Last week, RED Mountain Resort — the oldest ski resort in all of Western Canada — announced a historic moment in the mountain’s 110-plus-year history: It has now successfully raised over $10 million in online crowdfunding in an effort to keep the resort independently owned.
Located in Rossland, British Columbia, RED Mountain Resort traces its history back to the 1890s when Scandinavian miners flocked to B.C. during a gold rush. The miners who settled in Rossland started skiing on the local hill and founded the Rossland Ski Club — which eventually became known as RED Mountain Resort.
The mountain has a long history of being a no-frills, mom-and-pop operation that eschews crowds and overpriced lift tickets in favor of wide-open terrain and a relaxed atmosphere.
But following the acquisition of Whistler Blackcomb by Vail Resorts in August, the owners of RED became worried about the current trend of mergers and acquisitions in the ski industry, and launched the first-ever online crowdfunding campaign with the purpose of selling ownership and equity in the resort.
Under the tagline “Fight the man. Own the mountain” RED started an online crowdfunding campaign offering ownership equity to anyone willing to pledge at least $1,000 in donations on the StartEngine website with the goal of raising $10 million in pledges by April.
“RED started as a ski club that was owned by the community,” RED CEO Howard Katkov told TRANSWORLD BUSINESS at the time of the crowdfunding campaign. “You can feel it in the spirit of the place, the camaraderie, the spark … this StartEngine.com campaign is simply the latest expression of our intent to keep RED independent and thriving.”
“Our goal was to hit $10 million in reservations by April, but we managed to hit that number months in advance,” Katkov said in a press release on reaching the milestone. “We now sincerely hope that a large percentage of the RED fans that pledged their support will convert their reservations to a real investment when the Phase II launches this fall.”
As mentioned, RED secured the $10 million in pledges during the first phase of their crowdfunding campaign which they titled “Test the Waters.” Now, during the second phase of crowdfunding, the resort will be reaching out to the nearly 3,000 people who pledged donations in the hopes they will follow through and turn their pledges into monetary investments.
At that point, regardless of whether investors are on the hook for $1,000 or $50,000, independent investors will be guaranteed return on investment before any other existing equity investors.
And, in addition to the equity in the company they will receive with a monetary investment, each investor will receive a slew of perks including family season passes, custom skis and snowboards and access to a purpose-built clubhouse and overnight cabins.
“We went into this campaign feeling that these were uncharted waters,” Katkov said in the press release. “But the response was immediate, passionate, and unequivocal. Our choice to plant the flag for independent skiing and snowboarding during a time of high-profile mergers and acquisitions really resonated.”