MCG executives argue, however, that the worst is over for the company. Even during the pandemic last year, its retention rate was 92 percent, as members largely opted to keep paying their dues. And when clubs have been able to reopen, according to Mr. Jones, members have largely flocked back.
Daily Business Briefing
July 15, 2021, 7:33 p.m. ET
“We don’t have a problem with demand,” he said. (One thing that has changed, he conceded, is that members aren’t staying out quite as late as they did before the pandemic. “I think, in Covid, we’re a bit out of practice staying up late,” he said.)
That mirrors the overall arc of demand for private clubs, said Bill McMahon Sr., the chairman of the McMahon Group, a consultancy to the industry. At least in the United States, the industry as a whole has boomed, most likely thanks to the buoyant economy. The number of new clubs has risen, as has the number of applicants for them, particularly those 55 and younger, Mr. McMahon said.
“When people have more money in their pocket, they’re signing up,” he said.
MCG hopes to add three to five clubs every year across its brands, which also include the Ned and the Scorpios beach clubs, according to its prospectus.
If anything, those goals are conservative, suggested Andrew Carnie, MCG’s president. The company opened a Soho House this spring in Austin, Texas, with clubs in Paris, Tel Aviv and Rome also set to debut this year. Seven clubs are expected to open next year, including a Scorpios resort in Tulum, Mexico.
The company expects to pay down much of its debt with proceeds from its stock sale, Mr. Carnie said. And it hopes to finally turn a profit by the end of 2022.
MCG has also been expanding its offerings. Last year, it rolled out Soho Friends, which allows limited access to clubs and events for an annual fee of 100 pounds, or $138. (Traditional full-service membership costs about $3,400 a year.)