The nature of exclusivity is a tricky thing. Especially so when it comes to businesses looking to expand grow while retaining a sheen of discernibility. Case in point: Soho House, which just announced its IPO.
“As Soho House heads toward an IPO, the members’ club for the creative set may see any remaining air of exclusivity go up in flames,” argues Nimrod Kamer in an in-depth piece on the bohemian brand soon to turn public entity in Airmail News.
Kamer has a point. What began as a humble, underground workspace for creatives has become perhaps the most ubiquitous – not to mention most Instagrammed – chain of members clubs in the world. With over 27 locations in 10 countries (plus new openings in Tel Aviv, Austin, Rome, Paris, and Brighton, UK) detractors argue that the chain lost any claims to exclusivity and choosiness years ago.
In April Sky News broke the story that Soho House submitted a filing for an IPO in New York which would see the company valued at $3 billion. The news was confirmed in a June 21st press release in which Membership Collective Group (MCG), which owns Soho House and associated companies, The Ned and Scorpios Beach Club, announced that it has “has filed a registration statement on Form S-1 with the U.S. Securities and Exchange Commission (“SEC”) relating to a proposed initial public offering of shares of its Class A common stock.”
“This move will enable us to accelerate our investment in improving both the physical and digital elements of your membership,” founder Nick Jones told members via email.
Soho House group reportedly aims to use funds raised from the listing to expand to 46 Soho House sites globally by 2023. It is offering a yet-to-be-revealed fixed amount of shares that each member can buy.
As Kamer reminds us, Soho House did in fact hire J. P. Morgan and Morgan Stanley ahead of a since-aborted attempt at an IPO back in 2018. Now, however, the stars have seemingly aligned.
“It’s bullish on its timing this go-round—travel-and-leisure stocks are expected to boom post-pandemic—and big names are buying in, such as Goldman Sachs, who just loaned Soho House $770 million ahead of the IPO,” Kamer writes.
Taking a private members club public may seem counterintuitive as a degree of ownership will be handed over to anyone who chooses to invest. Some argue this could be the death knell of a club that once styled itself as the opposite to the boorish old members clubs of the capital. It used to be that you had to know someone to get in. That bankers weren’t allowed.
While the club chain does retain a selection process, it’s difficult to square its global pre-pandemic membership of over 110,000 with its supposed exclusivity. But is decrying Soho House’s IPO simply snobbery in and of itself? Instead of undermining its own raison d’être by inviting everyone in, is the chain simply forging ahead and continuing to break new ground?
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