Skating on thin ice Featured

10:08am EDT July 22, 2002
Mark Wetzel isn't a salesman. He's a hockey player with a passion for his sport and a vision for the future.

With enthusiasm and an open and honest approach, Wetzel was able to package and sell an idea where others have failed.

His multimillion-dollar idea becomes a reality this fall when the Center Ice Sports Complex opens its doors just south of the Akron Canton Airport in the new Port Jackson Industrial Park. The complex will house an ice arena for competitive hockey and figure skating, recreational skating and lessons; party and meeting rooms; concessions; a game room; pro shop; and seating for more than 400 spectators.

There are 17 rinks that serve Cleveland-area residents but the closest rinks to the Akron and Canton area are in Kent, Wheeling, Columbus and Athens. For Wetzel, who works from his home as a computer consultant, that wasn't close enough.

Here is how the hockey player raised $2,550,000.

Learn from others mistakes

Wetzel first contacted 250 potential investors, including many of those who had tried and failed to build a rink in the area during the past 20 years.

"I tried to find what their stumbling blocks had been so I could avoid them," Wetzel says. "I was selective on who I brought on board. I wanted a cohesive group of investors who could bring more to the table than just the money."

Wetzel spoke to Rotary and Kiwanis groups to spread the word. And to provide evidence of the public's interest to investors, he organized a pep rally of sorts to announce his plan. Several members from both the Cleveland Lumberjacks and the Pittsburgh Penguins attended.

With just one week's worth of advertising, Wetzel managed to attract 300 families to the event. This provided him with a mailing list. Word quickly spread, and soon he was receiving phone calls and faxes from as far away as Wooster and Dover. To date, he has a list of more than 600 families who have shown an interest in using the rink on a regular basis.

Ignorance is not bliss

Wetzel contacted vendors who supply ice skating rinks and attended the first ice rink management course offered at the University of Michigan to get a better understanding of the business.

He researched other similar markets that had rinks and compiled a business plan that fills a 2-inch binder to capacity. In addition to the research, legal documentation and surveys, Wetzel included a conservative pro forma financial statement that shows revenue returns within two years.

Wetzel says he didn't "wine and dine" potential investors. In fact, his headquarters for awhile was a booth in a local Applebee's.

"I'm not a salesman in a true sense," Wetzel admits. "Lots of people told me I had to sell the idea. But I thought if I shared the facts as I see them without a lot of glitz, I would do better.

"People told me I was crazy but either you believe in the idea or you don't."

Know your limitations

Wetzel raised $300,000 from his own investment plus those from nine individuals. He approached several banks and eventually raised an additional $250,000 through a National City Bank loan. Finally, the major obstacle he faced was conquered when he joined forces with Whipkey Construction, which is providing a $2 million piece of the financial pie.

Whipkey signed a 99-year land lease on the land and agreed to construct the building and then lease it to Wetzel and his investors with an option to buy both the land and the building in six years.

"The risk for the developer is minimal," Wetzel says. "If-God forbid-we failed, Whipkey could sell the building as warehouse or office space."

A few investors dropped out in the early stages, but Wetzel says other opportunities surfaced quickly.

"I've been told the loan decision meeting at National City was not a typical one because so many of the officers are true hockey fans," Wetzel says. "I guess they were pretty enthusiastic about the whole thing."

Robert Eames, vice president for National City Bank, says Wetzel did many things right in approaching the bank.

"He got us involved very early in the process, took our feedback and understood our parameters before finalizing the structure of the deal and before approaching his equity investors," Eames says. "He knew what he needed to raise for the equity and the initial risk the equity holders would have to take.

"Mark's perseverance was essential. He overcame a lot of hurdles that would have stopped many people with less fortitude," Eames adds.

Wetzel says one major stumbling block was having to scratch his original plan, which included two 35,000-square-foot ice arenas-one for hockey and one for figure skating.

"We wanted to raise $1 million (for a total of $3 million) and build two rinks right away," Wetzel says. "But when that didn't work out, we looked at other options."

Future plans include an expansion of the building, which will house the additional rink.

Wetzel credits his thorough preparation for his success with investors.

"There's no better way to convince investors than being prepared," Wetzel says. "I think luck helps, but I also believe we make our own luck."

He stresses the importance of having enthusiastic investors he can rely on for other resources beyond money.

Tom Schervish joined as an investor about halfway through the fund-raising phase. Wetzel says he relied on Schervish for business consulting. Another investor, Dr. Bernie Bubanic, provided marketing expertise. (Bubanic also serves as team chiropractor for the Lumberjacks, Penguins and the St. Louis Blues.)

To save operating expenses, Wetzel, who will manage the new complex, will lease the concessions and pro-shop functions and "concentrate on programming and core activities."

How to reach: Center Ice Sports Complex (330) 966-0169