If you're reading this article in the United Kingdom, it's likely that you've heard of Etc. Venues. The company operates 16 venues in the U.K. that host 18,000 events and 850,000 attendees annually, and their 14 London outposts comprise 278 meeting rooms, far more than most hotel brands' London inventory.
If you're a United States reader, you might not even know of Etc. Venues' existence, but that may be about to change. Today at IMEX Frankfurt, the company is announcing an aggressive expansion into the U.S. by launching three New York City meeting venues within 12 months, an investment of US$35 million, with more New York City venues likely to follow.
The goal, according to Alastair Stewart, managing director of Etc. Venues, is to become "the global leader in urban day conference and event centers." To that end, Stewart says that the company aims to double the size of their business over the next three to five years.
Stewart spoke with Northstar Meetings Group in the leadup to IMEX Frankfurt, touching upon a variety of topics while exclusively revealing to us the company's first New York City location: a 45,000-square-foot space at 360 Madison Avenue in Midtown Manhattan, near Grand Central Terminal.
Why New York, and why now?
I've always had an ambition to open up in New York, and I think that's really been coupled with encouragement that we've been given by our clients, many of whom are international. They would say that if we offered in New York what we're able to offer in London, then we'd do very well, because there's a shortage in New York of the type of venue that we operate.
There's a bit of a ring to London and New York as well — they're probably the two global capitals of the world from an economic perspective. Like London, New York has a sort of micro-economy of its own. So yes, we're coming to the U.S, but more importantly ,we're really coming to New York.
What sort of events do you see in your U.K. venues in terms of length?
I think the average duration of an event is about 1.2 days. We get events that last up to three or four days, and in fact some of the programs run a lot longer. For instance, it might be a graduate training, where they'll come to us for six to eight weeks. But the vast majority of what we do is for the day.
Do you consider your main competitors to be hotels?
By far the largest is hotels. The second largest competitor is probably a company's own internal space. We're seeing a big change now in London, and we think that we see a similar pattern in New York: Increasingly, organizations are downsizing on their own office space, and in some cases they are removing internal meeting and conference space.
Do you consider Convene a major competitor in New York?
[Laughing] I can't mention any names, but you might be right. We have 14 venues in London at the moment that are hosting around about 18,000 events, and that's putting through about 850,000 attendees. By way of comparison with Convene, they hosted 233,000 delegates last year. So you can see how much larger we are as a starting point.
Convene does a pretty good job with events; do you think that there's enough business to go around, or is there something you think you do better than Convene?
Well, I know the guys there, and they're good friends, and yes, we will collaborate and we will compete. Why I say we will collaborate is because I think they have been pretty much playing the same sort of the card in trying to persuade people about alternatives to hotels. And they've done a good job on that, and we're grateful, because I don't think I'd have got the investment without them proving that they can run a successful business in this space.
What will be different? I think there'll be significant differences in that Etc. Venues is a specialist, focused, dedicated conference and event space provider. Despite many temptations over the years to diversify, we haven't chosen to do so. My good friends at Convene have been dashing off in a lot of different directions recently, whether it's co-working spaces or coffee shops. And I think they'll have their strategy, but we will stick to what we do really well and only provide conference and event space.
How far out are people booking events at your venues in London?
We're typically getting our larger events booking nine to 12 months out, and then we'll get a sort of solid booking pattern, three, four or five months out. We do live in a world where there's a lot of last-minute demand, and we get quite a lot of bookings in the month itself. And that's where brand awareness is key, because people don't have time to shop around, they don't necessarily have time to do RFPs. They want to go to a brand that they know and they can trust. And our online booking platform shows a real-time snapshot of availability and rates.
What about those rates? Starting out in New York, are you trying to price low or what?
I think we're reassuringly expensive. That means we want to occupy the upper-quartile of pricing. We know that $400 and $500 a day rates, per person, are not atypical in four- and five-star hotels. We expect our rates to begin with a two, and I think on peak days it'll be pushing toward $300.
What's significant is what that rate includes. I think I told you earlier an anecdote about having a meeting with a $950 WiFi charge, and we couldn't get a cup of coffee. In Etc. Venues' pricing, all of those things will be inclusive. So we're as transparent as we can be on our pricing, and it will flow through to make it look like a good value. So it's reassuringly expensive good value, if that makes sense.
How are your events being catered?
A big part of our model is to employ our own catering staff, our own chefs. We invest in kitchens. So in the case of 360 Madison, we are investing a half-million dollars in providing a kitchen vent that goes to the roof. Why do we think that investment is worthwhile? Because it enables chefs to cook a significantly wider range of foods. And after technology, food is probably our single most important selling proposition. We want to be as well known for good food in New York as we are in London.
What are you looking for in New York venues?
Our plan is to open three venues as part of our 12-month launch. By the end of June, we hope to be out in the marketplace with three venues that will give us coverage in Midtown and the Financial District, which is where our customers have told us they would like us to be.
I'd like to have something around Penn Station, as an example. I think we can add in a couple of venues downtown, which will be ever slightly smaller in size and maybe more focused on smaller groups, whereas our initial venues will be targeted at the larger conference and event market that we've done well with in London.
If everything goes well in New York, do you anticipate spreading to other cities in the U.S.?
Our aspiration is to have a business the size of London in New York within three to five years. And we see that as nine to 10 venues, because I think the venues will be slightly larger as we find our way. And hopefully as we do well in New York, then we're likely to focus on the East Coast as the next priority. Washington, D.C., Philadelphia, Boston — those would be the likely suspects. But we have no immediate plans until we've proved ourselves out in New York.