Ticket Industry Vet Picks ‘Costco Club’ Model Over Resale Markups

Ticket fees were a hot topic of conversation in 2023, drawing the scrutiny of Swifties and President Joe Biden, among others. Across the economy, extra fees on purchases ranging from airline tickets to takeout meals cost consumers $64 billion each year, according to the White House. In June, major ticket marketplaces including Ticketmaster and SeatGeek pledged to be more up-front about pricing.

Now, startup Seat Club hopes to offer an alternative without any extra per-ticket costs. Instead, the company plans to operate with a Costco-like membership model, charging $99 annually for access to the buying platform.

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“We don’t make any money on the tickets,” Seat Club founder Cole Rubin said in an interview. “Our sole source of revenue is a subscription fee.”

Rubin is a ticketing industry veteran; he previously founded Dynasty Sports & Entertainment, which provided distribution tools to ticket rights-holders and secondary sellers. In 2020, Rubin left the company, which now operates as Logitix. He said he has invested roughly $1 million in Seat Club thus far.

“Throughout my time at Dynasty, I had fantastic access, because we were partners with all these teams, and once I transitioned out of that business… I’ve been buying tickets online, just like everyone else,” Rubin said. “This is a business for people like myself and my family who are going to a lot of events. Tickets are already expensive. To add that extra layer of fees on top of it, it’s tough. It’s a tough pill for people to swallow when they’re already spending a lot of money on tickets.”

In the past, executives from Live Nation, which owns Ticketmaster, have said most of the additional fees it charges as a primary seller go to the hosting venue, with the service keeping some of the money and other slices of it going to credit card companies. Secondary marketplaces such as StubHub and Vivid Seats point towards operating costs, customer service and delivery expenses when breaking down their fees.

Debates over the fairness of fees stretch back about as far as online ticket buying itself, and conversations around the various platforms’ cost structure has led some fans to recommend returning to the old-fashioned box office. On Seat Club, Rubin estimates that fans currently spending more than $750 annually on tickets will end up saving money by paying the $99 up front.

Rubin said that one of Seat Club’s biggest challenges will come in marketing, as it attempts to get its message out amid the ongoing digital ad-buying war between the biggest ticketing platforms.

“It’s really a customer acquisition game that these companies all play in, and so my hope is that we can get to consumers that are savvy, that understand that the inventory is fairly similar across all these exchanges,” Rubin said, “and they can just price compare and see that Seat Club is definitely a great value proposition.”

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