Netflix co-founder Reed Hastings buys stake in Powder Mountain

Eden • Turns out, building a utopian community at 9,000 feet is as hard as it sounds.

A group of four tech entrepreneurs bought Powder Mountain, the largest ski area in the United States by acreage, in 2013 with a dream of creating a permanent home for their high-minded and high-priced Summit Series conferences and the stars, politicians and tech moguls who attended them. In the decade since, though, they discovered running a ski resort and developing a mountain community takes considerably more time and money than they’d expected.

So two weeks ago, Elliott Bisnow of the Summit Mountain Holding Group approached Netflix co-founder and board member Reed Hastings — who owns a house on the mountain — with a proposition: Buy the majority of the Summit Mountain Holding Company’s shares in Powder Mountain and claim a spot on the board governing the mountain as well as a hand in shaping its future.

“‘You’d be the perfect owner from our point of view in terms of loving the mountain and appreciating it for what it is,’” Hastings said Bisnow told him. “‘And frankly, you’ve got the money.’”

“I was like, ‘Yes,’ and we hadn’t even talked price,” Hastings told The Tribune in a video call Monday. “I was just like, ‘I’m in!’”

Powder Mountain’s management announced the finalization of the deal Monday. Hastings, who according to Forbes is worth $3.5 billion, declined to say how much of the Summit group’s shares he purchased or what price they settled on. He will be a minority owner and have one vote on the five-person board overseeing the resort’s operations. Venture capitalist Greg Mauro, an original owner with the Summit group, remains the majority shareholder.

Still, Hastings will “share oversight of management and operations,” according to a news release. Whether the utopian ideal will remain with Hastings at the forefront may depend on a person’s definition of utopia.

“At some point, it was save-the-world stuff,” Hastings said of the Summit group’s vision. “And I think now it’s: have an incredible ski mountain that’s uncrowded where you can get multiday powder.”

Hastings and his wife, Patty, live in Santa Cruz, Calif., but are avid snowboarders and have owned a lot atop Powder Mountain for eight years. They finished building a unique “tubular” home there in 2021. He said he spent much of the first year of the COVID-19 pandemic there. He also spent most of the past three months there, he said, after retiring from Netflix in January.

Future plans for Powder Mountain?

With the deal closing so quickly, Hastings said he hasn’t had time to fully form a vision for what he wants Powder Mountain to look like two years from now, much less 10 or 20.

“No specific plans because I just haven’t thought through a lot, but certainly no radical plans,” he said. “You know of any big takeaways, it’s really, ‘Can we enhance the amazing thing that we’ve got?’”

That appears as if it will start with improvements to the beginner area. General manager Kevin Mitchell said the resort will do some regrading and put in a new surface lift in the Timberline area this summer. Hasting mentioned wanting to upgrade the lift in that area, where the ski school is based, as well as the dining options, which are minimal at best. In addition, reconfiguring the parking, which may include a reservation system, is a priority.

This summer, Mitchell said, the resort plans to construct additional trails for its nascent downhill mountain biking operation as well as tours and lessons.

Mitchell came on board in November while the Summit group was quietly looking for someone to purchase its shares. His hiring raised some concern in the ski community since he previously helped Homewood Mountain in Lake Tahoe, Calif., transition to a semiprivate resort. As such, it is expected to be open only to owners of homes on-mountain and in a few neighboring communities within a few years.

The fear that Powder would go private has grown since Wasatch Peaks Ranch, which neighbors Powder Mountain to the east, also found apparent success with the private ski resort model. Since opening in 2021, it has installed three chairlifts and has plans for four more. The resort, which caters to the 1%, also served as something of an inspiration to Bisnow and the Summit group in their purchase of Powder Mountain, according to their book “Make No Small Plans.”

Mitchell would not say definitively that Powder Mountain would remain a public resort, in part because he has not had much time to hash out plans with Hastings and the rest of the board.

“I don’t see us being in a place where we’ll be turning people away,” he said, “other than whatever our caps might be.”

Powder Mountain has long garnered attention for placing caps on the number of people it allows on the 8,400-skiable acres. In the past, it has limited day passes to 1,500 per day, which combined with season pass holders averaged out to about three acres per skier. Good luck getting an unlimited season pass, though. A spokesperson for the resort said last year about 6,000 people were on the waitlist for a full pass. And since those who already have one (or who own property on the mountain) get first dibs on the next year’s pass, typically only a few dozen new passes are issued each season.

That may change under the remade board. A spokesperson said the resort is no longer disclosing what the cap is for season and day passes. When asked if Powder Mountain skiers will still get three acres to themselves, Mitchell said, “We’ll see.”

He has, however, already made one overture to locals of the nearby Eden, Huntsville and Wolf Creek communities who have been frustrated about not being able to ski or ride the mountain. This spring, the resort announced that people in those communities who were already on the waitlist would get bumped up in line to buy a full season pass, right after those who were renewing.

“Those are our most passionate customers that want season passes and they live right here,” Mitchell said. “So, collectively, we just wanted to make sure we’re trying to help them ski at Powder Mountain more.”

He’s also trying to make it so there is more terrain to ski. Powder Mountain itself totals about 12,000 acres, but the resort this year entered into a more extensive partnership with Monument, a neighboring 20,000-acre private reserve whose CEO is former Clearlink captain Phil Hansen. The two partnered up to offer cat skiing adventures, scenic snowmobile trips and snowshoeing tours on terrain within both Powder Mountain and Monument’s borders. They expect to partner for extended mountain biking options in the near future as well.

The challenges ahead for Powder Mountain

As rosy as the future looks for the mountain, it won’t be without its challenges, as the Summit group discovered shortly after it bought the resort from a developer for $40 million in 2013.

Though a previous developer got zoning approval for 2,300 homes plus hotels and condos, Mauro and the Summit group planned to offer space for 500 relatively small but well-appointed, creatively designed and ecologically friendly homes. As of March, however, John Bond, the Weber County treasurer, said only about 65 building permits have been issued for the area.

“We didn’t move as swiftly in the development of Powder Mountain as we would have liked,” the Summit group said in its book, “and we’re the first to admit that we promised too much and trusted others’ promises to us too innocently.”

That trust may have extended to investors whom they believed would help advance their vision.

In August 2021, Summit filed a lawsuit in Utah’s federal court against two lender groups, one based in Delaware and the other based in Arizona. Summit claimed the lenders did not hold up their end of a contract in which they agreed to finance the resort after its purchase. It said they had specifically agreed to loan Summit $120 million to be used in the construction of a large development near the top of the mountain resort, which would feature hotel space, condominiums and single-family homes as well as shops and restaurants. Summit expected to pay the $87 million balance to complete the project.

However, the deal went south. The lawsuit alleges the lenders raised the necessary $120 million for the project — an effort boosted when, Summit claims, it arranged for NBA star Kobe Bryant to meet with investors — but they spent the money on other projects. The lenders claim they paid Summit $42 million but cut off the money after they say Summit failed to hold up its end of the agreement.

The Delaware lender group also filed a countersuit that claims it served Summit a default notice — which is attached as an exhibit in the countersuit — in July 2021, just a month before the initial lawsuit. The group claims Summit’s lawsuit was the company’s attempt “to avoid the absolute and unconditional” terms of the loan agreement.

As of this week, the lawsuit is unresolved and active in federal court.

Speaking prior to the announcement that Hastings would be coming on board, Bond, the Weber County treasurer, said he believes Powder Mountain has been well-operated under the Summit group. It is up-to-date on an $18 billion bond the group entered into with the county that taxes only the property owners on Powder Mountain and on its taxes. However, the talk of bringing well-heeled people and economic development to the neighborhood has faded and Bond indicated the Summit group was ripe for a change.

“We haven’t seen that large influx of people coming through and being able to see the events. … It just really hasn’t had a significant impact in our community,” he said.

“It’d be interesting to see where they go, who will ignite their vision. And I think that’s what we await.”

Hastings said he doesn’t want to be the mountain’s CEO — that’s Mitchell’s job. Still, he said he feels up for the challenge of making sure Powder Mountain is a place he wants to continue to be.

“[I’m] incredibly excited,” Hastings said. “My happiest moments are riding this mountain over the last eight years and [I’m] super excited to continue to do that.”