Going it alone – Green & Fortune
Green & Fortune is a contract caterer with a difference - there is no contract. Janie Manzoori-Stamford talks to founder John Nugent and learns why a traditional approach wouldn't have worked
When John Nugent announced in June 2007 that he was planning to quit high-end contract caterer Searcys in order to launch his own company, Green & Fortune, it's unlikely that too many eyebrows were raised.
After all, times were good. The phrase "credit crunch" had yet to be coined and the hospitality industry is well known for having more than its fair share of entrepreneurial spirit.
Fast forward 16 months and Nugent opened the doors to his new multi-faceted venture at Kings Place, where Guardian Newspapers makes up one of its neighbouring building tenants. A hop, skip and a jump from King's Cross station, it is also in the heart of the long-term regeneration of the busy London district, and not by accident.
Made up of three overlapping business strands - Rotunda bar, restaurant and private dining; Green & Fortune café; and Kings Place Events, which operates in two auditoriums, two art galleries and copious amounts of function space, both in and outdoors - this business is something of a departure from traditional contract catering.
For a start, there's no contract. And according to Nugent, that's because no catering contractor could have done it because of the short-term nature of most deals. "Seven years isn't enough to make it work."
Instead, Green & Fortune signed a 25-year lease with landlord Parabola Land (which has since sold its interest to German firm Deka), an arrangement that suited all parties involved. Developer Peter Millican, also Nugent's business partner, was given options on how to operate.
"Like most property organisations, he wanted an income on rent," explains Nugent. "He didn't want to carry any risk in terms of concession-based arrangements and nor did he want co-funding with a catering partner, so it looked like it was always going to be a commercial lease arrangement."
This type of deal obviously requires massive capital investment and while Nugent admits that the company is carrying a lot of debt, he says it allows for a much longer-term business strategy. "We've got no client to blame, as sometimes happens in those environments. It makes you make better decisions because you have to stand or fall by them. Once we pay our rent, we do what we see fit," says Nugent.
While the long-term lease was definitely an attractive prospect, it was perhaps the location that represented the most unique element of this opportunity. Kings Place overlooks a 67-acre development of office, residential, retail and education space, the earliest examples of which are expected to open this autumn.
The first noticeable change to the area came in 2007, when St Pancras was officially reopened as St Pancras International following its own extensive revamp, and Nugent says that since then, every month, in a very small way, something changes.
Nugent, who has lived in and around King's Cross for a number of years, had heard talk of the project many years ago. When it came to setting up Green & Fortune, he knew the chance to get in this early on a regeneration project would be unlikely to come up again.
But despite the anticipated and ongoing injection of footfall to the area, no one at Green & Fortune was under any illusions that theirs would be an easy ride.
The potential of Kings Place is vast but it is not without its own unique challenges, and rather than wait for business growth to come to the area, there was a very real determination to hit the ground running. Aside from the impending economic gloom at the time - Lehman Brothers went bust one week before Nugent opened the doors - the new business had to generate almost its entire footfall from scratch.
"We're not on the high street. We're housed inside a building. Some of that is an advantage but we had to spend a lot of time and effort on creating that initial awareness," says Nugent. "We were very aggressive on the events marketing side. That was key so that when we kicked off we weren't sitting around with nothing to do. The business could have flipped in that time had we not done the groundwork."
The efforts of a dedicated sales team saw to it that conference organisers who came to view the venue ahead of its opening were able to see the potential of what was essentially a hard hat site at the time.
The rigid business structure that was put in place prior to launch paid off handsomely and the event business continues to go from strength to strength. A list of past clients that includes Google UK, Audi and the BBC Music Magazine awards, were no doubt drawn to the state-of-the-art technology that was built into the infrastructure. This investment allows Green & Fortune to broadcast, record and stream events live, which for many traditional venues is much more challenging.
This October, the company will celebrate four years in business and also the first time that it has turned a profit, having broken even for the past year. Currently turning over just under £5m a year, Nugent is confident that there is capacity for growth. "We want to get to £7m in the next two or three years, but with a fair wind and a bit of luck it could be £8m or £9m. At £7m it becomes a very interesting proposition. It means we can service our debt properly, look to reinvest and look at new opportunities as well."
That's not to say that Nugent is in any hurry to get started on that "difficult second album", convinced as he is that it's imperative to get the first site absolutely perfect. "I don't believe in adding something for the sake of it. We've had loads of opportunities thrown our way but let's get one that's absolutely stonking," he explains. "I've seen where growth for the sake of growth can land you - it's the curse of the second site that can bring you down."
In the meantime, the focus is very much on Kings Place and the King's Cross development across the road. With a working population of about 35,000 to 40,000 people a day (half the size of Canary Wharf) and about 2,000 new homes to be built over the next decade, Green & Fortune already has its work cut out, because with the valuable new footfall will inevitably come a lot of new competitors.
"You have one eye on the regeneration and one eye on the competition the whole time," adds Nugent. "You've got to work harder and smarter and just deliver."
JOHN NUGENT'S TOP TIPS ON LAUNCHING A NEW BUSINESS
Be nimble
The rules will continually change and you must be able and ready to react to changing fortunes. Business plans need to be able to adapt to movements beyond your control. Build in contingencies and plan for the unexpected. Always consider what the next stage of the economic cycle might bring and what the shape of your business might need to be.
Try to find new and unique opportunities
If appropriate, be the first person in that marketplace or area. Use that challenge as an advantage and be aggressive in growing and exploiting revenues rapidly.
Surround yourself with the best possible people
Employ experts in their fields. Keep your structure as flat and open as possible. Use outside influences on one-off projects if required. They will stimulate ideas and broaden the skill set of your in-house team.
Never forget what is at the core of your business - hospitality
Process is extremely important, but never lose sight of the fact that success in your business will begin with looking after your customers. Be generous in your approach. Target the individuals and organisations that will support your business. Entertain well and generously. Use the resources within your business to promote the aims.
Embrace all promotional, PR, marketing and networking opportunities
Business will not automatically come to you. Use all these avenues to position yourself and the aims of the business. Be a people-focused business and encourage your teams to become ambassadors and faces of your business. The more that the outside world recognises you and the senior people in your business, the more it will be talked about.
