Peach Report - Northern Lights
24 February, 2012
With a string of new pubs, bars, restaurants and cafés just opened and big ambitions for 2012, Living Ventures is proof that there is plenty of life beyond London. Peter Martin and Tom Holman caught up with founders Tim Bacon and Jeremy Roberts in Manchester
As a model of how to master a market and succeed beyond the bubble of London, Living Ventures is hard to beat. With so much interest in the seemingly recession-proof London scene, and investors and the media firmly rooted in the capital, it can be easy to overlook the achievements of operators like this, shrewdly consolidating its corner of the country in the North West of England.
This is certainly no parochial business out in the sticks. With seven openings last year bringing its total estate to 26, Living Ventures is one of the most innovative and ambitious operators to be found anywhere, and one firmly on the front foot for 2012, with bags of ideas for more new sites.
A spin round Spinningfields
Proof that it has the measure of its market and is not afraid to try new things comes on a short turn round the Spinningfields development off Deansgate in Manchester, where a Living Ventures site, whether pub, bar, restaurant or deli, is never far away.
Its centrepiece here is the Oast House, the company’s first ever pub, which was launched in the autumn. It is supposedly modelled on 16th century Kentish inns, and, with a wood-heavy, chalet-style interior, it is not exactly what you expect to find amid the gleaming steel and high-rise concrete of Spinningfields. But that, perhaps, is its appeal. It is the perfect example of Living Ventures’ individuality when it comes to concepts and sites: an instinctive, imaginative approach that is far removed from the one-size-fits-all chain mentality.
“We’d never done a pub, but it was only a matter of time,” says Jeremy Roberts, Living Ventures' commercial director and co-founder, who is sitting at a table in the Oast House. It was conceived by Living Ventures and Spinningfields' developer, Mike Ingall, as an elaborate pop-up concept, but has proved so popular that negotiations are under way for a long-term licence.
“We wanted to produce a pub in a non-masculine way,” adds Tim Bacon, Living Ventures' managing director and the other co-founder, pointing to details such as comfy sofas and female-friendly cask ales, which soften the edges of the Oast House, resulting in a relaxed atmosphere and an eclectic customer base. Food accounts for about a quarter of sales and is turned out from both an area separate to the bar and an outdoor barbeque hut which makes an oasis of warmth in the Manchester chill: “You’re going to see hundreds of these popping up in pubs,” Bacon thinks.
A stroll further on across Spinningfields is The Alchemist, Living Ventures’ wine and cocktail-focused city bar concept, as opposed to its beer-driven pub, which is a little bigger than the Oast House, at 2,400 square feet. Bacon describes it as an “evolved” take on the Living Room formula that Living Ventures built up from 1999 and sold on in 2007. “There’s an aspirational element to it, but it’s not reliant on that.”
Close by is Peppermint Bay, Living Ventures’ just-opened deli and café concept, and, beneath that, Australasia. This is the company's take on what Bacon calls “casual fine dining”. Like Peppermint Bay, it is firmly inspired by Bacon's Australian heritage. An east-meets-west formula with an average spend of around £40 a head, its food and light, airy basement space have been acclaimed in the city, and become a popular haunt for Manchester's army of footballers’ wives in particular. With more tweaks to the concept, including a tighter focus on lunchtimes and more sharing-style dishes, Bacon sees it becoming a £5m-a-year business.
Like the Oast House and Peppermint Bay, Australasia represents a step into unknown territory for Living Ventures. But bringing new and imaginative sites to life, and watching Manchester enjoy them, is clearly what gives Bacon his kicks. It is a deep knowledge of the city’s market that gives him and Roberts the confidence to experiment, and that has made Living Ventures to Manchester what the legendary Lettuce Entertain You group has been to Chicago: its city’s champion operator, with interests at all levels of its eating-out scene.
Amid the economic downturn, Manchester is quietly thriving. “London is its own world, but Manchester has its own little bubble at the moment,” Bacon says. “Most of the people investing [in restaurants] are based in London and they tend to put their money where they know, so it becomes a self-fulfilling prophecy. But the opportunities up here are amazing.”
Roberts thinks the BBC’s much-discussed move north to Salford has had a psychological as well as physical effect, focusing much more attention on a city that has been overshadowed by London for too long. Being in the North West has meant Living Ventures has not had the same sort of access to funding from banks and investors as London-based operators, but Roberts says that has not compromised its ambitions. “We’ve always been entrepreneurial about it, and gone where the money is.”
That has partly meant building close links with developers of places like Spinningfields – and as Living Ventures contributes more and more to Manchester’s commercial and social scene and gets a reputation for making venues work, so it is increasingly courted by landlords, with incentives such as reverse premiums and loans on good terms. There is clearly room for operators that stand out from the crowd and try to keep things fresh and interesting, Bacon thinks. “Landlords don’t always want the same old stuff –they need points of difference in their developments.”
While the Spinningfields ventures are originals, Living Ventures’ record of expanding concepts suggests that ideas like the Oast House are likely to be repeated elsewhere. “They’re only one-offs for now,” Bacon says. More pubs will certainly follow, under Living Ventures’ New World Pub Company umbrella, and seven new openings are planned in all over the next year, two self-funded and five in partnership with landlords. The plans include Bacon’s next big ambition, a concept to present fine dining to a city that is strangely short on top-end restaurants: “We want to bring Michelin to Manchester.”
The path to expansion has been smoothed by a £4m refinancing deal late last year with Lloyds Bank Corporate Markets, and a straightening-out of ties with the Restaurant Group, which holds a 38% stake in the side of Living Ventures that looks after its nine-strong Italian Gusto brand and eight steak-and-seafood Blackhouse restaurants. “We’re in a good place now,” Bacon says.
The company has set as its radius in the North a one-hour drive-time from Manchester, but it has its eye on London, too (see below), and might consider international expansion for the right formats, Bacon says. “You never want to limit yourself.”
A happy marriage
Together, Living Ventures’ founders make up one of the industry’s great partnerships. With a string of deals behind them and a very successful business in front, the motivation for both men now is not money but a pleasure and pride in what they do and an appetite for trying something new and exciting.
They admit that their entrepreneurial spirit means Living Ventures is unlikely to ever hit more than about a half century of sites in all. “If I had a brand with 50 or 60 sites I’d be bored senseless,” Bacon admits. “I like developing individual units and seeing it we can get the concepts to five or six sites. After that I lose a bit of interest. And if we get to the stage where we’re bored with something, we can hopefully sell it or move on.”
Bacon and Roberts both emphasise the capabilities of the Living Ventures team, which allows them to be relatively hands-off the operational side of things and free from anxieties about day-to-day running. Roberts describes it as a “lifestyle” business, in the sense that it allows them to put their family lives first. “We’ve got some really strong, fantastic people, so we know we can delegate a lot.”
Bacon describes the partnership between himself and Roberts as like a good marriage: a team in which each happily complements the other and is able to fulfil ambitions, both personal and professional. “We both fill in each other’s gaps and get to live the lives we want. I think most truly successful people are those who do what they really want to be doing.” And almost in unison, they highlight the satisfaction of working and succeeding together. “If I was doing this by myself, I wouldn’t enjoy it nearly as much as I do.”
How Living Ventures grew up
1999 Founded by Tim Bacon and Jeremy Roberts. The Living Room concept quickly expands across UK cities
2003 Develops Prohibition bar format
2004 Turnover nears £20m. Named the fastest growing company in hospitality by the Sunday Times
2005 Acquires Est Est Est chain in a deal that sees the Restaurant Group take a 38% stake in the company
2006 Turnover peaks at £51m
2007 Sells the 34-strong Living Room estate to Ultimate Leisure for £28m
2008 Rebrands restaurant estate into Blackhouse and Gusto brands
2009 Opens Suburbia bar and club in Cheshire
2010 Opens Red Door neighbourhood bar in West Kirby, followed by another in Chester, and the Alchemist on Spinningfields in Manchester
2011 Adds Australasia, The Oast House and Peppermint Bay to Spinningfields
Having mastered Manchester, Living Ventures has plans to make its mark on London, too. It will start by developing its sole remaining London venue, the Smithfield Bar & Grill, into a fully-fledged Blackhouse, and then seek more opportunities in the capital.
For Bacon and Roberts, the journey south is less about proving themselves in London than establishing a foothold in another concentrated market that they understand. “It makes sense for our second hub to be London,” Bacon says, adding that the pair will also learn from previous forays into the capital. “We’ll be a lot more circumspect over sites. We were a bit naïve last time and applied northern rules to southern sites, which doesn’t always work.”
Living Ventures is the proud operator of some of the most exciting brands in the UK restaurant and bar market.