A New Gold Standard for Sports PSLs: The Golden State Warriors’ Membership Program

By: Michael Medved

I. Introduction

For the 2019-2020 National Basketball Association season, the Golden State Warriors concluded their long residency in Oakland’s Oracle Arena and embarked on a move across the bay to San Francisco’s newly constructed Chase Center.[1] True to the pathos of their Silicon Valley backgrounds, Warriors’ ownership implemented an innovative financing mechanism to assist in this move. But, “[w]hile Chase Center follows many 21st century arena trends—favoring an intimate fan experience instead of maximizing its seating capacity—the building’s financing [ran] counter to established norms.”[2]

The radical financing scheme the Warriors implemented to fuel construction of the Chase Center was called a membership program.[3] This program was an alteration to Personal Seat License’ (PSL) agreements as previously used by other sports franchises.[4] The membership program allowed the Warriors to solicit their rabid and wealthy fanbase to help fund construction of the Chase Center. Bruce Schoenfeld of the New York Times claims that Warriors owners Joe Lacob and Peter Gruber had envisioned this scheme since their purchase of the team. “Once Warriors’ owners Joe Lacob and Peter Guber decided their team needed a new arena, in San Francisco—and they seemingly made that decision before they bought the team in 2010—they also knew who would pay for it: the fans.”[5] Ultimately, the success of the program allowed “the Warriors to consolidate their arena, practice facility and basketball operations offices under a single roof and allow[ed] them to tighten their grip over all aspects of their business.”[6]

This article illuminates how the Warriors were able to persuade their fans to become purchasers of their membership offering in order to finance construction of the Chase Center. Specifically, this article will focus on how the Warriors were remarkably successful in this endeavor despite this membership not including the price of admission; but solely providing for the right to purchase admission. In doing so, this article will note the innovative strategies used by the Warriors that were held out as “carrots” to turn fans­—the most profitable of which being the Silicon Valley’s tech giants— into members. It will conclude with a recommendation for how future NBA teams incorporating a PSL should steal from the Warriors’ playbook.

Continue reading “A New Gold Standard for Sports PSLs: The Golden State Warriors’ Membership Program”