After overcoming over a year of rejections, Barrett Worthington and Meg Charity had been trying to land an investor to help them establish their dream pickleball club. They finally secured him by steering him away from the office and onto the pickleball court.
“It’s An Icebreaker”
“It’s an icebreaker,” says Worthington. “It breaks down walls, and it sort of helps facilitate friendships and conversations.”
The choice of meeting place wasn’t merely a tactical maneuver. It formed a crucial part of the pitch for their business concept: a pickleball social club.
This vision, nurtured over five years, materialized last June when Rally finally opened its doors in Charlotte, North Carolina, three months after the co-founders closed a $15 million seed round.
In the initial six months, over 40,000 individuals frequented the establishment—indulging in spritzers, tacos, cold brews, and court time. The company reports that 40 percent of these patrons returned within 30 days, with last month’s retention rate soaring to 75 percent.
Read another of our articles about the pickleball business in Charlotte, North Carolina, by clicking here.
A Chilly Funding Climate
It’s not only AI startups that are securing substantial capital during this difficult time. Despite a 38 percent drop in venture capital funding in 2023 to its lowest level in six years, the “eatertainment” sector has remained a beacon of hope as consumers, yearning for in-person experiences, continue to spend amid the post-pandemic services boom.
This trend is reflected in economic data, according to KPMG senior economist Yelena Maleyev. Americans are opting to spend their money on travel and experiences rather than material possessions.
“Even in a high price environment, high-interest rate environment, people still feel like they’re able to spend, especially on necessities and experiences,” she explains to Inc. “Because they are able to make up some of those inflation losses with higher wages.”
Capitalizing On The “Pickleboom”
While riding on favorable trends is advantageous, Charity and Worthington, who are business and life partners, emphasize that it takes more than that to launch a successful venture. Securing their seed round, comprising $10 million in equity and $5 million in debt, also demanded perseverance, networking, persuasion, and identifying the right audience.
The pair had observed how pickleball was trending long before it became the nation’s fastest-growing sport. In 2017, while Worthington was pursuing his business studies, they initiated an online platform akin to Uber for tennis lessons, connecting players with local instructors for freelance coaching. They quickly discerned significant growth in pickleball.
Transitioning the idea offline, they rented court space and began hosting “picklefest” pop-ups featuring matches, live music, and food trucks. This experience prompted them to contemplate scaling up the concept and enhancing its profitability, shifting the focus more towards social interaction than instruction. Worthington explains, “As you get older and you graduate from college and enter the workforce, it becomes a lot harder to make friends and also to find those types of communities.”
Finding The Right Audience
Initially, the entrepreneurs leveraged Worthington’s connections from the University of Virginia’s Darden School of Business.
However, this approach didn’t always resonate, particularly with older investors who associated the term “wellness” with a certain lifestyle brand.
Nonetheless, every unsuccessful interaction concluded with the same inquiry: “Is there anyone else you can introduce us to?”
This persistence eventually led to their first pitch session on the pickleball court and an introduction to Cal Simmons, chairman of the Washington, D.C. chapter of the angel investor group Tiger 21, who now serves on Rally’s board.
“It’s helpful to have someone vouch for you,” notes Worthington. “It took a lot of time to get our first willing and able investor to take a chance. Once somebody’s willing to get in, it becomes a lot easier, but getting that first person is really the challenge.”
Seeking Local Support
While Rally’s investors have their bases in major cities like New York, Los Angeles, Chicago, and Washington, D.C., the co-founders also sought funding from local sources by involving other small business owners in Charlotte as backers.
These investors not only provided financial support but also actively participated in matches and brought their clients along. This grassroots strategy is one they aim to replicate in future locations.
Nearly eight months into operations, Rally’s founders report a steady increase in sales, distributed across three main categories: 40 percent from food and drinks, 30 percent from pickleball, and 30 percent from events. However, specific revenue figures were not disclosed.
Their ultimate aspiration? Empowering other female founders to secure their own funding rounds, ideally on Rally’s pickleball courts. As Worthington envisions, “It should be the new golf in terms of being the foundation for business deals.”
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