Travel back in timeーA look back at 20 years of GDO history (Part 1)

As a grad student in the US, I discover a freer form of golf and find the inspiration for a business

On May 1, 2020, Golf Digest Online (GDO) marked the 20th anniversary of its founding. The country was in lockdown due to COVID-19. It was peak season for golf, and virtually nobody was out playing. But by summer, a new lifestyle was starting to catch on; as people shunned crowds and sought open spaces, they flocked back to golf courses. (*) It was a tumultuous year, one of dramatic change the likes of which no one could have foreseen. As the pandemic raged on, GDO CEO Mike Ishizaka found himself reflecting on a variety of things. In this series, he tells us in his own words what it was like to found a company to lead an Internet-based golf revolution in 2000, and what his thoughts are now. 

What I love about it isn’t so much the athletic part, the insatiable desire to get an ever-better score. It’s going to all kinds of courses and having fun. It’s getting to know the people playing with me, setting personal bests, putting everything I’ve got into that long drive. All of these things are part of golf’s charm. But there was a time, when I was a young employee organizing competitions and entertaining clients for my company, that golf was a painful experience for me—it was business. Only later, when I went to the US for graduate school, did I rediscover the wonders of the game. It was then that I realized once again how fun it was, and that I found the inspiration to start a business. Today, I’ll talk about those beginnings. 

In the 1990s, when I joined Mitsubishi, nearly all golf courses were for members only. The Kanto region alone had 500 to 700 courses and only a handful of those allowed visitors to book a tee time without a membership. And they were all chock full of corporate types. You had to wear a jacket to enter the clubhouse, and when you played it was standard to have a caddy with you. 

I had more golf experience than the other new hires, so I was always the one who got stuck organizing competitions and entertaining clients. The work was exhausting. Only when I wasn’t running the events could I actually get a round in. I had to pay greens fees—this was on a new hire’s salary—and I was working all day on weekends. That was my image of “golf” in my first few years at the company...frankly, a game for old men. Gradually, I was coming to dread it. 

All that changed when I went to the US for business school. I made friends in class and through club activities, and during breaks we started spending every minute we could spare playing golf. At our own pace, for our own enjoyment. It was so much fun. Going from course to course, I got to know all sorts of people. Who knew golf could be so great? It didn’t take long for me to rekindle my love for the game I’d started to hate as a company employee in Japan. 

My time as a student in the US coincided with the Internet venture boom. Before I knew it, I was swept up in the fever of grad school and the exhilaration of being in America. The potential of the Internet excited me, and little by little my dream of launching my own business started to grow.

Then, a class on Internet business gave me a new direction in life. For my class project, I decided to write a business plan exploring the potential for an Internet golf business in Japan. It was around fall 1998 that I first came up with the idea and started working on the report.

Of course, I needed to do some homework before I could write the report. 

First, I needed to research the Japanese golf industry. On that point, I knew who to turn to. My maternal grandfather had founded a company called Golf Digest that published a golf magazine. It was now on its 3rd generation of leadership, with my cousin Genichi Kimura as CEO and his younger brother Masahiro as managing director. Masahiro and I were especially close, having been rugby teammates in college. He readily agreed to help me with my research. 

The other thing I needed to research was the state of Internet usage and, in particular, trends in the use of Internet-based golf services. My goal was to prove a hypothesis I’d come up with. Conducting a multi-question survey of golfers in Japan by email and fax from where I was in the US was a challenge, and success wasn’t guaranteed (since Internet questionnaires weren’t yet common, I had to ask my network of contacts for help one by one, analog-style). 

My hypothesis was that there was already a certain level of PC ownership and Internet access among golfers in Japan. Furthermore, people who met these criteria would be more likely to use services of value to them if those services were provided via the Internet. 

Back in 1998-99, PCs and Internet service were expensive, and individual usage was still low. You really had to be interested or involved in IT. But I figured there was a high probability that many of those types of users were also golfers. In other words, Internet usage was probably higher among golfers than among other categories of customers. 

Ultimately, I collected a sample of 100-plus respondents to my survey. The results made me sure of two things: one, my hypothesis was correct, and two, Internet golf services were a can’t-lose prospect. At the same time, conducting the survey was fun and interesting in itself...and it was also my first introduction to how important and fascinating marketing is. 

Even as I grasped the potential demand for Internet golf services, I was also gradually coming to understand the tough situation the Japanese golf industry was in. What struck me the most was how much bad debt golf courses had. Up until then, a lot of golf clubs had relied on selling memberships for revenue. That business model became the biggest strain on course management when Japan’s economic bubble burst and the market for memberships cooled down. I was surer than ever that this was a chance to offer new kinds of services. 

My report examined where new Internet channels should stand in relation to traditional print media. I argued that Internet-based golf-related services represented a major business opportunity as magazine sales continued to decline. I also touched on how to revitalize the golf industry as a whole during this transition period. The report concluded by proposing specific ways forward. 

After about half a year of work, I finished the report and handed it in. I managed to pass the class (with just an OK grade...) and graduated from business school. 

Since Golf Digest’s managing director Masahiro Kimura gave me so much help with the report, I also shared it with him. Then, in early summer 1999, I returned to Japan and, for a time, to Mitsubishi. Not in the energy division this time, but in finance, which is where I’d asked to be assigned. Actually, it was more M&A support and investments than finance. Through my work there, my conviction that I should start my own golf business steadily grew. And in November 1999, I made the decision to quit Mitsubishi. 

(*) Based on golf course customer referral data compiled by GDO. In August 2020, customer referrals were up more than 25% over the previous year, setting a GDO record for the highest ever for the month of August.