May 28, 2007
Lehigh Valley Grand Prix Developing Indoor Race Track
By Amy Leap | Business Journal Staff
Mike McCreary is a young man with a plan for a quarter-mile road course for indoor kart racing, and he intends to see it through.
“The city of Allentown had a big empty space that needed to be filled, and I came to them with a unique opportunity to fill it,” McCreary said.
The $1.5 million construction project, which includes the track, may open as early as July, McCreary said. The establishment will be called the Lehigh Valley Grand Prix.
The opportunity McCreary is talking about is a 48,000- square-foot venue that will include a 42,000-square-foot track as well as a gathering area with video games, two party rooms offered for private groups and a conference room for business occasions. Patrons will also be able to watch through a glass wall as other people race on the track.
McCreary developed the business plan for the indoor kart track while he was a student in Lehigh University’s entrepreneurship program.
His business plan won the student entrepreneurship competition, and McCreary began to put the plan into action.
Using prize money won in the student entrepreneurship competition and taking on a partner, Chris Cooper, his college roommate and a business and finance major at Lehigh University, the plan on paper moved toward a reality.
McCreary said, “I took the plan to my dad who is a financial advisor. He looked over the plan and said the numbers were positive.”
McCreary said finding a building to accommodate his venture was his most difficult obstacle. “Because so many factors went into the decision, such as zoning regulations, size, location and cost, it took time,” he said.
“That’s where the city of Allentown’s Bridge Works was perfect,” McCreary said. “We found a building large enough that had the supporting columns far enough apart to lay out the track.”
Once McCreary found the right space for the business venture, he met with the Small Business Development Center (SBDC) associated with the Lehigh Business College, where he was able to meet with an architect and a lawyer.
“The program helped me develop my idea and set me up with the people I needed to make it happen,” he said.
Along with the lawyer, McCreary and Cooper approached Merrill Lynch for a loan. Like McCreary’s father, Merrill Lynch’s financial advisors thought the business plan was a sound one, McCreary said.
Finding a building to accommodate the kart track was just the beginning, McCreary and Cooper had to do research on what type of racing karts to buy, what type of audience to market to and what other services to offer in order to make the investment profitable.
McCreary and Cooper said both are banking what they call the Allentown area’s strong history of racing.
Counting on this fact, the partners said they plan to market the racetrack to corporations for corporate activities, businesses for conferences and to the public for private parties.
Business partners Chris Cooper, left, and Mike McCreary walk the length of the Lehigh Valley Grand Prix construction site. Photo by Amy Leap.
“Racing is in the blood of the locals,” McCreary said.
To make group booking more attractive, McCreary said they are working on an agreement with five different caterers to offer package deals that include meals.
“We will also have a caterer every day for anyone who is just here racing on their own,” McCreary explained.
The insurance for the business, according to Cooper, will run them close to $2,500 a month, making safety a number one priority.
LVGP will use Sodi competition karts. McCreary said, “Our GT3 Proline karts have very sensitive steering and responsive handling, which is ideal for experienced drivers.”
Adult karts feature 6.5 hp Honda engines and have been handcrafted for Lehigh Valley Grand Prix.
For children ages 8-15, LVGP provides Sodi Kid Karts. Designed with all of the safety features of the adult karts, these smaller karts feature 5.5 hp Honda engines.
“Our gas-powered karts will be able to up a straightaway at speeds of up to 45 mph. More importantly, the karts will be designed with safety features such as a roll bar, threepoint safety belt, and an impact resistant bumper system,” McCreary said. He added that all drivers will be equipped with a fullface helmet and a neck brace to ensure their protection.
Although the business partners said they have worked hard and done their homework on just about every aspect of their new venture, they admit there probably will be some wrinkles to iron out but they are confident their first business venture will be a successful venture.
Lisa Getzler-Linn, director of the Thalheimer Student Entrepreneurship Contest and associate director of Lehigh’s IPD program, shared those sentiments.
“Everything from the executive summary through the basic business plan were well articulated and obviously proposed by well motivated student entrepreneurs,” she said. “The selection committee deemed the venture a possible real business success that could contribute to the business revitalization of the Greater Bethlehem/Lehigh Valley region.”
Source: Eastern Pennsylvania Business Journal | May 28, 2007