Starting a rally-style (dirt) entertainment center (sales, investors, salary, versus)

[Speedteacher]

My business partner and I are starting a rally-style race track near Fort Wayne, IN. We provide cars (Subarus) for people to use in a one-at-a-time racing format. We will have several cars, along with instructors, available throughout the week. We will be part of an extreme sports complex that also has a motocross track and several paintball parks (both indoor and outdoor).

This has been in development for the past 18 months with very favorable reviews from our core demographic (ages 16 to 30). We displayed one of our vehicles in a local mall for 30 days and had over 2000 people express an interest in what we were doing.

I am 39 and have a great job in Orthopaedic Manufacturing. My business partner is 47 and ran a successful chain of video stores when videos were hot. I have been involved in the sport of autocross (SCCA) for 10 years. My partner has been involved for over 20 years and is a former national champion. This is the sport that is the basis of our business. (Note, autocross is on pavement and rallycross is on dirt. One car at a time... compare times with competitors to see who wins.)

We have about $10,000 (cash) of the $50,000 we need to get this started. Our cost of entry is very low compared to our potential gross sales. It looks like an investor or two is our best shot. We feel we have a very solid business model and a strong leadership team in place to be successful immediately. We have a small sales support group who will do the bulk of the sales. They are members of our demographic and excited about what we are starting. My business partner will run the operations side of the business. I will have the option of continuing my job (3rd shift supervisor) until the volume of the business requires my full attention. At that point it would make sense to transition to full-time involvement.
Over the course of the next three years we conservatively estimate sales growth of approximately 30% each year. This is based on expanded programs we'll implement as we develop our core customer base.

I would like to know where best to find an investor (I will use the search feature as well, but would love some personal insights), and what would be enticing enough to an investor to get them on board. I have the luxury of a good paying job, so my salary from the business would go to my investors and the growth and security of the business first, and then to me.

Thank you in advance for any insight or advice you are willing to share.
I'm not sure if I can include a link to our website in this post (against the rules I believe), but if I'm wrong, let me know and I will.

Todd
RPM Motorsports

[desertsun41]

It appears you are already open for business and have been for at least a year that I can see by your web site I found. Why are you saying you are about to open?

In this economic depression I would consider your venture a luxury and in times like this people cut out the luxuries in their lives and just go into survival mode

Good luck though.

[Speedteacher]

We have been developing this program for 18 months. It has taken us that long to find a site that is appropriate. Now that we have, we are ready to get going. So, we are about to open for business.

According to our extensive research, our market here in Indiana is chomping at the bit to participate. Our demographic isn't really holding back. They might indulge in one fun thing versus three fun things. Its just up to us to get their attention. It might be different in Texas, I don't know. People here are definitely not in 'survival mode' yet. We'll find out pretty quick...

I appreciate you taking the time to research us on the web. Its cool you were able to find it, assuming it was our website you checked out.

Thanks!

Todd

[wanneroo]

Well as someone who has worked for different schools, teaches rally and off road driving professionally and does a lot of driving and instruction work for a certain manufacturer, plus all the events and racing I do I think there are a # of things to keep in mind.

1. Liability- I would have your p's and q's covered on that.

2. Billys- What are Billys? Industry term for people that turn up off the street to drive. A lot of people don't care about the car or themselves and all it takes is one second and you have a major issue. Plus few americans have any understanding of vehicle dynamics hence leading to more problems when you put people in a vehicle and let them go flat out, even in a "low speed situation". I've done a lot of low speed courses for manufacturers and even then you still always have to keep your finger on it.

3. Track maintenance- The rally course I currently use for training, we have to constantly maintain and it is expensive and time consuming. Rally cars, even at low speed, having run over a course a number of times will rut and damage a course quickly. Also rain will rip up a course and if used in the wet and not maintained it will "set" when dried creating some interesting scenarios.

4. The Track- I would put a lot of thinking into how you set your track up. How much sideways action, how much speed, how much run off room, etc. Again liability and safety come into play. What if someone misjudges a gas pedal for the brake? I've seen it happen with devastating results.

5. Instructors- If you have instructors ride right seat make sure you have skilled instructors that have an understanding of vehicle dynamics and can also recognize things going wrong in car before they do. If you don't have instructors in car, my only worry is that people can turn it into a demolition derby.

6. Car maintenance- cars will take a beating. Gravel blasts metal on the underside of cars to pieces, tires get ripped up, front and rear clips get beat up, etc. Not to mention all the mechanical components with Billys revving engines to 9000 rpm or crunching gearboxes and smoking clutches.

I think you have a great business idea, but I hope you consider the above and keep that in mind. I deal with these things all the time in the course of my work. From reading what you wrote, I have good reason to think you don't know what you are letting yourself in for and with $50K it is going to be tough.

Good Luck!

[Speedteacher]

I appreciate the feedback.