Soho House has secured a $100m (£81m) equity injection to shore up its finances after the coronavirus pandemic hampered spending across its global network of upmarket venues.
Sky News has learnt that Ron Burkle, the American billionaire who is Soho House’s biggest investor, led a group comprising new and existing shareholders in providing the new money in recent weeks.
Sources said the investment was made at the same $2bn valuation at which the company raised $100m late last year, underlining its backers’ confidence in the future of the business.
Many of the group’s sites have reopened as overseas governments have eased lockdown restrictions, with its UK clubs and hotels hoping to resume trading early next month, in line with government guidance.
Soho House, which has explored a public listing in New York for the last couple of years, has grown at breakneck pace over the last decade, opening clubs in Barcelona, Hong Kong, Istanbul, Mumbai and West Hollywood.
Further openings are planned in Paris, Rome and Tel Aviv.
The company now has roughly 110,000 members, many of whom pay well over £1000-a-year in fees to gain access to venues, as well as discounted hotel rooms and consumer products sold under the Cowshed brand.
One insider said member retention had improved during the COVID-19 pandemic, with the group offering credits against membership fees to spend on other Soho House products.
The club, which has launched a chain of Soho Works work spaces which are broadly comparable to the likes of WeWork, has added features during the lockdown such as a such as a digital conferencing service.
Originally conceived by founder Nick Jones as a networking venue for executives in the advertising, media and creative industries, a Soho House membership has become a status symbol for international executives working in sectors including music, fashion and broadcasting.
Mr Jones, who is married to the broadcaster Kirsty Young, opened its first site on Greek Street in Central London in 1995.
The company prides itself on offering members a discreet and relaxed environment in buildings often housing a hotel, restaurants, gym and other facilities.
Its clubs have become a home-from-home for A-list celebrities, with the likes of Kate Moss and Eddie Redmayne among those photographed emerging from Soho House parties.
Soho House’s breakneck expansion has been facilitated by a series of deals, including the sale by Mr Jones of a controlling stake in the company to Richard Caring, the textiles tycoon, in 2008.
That transaction valued the company at about £130m, with a subsequent takeover by Ron Burkle, a Californian supermarket billionaire, four years later attributing a £250m price tag to Soho House.
Both Mr Jones and Mr Caring have remained as shareholders since then, with the former continuing to run the business as its chief executive.
Last October, it announced a further $100m fundraising led by Raycliff Capital, an investment firm, with participation from Simon Property Group.
The investors were chosen partly to help provide strategic insight aimed at assisting Soho House’s opening programme,
The company’s expansion is driven by a capital expenditure-light model, with partners developing buildings in selected cities at their own cost, with Soho House as a tenant which then receives a payment if the landlord sells the building.
An insider said its reopened sites in cities such as Hong Kong and Malibu had performed strongly in recent days, providing evidence of “demand and bounce-back” from COVID-19.
Soho House has also added a strand of membership called Cities Without Houses to enable thousands of people to join its “community”, even if they live in a location without one of the group’s venues.
A Soho House spokesman said this weekend: “We have secured additional equity funding as a follow-on to last year’s equity investment, which underlines the $2bn valuation of Soho House.
“It is led by Ron Burkle personally, and shows his belief in the business.”
Last year, it reported turnover for 2018 of £432.5m, a rise of 20%.
Membership subscriptions accounted for just under 25% of the total, with food and beverage sales up 20% to £190.5m.
At the time it reported the results, it said 36,000 people were on its global membership waiting list.
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