Score Board: From Collectibles, A Nice Collection Of CashLaurel Touby
Joe DiMaggio is always getting pestered by autograph hounds, sometimes even when he's eating. But when Paul Goldin asked the former Yankee great for his signature over lunch last October, he was happy to oblige. Goldin, chairman of Score Board Inc., was offering DiMaggio up to $6 million in return.
What Goldin arranged at lunch that day was the exclusive rights to Joltin' Joe's autograph for two years. Now, when he signs his name on any baseball memento, Score Board sells it and keeps approximately 35% of the take. These simple arrangements, combined with a surging interest in sports trading cards, have Score Board on a winning streak in the $2 billion-plus sports memorabilia market. Since 1989, its net income has catapulted 905%, to $6 million, on an 822% sales gain, to $59 million.
Goldin, 60, founded Score Board with his son, Kenneth, 26, back in 1987. Baseball-card collectors since the early 1970s, they got the idea after attending a jam-packed sports-card convention. "I thought: 'There's got to be a business opportunity here,' " says Paul, who was then president of a small health care company that later went bankrupt because of heavy competition and decreased medicare payments. He persuaded a New York investment firm, the now-defunct Greentree Securities, to underwrite an initial public offering that raised $2.2 million. The Goldins invested the proceeds in bulk lots of new baseball cards, sorting out the best players and reselling them at a premium.
`THE HOTTEST.' In 1988, they branched out by acquiring Game Time, a maker of trading cards and trivia board games. Soon, they saw a burgeoning market for autographs and began signing up sports stars from Joe Montana to Muhammad Ali. "They've got practically all the hottest athletes," says David Benhaim, an analyst with Adams, Harkness & Hill Inc. in Boston. By having someone from Score Board watch as the players sign, the company can promise buyers that each signature is authentic.
Now, Ken Goldin is heading a foray into the $2.7 billion entertainment memorabilia market. Founded in 1990, Score Board's Catch a Star Collectibles Div. sells products such as John Lennon gold-record plaques and Elvis Presley jewelry. The unit now produces about 7% of Score Board's revenues, but it's a risky business. Warns Karen Raugust, editor of The Licensing Letter: "People aren't going to get sick of baseball, but a Batman craze will die out."
Ken insists that Score Board won't get burned by depending too heavily on one faddish product. Besides, the company's mix will always include a healthy dose of sports, the Goldins' first love. "I've met every sports hero I've ever had," Paul enthuses. "Except Michael Jordan. It's a little difficult to get to him, but I think eventually we will."