The New Club Kids: Exclusive Social Clubs Get a Millennial Update
"There are so many people here," whispered a leggy brunette to her equally spindly friend, scanning for suitors from their perch at the white granite bar of a fashionable new Manhattan hotel. Amid Park Avenue-morbid decor—tufted leather seating, dark bookcases, a golden cat skeleton sculpture by the artist Jamie Roadkill—a crowd pushed toward the open bar. Everyone was here to make friends, or something like that.
The opulent weeknight event was hosted by Magnises, a members-only benefits card program that caters to millennials. Along with Select and Founders Card, it's one of several rising club programs that promise exclusive experiences at nightlife hot spots, unique networking events, and perks akin to those offered by credit cards. They've found popularity among millennials in particular, who value experiences over material possessions.
The clubs, which operate primarily in America's biggest cities, say they aim to recruit diverse members at the top of their respective fields. Magnises has about 30,000 members, Select more than 10,000 and Founders Card around 20,000; those who want in can find themselves on a lengthy wait list. The clubs say their ultimate goal is building relationships, and while they have no age restrictions, millennials make up the bulk of their membership—spurred by their values and their habit of moving frequently to new cities.
Unlike the country clubs and university clubs beloved of older generations, these new clubs eschew the brick-and-mortar clubhouse completely, relying instead on relationships with local businesses to host events.
They're also far less expensive. Magnises' annual dues are $250 and Select's $300, but both occasionally offer free memberships to people they think would benefit their communities; Founders Card is the priciest of the bunch, at $795 a year plus a one-time $95 fee. That's still considerably cheaper than traditional clubs, even those that try to lure millennials with reduced prices. The median initiation fee for a junior member at an old-school club that doesn't offer golf is $5,480, plus $3,500 for annual dues, according to industry data compiled by hospitality analytics firm Club Benchmarking; teeing off could cost somebody even more.
Along with networking events, the new clubs also offer perks similar to those of rewards credit cards—replete with a cool-looking card. Founders Card offers more than 500 benefits, many travel-related, Select offers bar and restaurant discounts plus travel and wellness-center perks and Magnises offers similar perks, plus up-charged packages geared toward members' specific interests, offering discounts on sports events, co-working space, hotels and more.
Asked who he sees as Magnises' rivals, CEO Billy McFarland named rewards credit cards; Select CEO Carlo Cisco also sees the cards as stiff, if indirect, competition. And like those competitors, the clubs each offer a sleek membership card. Employees and members of all three described theirs as "sexy."
But beyond the parties, deals and alluring cards, millennials say they're joining the clubs for the sense of community.
"This group is a unique group," explained Jerome Hardaway, the 30-year-old executive director of the nonprofit Vets Who Code and a Magnises member. "They've earned it. It's not just the hoity-toity, old-money field. It wasn't the events that brought me in; it's the way they were catering to millennials." He uses the club to reach out to likeminded entrepreneurs and build relationships with members interested in his charity work, and he plans to re-up his membership next year.
The dues and the vibe might differ, but these new clubs handle membership similarly to their more traditional brethren. There's an application, which for Founders Card is two pages including multiple questions. That, much like a ritzy country club, can strike some millennials as off-putting and elitist, but the card clubs' executives argue it helps preserve an active and diverse community.
All three clubs are secretive about their application process—the special sauce that defines their unique communities.
Magnises doesn't outright reject applicants but will keep some in limbo indefinitely. And it worries about accepting too many applicants from similar backgrounds. "We can't let in 2,000 people from the same company tomorrow, because it would sway the group and the group-think," its CEO McFarland said.
The premium his club places on diversity was evident at its recent event at the Manhattan hotel, where investment bankers mingled with designers and a computer programmer was wrangled into a discussion of Eastern European history.
"There's really no disqualifying factor, necessarily," said Cisco, the Select CEO, of his club. "Employment and income are a factor, obviously, but we feel we're building a community here. We want to make sure anyone who joins would be someone we see connecting with the community at large."
Select's secret sauce has resulted in a membership base with an average income of $280,000 a year—considerably more than the average American earns, and especially impressive for the notoriously debt-ridden millennial demographic.
Someone with that kind of salary could certainly afford to join a country club or university club with high dues. But such a club would offer a different sort of community, and a young member might not be able to take advantage of its perks if they moved, say, from Los Angeles to New York for a job.
The new millennial-centric clubs pride themselves on offering a way for new transplants to meet friends and find hot spots—a de facto best friend for anybody with a new career in a new town.
Neeharika Sinha, a 32-year-old tech entrepreneur, said she joined Magnises after it approached her on Instagram, where she has close to 1,000 followers. (The club said it occasionally reaches out to people it considers community influencers if it thinks they would add to its community, and said such outreach is important to its plans for 1 million members within the next three years.)
"I moved from New York to San Francisco two years back. I kind of felt uprooted, and I felt like I needed to know more events," Sinha explained. She has yet to attend an event, but she added: "I felt this was a good way to connect with the city. I'm ready to pay a premium if the events are more curated and one-of-a-kind."
Magnises has no outpost in Nashville, where Hardaway lives. But he joined anyway, because he travels to New York regularly on business and couldn't find anything comparable in his hometown.
"Country clubs aren't catering to millennials," he said. "I tried golf; I hated golfing. I can't see myself spending the rest of my days building relationships while walking with a stick, hitting a ball."
Watch Next: Millennials, Don't Worry, You'll Be Able to Retire
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.