10 October 2017

Portrait, Nick Jones: how the Soho House empire was built

Nick Jones has never had a five-year plan in his life. But more than 20 years since opening the first Soho House members' club on London's Greek Street, he's built a formidable empire.

Soho House’s vast new west London site is sandwiched between the Westfield shopping centre and Queens Park Rangers’ football ground. This latest outpost of the members’ club and the hotel is being used as bait by developers to lure tenants to nearby offices and flats.

The location feels incongruous with the caricature of the ‘creative’ Soho House member, but founder and CEO Nick Jones, a man known for his legendary gut instinct, has no doubt about the spot he’s chosen. ‘It was either this or Battersea Power Station,’ he says.

‘This one felt right.’ ‘London’s become a lot bigger and there’s a whole bunch of our young people around Harrow Road, Kensal and Acton. This will be great.’ Jones has taken over a large chunk of what was Television Centre, the BBC’s home between 1960 and 2013.

Blue Peter bar

Jones is on site trying to wangle Studio One (where The Jonathan Ross Show is filmed) for the club’s launch party. He’s also trying to cajole the top echelons of the Beeb into allowing him to call the main drinking den The Blue Peter bar, complete with a porcelain Shep the dog. He wants to call the restaurant The Canteen.

It was also his idea to create a vast gym – reckoned to be the biggest in London – in the basement. It’s going to be the carrot to pull in younger members. ‘Health is obviously a big deal now, but I feel there is something in the “revolving class” – the idea of a constant class going on so you can turn up and just walk in.’

All of this is vintage Jones. Energetic, instinctive, mischievous, immersed in detail, and with a highly attuned sense of what affluent people in cities either want now or will want when he offers it.

The hospitality factory

Soho House is many things – rocket fuel for an area’s gentrification for starters – but perhaps more than anything it’s a hospitality factory. It churns out members’ clubs, hotels and a range of business units loosely connected to the lives of its members at a spectacular rate.

At the time of writing, there were nearly 70,000 paying members across 18 clubs from Malibu to Istanbul, which contributed to £104m in income last year (although the company posted a £7.5m pre-tax loss). It also has an array of side ventures such as a fledgeling co-working scheme (Soho Works), toiletries (Cowshed), and its own brand of juices (House Press). It opened its own online store last year, selling homeware inspired by its various properties – making £2m in sales and over £100,000 in profit in its first year.

Opportunity and instinct

Soho House’s modus operandi is opportunity and instinct. In the space of roughly three years, it quickly expanded its fancy junk food mini-chain – which includes Chicken Shop, Pizza East and Dirty Burger – before off-loading half the equity to release some much-needed cash, valuing this little side business at a cool £33m.

And standing at the front, centre and top is Jones. The group’s swashbuckling leader is seemingly present in every one of its properties and at the forefront of every decision; choosing the lampshades which will go in the new club in Amsterdam, hunting a plot of land for a potential resort in Cabo, setting the pricing of a new motels business called ‘Mollies’ – Jones is the most prominent voice in all of the details.

Then there’s his opportunism. Both the BBC building and Jones’ third New York club, Dumbo House, will open early next year. Despite there being no plans to open in Brooklyn 12 months ago, when the Dumbo building was presented to Jones it swiftly became a construction site.

This reliance on instinct confounds popular business wisdom.

No strategy

‘Strategic? He doesn’t know the meaning of the word,’ says Robin Hutson, owner of The Pig hotel, former chairman of Soho House and one of Jones’ closest friends.

The man himself revels in it: ‘I’ve never had a five-year business plan in my life. There’s never much logic. There’s a danger you don’t do anything if you overthink.’ Trying to second-guess what’s next, or what’s about to turn from an idea to something tangible is both a waste of time and joyous fun.

It could be anything. ‘His enthusiasm means he always wants to do new things and wants to do everything better than the last time,’ says a former colleague.

For all the times Soho House is cited by others as a ‘great brand’, Jones doesn’t appear to be a man who thinks about it. Nor does it seem like false modesty when he describes himself as a caterer, motivated solely by seeing people have a great time.

Memory man

A consistent description of him is ‘product-driven’. He fills his clubs with ‘all the toys’ (pools, cinemas, spas, etc) while attempting to instil each with its own character, style and individual artefacts. Everyone Courier spoke to put his ability to cram the finer details of each club and the broader business into his brain down to a special power: his memory. ‘He will know instantly if a number has changed or a tiny bit of design detail has shifted,’ says one associate – remarkable given he never writes anything down due to his severe dyslexia.

In-house control

Jones admits to being a control freak; a quality which led him to ditch outside interiors companies and run design in-house. Architecture followed. Soho House now even has its own construction team. It’s registered as a separate enterprise which booked £62.5m worth of work last year. It means Jones is closer to the design of every facet. It also means he can now change his mind without getting a bill from an external company.

‘Caz has only just forgiven me for what I did over at Dean Street [a new club in Soho].’ Gary Cazaley is Soho House’s site manager.

‘A no is a way to a yes’

‘That was a bad one,’ says Jones, sheepishly glancing at Cazaley. He had insisted that an entire wall will be knocked down and moved by just a few centimetres. ‘Caz worked his knackers off, [but] I had to say, “I’m terribly sorry but it’s going to have to come out”.’ ‘After some time we’ll kiss and make up but [if I’d said nothing] I’d have to see it for 20 years,’ he adds. He is constantly pushing and prodding.

‘I work on the basis that every conversation starts with a “no”; a “no” is a way to a “yes”. You just have to work out the route for a given situation.’

Country playground

Persuasion, instinct and obsession over detail were at the fore when planning the epic farm resort he opened in the Cotswolds in 2015, Soho Farmhouse. A farmer had invited Jones to look at his country house, pitching it as a hotel. ‘What about the whole farm?’ Jones posited. A blueprint for an outrageous bucolic playground followed. It constantly shifted throughout its development as Jones saw endless possibilities for improvements.

But the spiralling costs of the venture pushed the company to the edge as it began running out of cash. In April this year, it closed a £275m debt financing deal. ‘We overspent, but it was soon resolved,’ he says.

More recently, the company has been persuading property owners to shoulder the entire capital expenditure of a new venture, so Soho House is less financially exposed and functions more as an operator. Future income is then split between the two parties.

Cash has always been a problem, leading Jones to sell a majority chunk to restaurateur Richard Caring for £105m in 2008. In 2012, American investor Ron Burkle became the majority owner when he bought a 60% share. Caring now has 30%, leaving Jones with 10%.

Crisis after crisis

It was the same in the early days when Jones was hankering to expand beyond the original club – a rickety Georgian house in Soho. His record of two failed restaurants did little to dampen his self-belief. ‘His enthusiasm to do the next thing was pretty difficult to manage from a cash flow perspective for a fledgeling business,’ recalls Hutson. That enthusiasm saw Jones take on New York, against all the advice he was given.

Everyone says opening a club in New York’s Meatpacking district in 2003 was a seminal moment for Jones. He was in his element. He went up against American lawyers, landlords and builder unions – plastic rats were left outside the building to show it was using non-union workers.

Crisis after crisis followed. ‘Nick struggled to get across the idea to Americans that Soho House wasn’t like a country club and you couldn’t just pay your way in,’ says a colleague from the time. ‘But, amid all of that, he loved the living-on-the-edge, seat-of-the-pants spirit of it.’ Jones says he hasn’t changed much since then. ‘I can sniff things a bit quicker now, I suppose,’ he says. Others say he has worked hard to become more proficient at the boring aspects of the business.

Too corporate?

With its size, age and complexity, one wonders whether Soho House can continue to pull off ever-more radical projects and remain commercially sustainable.

The too-big-and-too-corporate charge is one everyone connected to Soho House hears, not least Jones.

‘I fight that every day. It’s crucial we keep the spirit of a dysfunctional family.’ He adds: ‘But what’s the alternative? You stay the same, and lose all your good people because they want more.’

Culture of casualisation

Jones knows he has to ensure the clubs feel like they still embody something youthful – a difficult challenge for a 20-year-old global group with a 54-year-old in charge. ‘If I go to one of the clubs and feel like an uncle at a wedding, I feel we’re getting this right.’

Winds have certainly blown in Soho House’s favour. Being ‘creative’ has become more lucrative in many spheres, the freelance and startup economy has exploded, and the casualisation of eating and playing have all come at the right time for Jones.

Hutson argues that Jones is partly responsible for the shift: ‘He’s had a tremendous influence on how we eat, drink and play.’

Kirsty’s weekends

Is he likely to slow down? ‘God no, I feel as good as I’ve ever done,’ says Jones. He’s got his eye on replicating Farmhouse in upstate New York. He’s also about to become a hospitality player in Asia with venues in Mumbai and Tokyo in the works; Hong Kong and Singapore are likely to follow. Jones is on planes more than ever.

‘He never gets sick, he works the longest hours. And he’s just obsessed. They’ll carry him out of one of these places, I’m certain of it,’ says a colleague.

His wife, the BBC broadcaster and Desert Island Discs host Kirsty Young, has only insisted that he keep weekends sacrosanct. What does she think of him parking up at the Beeb? ‘I haven’t really talked it through with her but it could be convenient if she’s doing Have I Got News For You.’

Before the week’s out, he’ll be travelling to six countries in four days and diving into every minute aspect of the business. There are more deals to make, employees to catch up with and lampshades to choose.

Monday to Friday

A recent working week in the life of Nick Jones.

Monday

Full day of reviews with the team at Soho House’s HQ on Dean Street (plus a snatched Pret lunch).

Fly late afternoon to New York with Soho House’s COO.

Review current and upcoming projects en route.

Sleep at the Meatpacking district club.

Tuesday

Meetings at 7 am at the club.

Dumbo site visit and design meetings.

Reviews over lunch with the North American management.

Dinner with the New York team at Ludlow House.

Overnight flight to London.

Wednesday

Land in London, shower at Dean Street Townhouse.

Full day reviewing food, staff and service at branches of Chicken Shop, Pizza East and Dirty Burger with general managers.

Theatre (The Ferryman) and dinner in Soho with family.

Thursday

Morning reviews with management at HQ.

Afternoon visit to The Ned. Updates and reviews of all areas.

Back home to Oxford.

Friday

Working at Soho Farmhouse.

New menu tastings and catch-ups with all staff.

First appeared in Issue 19 Oct/Nov