Poolhouse is an innovative social sports concept launched by the same visionary minds behind the wildly popular Topgolf. The venture has successfully secured an impressive $34 million in funding, which marks a significant step in redefining the social interaction around billiards.

According to a detailed deal memo from one of the company's leading investors, Poolhouse plans to distinguish itself in a competitive market filled with various social sports concepts. By leveraging technology, the new venture aims to reinvent the traditional game of pool and enhance the overall experience for its patrons.

Poolhouse's strategy is to emulate the successful recreational model of Topgolf, but with a focus on billiards. The founders are committed to creating a lounge-like atmosphere that provides high-quality food and beverages, exceeding the typical offerings found in standard sports bars. This unique blend of recreational activity and upscale dining is expected to attract a diverse clientele.

The UK-based company has plans to launch its first location in London next year, with aspirations to expand into the US market shortly thereafter, providing further opportunities for growth and engagement.

The seed round for Poolhouse was spearheaded by venture capital firms Sharp Alpha and DMG Ventures, which saw a primary close in October. The startup also gained the backing of notable investors including David Blitzer, Simon Sports, Active Partners, and Emerging Fund, all of whom share a vision for the future of social sports.

According to Sharp Alpha, which disclosed its comprehensive 28-page deal memo exclusively to Business Insider, Poolhouse is part of a rapidly growing category known as 'competitive socialization.' This trend is characterized by companies striving to modernize traditional recreational sports. Other rising concepts in this landscape include Puttshack, the Jolliffe's innovative mini-golf offering, the darts-centric chain Flight Club, and the racing simulator F1 Arcade, which attracted a staggering $130 million in investment last year.

Topgolf has played a pivotal role in popularizing this category, transforming how people engage with golf through gamified indoor driving ranges. The company's groundbreaking approach has successfully brought golf to a new and diverse demographic. In 2020, Topgolf was acquired by Callaway in a substantial $2 billion deal, signifying its massive impact on the sports entertainment sector.

CEO and co-founder of Poolhouse, Andrew O'Brien, shared insights into the concept, stating, "Who would have thought 20, 25 years ago when Topgolf was created that people would be going in dresses and high heels, having never swung a golf club before, and having a great time playing golf?" This reflection highlights the transformation of how recreational activities can cater to broader audiences.

Poolhouse's founders have described this venture as their "most ambitious" and "scalable" business to date, with a focus on making the game of pool more accessible to players of all skill levels. O'Brien explained that Poolhouse will equip standard pool tables with cutting-edge technology to assess player performance at the start of each game. This innovation allows for adjustments to be made, such as providing bonuses to beginners or introducing hurdles for more seasoned players. The format accommodates up to 12 participants, enhancing the social aspect of the game.

Furthermore, the gamified components will be projected directly onto the pool tables, simplifying the experience compared to other social sports venues that often have bulky setups.

While Topgolf venues can require investments exceeding $40 million to construct, Poolhouse is aiming for a more economical approach, targeting a budget of approximately $15 million to $20 million per location. However, costs may rise in metropolitan areas where real estate prices are significantly higher, such as New York City or Las Vegas.

The success of the "Topgolf for X" model has inspired numerous businesses to replicate its formula across various recreational disciplines, from darts to ping-pong to racing.

Sharp Alpha emphasized that while all these venues may be enjoyable, not all are suitable for investment. The firm, which specializes in sports, gaming, and entertainment, dedicated over a year to meticulously evaluating various concepts before committing to Poolhouse.

Successful business models in this industry, as outlined by Sharp Alpha, should possess four essential elements: strong revenue streams from food and beverages, frequent customer traffic centered around everyday hobbies, facilities conducive to hosting events such as corporate gatherings and birthdays, and proprietary software capable of generating high-margin third-party opportunities.

On that note, Poolhouse is also considering franchising and licensing options to extend its brand reach beyond its own venues, which could position it for substantial growth in the future.

The impressive track record of Poolhouse's founders played a significant role in attracting investors, with Danzig describing the initiative as a "textbook case of founder-market fit." This alignment between experienced entrepreneurs and a growing market need is seen as a promising indicator for success.

Overall, the vision laid out by Poolhouse and its founders represents an exciting new chapter in the world of social sports, blending recreation, technology, and dining into a unique and engaging experience.