Carluccio’s founder Simon Kossoff: The interview

The Carluccio's co-founder on the invention of a brand new restaurant concept

Simon Kossoff attributes his career in the restaurant industry to a rebellion against the accountancy and marketing jobs all his university colleagues were taking after graduating from their economics degrees. Not wanting to follow suit, he enrolled on a new post-grad course he’d heard about – international hospitality management. It was the first step in a long career journey which eventually led him to Antonio and Pricilla Carluccio, and one of the most successful new restaurant concepts in the UK.

“I initially just wanted to be a student for another year,” he says. “But during that year I got a real taste for the restaurant business.” With no available grants for the course he’d chosen, Kossoff supported his extra year of study by working in restaurants receiving what he describes as ‘proper experience’.

“It’s still the case, but it was even more so 30 years ago, that to get a career in the restaurant business you needed to have done your time washing dishes and serving customers. For those of us that came from a traditional university education, it gave us the opportunity to get experience under our belts.”

Simon’s first job after finishing the course was in a large hotel in London, but it proved a decidedly unrewarding experience. “I hated it. The management hierarchy – it was so overruled and it didn’t really deliver what the customers wanted.” Nine months later, Simon found himself at Pizza Express, back when the company was still operated by founder Peter Boizot, and the number of outlets was in the tens rather than the hundreds.

Simon established a knack for sorting out management difficulties which lead him to My Kinda Town, an American themed company which ran hamburger and deep-dish pizza joints. The company was eventually sold to Capital Radio, and it was while working for the Radio Café that he met Antonio and Pricilla Carluccio.

The couple already ran a food shop in Covent Garden but Pricilla wanted to extend the business into an all day casual restaurant. “She wanted it to be something that could grow – more of a brand. She had a really clear idea of what she wanted but just didn’t have the skills in her team to develop it, get funding and find the right sites etc. So we came together as a partnership.”

With the idea cemented, Simon and the Carluccios started the gruelling task of securing funding for a restaurant during the dot com boom. “I think it would have been easier for us to raise £200m for an online food venture at that time than the £2m we needed for a bricks and mortar business. Pricilla and I must have done a hundred presentations, but the venture capitalists just weren’t interested.”

After managing to secure some funding from business angels they met up with Seattle Coffee Company founder Scott Svenson. He had recently sold his company to Starbucks allowing the coffee giant to take over all his UK sites. Simon and the Carluccios had been trying to raise the required capital for nearly two years but once Svenson came on board they had the rest of the cash within six weeks.

Simon had managed to keep a site near Oxford Circus on hold until the money came in. The investment documentation was signed on a Friday and the following Monday the builders set to work. It took 16 weeks to finish the first site, but each new Carluccio’s is now finished in half that. The first restaurant opened in November 1999 and was immediately very busy at lunchtimes, but empty the rest of the day. The all day café theme was also not proving financially viable. They simply weren’t charging enough to make any money and knew they’d either have to adapt the whole business model or go under.

“Pricilla had imagined it as a kind of Italian bar where you might pop in for an espresso and slice of pizza but she hadn’t really viewed it as a restaurant. Over Christmas that year I rewrote the menu, put the prices up, added a breakfast menu and extended the opening hours so we could trade from 8am to 11pm.”  Carluccio’s first day of all-day trading was Valentine’s Day 2000 and from that day onwards ‘the whole thing just went insane’.

“We had people at breakfast, lunch and dinner. People came in for take-away coffees and picnics. We’d gone from a fatally flawed business model to suddenly having the most exciting restaurant model any of us had ever seen.” The second site opened a year later in Fenwicks, Bond Street, after the department store approached them and even stumped up the cash to build it. “That was great for us because they invested all the money, it was very close to our first site, and being in the store we had a captive audience.”

However, it wasn’t until the third restaurant that the business became sustainable. Although much bigger than originally intended by Simon, the St Christopher’s Place restaurant was immediately very successful. “It transformed the business from being one that was spending capital to one that was generating cash.”

Another £2m was then raised from the shareholders to expand further. By 2005, with 25 restaurants, the original investors were keen for Simon and the Carluccios to make good on their promise that they’d be able to realise their investment within five years. “We had a few choices. We could have sold the business to another restaurateur or a private equity firm, but I felt the management team still had more to do. None of us wanted to go off and do something else so we floated on AIM. I felt that at least that way we were in control of our own destiny.”

At the point of flotation Antonio and Pricilla sold the majority of their company share while Simon continued with the expansion. There are currently 35 Carluccio’s restaurants but Simon believes there’s scope for 100 in the UK, and is also starting to entertain the idea of international expansion.

Despite his success, he maintains he wouldn’t recommend the restaurant trade to his children, insisting there are lots of easier ways to make money. “Your chance of being one of those people that works their guts out and then runs out of steam is very high, which is why you’ve got to be really determined. It’s a very thin slice of people who make it to the top, but there is great enjoyment to be had in looking after customers.

“I used to stand in the middle of a busy restaurant and feel like I was running a party. This business is too hard to be in if you don’t feel that buzz.”

 

Taken from the book Starting Your Own Restaurant, available from Crimson Publishing and Amazon

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