A golfer gets ready to place a wager
Loopgolf, a Bay Area fintech startup that streamlines recreational golf wagers, sees on-course betting as a gateway to capturing a big slice of golfers’ overall spend.
Founders Thomas Reinholm and Matt Rum met while working at mobile payments company Block, formerly known as Square. They became fast friends, bonding over their shared passion for playing golf with money on the line to make their matches a little more interesting.
Their business venture was crystalized while playing a Nassau, a common tripartite bet with wagers on the front nine, the back nine, and for the full 18 holes. Presses, secondary bets for the remaining holes in a particular segment or for the overall Nassau further complicate keeping track of the overall tally, especially as this additional action piles up.
They were the midst of a rollicking back-and-forth match with multiple presses that was coming down to the wire. Reinholm, who was acting as scorekeeper, found himself getting peppered by questions from his playing partners on where the match stood and how much up or down they were as they headed into the final stretch. The rapid-fire was coming at him during pivotal moments of the match, while he was trying to bear down and focus on executing key shots to close out the round. Even when the final ball poured into the 18th cup, all was not resolved.
“Once we completed the round, we were sitting down afterwards for twenty-five minutes trying to figure out what all the scribbling on the scorecard meant, agree on the outcome and then eventually settle all the wagers that took place,” Reinholm remembers.
“You get involved in these debates and there shouldn’t be any room for debate. You should just shake everyone’s hand and move on,” he adds.
On the car ride home, they realized there had to be a better, more elegant solution than the old-fashioned pen and paper method that could let players know where they stood on a net-dollars basis in real-time and automatically settle bets post round.
After a search for a product to solve all these pain points came up blank, they decided to leverage their background in payments infrastructure to build a digital wallet for golfers that would remove all the friction and awkwardness inherent in peer-to-peer betting, including making sure winners couldn’t get stiffed. Upon completion of a match, once the scorekeeper taps the ‘settle’ button, all funds are ledgered into the appropriate players’ wallets.
“Starting with coordinating your round, scoring it and settling it, we’ve made it as seamless as it can be. Loopgolf simplifies the entire process of setting up and completing a money match,” Rum says.
To dissuade sandbagging, players currently need to synch their account to the USGA’s Golf Handicap Information Network (GHIN) when onboarding onto the app and round scores are also automatically posted upon completion.
So far Loopgolf, which launched in open beta in September, has raised $1.3 in in pre-seed funding and aim to close out the remainder of a $2 million round in the next couple months. Notable backers include Acorns co-founder Jeff Cruttenden, Oakland A’s outfielder Stephen Piscotty, Fox Ventures, SWS Ventures, and Sendoso CEO Kris Rudeegraap.
They are in the midst of launching a crowd funding campaign on Republic to give their early adopters an opportunity to take an equity stake in the company which they forecast will hit 30,000 monthly active users by year end 2023.
Currently, the wager platform only facilitates bets for match play and skins games but they are just getting started. Before the end of the year they plan to add closest to the pin and longest drive side bets to augment their betting game offerings.
The grand vision for Loopgolf is to further utilize the product’s payment infrastructure by issuing a debit or credit card tethered to a golf-oriented rewards program where points earned will unlock experiences and discounts.
“What is really unique that we’ll be able to do is both reward spend on the card, but also play out on the course. We are looking to reward golfers for all of the dollars and all the time they spend on golf,” Reinholm explains.
Rum points out that what Delta’s Skymiles loyalty and rewards program has done to “gamify spend back toward travel,” is a big inspiration for the product they aim to build where bucket list experiences like a round at Pebble Beach or tickets to the U.S. Open could be unlocked.
On the near-term horizon they’re planning a Play For tournament in 2023 that will follow a March Madness style single-knockout format to reward customers while also showcasing their on-course wagering capabilities in an event setting.
Down the pipe, Loopgolf will further grow the utility of the platform by integrating curated commerce discovery into the app, exposing their community to new and notable brands. They also plan to eventually partner with a sportsbook to add a pro golf betting component to the fold with an eye towards facilitating in-round action.
Today, the backend infrastructure to bet on whether or not Justin Thomas will keep his next drive on the fairway or if Jon Rahm is about to sink a 10 footer is not in place, but this is ultimately the direction where golf betting is heading in the near future.
A golfer gets ready to place a wager