One to watch
● Company: Nine Group of Hotels
● What it does, in a sentence: Hotel owner
● Founded: 2011 in Watford, Hertfordshire
● Founder/s: Vivek Chadha
● Size of team: Currently 800 people across the 18 hotels in the portfolio. Continuing to expand
● Your name and role: Vivek Chadha, CEO and Founder
What problem are you trying to solve?
We’re aiming to address a lack of supply of great hotels that people love and wish to do business in. We want the next generation to use our hotels as their offices and meeting spaces for no cost. We want to create a great atmosphere where our guests can do business and socialise at the same time.
How big is the market – and how much of it do you think you can own?
My goal for the Nine Group of Hotels is to be the largest private hotelier in the UK with over 100 units in key areas. Our market is worldwide and we are expanding into continental Europe.
How do you make money?
We make money in two ways. Firstly we love real estate and believe in the traditional culture of owning hotels. I believe hotels are the best real estate class to own and as such we make money by the value of our hotels appreciating over a period of time.
Secondly we make money because guests love our hotels, making our trading extremely profitable. We believe our hotels are more profitable than others simply because we know how to ‘sweat our assets’ by making our processes efficient and straightforward. The culture of owning your business is in our company and as an owner and operator myself I believe in instilling this culture within all our employees.
Who’s on your team that makes you think you can do this?
I have many stakeholders who without whom our success would not be possible. Brands like IHG, Accor and Hilton have supported me over the years. These brands believe in us because we have consistently shown we can deliver 3 or 4 hotel openings per year. Our growth rate has been one of the fastest in the country and we have a great relationship as a franchiser as a result of this.
Who’s bankrolling you?
When I first established Nine Group I was bankrolled by very small banks you may not have heard of. Today we are bankrolled by the largest banks in the world including Santander, HSBC, Coutts, RBS, Bank of Singapore and Metro. In the future we will look to consolidate to one major bank.
What advice would you give other entrepreneurs trying to secure that kind of finance?
Have the right attitude and don’t negotiate too much! A relationship is much more important! When you want to buy a hotel that no one believes in but you know you can make millions out of the asset in the long term, the only person who is going to listen to that story is the banker you have built a great relationship with. It doesn’t matter if they are 75 BPS more expensive.
What do you believe the key to growing this business is?
Trying to be the best in my industry and concentrating on one goal in whatever I do is the key to my success so far. My main goal is to become the largest private hotel operator and developer in the country. I don’t want to be the best in in any other industry.
What metrics do you look at every day?
Before I eat my breakfast, I know exactly how each and every hotel in the group performed the previous night from its average daily rate to total occupancy. I also look at weekly and monthly forecasts to ensure we are on track to hit our annual budgets. I review the progress of our new developments every day to ensure we will open our hotels on time.
What’s been the most unexpectedly valuable lesson you’ve learnt so far?
Learn from your elders. I am only 30 so I have not seen many business cycles. I listen to what the older generation of hoteliers are doing and try to use their philosophy in parts. Combine that philosophy with your growth plans and there’s a lot of lessons to learn.
What’s been your biggest mistake so far?
Not listening to my instincts and listening to people much more risk-averse than me in my early years. As a result of this I have not purchased hotels that I have seen go on to more than double in value.
What do you think is on the horizon for your industry in the year ahead?
Airbnb type of concepts. Essentially, serviced apartments with great retro food concepts as part of the development.
Which London start-up/s are you watching, and why?
I’m keeping a close eye on the potential prospects and opportunities of restaurants with rooms.