PXG, at $5K for a set of clubs, tries to make a move in equipment industry

KAPALUA, Hawaii -- Bob Parsons conducts business to an extreme, and that now includes golf clubs.

The people he hired to build his golf clubs have no limitations and no deadlines.

See Full Article

Money is no object, either, and that better be the case for the consumers. Parsons, the billionaire founder of GoDaddy, is selling his PXG clubs at about $5,000 for the entire set.

"Making money is not what I have in mind," Parsons said. "My goal with this is to build some very incredible clubs without regard to cost, without regard to the process. I've been telling people what I'm doing and I've heard many times, 'You're nuts.' That's a very good sign."

Ryan Moore last year became the first PGA Tour to put them in play.

Now, the Scottsdale, Arizona-based company is hopeful of making a big splash in 2016 by signing an additional eight players, men and women, to staff contracts at PXG. Topping the list is British Open champion Zach Johnson, who had been with Titleist his entire PGA Tour career that includes 12 victories and two majors.

Johnson, who is in the field this week at the Hyundai Tournament of Champions, did not want to discuss his switch ahead the announcement at Kapalua. He said in a release that he did not make the change lightly.

"My entire team, from caddie to coach, was part of the discernment process," Johnson said. "We all agree that PXG is undeniably the best equipment to help me achieve my goals on the course."

PXG also signed Billy Horschel, Chris Kirk, James Hahn and Charles Howell III on the PGA Tour, along with Cristie Kerr, Alison Lee and Gerina Piller on the LPGA Tour. Already on board with the clubs were Moore, Rocco Mediate (Champions Tour), Sadena Parks and Beatriz Recari.

Parsons describes himself as a golf fanatic and an equipment junkie. He didn't start playing seriously until he was in his 30s because he was too busy with work, first with Parsons Technologies for 10 years (which he sold in 1994 for $64 million) and then with the GoDaddy Group. He stepped down as GoDaddy executive chairman in 2014, though he remains on the board and is the largest shareholder.

By then, an affinity for golf turned into an addiction.

"It got to the point three or four years before I started the PXG venture that I would spend about $250,000 to $300,000 a year on equipment," he said. "I bought pretty much everything and would hit it. I could tell you which irons, woods and all that ... were real and what wasn't. Most of it is gimmicky. You take any manufacturer and they say, 'This will give you an extra 10 yards and 15 yards.' If all that were true, we'd be hitting it a mile-and-a-half."

Eventually, Parsons was intrigued by building his own clubs.

PXG stands for "Parsons Xtreme Golf," though a running joke in the industry is that it also stands for "Ping X-Guys." Among the Ping employees he hired were two engineers, former Bay Hill winner Mike Nicolette and Brad Schweigert, and Parsons turned them loose.

"We have no constraints on our engineers, no cost constraints, no time constraints," Parsons said. "The only they must do is the performance must be there before we release it. ... We're using as much technology as we can shake out as long as they conform with USGA rules."

The iron, which has the look of a blade, is a hollow body design that is filled with thermoplastic elastomer that allows for a thinner face. The signature look on the PXG clubs are what appears to be black dots. Those are tungsten alloy screws that enhance the perimeter weighting and increase forgiveness.

"Our iron is one of the few that is made to be adjusted weight-wise," Parsons said. "When the engineers were doing the initial development, they took one of our first prototypes -- which was a train wreck -- and put weights into it one way. I said, 'That looks good. It's going to be our trademark look."'

The equipment industry is crowded, and the venture is a risk. Parsons doesn't mind that.

"If we did exactly that TaylorMade and Ping was doing, and Callaway and on and on, we'd get our brains beat out," Parsons said.

He was behind the racy GoDaddy.com ads during the Super Bowl (he said PXG doesn't need to be as outrageous in its marketing). He also caused a sensation in golf circles when he bought what is now Scottsdale National Golf Club and wrote a letter to members outlining bold new rules -- no more than 30 rounds a year without bringing a paying guest and a $100 service fee every time a member plays. Those who didn't like the rules were given a refund on their initiation fee.

It was different. But that's what Parsons is all about.

But is there a market for golf clubs that cost $5,000 for a set?

"There are 6.5 million avid golfers in the country, and 4.1 million of the have a household income in excess of $125,000 a year, which means about 2 million have significantly higher than that in household income," he said. "If you ran across a set of clubs that you don't have to change a thing in your game and it would take you down to a 3 (handicap index) and you feel great hitting them ... you'd do what you could to buy them."



Advertisements

Latest Economic News

  • Broker, agent who worked with subsidiary of Home Capital disciplined

    Economic CBC News
    An Ontario regulator says it has imposed disciplinary actions against a mortgage broker and agent who worked with Home Trust Co., a subsidiary of Home Capital Group, over their handling of mortgages. The Financial Services Commission of Ontario (FSCO) says it conducted a review of 45 mortgage brokers and agents that Home Capital cut ties with after they were accused of falsifying income information several years ago. Source
  • Calgary man on lam in Mexico sentenced to 3 years in $27M mortgage fraud

    Economic CTV News
    CALGARY -- A Calgary man who was arrested after being on the lam for two years in Mexico for his part in a $27 million mortgage fraud has been sentenced to three years in prison. Source
  • Nortel Canada to start paying billions to creditors

    Economic CBC News
    Nortel Canada's long-suffering creditors will finally begin to receive their share of more than US$4 billion to be distributed under a plan approved in January, eight years after the former technology titan began bankruptcy proceedings. Nortel Networks Corp. Source
  • Nortel Canada to start paying billions to creditors; first instalment by July

    Economic CTV News
    TORONTO - Nortel Canada's long-suffering creditors will finally begin to receive their share of more than US$4 billion to be distributed under a plan approved in January, eight years after the former technology titan began bankruptcy proceedings. Source
  • Que. construction strike: Day 3 kicks off with little to show at bargaining table

    Economic CTV News
    MONTREAL -- There is little progress to report at the table as Quebec's construction strike enters Day 3. Eric Cote, a spokesman for one association of employers, says negotiations resumed late Thursday and that representatives for his group emerged early today suggesting they were a waste of time. Source
  • Ford's ex-CEO leaves company with $51.1M US

    Economic CBC News
    Ford's former CEO Mark Fields is leaving the company with an estimated $51.1 million US in cash, stock awards and pension benefits. Fields, 56, retired earlier this week after three years as CEO. Ford made record profits during his tenure but its stock price dropped nearly 40 per cent on investors' concerns about the company's future. Source
  • Ford's ex-CEO leaves company with US$51.1 million

    Economic CTV News
    DETROIT -- Ford's former CEO Mark Fields is leaving the company with an estimated US$51.1 million in cash, stock awards and pension benefits. Fields, 56, retired earlier this week after three years as CEO. Source
  • Rising program expenses propel fed 2016-17 deficit to $21.8B: preliminary estimate

    Economic CBC News
    A preliminary analysis of the federal books suggests the government ran a 2016-17 deficit of $21.8 billion to put the Liberals close to their projection for the fiscal year. The Trudeau government's spring budget projected a shortfall of $23 billion for the fiscal year, without counting a $3-billion risk adjustment added to the accounting framework. Source
  • Feds run $21.8B deficit in 16-17, putting them close to target: early analysis

    Economic CBC News
    A preliminary analysis of the federal books suggests the government ran a 2016-17 deficit of $21.8 billion to put the Liberals close to their projection for the fiscal year. The Trudeau government's spring budget projected a shortfall of $23 billion for the fiscal year, without counting a $3-billion risk adjustment added to the accounting framework. Source
  • U.S. GDP reading for start of year revised upward, but still weak

    Economic CBC News
    The U.S. economy started 2017 out with a whimper, but it wasn't quite as weak as first thought. The government revised up its January-March growth reading to a rate of 1.2 per cent — better than an earlier estimate of 0.7 per cent but well below President Donald Trump's ambitious growth targets. Source