How to Make Money Without Actually Making Money

With nearly seventy million people hitting the lanes at least once a year, bowling is the largest participation sport in the United States. It’s also a sport with proud regionally specific traditions and a constellation of time-tested centers that for decades have been run by independent operators treating the spaces like their homes. These are people who love bowling, and who aren’t hell-bent on maximizing profits. Many bowling centers cater to seniors by opening hours before the after-work rush, sometimes as early as 9 a.m.

Bowlero isn’t interested in maintaining the culture of bowling. What Bowlero wants to do is become the Starbucks of bowling.

In 2021, Bowlero listed itself as a public company on the New York Stock Exchange. Over the next few years, as the country reopened following the pandemic and people became eager to get out, Bowlero’s business boomed. From 2021 to 2023, the company’s annual revenue went from a few hundred million to over a billion. That amounts to roughly a quarter of the industry’s total revenue.

As demand spiked, Bowlero regularly and significantly raised prices on bowling and concessions. Some Bowlero centers even saw Uber-like surge pricing. At one Northern California Bowlero, according to the Wall Street Journal, that meant a few hours of bowling cost you more than $400. As a local told the Journal, “This strikes me as outrageous for a pedestrian family activity.”

Online forums are full of similar grumblings from bowlers about Bowlero’s price increases. In a 2022 earnings call, the company boasted, “We’re raising price on everything.”

In the fall of 2023, financial journalist Herb Greenberg issued a “Red Flag Alert” to the readers of his newsletter, urging them not to buy Bowlero stock. Greenberg usually knows what he’s talking about: his past reporting has led to Securities and Exchange Commission investigations and convictions for securities fraud.

In Greenberg’s analysis, Bowlero greatly benefited from the effects of the pandemic, meaning its market advantage was artificial. Since then, Greenberg has reported, sales have slowed and margins have shrunk. Bowlero boasts that it is “one of the world’s premier operators of location-based entertainment.” But in a world that has reopened in full, a Bowlero center is just another “location.”

In its effort to expand its empire, Bowlero is spending freely on new centers. At some point a roll-up has to stop “rolling up,” Greenberg says, and actually become a sustainable moneymaking business. But as long as Bowlero can keep expanding and projecting great future success, its stock can keep rising. And one of Bowlero’s major stockholders is Tom Shannon, its own CEO.

Shannon is a business owner, not a bowler. He got his start in the ’90s, originally under the name Bowlmor, with one bowling center in New York City. It was there that he developed his big idea, the one that would become the Bowlero template: a bowling center as a glitzy all-in entertainment palace, where anything from cocktails to video games can draw your attention away from the lanes. In a 2011 interview with Bloomberg, just a few years before Bowlero began its aggressive expansion push, Shannon made an infamous and illuminating comment. “I don’t think anyone takes bowling seriously,” he said. “Why would you?”

Katherine Spurlock, a Louisiana-based research analyst and former short seller, shares Greenberg’s Bowlero skepticism. She has watched as Bowlero has continued to amass debt and then use incoming revenue to pay dividends and buy back shares.

“If the company pays dividends, Shannon and other insiders will get paid accordingly,” Spurlock says. “If the company’s shares rise because it repurchases its shares, then Shannon and other insiders are likewise rewarded.”

And if the company continues to use revenue not to invest in the business but to reward shareholders, Spurlock asks, “Who likely benefits the most?” The answer, again, is Shannon.

Bowlero’s executives may believe it will one day expand itself into a hugely profitable quasi monopoly. But for Shannon, it doesn’t matter if Bowlero soars or crashes. Either way, he gets paid.

Bowlero stock has been dramatically boosted by investment personality Jim Cramer, who has gushed over the company — “You can’t go wrong with Bowlero!” — and has repeatedly conducted fawning interviews with Shannon on his popular CNBC show Mad Money.

Thanks in part to Cramer’s endorsement, there are fleets of amateur investors for whom Bowlero seems like an obvious buy. But there are “natural sellers among the insiders” at Bowlero, Greenberg warns. That means there are people who know the ins and outs of the company, own lots of its stock, and would be more than happy to sell.

And if those insiders unload their stocks when they’re peaking, the value of the stock plummets. The insiders profit; the everyday investors lose out.

“This,” Greenberg says, “is a dangerous stock.”

Bowlero did not respond to multiple requests for comment. But Greenberg’s warning goes to the heart of the Bowlero story so far. Is the company actually a healthy and growing entity? Or is it just very successful at presenting itself as one? And if it’s the latter, how does this all end?

When the coworking giant WeWork crashed, a bunch of office space was left vulnerable. If Bowlero goes down, what’s at risk are the very centers where bowlers come together.

What About the Bowling?

Brett Parker, Bowlero’s chief financial officer, once said that Shannon’s “vision” for Bowlero was taking “the very traditional, warm-beer, cold-food, smelly-bathroom, scary-person-on-the-lane-next-to-you bowling center” and turning it into “something more.”

The independent bowling journalist Jeff Richgels disagrees. As a longtime newspaperman at various Wisconsin publications as well as a high-level bowler — he’s a member of multiple local Halls of Fame — Richgels is uniquely positioned to cover Bowlero.

“Their business is selling overpriced food and drinks,” he tells me, with dismay. “They treat bowlers like shit.”

On his site 11thFrame.com, he’s compiled allegations that centers are full of “food debris, dirt, salt, gum, and overall garbage”; that bathrooms go days without being cleaned; that store managers laugh off or dismiss complaints. Richgels quoted one former manager for a Bowlero center in the Milwaukee area alleging that when Bowlero took over the location, “They IMMEDIATELY made us cancel all janitorial contracts.”

As shortsighted as that sounds, such negligence appears elemental to Bowlero’s business model. In a 2023 research report, a Wall Street analyst for the investment bank Stifel Financial wrote that Bowlero can “easily cut 30 percent of [expenses] while running a typical bowling center on a skeleton crew of a handful of staff . . . and minimal required maintenance.”

Bowlero has also purchased the Professional Bowlers Association (PBA), the sport’s top league. As Richgels has covered, since Bowlero’s takeover the PBA’s website has failed to keep up its stats and records. “Records, archives, Hall of Fame are everything for fans,” he’s written. “You’re telling the world this isn’t a professional sport worthy of being taken seriously.”

When Bowlero first took over the PBA in 2019, Big Mike and his cohost, Brooklyn Rob, played the audio of Shannon’s “Who would take bowling seriously” comment. Then the two fell into stunned silence. It was as if they’d just announced the death of a beloved local dignitary. Finally, Rob spoke, struggling to articulate his panic: “Mike. . . how do you. . . I mean. . . he owns. . . he owns the PBA.”

In one of Cramer’s friendly CNBC interviews with Shannon, the CEO coolly stated that the PBA takeover was a mercenary move to drive more business to Bowlero centers: “What it really is, is an infomercial.”

Bowlero has also purchased some of the “most well-known competitive bowling centers in the country,” Big Mike says. That includes the former Carolier Lanes in North Brunswick, New Jersey.

For years, Carolier has hosted major tournaments and all-time greats. This is where, in 2012, a Hall of Famer bowler named Pete Weber won the PBA’s US Open, flailed in joy, then pointed two thumbs at his chest and shouted “Who do you think you are? I am!” A bewildering moment of pure joy, it’s become an iconic phrase for bowling as well as the internet at large.

“That happened there!” Big Mike says. “To competitive bowlers, this place was the mecca.”

After Bowlero took over Carolier, they renamed it Bowlero North Brunswick and gave it an eyebrow-raising makeover by installing 16-foot screens, a Kung Fu Panda Dojo Mojo video game, and, for some reason, a “sexy and cool” 1969 Mustang in the lobby.

While reporting this piece, I found that people in the bowling industry were largely reluctant to talk about Bowlero. Emails and texts went unanswered. Folks who initially agreed to talk would change their minds or suddenly stop responding.

Robby Spigner, a former PBA bowler who now owns and operates his own centers, agreed to an interview but, once on the phone, declined to comment about Bowlero in any way, saying only, “It’s a great and wonderful industry and everyone plays a role in making it great and wonderful.” I started getting the feeling that people were scared.

One exception was Robin Goldberg, the owner-operator of Dream Lanes in Madison, Wisconsin. Bowlero has acquired several centers throughout Wisconsin, but they’ve yet to reach Madison. Goldberg knows Dream Lanes may yet become a target for Bowlero, but he hopes to never sell to the company. Doing so, he said, would mean that “my brand, that I spent a lifetime working on, would get flushed down the toilet.”

Goldberg’s father opened Dream Lanes in 1957, the year Goldberg was born. He started working there as a twelve-year-old — cleaning, taking out the trash, stocking the bar. Some customers have been with him ever since, displaying remarkable longevity.

“What’s their secret?” I ask.

“Bowling multiple times a week,” he shoots back.

Goldberg is proud of being an independent operator, of being on-site, of wholly devoting himself to this culture.

“I’ve always felt like nobody cares like an owner cares,” he says. “If there’s a problem, I’m in the building. I’m not gonna have to go back to my corporate office.”

In Wisconsin, long winters make bowling a particularly needed communal pastime. “This is where people celebrate,” he says. “This is where people mourn.”

Why Is Bowlero in the Gutter With the Feds?

In the summer of 2023, Shannon was back for one of his regular Mad Money appearances. Cramer asked him about an investigation from the Equal Employment Opportunity Commission, a federal agency created by the 1964 Civil Rights Act to fight workplace discrimination. More than seventy former Bowlero employees had filed complaints with the agency alleging that under Shannon’s control, Bowlero had utilized flagrantly illegal hiring practices.

Shannon brushed it all off. “These allegations are frankly absurd,” he said. “They don’t pass the sniff test. They don’t pass any common sense.”

In fact, at the time of that Cramer interview, federal regulators had already determined that the allegations were credible. A few months before, Bowlero had stated in its own quarterly corporate disclosure form that federal regulators had taken the charges so seriously they had conducted their own “administrative investigation,” determined “probable cause,” and found that the abusive hiring practices likely dated back a decade.

Complainants in the investigation allege that Shannon himself held video interviews through Skype to physically assess candidates.

“It was a two-minute quick look of a physical appearance,” one former Bowlero HR manager told the New York Post. They were “beauty contests.”

Shannon also allegedly pushed out employees he deemed old or unattractive. In one two-year span, nearly three hundred managers were fired. One affidavit submitted to investigators alleges that one employee was let go “shortly after being stricken with a medical condition that caused his face to become disfigured.” Other employees were allegedly “managed out,” meaning they were pushed into quitting through constant criticism and workplace harassment.

Former Bowlero employees also told investigators that Shannon made “racially motivated” comments and that the company had a policy banning customers wearing Timberland boots and backward ball caps, which one employee said was a tacit attempt “to deter African American males” from coming to Bowlero centers. Additionally, the complainants say that Shannon was discriminatory against pregnant employees.

“It was well known within the company that motherhood is the end of your career at the company if you work for Shannon,” one affidavit states. “Pregnancy was totally against Shannon’s practices of having attractive, sexually appealing persons at the forefront of his company, regardless of merit and competence.”

Tom Tanase, the former chief information officer at Bowlero, recently joined the hiring discrimination case. Tanase now says that Bowlero is retaliating against him for doing so by suing him for allegedly hacking into Shannon’s email account. In one conversation with Bowlero executive Brett Parker, which Tanase taped, Parker presses Tanase to stop cooperating with Daniel Dowe, an attorney working on behalf of former Bowlero employees involved in the hiring discrimination case.

According to the transcript of the call, Parker told Tanase, “You tell us everything you know about Dowe” and “there can be a number” — apparently a reference to a payout. “Be our friend in this matter and you will get paid,” said Parker. But if Tanase failed to cooperate, Parker warned him, “You’re going to be trying to explain” your actions “to the FBI.”

Tanase was not available for comment. Posting recently on LinkedIn about Shannon and the federal investigation, Tanase wrote, “Some people are blinded by ego.”

Dowe, the attorney representing former Bowlero employees, told me that federal investigators attempted conciliation with Bowlero in hopes of settling the case. (The reported settlement number was $60 million.) But nothing came of the process.

“They’ve exhausted all administrative remedies,” Dowe says, “so now a lawsuit in federal court is imminent against the company and its directors.”

As for the executive who allegedly threatened Tanase, Dowe added, “I believe Brett Parker needs to consider hiring his own lawyer.”

Big Mike says the hiring discrimination investigation is dismaying but not surprising.

“The bowling community is small,” he says. “I personally know people who were let go for age reasons, appearance reasons. The community definitely took notice of that.”

The Place for Purists

Howell Township, just a few hours west of midtown Manhattan, is a bucolic, horsy part of central New Jersey. But tucked amid the stables and sprawling wood-shaded farms is another kind of classic Americana: Howell Lanes, a strip-mall bowling center.

Parker Bohn III grew up in Howell Lanes. In the ’70s, he worked here for a friendly owner who let him bowl morning, day, and night. Bohn went on to become one of the greatest professional bowlers of all time. Framed photos of Bohn, with his once-trademark mustache, dot the place; in the bar, a massive mural shows Bohn emerging out of inky darkness to fire a ball down a lane. Now sixty, with a polo shirt tucked into blue jeans, Bohn still carries himself with the obvious swagger of a champion athlete.

We sit in front of five lanes, walled off from the rest of Howell Lanes, packed with specialty tech designed to help bowlers get better — like Specto, the “world’s most advanced ball-tracking system.” It’s a bowling center within a bowling center. This is Bohn’s domain. Bohn points to a lanky teenager in a Pacers hoodie engaged in an intense practice session.

“This kid’s dreaming of becoming a professional,” he says. Ahead of an upcoming tournament, he’s in here, using the tech, getting lessons, grinding.

At a lot of “corporate centers,” Bohn explains, “it’s ‘give me your credit card, we’ll let you know how much you owe at the end.’ You’re just a number. How many bowling proprietors are going to look at an individual and go, ‘They could be the next one.’”

Bohn still bowls on the PBA — which, thanks to financial investment from Bowlero, he says is “on the upward swing.” But as far as Bowlero’s centers, Bohn says, “They are in it for the entertainment business.”

I tell him that a lot of the hard-core bowlers have told me they feel they’re running out of places to bowl seriously, that Bowlero is swallowing it all up. As Richgels, the indie bowling reporter, told me, “The tragedy of Bowlero is that they’re the biggest and most important company in bowling and they care nothing about the sport.”

Bohn nods his head in solidarity.

Bowlers “want to work on their craft,” he says. “They feel they don’t have that venue to work.” Bohn says he’s not competing with Bowlero. But it’s evident he sees bowling in a very different way.

Before I leave, I ask Bohn about the ring on his right hand. It is a massive unit, a serious lump of glitz. It turns out the PBA gives you a ring for the first three hundred, or perfect game, you bowl, then adds a diamond for each 300 after that. At twenty-eight diamonds, Bohn’s ring is long since filled. Since then, Bohn has gone on to bowl about a hundred additional perfect games. No one in history has bowled more perfect games in official PBA competitions than Bohn.

I ask him to take me back through the decades, through the cigarette smoke. He happily obliges.

“You never forget your first one,” he says. “It came at a place that’s no longer there. Fantasy Lanes. Upper Saddle River, New Jersey. Route 17. As soon as I did it, the owner came down and asked me if I wanted anything. I said, ‘A chair and a cup of water.’ I was shaking. My legs were out from under me. I couldn’t believe I just accomplished what I did.”

I’m buzzing just imagining it. I’m in the presence of a purist who has exhausted himself for decades perfecting his game and has experienced the highest highs this sport offers. It makes me realize there are people who love this sport more than anything else in the world.

All these years later, all these three hundreds banged, he doesn’t have the nerves anymore, Bohn says — but he still has the hunger.

“I get excited for the fan in the back,” he says. “Every time I have a ball in my hand, and I’ve got the front nine in a row, I want to finish it for everybody else that’s watching. They want to see you do it. You got a chance to put on a show.”