Super rebound: Exec resurfaces with ticket site

By Craig M. Douglas, Boston Business Journal
Published February 4, 2005

Diane DiCarlo says she is a "huge" New England Patriots fan, and she is willing to put her money where her mouth is.

The 33-year-old Revere resident spent $3,600 for two tickets to last year's Super Bowl, and she's on the hook for another $3,800 for this Sunday's game between the Pats and the Philadelphia Eagles in Jacksonville, Fla.

Yet DiCarlo said this year's purchase was far less taxing, even though the tickets for her and her 35-year-old fiancé, Ed Chapman, were slightly more expensive. Last year the couple haggled with ticket scalpers for days in Houston before landing a pair of last-minute seats for the Patriots tilt against the Carolina Panthers. DiCarlo said the pressure to complete the mission was pervasive.

"We were stressed the whole time," she said sourly, noting that she was also scammed out of $350 after buying phony tickets on eBay for the Patriots' home opener against the Indianapolis Colts in September. "I'm just too trusting."

But DiCarlo's big-game fortunes turned for the best last week when, desperate for passes to Sunday's Super Bowl, she was directed to the Web site of RazorGator, an online exchange that boasts a "liquid" market for "hard-to-get" tickets to major events. Within minutes, DiCarlo had two Super Bowl tickets under wraps.

Her next move was to book a four-night, $1,000 reservation at a one-star motel in Jacksonville.

"It took a lot for me to be like, 'Here's my credit card for $4,000,' " said the Johnson & Johnson pharmaceutical saleswoman, who's now planning to use RazorGator to land a pair of $650 tickets for the Boston Red Sox' opening-day game in April. "But I got a really good price."

By comparison, Super Bowl tickets posted on other Web sites were priced as low as $2,700 for upper-deck seats and as much as $100,000 for luxury-box seating.

Based in Beverly Hills, Calif., RazorGator is led by David Lord, a Shrewsbury native and former Northeastern University offensive lineman who made waves in 1999 by founding online toy retailer ToySmart.com in Waltham. The Walt Disney Co. eventually bought a $55 million majority stake in that venture shortly before it collapsed into bankruptcy in May 2000.

The 290-pound Lord spent the next three years as the CEO at software developer Expound Inc. in Bedford before taking over RazorGator last March. Today he manages 70 employees and recently closed on a $5 million round of venture capital with Hercules Technology Growth Capital Inc. in Waltham.

Lord said RazorGator buys and sells tickets in the "open market," noting that arbitrage opportunities are available to savvy buyers. However, the company's primary objective is to provide liquidity and up-to-the-minute pricing for buyers and sellers of exclusive tickets, he said.

The company generates most of its revenue from ticket sellers, who are assessed a 15 percent surcharge on each transaction amount. A flat service fee is also levied on RazorGator's buyers and sellers, providing the company a predictable revenue stream for even the smallest of events.

While RazorGator facilitated the sale of 4,000 tickets to last year's Super Bowl, World Cup soccer triggers the most activity on its Web site. Nonetheless, Lord said sales for Sunday's game have already exceeded last year's mark. He said Supercross motorcycle racing and Josh Groban concerts also seem to attract the most rabid fans.

This fall, when the Red Sox clinched a berth in the World Series, Lord oversaw the company's first $1 million day. "It was unbelievable. For me it was particularly fitting," he said.

Ticket reselling is legal in the state of California, meaning RazorGator is exempt from many of the laws that penalize ticket scalpers outside of events. While Massachusetts offers a relatively "open market," Lord said "profit caps" are enforced when a RazorGator transaction is made between two residents within certain states, including Florida and New York, which caps prices at 20 percent of face value.

Each year, demand for Super Bowl tickets reaches a fever pitch in the secondary market, as only a select number of each team's season-ticket holders are granted seats via a lottery system. To highlight the difficulty in landing a ticket through the Patriots' box office, Dianne DiCarlo said her fiancé has been a Patriots season-ticket holder for 16 years, and has repeatedly failed to win a lottery-assigned seat for any of the team's four Super Bowl appearances since 1997.

A RazorGator spokeswoman said the Super Bowl tickets come from "a potpourri of sources," including NFL personnel, players, on-field officials, and even some season ticket holders, despite a hardball team policy of revoking season ticket privileges to fans who auction them online.