'We haven’t been asked to do that' - No timeframe for LIV Golf to turn a profit, COO Atul Khosla confirms
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Updated 28/07/2022 at 20:16 GMT
The third LIV Golf event takes place in Bedminster this week. The series has already confirmed its plans for 2023, with 14 events pencilled in. The venues and dates have not yet been confirmed, but it appears the intention is to grow. Profitability is seen as a long-term aim, but there is no timeframe to achieve it.
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LIV Golf has not been set a timeframe for it to become profitable, with the aim being to grow the product on the world stage.
The Saudi-backed series is in ‘startup’ mode, according to its president and COO Atul Khosla - and is prepared to take risks, and make mistakes - in its early stages.
The third event takes place in Bedminster this week, and its schedule for 2023 has been confirmed.
There will be 14 events, featuring individual and team competitions. The teams will be consistent through the year, and the aim is to grow them as franchises in their own right.
Huge amounts of money have been thrown at LIV Golf, with big signing bonuses handed to players on top of the massive prize funds for each event.
Backed by Saudi Arabia's Public Investment Fund, money is no object but a time will come when it must wash its own face.
“It’s hard to put a line in the sand, and we haven’t been asked to do that,” Khosla told Golf Digest when asked about a timeline for profitability. “We’ve been asked to show how we would build something, which we are doing.
“Four months ago we were at a very different place where we were questioning how this would get off the ground this year, and today we’re at a place where we’re announcing the desire to have a full schedule. We’ve seen the trajectory change.”
There has been widespread speculation that the PIF is attempting to use LIV Golf to improve its image.
Should LIV Golf prove to be a success that will be an added benefit, but Khosla claimed the PIF’s aim is to make a success of its investments.
“If you look at the investment portfolio or our primary investor, the Public Investment Fund, they have invested all over the world in incredibly large businesses and profitable businesses,” Khosla said. “Their view of this is no different. That’s the expectation that we have from our board.
“Like any other startup, do we have upfront costs to get the product off the ground? Yes, we do. It’s no different than a burn rate that an Uber may have, or any other startup tech might have to get a product off the ground with a vision of disrupting a space. We are fortunate, of course, to have an institution that has the patience to be able to go through this methodically and in the right fashion.”
LIV has recruited star names such as Phil Mickelson, Bryson DeChambeau, Dustin Johnson and Brooks Koepka. Those players are captains of their teams, and the aim is to turn them into franchises and attract investors.
“Eventually there’s a valuation for those 12 teams,” Khosla said. “There’s equity being held by the league, there’s equity being held by the players. There will be a chance to get additional investors if one wants to dilute their initial investment, that is classic work that happens in sports today. Teams get valued, teams get sold. We are introducing that concept into golf.
“It’s not a novel concept. Fans understand teams, it’s second nature. We grew up playing team sports. But it is fundamental to how the model will play itself out, and the players are absolutely bought into it.”
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LIV is at loggerheads with the established tours, the PGA Tour and DP World Tour. Its players’ status is at risk as LIV events do not currently qualify for world ranking points.
The majors have yet to take a stance on whether LIV golfers will be allowed to compete, and that is likely to be kicked down the road as the next major is not until the Masters in April.
LIV is reported to have locked down its 48 players for 2023 already, and Golf Digest claims some players in the world’s top 50 have been knocked back.
There have been calls from the likes of Ernie Els and Bernard Gallagher for the heads of the organisations to sit down and talk.
So far, there has been no sign of the sides softening their stances, and much may hinge on how long the PIF will be prepared to fund LIV.
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