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Redefining the Exotic Car-Share Industry

In Conversation with: Rick Gaan
CEO of Club Sportiva

Imagine being able to drive shiny Ferraris, Lamborghinis and Maseratis whenever you want. Imagine having access to stylish clubhouses, which are stocked with spirits and filled with car enthusiasts who you can network with or just unwind with. Imagine driving exotic cars through the hills of northern California with the wind blowing through your hair. Sounds like a car-lover’s dream, right? Well, these are the perks of being a member of Club Sportiva.

I had the opportunity to chat with Club Sportiva’s CEO Rick Gaan, a successful but humble businessman who has managed to make Club Sportiva an exclusive exotic car-share club that is luxurious without being pretentious. We talked about how Mr. Gaan got into the car business and how he and his business partner Sia Bani transformed the exotic car-share business model at Club Sportiva.

Passion for Cars

Mr. Gaan’s passion for cars began when he was a kid. He grew up in the car-centric Los Angeles area and later went to UCLA, where he completed a degree in electrical engineering.

Even though his background in engineering brought him to Hewlett Packard (HP), where he served as a senior marketing executive, the “car bug” never left him. After working with HP for some years, he came to the realization that he wanted to make a career change and focus on cars. He said to himself: “At the end of the day, I don’t want to look back at my life and say ‘what if?’” Eventually, Mr. Gaan acquired a go-karting track—LeMans Karting in Fremont, CA in 2005. This satisfied his car craving for the time being.

Unexpected Acquisition

In 2008, Mr. Gaan was very pleased with his sales team’s accomplishments at LeMans Karting. To reward them for their hard work, Mr. Gaan wanted to give them a memorable gift during the holiday season. He knew about the exotic car-share club Club Sportiva and figured Club Sportiva memberships would be the perfect gift for his car-loving sales team. When Mr. Gaan went to purchase the memberships for his sales team, the previous owners of Club Sportiva asked Mr. Gaan to become an investor of the club. Mr. Gaan recognized that becoming involved with Club Sportiva could be an exciting business venture. Soon after, Mr. Gaan negotiated the purchase of Club Sportiva and became the new owner.

“Everything in my life has been [unexpected]. When I see an opportunity I am the type that will basically go ‘you know what? I am not going to over-analyze it. It seems like it is something that would be along the lines of what I would like to pursue or do,’” Mr. Gaan said of the situation. “Sometimes it’s better to follow your gut and not overanalyze.”

The Club Sportiva Business Model

Before Mr. Gaan acquired Club Sportiva, it was considered to be the pioneer of the exotic car-share business models. Under this model, which was based on the property timeshare model, members had to purchase and maintain an annual membership in addition to points that could be used towards car time. The benefit of this model is that each club member can enjoy a variety of luxury cars while the cost of maintaining this fleet of cars is spread across all of the members. However, a downside of this particular model was that once the year was over, unused points would expire.

Mr. Gaan and his business partner Sia Bani were inspired by Club Sportiva’s original model but they transformed it in key ways. Mr. Gaan and Mr. Bani decided to adopt a more practical model for Club Sportiva. Instead of setting high membership fees, they decided to set dues low—approximately the price of a cell phone bill. As Mr. Gaan stated, “We are not about the glitz and the glamour—[we are trying to serve the car enthusiast]— some of whom are not super wealthy.”  Under Mr. Gaan and Mr. Bani’s model, members still have to buy points. However, unlike the previous model, these points never expire.

Mr. Gaan and Mr. Bani also introduced an exotic car rental service to Club Sportiva. Although some may have thought the rental services would decrease Club Sportiva’s exclusive image, Mr. Gaan informed me, “Our members love that we have renters!” The renters subsidize costs for Club Sportiva members.

The Club

In the state of California, where luxury car rental companies are ubiquitous, Club Sportiva provides clubhouse amenities that are not provided by any other companies. As Mr. Gaan states, “We are absolutely the leaders in the whole United States…that has been pushing forward with the share/club concept for the luxury lifestyle.” This makes Club Sportiva much more than an exotic car-share company. Rather, it is a social and cultural hotspot.

Club Sportiva has luxurious clubhouses in Silicon Valley, Menlo Park, Marina del Ray and San Francisco. At these clubhouses, members can enjoy a drink while relaxing or networking with other like-minded car enthusiasts. Members can also host private parties at these clubhouses, where guests can party and mingle in spaces filled with glimmering exotic cars. Club members even plan excursions together—from off-roading expeditions in Hollister, California to Oktoberfest celebrations in Munich, Germany.

Why should someone be a member of Club Sportiva if they can afford to buy an exotic car ?

G: “In the exotic car world the easiest thing to do is to buy the car—the hardest thing to do is to maintain it. Club Sportiva allows you to enjoy a variety of exotic cars without the hassle of tune-ups and maintenance.”

Tell us about your clients.

G: “We have all of them. In general, even though the memberships are quite affordable… we are seeing a lot of …business owners…executives…really outstanding people in their professions [ex. physicians]…It’s a neat mix of people…We have some members that are very young…in their mid 20s… people [who] are very successful in their careers from Google, Facebook…mostly very successful business owners.”

Does Club Sportiva have female members?

G: “Oh we absolutely have female members and boy do they have a good time!”

What was your first luxury car?

G: “I am not sure if this is luxury or exotic but it’s the one that I’ve wanted for the longest time…the Porsche 911.”

[Note: Mr. Gaan bought the 1994 Porsche 911 RS America, which is one of 86 made in the world.]

What is your favorite car?

G: “It depends on my mood…for the longest time my favorite was something that was probably one of the least expensive exotics but the most rewarding…the Lotus Elise…The reason for that is I really like racing go-karts and that’s the closest car for the street that mimics a go-kart… It’s very light…1900 pounds…where today a lot of cars are four thousand pounds.”

Which car should everyone drive at least once in their life?

G: “If you haven’t experienced driving a Ferrari you have to do that before you die…the sound that it makes, the smells …the experience behind the wheel is absolutely hard to describe. It’ll cause the hairs on the back of your neck to stand up.”

Which car will impress a date the most?

G: “I am going to guess…it would probably be the Lamborghini…They come in very bright colors…if you want to be a peacock you drive a Lamborghini.”

What advice do you have for young entrepreneurs?

G: “Commitment. Know, within yourself, what you’re willing to sacrifice for the health of your company, and be willing to put your personal needs aside if you truly feel you’re making a contribution to [the] space you’re participating in.  And do it without complaint, as it is your company. There are simply no promises or guarantees that things will work out.  But if it does, there’s simply few things that are more satisfying! That way, when you look back on your life, there won’t be regrets.  There won’t be any question of ‘I could have … would have … should have…’ because you know, in your heart, that you gave it all you got.”

 

Nisha Choksi is the Managing Editor of Universal Mirror. She is working on completing her Master’s degree in Public Policy and Administration (MPPA) from Northwestern University, focusing on issues related to education and economic development.  Nisha is an active dancer who enjoys traveling and is obsessed with all things beauty.  

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