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PopStroke: Golf's Next Billion Dollar Company
TaylorMade invested in PopStroke - bringing the valuation to $650 million.
Every Monday, I write a newsletter breaking down the business in golf. Welcome to the 71 new Perfect Putt members who have joined us since our last newsletter. Join 6,137 intelligent and curious golfers by subscribing below.
Pictured above is White Manor Country Club in Malvern, Pennsylvania — a Concert Golf Partners Golf Club.
Concert Golf Partners is the leading boutique owner-operator of upscale, private clubs nationwide. Since its founding in 2011, Concert Golf has developed a reputation as the buyer of choice for private club owners seeking to pass the torch to a high-quality operator.
NGF recently named Concert Golf a Top 100 Business in Golf — a high honor.
Concert Golf has a portfolio of 29 boutique golf clubs in the United States — below are a few.
Crestview Country Club— Wichita, Kansas
Blue Hill Country Club — Boston, Massachusetts
Hawthorns Golf & Country Club — Fishers, Indiana
Concert Golf is actively seeking to add to its boutique portfolio. If your club or you know of a club looking to explore an acquisition — reach out to the Concert Golf Team below.
Hey Golfers —
PopStroke achieved a huge milestone a few weeks ago—an investment from TaylorMade. While the investor is significant — PopStroke’s valuation of $650 million has my attention.
Before we dive into the newsletter — here’s a brief overview of PopStroke.
PopStroke was founded by Greg Bartoli, a former Wall Street executive, in 2018. Tiger Woods Ventures joined in 2019 as a partner and investor.
PopStroke is golf entertainment. It focuses on the outdoor putting concept leveraging technology to enhance the customer experience while promoting a community environment. It costs $20 to play 18 holes at a PopStroke venue.
PopStroke has six locations:
Fort Myers, Florida
Port Saint Lucie, Florida
PopStroke has three locations in the developmental pipeline:
Delray Beach, Florida
Last spring, I wrote a piece stating the next big business in golf was the mini golf segment. At the time — the mini golf segment was valued around $1 billion — that has changed quickly.
In October of 2022 — BlackRock invested $150 million in Puttshack
In January of 2023 — PopStroke was valued at $650 million
Is the PopStroke valuation rich with only six venues?
Probably. But when Puttshack raised $150 million from BlackRock last fall, it reset the market.
Puttshack has nine locations throughout the United States and the United Kingdom.
Puttshack has a major advantage over PopStroke.
Puttshack is indoor mini golf — their total addressable market is larger than PopStroke. To this point — PopStroke has focused on outdoor putting courses. They will be limited to opening venues in warm climates.
But maybe warm climates don’t matter as much as we think — off-course golf is growing at a wild pace.
National Golf Foundation has published a study of on-course and off-course participation in recent years. Here are the links to each study for the last three years below.
From 2020 to 2022 — off-course golf added nearly three million participants. On-course golf added 600,000.
These numbers are representative of golfers that play golf on-course and off-course only. Several million golfers do both — that is not included in the chart below.
Callaway has paved the way for equipment companies investing in golf entertainment. I looked back at the press release from October 2020 when Callaway announced it was purchasing Topgolf.
The deal was worth over $2 billion. Topgolf had 63 venues at the time and did $1.1 billion in revenue in 2019.
Based on the valuation — a Topgolf venue was valued at around $30 million. Compared to a PopStroke venue valued at around $100 million per venue.
A Topgolf venue needs around 15 acres to build a venue and has an average cost of $17 million. While we don’t know the development costs of a PopStroke venue, we know that they need around an acre to build — significantly less than Topgolf.
Synergies are important for investments or acquisitions.
Callaway has a significant advantage with sell-through opportunities with Topgolf. Golfers can demo nearly all of Callaway’s equipment.
What will the TaylorMade synergies look like with PopStroke?
We know that TaylorMade is making a special golf ball for PopStroke. PopStroke will also be using TaylorMade putters as rentals. I imagine the relationship will evolve to PopStroke selling TaylorMade equipment and apparel in the future.
It is important to note that TaylorMade was acquired by Centroid Investment Partners, a South Korean Private equity firm, in 2021 for $1.7 billion.
The investment in PopStroke diversifies TaylorMade’s business as it competes with Acushnet and Callaway. Acushnet’s market cap is nearly $3.5 billion, while Callaway’s market cap is $4.3 billion.
PopStroke is building a community too.
PopStroke hosted a three-day Tour Championship last fall with a total purse of $125,000.
The team champion won $20,000
The individual champion won $5,000
In an interesting wrinkle — the PopStroke Tour Championship was televised.
PopStroke also has a weekly league in each of its locations.
PopStroke is essentially commercializing putting courses and re-creating a sub-sport in golf.
Is PopStroke worth $1 billion today?
No — but there is a good chance they will be in the next few years.
As we continue to see off-course golf explode and PopStroke open more venues, it will create more revenue opportunities.
Separately — the golf community will continue to see companies focusing on off-course golf as the market continues to grow. It is an exciting time to build in the space.
Have yourself a great Monday. Talk to you next week!
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