A Kingpin in Manhattan: Tom Shannon of Bowlmor

“Upscale bowling” was an oxymoron until Tom Shannon got in the game. In 1997, he bought Bowlmor Lanes, the rapidly dilapidating Greenwich Village institution, and reinvented the place as a marriage between hospitality and bowling. Under his leadership, the Bowlmor brand came to represent high design, excellent service, and high-priced cocktails. The combination worked and he took it from failing business to earning more than $50 million in revenue per year.

Over the last 14 years, Shannon has built something of an empire with six locations: Orange County, Silicon Valley Bethesda, Miami, and two NYC locations—the original Greenwich Village bowling alley and the recently opened Times Square location.

Today, Shannon sits in what can be considered his professional Xanadu. According to Shannon, the 90,000-square-foot, $25 million Bowlmor Times Square is the most expensive bowling alley ever created. The 45-lane complex has seven themed lounges, impeccably decorated in New York themes inspired by neighborhoods such as Chinatown and icons like Andy Warhol. The location is also home to a nightclub and a sports bar, with cuisine by chef David Burke.

After this epic Epcot of bowling, what is Shannon’s next project? While he wasn’t specific, he’s looking to make bowling an international pastime. Before he embarks on his next venture, Shannon sat down with NY Report executive editor Daria Meoli to talk about what made him think getting into the bowling industry was a good idea, why he considers customer satisfaction a better indicator of success then EBITDA, and why he takes business very personally.

Daria Meoli: You purchased Bowlmor Lanes in the Village after earning an MBA from the University of Virginia. Why?

Tom Shannon: I graduated in a recession, so there weren’t a lot of good job opportunities, and the second was that I just really wanted to have ownership of my own thing. I looked at different sorts of things from startups to acquiring different businesses, and then I got invited to a party at Bowlmor in March of ’94, and I fell in love with it. It was a big anachronism—40,000 square feet, really run down, and heading towards extinction. I was able to buy it in 1997. 

We turned it around, and within three years it became the highest grossing bowling alley in the world.

Photo by: Jill Lotenberg

DM: You were fresh out of business school with little experience. How were you able to convince investors that it was a good idea to buy a bowling alley in Manhattan?

TS: Fortunately, I didn’t really have any investors. It was all debt. That’s why I say it was $3,000 down and $2 million borrowed. The sellers took back a seller note for about two-thirds of the purchase price. I brought in a consortium of Small Business Investment Companies (SBICs) to fill the gap. So, it was all debt and no equity.

DM: What potential did you see to make money from a rundown bowling alley?

TS: I was 31 when I bought it, and I wanted to make it a place that would appeal to a 31-year-old. I modeled it extensively, and I built a discounted cash flow model. It seemed inconceivable that it wouldn’t work out. For one reason, the cost structure was very low, so I didn’t have to be too bullish in terms of revenue assumptions to really make it work. That said, we took an aggressive approach to marketing. At one point, we were spending three quarters of a million dollars a year just to advertise one bowling alley. But in the context of the revenue it was making, it was a pretty small percentage.

The premise was simple. People love to bowl. Bowling is a constant. But the environment that surrounded the bowling industry was completely obsolete. So, we kept the bowling, but we put it in a more design and service-intensive environment. We did with bowling what Starbucks did with coffee. I don’t know why no one had done it before. It was the world’s first upscale bowling alley and it resonated incredibly well. I grew revenue fifteen fold in a decade. It’s not like I had a factory that was making a product to be shipped, and we sold more of them globally. We did this with one property, and it became the savior of the industry, frankly, because bowling alleys had been closing at the rate of about 200 a year prior to this. And then as Bowlmor became well known and the economic story became well known, people started not only not closing them, but actually opening them. Bowlmor created a renaissance in the bowling industry.