Clubessential acquires foreUP, as management software market continues to recapitalize

foreUP and Chronogolf report strong 2020, and Teesnap for sale again
  • Evan Teshima by Tech Buzz

The golf course management software market has seen a lot of change in the last few years, as companies seek funding to compete. The latest acquisition was announced this week, as Clubessential Holdings, the parent company of Clubessential, announced it acquired foreUP, the second-largest player in the public golf course space and one of the first cloud-based systems in the golf industry. 

Meanwhile, Teesnap is back on the market for sale after a nine-month hiatus, and Lightspeed, formerly Chronogolf, reports significant growth a few years after its acquisition. 

Clubessential Holdings was founded in 2016 with the acquisition of Clubessential, a club management technology company. Backed by Battery Ventures, an investment firm that specializes in technology companies, it has been on an acquisition tear, buying Prestosports in 2017, ClubReady in 2018 and Vermont Systems, which offers golf management software, in 2020. 

foreUP, its latest acquisition, increases Clubessential’s combined reach to 3,000 courses and clubs. Evan Teshima, who co-founded foreUP in 2012, will continue as CEO, a position he has held since 2018. Teshima started the company with Joel Ragar in their senior year at Brigham Young University. Ragar left the company in 2018. 

For the past ten years, the foreUP team has been on a mission to modernize and simplify golf operations by bringing the course to the cloud,” said Teshima in a press release. “As we continue to innovate to help our customers increase golf participation and improve their financial performance, we found an ideal business partner in Clubessential Holdings to support our rapid growth.”

Teshima told TechBuzz, a local tech news source, in October that the company had doubled its revenue in 2020 compared to 2019, partly thanks to the pandemic. He said 95% of the company’s revenues came from recurring subscriptions and that the company added 400 new clients in 2020. That would bring it to an estimated 1,500 courses, or around a 14% marketshare in public golf. 

Still, foreUP faces stiff competition from market leader GolfNow, which acquired EZLinks in late 2019. At that time, GolfNow, which is owned by NBC Sports, had more than 61% of the market share based on tee time booking software. foreUP was second with 8%, but was growing at about 25% a year. 

Some analysts predicted GolfNow would lose a sizeable number of EZLinks’ customers to companies like foreUP. GolfNow had seen a slow erosion in clients during the prior five years, largely related to ill feelings about the company’s tee time barter option. The National Golf Course Owners Association released a study last year that made a strong case that such bartering is not in the best interests of golf course owners and operators. While GolfNow offers other payment options, the barter business model has negatively impacted its brand among some operators. foreUP and other competitors have reported strong growth since GolfNow acquired EZLinks, as was predicted.

GolfNow recently restructured management and announced in November that Jeff Foster, who helped come up with the GolfNow concept 20 years ago, was leaving the company. 

Still, GolfNow has recently renewed agreements with major players. KemperSports recently renewed, as did Indigo Golf, a division of Troon, which uses its G1 software. 

foreUP also faces increased competition from Lightspeed, which acquired Chronogolf in 2019, providing that company with deeper pockets. Lightspeed, a public company with more than 900 employees, reported that its clients enjoyed a 23% growth in rounds in 2020 — higher than the industry average. It serves 1,000 golf courses and recently signed Landscape Golf Management as a client. 

Other competitors include Teesnap, which was founded by Allegiant Airlines in 2013. Allegiant announced in 2019 that the software company was for sale. However, despite the fact that it was the fastest-growing golf management software company in the market, it was losing money and was unable to find a buyer. 

Allegiant Air restructured the company in April 2020 and parted ways with founder Bryan Lord and other employees, including Mark Farrow. Farrow was director of business development at Teesnap since its founding and joined foreUP in March 2020. 

Since the restructuring, Teesnap “has been cash flow positive, producing a double-digit EBITDA margin on almost 50% increase in net revenue from 2019,” said Gregory Andersonchief financial officer at Allegiant in an earnings call in early February. 

Allegiant is restarting the process to sell the business. 

Club Prophet may be the last independent company with more than 2% market share in the golf management software space. It was founded by Tom and Rick Robshaw in 1993 and is used by 1,700 courses. 

Vermont Systems, also owned by Clubessential Holdings, has less than 2% of the public course market, but is primarily focused on recreation management for municipalities, universities and the military. Other Clubessential properties focus on fitness clubs, ClubReady, and sports technology, Prestosports.

Clubessential’s acquisition of foreUP combines a company in the public golf market with a company in the private club space. Clubessential serves 1,300 private clubs. 

foreUP is headquartered in Pleasant Grove, Utah, with more than 90 employees. Prior to the acquisition by Clubessential, the founders and employees owned 90% of the company. It offers point of sale, tee sheet, billing, food and beverage and reporting software solutions, as well as marketing and web services. 

“We’ve followed Evan and the foreUP team over the past several years as they've successfully transitioned the public golf software market to the cloud,” said Randy Eckels, CEO of Clubessential Holdings. “We’ve been impressed with their vision, commitment and passion for delivering exceptional customer experiences through innovative applications of technology.” 

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