Surviving Covid with a Bootstrapped Venture: Kristi Herold, CEO of JAM (Part 5)

Sramana Mitra: It also depends on what you are trying to accomplish because cash acquisitions are easy to rationalize on your balance sheet. If it’s an equity acquisition joint venture with another player, then that is not so easy to value. That is why I was probing that issue. Let’s go back to what happened when the pandemic strikes. How did you orchestrate and move forward?

Kristi Herold: As I said, we had two deals that we were doing our due diligence on that would have doubled the size of our organization by May or June of 2020. We had to put a pause on both of those. We were anticipating that we were going to be shut down for a month or two. I wasn’t anticipating that we would be here 13 months later not being to operate our sports league.

We have had a few operations in a few of our cities. Toronto is our largest city and we haven’t been able to operate there at all. We initially had to do temporary lay-offs with the majority of our teams. This was the hardest day of my life – March 13, 2020. As soon as we understood that the Canadian government was going to help with some wage subsidies, we were able to bring everyone back. This was fantastic.

In March and April, we were trying a lot of different things to see what we could do to stay alive. We were trying to keep our members engaged through play. We started offering virtual games – things like bingo, trivia night, and online speed dating. We realized that it was fun for people. They were enjoying the opportunity, but our model wasn’t going to be sustainable.

We were charging $5 a night for a night of bingo. You would get 50 to 100 people there. It wasn’t going to be sustainable, but we realized that all the corporate teams that are now working remotely are struggling to connect through play. The natural bonding that used to occur when you walk to the elevator and grab lunch with someone or stand at the office cooler and laugh about what you watched on TV last night was not happening.

We started offering these corporate virtual events to corporate teams. We found that every team who did it the next day was booking us back and asking for a package. They would try an event and say, “We want to book a package of 10. We want to give these as gifts to our corporate clients. These events are so much fun.” We realized that we were on to something.

We had all of our full-time staff from the Sports Social Club and they were acting as hosts and running these events that we were doing. We started innovating and started creating more events. In addition to Bingo, we added Trivia, Escape Rooms, Scavenger Hunts, and more. Our most popular one is called Survey Says. It is a take on a Family Feud. We also have Reveal of Fortune which is like the Wheel of Fortune Game. We also have Jeopardy. We have all these fun events.

By the end of the summer, we were hoping that we would get sports back up and running. We realized that our full-time staff can’t be hosting these events all the time. We need to build this as its own sustainable business. We have since hired 40 out-of-work actors and comedians who have been crushed by the pandemic because they are out of jobs and their side hustles are not there as well.

That has been amazing in that we have been able to create work for our work actors and comedians. We’ve hired 40 hosts now in a number of countries across Europe, Canada, and the US. We have done over 15,000 events for over 50,000 people in 20 different countries. We hit $1 million in revenues last week. This was done in less than a week. 

This segment is part 5 in the series : Surviving Covid with a Bootstrapped Venture: Kristi Herold, CEO of JAM
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