SELLING CROWDS TO CLUBS: CODY PRUITT’S

STORYBy Eddie Wharton, Hayley

Serebransky and Holly Lagasse

Someone Gets Paid To do This

Meet Cody Pruitt

Started off as a child model Played in bands throughout High School Started Hosting Tables In 2009, Started The Bespoke Group with Doug Rand

Nightlife Business Models

Nightclubs exist to make money They make money mainly from the paying

crowd – cover and drinks at the bar And from VIP´s who spends thousands for

alcohol that may only cost 1/20 of that They are not just buying alcohol, they are

buying other forms of value Value: Ambiance, Music, Status and

belonging How do clubs create these other forms of

value?

Nightlife Pyramid - NYC Higher items on the pyramid

are supported by things lower down

Blue signifies a revenue and red a cost, with shade indicating magnitude

Loosely speaking, blue is the target market and red is the value proposition

The larger a section is, the more important it is relative to others

The pyramid represents a club´s strategy for making money an creating value to justify the markups in prices

Note the high value of VIP’s and that they are on top of the desirable crowd

The Nightlife Formula

Opium, Night of Afrojack

DJ is most important and largest cost

Desirable crowd and VIP’s are less important, but still produce revenue

The non paying customers (college kids having fun - us) are paid for so that the paying techie conference members do not feel awkward

Everyone pays or is meant to create a value that someone else will pay for

The Bespoke Group

Pyramid is a club’s strategy

Clubs pay employees to execute different parts of this strategy

Bespoke started by executing on the goal to bring out a “desirable crowd”

The Bespoke Group

Brings out the “desirable crowd” Their ability to bring out this crowd is their

product Their target customer is nightclubs Started out merely hosting a table for 20-30

people Goes do a different club each night of the week Offers their desirable crowd VIP treatment in

exchange for coming, which builds a long term relationship with them and sustains the model

The Bespoke Group Grows

Ballooned to 80-200 people Bespoke was allowed to book DJ’s Starting managing and booking their own

DJ as a separate line of business Allowed Bespoke to control more of the

pyramid and therefore get paid more by clubs because they delivered more value

The Bespoke Model

Problems

Bespoke can only grow by hosting more events per week or by making more money per event

Already host 6 events per week Growth has stagnated Without bringing in revenue producers,

cannot get paid more Clubs need VIP customers and are only

willing to pay more that

No VIP’s

The VIP’s do not follow Bespoke around the way the desirable crowd does

When they do come it is sporadic Clubs are forced to secure these VIP’s

outside of Bespoke through other channels

Worse Than You Think

In nightlife, it is necessary to move up as you age

You become too old for positions Nobody likes a 40 year old promoter,

but a 40 year old club owner is respectable

Without increasing revenues and executing more of the nightlife formula it is impossible to move up and stagnation is not sustainable

Discussion Questions

How does Bespoke continue to grow? How can they execute on more of the

nightlife formula? How do they gain control over the elusive

VIP market? Should Cody start applying for a 9 to 5

job?

Cody’s Solution

Decided he needed to build a relationship with VIP crowd just as he had with desirable crowd

Scouted out big spender in clubs, lounges, bars to find a central person in the groups

Approached central person and traded him access for his control over VIP’s

Used him to build a relationship with VIP’S Before: strangers; Now: know Pruitt, his

partners, their crowd, models, etc. Increased Profits

Cody’s Future

SHORT TERM LONG TERM

Expand private and special events division

Build public relations and publicity business

Open a restaurant in the next two years

Gives him credibility with State Liquor Authority

Eventually will open club or lounge

THE END.