Snowmobile oval racing is getting a major boost from a Houston, Texas-based former racer and race team owner who made it big in real estate.
Tom Lipar fell in love with snowmobiles in the 1970s before he moved south and started his mega-successful businesses – LGI Developments and LGI Homes. About four years ago, Lipar was reunited with snowmobile racing, and it rekindled his love for fast-moving oval sleds to the point where he’s not only backs a team, he’s personally investing more than $125,000 a year in a points fund to help grow the sport. Excerpts from this interview ran in the March issue of Snow Goer magazine, but we give you the full text here unfiltered.
The first TLR Cup race of the season occurred January 6 in Wisconsin; Round 2 was scheduled for Escanaba, Michigan, this coming weekend, but it was cancelled due to poor ice conditions. Round three will be at the Friday Night Thunder program at the Eagle River World Championship Snowmobile Derby on January 18. Learn more at TLRCup.com.
SNOW GOER: Why would a successful businessman based in Texas make such a major investment into snowmobile oval racing?
TOM LIPAR: I am originally from Michigan and started racing snowmobiles in 1970. I sprint raced until 1976 and then formed Team Remus, an enduro race team, that competed on the MIRA [Midwest International Racing Association] circuit. During the 1978 season, Rob Diamond — another Michigan driver — and I joined forces. We raced together until 1982, he raced with me for 2 years and I helped him on his team for a couple of years. We had success in enduro races such as winning the first Eagle River enduro race in 1982. Rob also captured a lot poles positions and wins during that time and continued to do so throughout his career.
So I left and got out of snowmobile racing in 1983. I left Michigan in 1990 ended up in Texas in the real estate business and have been here pretty much ever since.
About four years ago, [one of] Rob Diamond’s son[s], Mitch, called to see if I wanted to sponsor him and his dad’s enduro race team. I told him I would like to go to a race to see what had changed in 25 years. So I flew in to Kinross, Michigan, in January, 2008, to watch the race. I was there on Saturday in enough time to watch the sprint races. When it was time for the champ race, a friend of Joel Diamond’s [another of Rob’s sons] asked Joel if he wanted to drive his [champ] sled. So Joe had to start in the back row, since he had never driven a champ sled, and in the first heat, he came in second. To me, it was very exciting and I was hooked. I told Mitch that I would sponsor him in enduro racing if we could also do some champ racing. So that’s how I got back involved in [snowmobile] racing, basically through an old relationship with a friend of mine who I had raced with almost 25 years ago.
The reason I decided to put money in to the Cup series is to try to grow the sport because I was a bit concerned about how the Champ series and were going. It seemed like they were losing driver participation and it was splintered all over the place. I thought, “If I’m going to spend this money to be successful in the Pro Champ world, I want there to be some good competition, and I want it to last.” I didn’t want to spend a lot of money on a race team and then in three years it’s down to either not being in existence or there’s so little competition that it’s not any fun.
My plan is to put up for the money for the TLR Cup in the beginning and then seek sponsor support to keep it going. I loved snowmobile racing 25 years ago and I got re-hooked when I got back involved with the Diamonds. I just wanted to enjoy it and continue to see it grow, and I thought the TLR Cup would be the first step in helping the sport gain back its popularity.
SNOW GOER: What is it about oval racing that appeals to you?
TOM LIPAR: I am very
competitive, and like competition, and any racing is competitive. Oval snowmobile racing was where I was introduced to competitive racing. In 1970 when I got out of the military, I came home and saw my first snowmobile, a 1969 Arctic Cat Panther my father had purchased. I think everyone in our small town of 300 owned a snowmobile and there was an oval race in our town and every other small town every weekend. That was a thing you did in the winter, you’d ride your snowmobile and on Saturday during the day you might race it, and at night you’d go riding with your buddies. So, I think the root of snowmobiling is in oval racing. I think they sold more snowmobiles back in those days for the sake of people wanting to get out and go racing than they did just for pure trail riding.
The other factor I like about oval racing is that it’s fast. Racing is about speed, in my opinion. I am always disappointed when NASCAR keeps cutting back their speed, and that’s one of the reasons myself and two other gentleman started our own drag racing league. We were running in NHRA [the National Hot Rod Association], where we won a couple of championships in Pro Mod, but they kept restricting the rules and cutting us back because we kept innovating and going faster and faster. So we started our own league [the American Drag Racing League]. If you have too many rules, especially in drag racing, to restrict horsepower or whatever, it’s actually more expensive for the little guy because the big teams with a lot of money can go out and spend tens of thousands of dollars on exotic metals or whatever, and the little guy can’t. But if it’s a wide open book, guys can come up with something totally different that maybe doesn’t cost a lot and win. I’ve seen it happen.
SNOW GOER: The money is a big draw, obviously, and that gains headlines, but TLR races are also more professional, better promoted – fans get to see the racers, there just seems to be a high level to them. Why is that a priority for you? And what can it mean for the sport?
TOM LIPAR: The sport, any sport has to keep evolving to keep it popular. My purpose with the TLR Cup was to bring more sponsorship and more interest to this sport of oval racing. In order to do that, first you have to have somebody put on the show. You have to have teams with good equipment and good drivers, and a certain number of them. There are teams we have that have been around for a long time that love to race and they are going to be involved. But in order to get somebody new into it and bring people up from the lower classes, there’s got to be some sort of incentive. That incentive is recognition and money (another form of recognition). We recognize the drivers with driver introductions on our stage (with helmets off so they can see them), we have a website with driver histories, etc., and we also give race announcers a book with all of the drivers info, cup standings, etc., in it to use during our race. You need to make it look professional and make it a show.
When you have more participants and more competition, you’re going to start to have more fans involved — you’re going to have more publicity, more press, people are going to hear about it and want to come to the events. When you get more people coming to the events and you get the word out there and it gets more popular, then you’re going to get the sponsorships involved.
In other words, the sponsor that is going to put his name on something, if it’s truly an investment and it’s not just a personal [interest] for him, if he’s looking to get more bang for his buck, he just wants his [company’s] name or his product in front of many people as he can. Just like in drag racing or in NASCAR: How many impressions are you going to get for having your car on TV and have people looking at it? Well, how many people are you going to have in the stands looking at Amsoil or Woody’s [banners] out on the track? So if you can grow the crowd you can grow the sponsorship, if you grow the sponsorship you can grow the money. It’s a cycle.
In our American Drag Racing League, we gave away tickets, believe it or not. We didn’t charge for tickets. In the race we had here in Houston, we would put 53,000 people each day through the gates in a two-day event. The sponsor doesn’t care if the person paid for that ticket or if they got there for free. He cares that you’ve got 53,000 people that are going to eyeball his product. So we were able to get a lot of sponsorship for our drag racing, which allowed us to have big purses. The other thing we know – which is important in trying to help these tracks out a little bit – is that 53,000 people at a race track where they’ve got $6 hot dogs and $5 beers generates $320,000 in revenue just from the concessions. That’s not a guess, that’s straight from the track. Most of that is profit, and as an association we got some of that money. So we found it was better off to give the tickets away because the sponsors needed to see bodies. Our revenue came from parking and concessions.
The other example of that is Aaron Poulter who started Monster Trucks racing. His idea was to charge $5 per ticket for adults and let kids in free. This is when everybody else was getting $15 or $20 for a like event. He said, “5 bucks and I’m never going to go any higher than that.” Well, I think it’s $20 now because he sold it to Clear Channel, but it’s still not $60 or $80 or $100 like some [other events]. Aaron said, “I’m gonna do 5 bucks and put butts in the seat.” Well he got butts in the seats – he’d get 50,000 or 60,000 people, and therefore he got sponsorships. The idea of the drag racing evolved from this. We tried charging for tickets at first, but we didn’t get anywhere.
You have to have a good show, because the product that you are selling to the sponsors is the number of people you can get to that venue. It’s not the race. The sponsor doesn’t want to hear that it was a good race, they want to hear that you had people in the seats that they can market to or because it’s well-known enough that the sled they sponsor might be on the front cover of Snow Goer. That’s revenue to them.
I am going to continue to work to make the TLR Cup some other “cup” – whether it’s the Amsoil Cup or the Woody’s Cup or whatever it might be. I am going to start working hard through this process, it will take time to get there but hopefully we can raise enough money for the a big purse. The way I have to work is to provide seed money, help the tracks, give advice on trying to grow the spectators. That’s the only way it’s going to work – to grow the spectators. You’ve got to have a good show; if you do you can get a lot of spectators; if you have a lot of spectators you get more sponsorships; if you get more sponsorships you get more money for purses; which then you can put on
an even better show. So it’s kind of a wheel that goes round and round. You’ve got to have somebody who pushes it and somebody who can start it up.
I hope soon it will not be called the TLR Cup, hopefully we will have big sponsor’s name on the cup and venues where we can draw spectators. We have to make this a world-class event, it’s not there yet.
The TLR cup has been running for a couple of years, and has crossed borders it the past: Now everything is more-or-less focused in Wisconsin, with one trip each across the border into Minnesota and Michigan. Why?
The first year, we held a TLR Cup race at Valcourt [Quebec]. I wanted to try the Canadian race because it is one of the largest as far as fans are concerned. The reason we didn’t do it the second year was, that I wanted to end the series in the [United] States and the last race in the States was Weyauwega [Wisconsin]. I also wanted to have an awards banquet and give out the money right when we were done. I didn’t want to let it get into the spring. So I decided I was going to cut it off at the last U.S. race of the year, where we could have a banquet and give everybody a meal and hand out the checks.
Will we go back into Canada? Yeah, probably. Maybe even for next year. Geographically, for sponsorships, I want to have it in as many places that race as possible. We almost went to Fargo this year, and had some preliminary talks, but I didn’t want to change much this year and they had a race date that I didn’t think would fit quite yet. But we will be in Minnesota at the U.S. Nationals. We also have the race in Escanaba, Michigan, that was cancelled last year, but we’re going to give it another shot and see how that works. [EDITOR’S NOTE: The day before this article was posted, Escanaba unfortunately had to cancel its event again because of bad ice conditions.]
So we’ll have Michigan and Minnesota and Wisconsin, and I’d like to see major venues in the Dakotas, Wisconsin, Minnesota, Michigan and in Canada. It all depends – we don’t get many Canadian drivers to participate, only in Eagle River they’ll sign up if they can for the money for our event. I’d like to make it big enough where the Canadian drivers will come down to the States and American drivers will go to Canada. That’s going to come over time, because in order for that to happen, you’re going to have to put up the money so it makes sense for teams to it. So we’re going to have to grow it, grow the fans, grow the sponsorships, grow the purses so we can get people to say, “Hey, this is worth it.” And grow the recognition, some people have got money and don’t need the purses to survive, but if they think it is the place to be recognized as the best, they’ll come. That’s in any racing.
TOM LIPAR: The effort was to do it in multiple states and multiple regions rather than associations. So if Wisconsin, Minnesota and Michigan had all been under USSA or whomever, it wouldn’t have mattered. It’s more or less having a wide geographical region to draw from.
SNOW GOER: Do you personally get to most of the races with your TLR race team?
TOM LIPAR: I get to them all. Yeah, I work on the sleds. I do the computer stuff mostly and make the big decisions. George Sherrard (George was Blair Morgan’s crew chief for most of his X games Gold medals wins) does most of the work , and I still have a Diamond on my team – Rod Diamond is a Rob’s cousin that was part of our crew back in the day.
SNOW GOER: Living now in the Houston, Texas, area, do co-workers, neighbors or counterparts wonder why, on winter weekends, you’re going 1,000 miles north to stand beside an ice-covered track?
TOM LIPAR: Some of them just have a blank stare on their face [laughs]. “What? Snowmobile racing?” Most of them don’t know what snowmobiles are, they’ve never been on one or even seen one. So, I just tell them I used to do a lot of snowmobiling and I love doing it, and they understand that. At company events we’ll show pictures of the races. We used to do that with our drag racing – we’d have the drag racing team down to our Christmas party. We haven’t done that with the snowmobilers, but we get them involved, and it’s kind of like a company team, and employees ask, “How did the team do this weekend at the snowmobile races?” And when we tell them we won, they say, “That’s great!” They feel a little bit that it’s part of their team too.
SNOW GOER: Do you have any 3- or 5-year plans written for the TLR Cup, or is it more year-by-year?
TOM LIPAR: It’s year-by-year, but my goal was that in 5 years, which is three years from now including this year, that it’s got significant revenue from sponsorship and we’ve got a larger, more varied number of races at bigger venues and we’ve got 30-plus drivers and teams.
SNOW GOER: Share with us briefly your resume, and how you’ve gotten into a position where you can invest in snowmobile racing like this.
TOM LIPAR: I’m involved in land development. I started out in sales and worked my way up and finally started my own company in 1995. We actually have two businesses; the other one started in 1997. With the first one [LGI Developments], we develop properties – I’ve developed probably 15,000 to 20,000 acres in the last 18 years and sold over 15,000 lots to individuals. We build those types of developments around Texas and the East Coast. The other business we got into was home building, it’s called LGI homes; we’ll build 1,000 homes this year in Texas, Florida and Arizona, and I think we’re now the 35th or 40th largest builder in the country. I just started in the oil business, and we’re working on that company to make it successful. Hopefully that’ll support itself – it’s not profitable yet. But if you’re in Texas you have to be in the oil business, right? [laughs]
SNOW GOER: You started this TLR Cup when the housing market was in the tank – you had to feel some of that bite, I’m guessing. Was it a challenging time to be investing money for you?
TOM LIPAR: We were the only company of the top 200 builders at the time to make money in 2008 – we got an award for that. And we have grown at a 20, 30, 40 percent pace all through the recession. It just goes back to the fact that we run our business different than the typical builder. We’re actually grown and prospered during the downturn. One of the ways, in the last two years, is that we’ve actually been able to buy cheaper lots. We used to produce our own lots to build the houses on, but because of the recession and all the banks foreclosures and all the developers going out of business, we were able to buy foreclosed development lots for a lot cheaper and then build on them. So we were able to grow a lot quicker using that method. We also do our marketing different. There’s always somebody that’s doing something different, and those are the people that make money during a recession, thankfully we’re one of them that did that in housing.
SNOW GOER: Let’s cover the finances of the TLR Cup. What’s this year’s payout?
TOM LIPAR: The total purse is $125,000, $100,000 for the point’s championship and $25,000 for the weekly race purse.
SNOW GOER: And that doesn’t include investment in your actually race team, correct?
TOM LIPAR: I’ll spend about $200,000 ( a lot of travel in that) on racing plus the cup money.