Wednesday, March 5, 2014

Joseph Schumpeter would be proud

Tri Columbia, with its 30-year-old Columbia Triathlon (Olympic distance) was a very early player in the national triathlon scene.  In addition to that large and much-loved mid-distance race Tri Columbia puts on the Eagleman, which Ted tore up a few years back, and several other less well known regional events including the Chesapeakeman (Chessie) 140.6.

To place the enterprise in appropriate historical perspective, one source dates the first "official" triathlon race to 1974 in California.  (It does reference triathlon in the 1920s in France but gives the distinct impression that the sport was not a sport until the '70s.)  Tri Columbia's Columbia Triathlon has been run continuously since 1984.

The report is that the enterprise is inches away from folding.  (Hat tip to frequent commenter D__, who as founder of a mid-Atlantic power triathlon team is frequently in the know on these matters.)

Why?  The blame seems to revolve around a high level of competition.  A few years back I ruminated here on runningprofs on the developing triathlon market, noting that the entry barrier to putting on a mid- or short-course race was little more than permit fees and insurance.

On the basis of my three (extraordinary) Tri Columbia events and observation of the firm for several years, I will add a slight bit of texture:  there is substantial market segmentation in triathlon.  There is Ironman, Challenge and Rev3 (three large, well-funded promoters); there is the category including Set-up Events, Sommer Sports, and similar mid-tier promoters putting on race series; there is the category of similarly mid-tier single-even promoters like the Silverman Triathlon folks; and there is the infinity of club races.

Ironman et al. have created brands of extraordinary value and have turned "triathlon" into their customers' first-priority week-long vacation.  Mid-tier races are for the committed few who want to race several times per year and are less concerned about getting their backs slapped at the water-cooler the following week.  (For fun, try bragging to a colleague that you just finished the "Chesapeakeman" or -- I did this once -- "Great Illini."  Doesn't quite have the same ring.)  Club races are for early and late season "gotta get my speed workout in" AND for "cross this off my bucket list" athletes.

Tri Columbia's problem was that it fit squarely in the middle tier.  That firm offered a first-rate race experience for regional athletes.  For many of us it was the unofficial start to serious training and racing.  In 2013 the competition in my age group at the Columbia Triathlon was better than at much larger -- and much better known -- races including the Nation's Triathlon, Timberman 1/2 Ironman, and Lake Tahoe Ironman.  (With similar perceived output on my end, in my age group I was 18th at Columbia compared with 3d, 11th and 12th at the other races.)

Tri Columbia tried, though, to compete in the top tier.  The Columbia Triathlon had become the go-to black-label race of choice for pros resting between their Kona qualification and their Kona training cycle.  Not many of those pros were mid-Atlantic locals, suggesting that a large chunk of money was going to appearance fees.  Other large chunks of money were clearly going to making the races first-rate:  the level of support and amount of swag at Tri Columbia events is much greater than at regional competitor Set-up Events events.

What lesson?  Unless you have large dollars behind you, to run a triathlon race series you need to be lean and regional/local, unless you want your lunch eaten.


  1. One reaction to this development---albeit one that likely won't find much resonance in a blog full of economists---is that this isn't like any old market competitor getting in over its head. Instead, it's almost like losing a public resource. Eagleman and Tri Columbia are basically the only races on the East Coast to boast world-class competition. That's driven by the sizeable prize purse that Max mentioned, and also by the fact that Eagleman was among the handful of 70.3's that had Kona slots on offer.

    My not-entirely-uninformed intel is that Eagleman alone is $500k in debt. If that's anything close to correct, I think it is very difficult to explain on the basis of a single bad registration cycle. Instead, I offer the following carefully phrased statement from the Slowtwitch article:

    "Nobody currently on staff is implicated in any financial mismanagement."

    This is like saying that no one currently suiting up for the Miami Dolphins is implicated in bullying, or that no one registered for the Tour De France is currently serving a drug suspension. I suspect we'll learn that longtime race management, i.e., Rob Vigorito, who ran TriColumbia for 30 years until separating from it a year ago, was paid quite a bit more than his role as head of a nonprofit triathlon organization would suggest.

    1. Were such a thing at some point to be disclosed, it would indeed be a bombshell.

  2. Nonprofit governance may, in fact, be an oxymoron . . . During the season, a lot of money runs through the organization. At the end of the season a small deficit may seem manageable, and easy to make up the next year. Pretty soon you're Mr. Micawber.