An in-depth analysis of a struggling coworking operator providing insights that helped them transform their model
To help The Clubhouse London, a coworking operator that fell into administration, transform their model to make the most of their assets and boost revenue.
A report that provided long-term strategic and tactical recommendations that resulted in a fundamental proposition change for The Clubhouse London.
Our findings, delivered in the final report, resulted in The Clubhouse London being acquired administration by a partnership of BOOST&Co and IWG, the world’s largest flexible workspace operator, escaping administration.
The Clubhouse London, a coworking space operator, opened their first site in Mayfair in 2011. After six years of modest success, they opened three additional properties in 2017, funded in part by BOOST&Co, a boutique financier. However, high overheads and struggles scaling revenue resulted in their expanded portfolio working against them to generate consistent annual losses. Towards the end of 2019, the firm went into administration despite forecasted growth of 55% during the 12 months to March 2020.
The Clubhouse London had a revenue problem which they needed expert help to understand and tackle. Without addressing their sub-optimal revenue generation, they would struggle to remain in the market. Accordingly, BOOST&Co asked us to examine the options available to deliver the best outcome for themselves as investors and The Clubhouse London as a business.
We first conducted a thorough review of the business, including using a mystery shopper, interviewing staff, analysing all the data we could access (including revenue, marketing spend, membership rates, and customer feedback), and surveying the different site locations.
Our aim was to develop as broad-based an understanding of the business model and current situation as possible. This would help us to make informed decisions about the most viable avenues for revenue growth and loss-limiting as we moved on to compile our report.
A rapid report
As time was of the essence for The Clubhouse London, we aimed to compile and deliver our report within two weeks, without sacrificing the integrity of our recommendations. With all of the information we required already gathered, we could move on to structuring our insights.
Our report included long-term strategic and tactical recommendations, along with ten key issues to focus on in the short term that were centred around the sole objective of maximising revenue while keeping additional overhead costs to a minimum.
These recommendations included working with property brokers to create reliable sales channels, reviewing management agreements with landlords, and addressing the disconnect between customer expectations and experience on-site.
The findings delivered in our report prompted a partnership between BOOST&Co and IWG to purchase and operate The Clubhouse London. A full review of the brand also resulted in a fundamental proposition change to focus on the flexible office market rather than the narrower coworking space.
With the new approach decided on, we developed fresh ROI forecasts for the flexible office proposition and provided tailored guidelines for customer acquisition cost per channel. We also made specific marketing recommendations including cutting back on PPC costs to focus on more cost-effective marketing channels like referral marketing and better use of The Clubhouse London’s proprietary database of 40,000 contacts.
The Spaces to Places method
When tackling a research-heavy project, we focus on delivering insights that make a fundamental difference to the relevance a business has in the sector it operates in. Using technical and industry-specific techniques, we identify shortcomings and provide bespoke recommendations that are oriented around making the biggest difference with the least spend.
Feedback from Boost&Co
“Spaces to Places provided critical insights into [The Clubhouse London]. This allowed me to make fast decisions with confidence. They played a key role in achieving a good outcome on the project due to their knowledge of the market and inputs on how we could make the company more competitive and dynamic in the marketplace.”
– Roux Brits, Principal at BOOST&Co