEO, but it wasn't for us.
(21:48):
So we're much more looking for business or existing cash flow.
Best in class brands of any size. I would say
are at sweet spots. Yeah, if you can be in
the range from two to ten million e butit we
love that because we know we can the most value.
If do we see much larger deals of course, but
then you know, Jason and I spoke about this in Doha.
It was just trickier for us. You know, again, I'm
(22:10):
one source of capital. For me to go buy something
that's two three hundred million dollars, I better not miss right,
and you better be love that deal. I think that
we pass on a lot of deals that become very
successful when we knew they were great deals. We just
weren't structurally set up for that. And that's what I
think the next way it is, and we've created that
(22:31):
reputation and brand that you know, if we did a
capital behind us, like no one does better due diligences
in the sport of golf than us, we might as
well be like a Mackenzie amos So a group like that,
and just be hired to go do the due diligence
before you go buy one of the big We'll know
the CEO, will know every employee, we'll know the pros
and cons of it, and unfortunately they're not all great
(22:52):
in golf, so you have to be particular.
Speaker 1 (22:54):
They might look great.
Speaker 4 (22:55):
It goes to other businesses too, but it's they making
money is tough, right, And I've noticed that lots of revenue.
I see the apparel lines. I never understand it because
that trades off, has to trade off for multiple revenue.
I never never could get that in my head where
I'm like, Okay, so you sell one hundred million, but
you make no money. I don't even know how that's possible.
(23:16):
But let's talk about it. And then you're worth three
hundred million. I'm like, okay, So I don't live in
that world. I just want to see approve of it.
And that normally comes with good operating teams because they've
gotten it to a place of cash flowing. We don't
have too many revenue based business We have one that
lives on the line of like we have a company
called Faraway Jockey dot Com, which is just this website
(23:40):
and we're on pace to sell twenty million dollars this year.
And like custom golf clubs online, well you can go
on and build any set of golf clubes with any shaft,
any specs, and we're the only website in the world
that offers this, which is another weird thing to say
that we do not have one competitor in the entire space.
I don't think anyone would be crazy enough to have
the build shop and the things that we have.
Speaker 1 (23:58):
Already in place.
Speaker 4 (24:00):
But when we first bought it, we bought it to
kind of shelve it because it was a competitor and
it could hurt one of our other operating businesses. Then
we kind of let it loose. And this thing's going
to do twenty million dollars. I spend ten grand a
month on marketing. I don't even spend money on marketing.
We also now are like, maybe we should just get
to forty fifty. We're not looking at as okay, it
(24:20):
breaks evens, it makes a few million bucks.
Speaker 1 (24:22):
Who cares?
Speaker 4 (24:22):
Like this thing's going so fast, And we've gone from
nine to twenty in two years, right, And I'm like,
all right, this can go to forty to fifty fairly quickly.
Speaker 1 (24:32):
So why don't we.
Speaker 4 (24:32):
Let this one run a little bit and we'll spend
extra cash on it and we won't look at the
bottom line. Good, then you could pull that back at
a certain volume, at fifty million dollars starts stripping out
those costs. Next thing, you know, you can make it
very successful. But that's probably the only time we live
in that world. Howard would you know, be all over
me on that one. But he you know, we like,
(24:53):
he'd rather be small and make money.
Speaker 1 (24:55):
I get it.
Speaker 4 (24:55):
That's the goal here is like make these businesses profitable
and run them like reil businesses, because a lot of
golf companies are more of a friends and family like
cool deal, and you know, they're not structurally run like companies.
And I think that's what we've We were like, how
can we help these people bring that structure to them.
Speaker 1 (25:13):
I think that's where we do a really good job.
Speaker 2 (25:27):
And so, Hoyd, as we wrap up here, I mean,
I guess one sort of existential question I have for
you is, you know, we have experienced this boom, a
boom that didn't really as you said earlier in the conversation,
you know, didn't really slow down. And you know, the
content is growing, the audience is growing even and maybe
because of some of the live and PGA drama, and
(25:50):
you've got some good storylines in the on the professional level,
people are super into it. What sort of lurking out
there that could sort of dent golf because you know,
ten years ago, we wouldn't be talking to you, like,
we wouldn't be having this conversation because your company wouldn't
have existed, and golf was in what looked like terminal decline.
(26:13):
And now here we are. So what are the things
that could get in the way of this continuing on?
Speaker 4 (26:20):
Well, I would say, honestly, I think it's coming to
an end. It's probably the tours. Right, When if you
have what's happening in the sport of golf happened for
too long, you start to lose fans, You start to
lose people. It's all about money, money, money, money, money,
which is all sports. But it was getting like it
was taking over hours, right, and then you start you
just started getting upset with it, and then people wore
deterred from it. Normally wouldn't bother me, but when we
(26:43):
start seeing it trickle down into the.
Speaker 1 (26:45):
World of golf, now it bothers me.
Speaker 4 (26:47):
That's a problem, right, It was just so negative for
five years. I don't even sure how the sport is
still so healthy considering Yeah, that's where I was a
little nervous. In twenty three, twenty four twenty four like
it was. It was like we were going the other
way a little bit. You could see it. I think
it corrected itself in twenty five in a big way
into twenty six. But there was a time there I
(27:09):
was a little nervous because it was trickling down to
our businesses, which means if I'm feeling it tailor made,
everyone was feeling it right. So I think that's I
don't see any others. I mean, yeah, you could say,
like you know, the workforce, you could say it in
any business.
Speaker 1 (27:26):
AI, what's going to happen here? Like how many employees?
Speaker 4 (27:29):
I think businesses, I'm not even sure how business are
going to be traded soon. If you only have you know,
you're even the margin, you go from twenty to fifty
percent suddenly because you use technology.
Speaker 1 (27:39):
It's all going to change.
Speaker 4 (27:40):
And I think we look at it every day, and
I think golf tends to be the last one to
react to any of those things. We for sure don't
want to be that group, you know, we'd like to
be all over that, but that could have an effect too.
I think there's too many there's too many people in
the PGA of America. All these young pro looking for jobs.
(28:01):
But there's not there's not there's no jobs. There's not
that many jobs versus how many people are in those programs.
Speaker 1 (28:07):
It makes me a little nervous.
Speaker 4 (28:09):
You know, where you have this education, where are they
going to go use their tools to be successful?
Speaker 1 (28:15):
And sometimes I pinch myself. I'm very fortunate.
Speaker 4 (28:17):
I mean, like I said, from caddying to starting a
club fitting company to being where I am today. I mean,
sometimes I forget I'm in the sport of golf, and
I'm like, hey, hoy, this is pretty good, Like remember
where you are and so.
Speaker 1 (28:29):
You gotta I checked.
Speaker 3 (28:31):
So, hoy, what one final question for me, because I
know we're coming up on some time the question that
I have you talked about the future and really not
knowing what's going on in the future, a little bit
of the past and where we've been. I guess my
question is what's next in the next three to five years.
Speaker 1 (28:46):
If I was to say forecast.
Speaker 3 (28:49):
This for me, are you going to go from fifteen
companies to thirty as you grow your portfolio? Are you
maybe selling to a private equity group? Are you going IPO?
What's next for this company?
Speaker 1 (28:58):
Well?
Speaker 4 (28:59):
It just required three businesses in the last like four months,
so we really haven't slowed down or partnered up with
different businesses and made investments. I don't see its slowing down.
As long as we're cash flowing and doing the right things,
we will keep growing. I think that we will bring
in partners. I had no doubt in my mind that
that's probably the next step. But there, you know, like
(29:19):
I said, we built that respect and you got to
prove it first, and now we have something that we proved,
and I think it's a great front running brand. Quite frankly,
now it has this respect that if it had real capital.
We have real capital, but it's like, you know, another
level of capital. I think there's a lot of people
we get approached all the time, from pe firms to celebrity,
all sorts of people coming.
Speaker 1 (29:40):
To us like how do we get involved in this world?
Speaker 2 (29:43):
Right?
Speaker 4 (29:44):
So I think that I want to see growth. I
don't have no intentions to slow down. I'm young, you
know Howard's been great to me. His son Michael is
now the co CEO of the bank, and he's young
like I am, and he's hungry. So there's no real
slowing down as long as as they're good businesses. I
think we have to have discipline. We can't just get
you know, crazy, but like you have to have discipline.
(30:06):
I think if we keep doing that, we'll keep crying.
Speaker 1 (30:09):
All right, Well, we're gonna knock on your door at
Bounty Club at some point, and just like it, don't
come in August. It's a little hot there, stay away, yes,
summer exactly.
Speaker 2 (30:18):
Growing up in the South, I know better than to
go much south of New York during the summertimes. So hoyt,
good luck in St.
Speaker 1 (30:27):
Andrews.
Speaker 2 (30:27):
Good luck with all your travels. Great to spend some
time with you. We love the company, and uh, just
keep on trucking. Love to see them.
Speaker 1 (30:34):
Yeah, no, I appreciate you both having me on. That
was great.
Speaker 3 (30:37):
You got it.
Speaker 2 (30:42):
The Deal is a production from Bloomberg Podcast in Bloomberg Originals.
The Deal is hosted by Alex Rodriguez and me Jason Kelly.
The show was produced by Stacy Wong. Our senior producers
are alexis Hot and Animasarakis. Original music by Blake Maples.
Our booker is Paige Keffer. Our executive producers are Amy Keene,
(31:02):
Kelly Leferrier, and Ashley Zingaro. Special thanks to Rachel Carnivale,
Elena Los Angeles, and Nick Silva. You can also watch
this episode on The Deal on YouTube. Subscribe to the
Deal and leave us a review wherever you get your podcasts.
It helps other people find the show. Thanks for listening.
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