Money Clip: Teeing Up New Clients
Many golfers aren't just looking for lost balls when they play. They're looking to grow their businesses. How do they do it? What's the secret to turning a round of golf, or maybe a few rounds, into money?
I have an investment-manager friend with 50 wealthy clients, more than half of whom he signed up through golf. My friend—let's call him Steve—has been at this for more than 30 years. "No question, golf works better than anything else for building my [client base]," he says. "What am I going to do, email you? Cold-call you? No. Let's go whack it around, tell some jokes, get to know each other."
Here are Steve's four keys for mixing golf and business prospects.
THE CARE AND TREATMENT OF POTENTIAL CLIENTS
1. TAKE YOUR TIME. A round of golf is a great start, but don't expect anything to happen after just 18 holes. You and your prospect are getting to know each other. This is why Steve always goes on two or three golf trips a year with clients and their friends (the prospects). "There are just so many opportunities to connect: sitting on the bus, in the pub, in the hot tub, gambling..."
2. TREAD LIGHTLY. "I was a pretty pushy, aggressive guy when I was young," Steve says. "The soft sell works so much better." Most of the time he'll wait for prospects to approach him. In rare cases—if the guy has been exhibiting "buy signals," such as asking Steve his opinion on the stock market—he'll make the first move. "I'll say something like, 'I'd love to talk with you sometime when we get back from this trip.' "
3. THE COURSE IS NO PLACE FOR BUSINESS TALK. In three decades, Steve says he has never once brought up business while playing. "That's why we play—to get away from talking business," he says. "We're building relationships. People want to do business with people they like, but you've got to get 'em to like you first."
4. BEING NICE GOES A LONG WAY. "You want people saying, 'I like this guy. He gets the pin. He's polite. He's friendly.' " On a trip, Steve says, "I like to throw a little money around. Bring some gifts, pick up a tab every now and then. Nobody hates that. You know that book Blink, about trusting your first impressions? It's really true. You can't overestimate the value of people just thinking you're a nice guy."
ARE THESE BUSINESS EXPENSES?
Say you went on a golf trip to schmooze potential clients, but your employer didn't cover the cost. Could you claim it as an unreimbursed business expense on your tax return? Yes, says Art Hurley, a partner in the accounting firm Daszkal Bolton. Just know that if you're audited by the IRS, you'll need to show that the primary purpose of the trip was client-generation or maintenance, not pleasure. It would help if you could document which current clients you recruited on previous trips. Something else to keep in mind: Only business expenses that exceed 2 percent of your adjusted gross income are deductible.
Golf can do more than help you connect with clients. It can reveal the people you don't want to do business with. On a trip with a prospect a few years back, Steve's internal alarm bells went off when he saw the guy furtively kick a ball out from behind a tree. Later on, Steve's fears were confirmed when the guy's caddie fired him—walking off the course in disgust over his rude behavior. "Life's too short," Steve says. "I don't need a client like that."