The famous celebrity hotspot Soho House has accused analysts of launching a share ruse to rake in millions – by claiming the prestigious venues are ‘overcrowded’.
Soho House – where the likes of Taylor Swift, Margot Robbie and Leonardo DiCaprio often visit – is embroiled in a row after a financial analyst’s report said it has expanded its notorious exclusive membership too quickly.
The report by GlassHouse Research claimed the result was a ‘decline in service quality’ with ‘longer wait times’ and reduced ‘personalised attention’.
It concluded that the value of the company after 28 years of losses ‘is a zero’. But the private members’ club hit back, claiming the report was inaccurate and ‘misleading’.
The company said the report was deliberately negative in an attempt to drive down the club’s share price so that GlassHouse could benefit from short-selling.
Short-selling is a when investors borrow a company’s shares to sell, hoping that the price will fall so they can buy them back at a cheaper price before being returned to their original owner.
The 31-page report titled ‘Soho House & Co: A company facing an existential crisis’, described the club as a company with a ‘broken business model and terrible accounting’. After it’s publication, the company’s share price went down by 30 per cent, The Times reported.
It read: ‘Eerily similar to WeWork’s public offering, we believe SHCO will eventually meet the same fate as the now defunct co-working space.’ The report pointed to a ‘persistent lack of profitability’, issues with ‘overcrowding’, and a ‘perceived decline in service quality’.
Some of the concerns raised in the report were echoed by former members of the club. The Times reported that one member of the prestigious club let his membership lapse because it was now ‘the All Bar One of members’ clubs’ and it was ‘opening their doors to everybody’.
The newspaper said that another former member said the clubs were ‘overwhelmed’ and it is ‘hard to get decent service’. Soho House was established in 1995 for ‘creatives’ in London by Nick Jones, a British entrepreneur.
Full membership, with access to every venue across the world, costs nearly £3,000 a year. Membership to one club starts at £850 but rises to above £1,000 for many, depending on the location. Venues boast swimming pools, spas, gyms and even bedrooms.
The application process is comprehensive, requiring prospective members to provide a biography, explain what they can contribute and whether they already know existing members. The club has a membership committee of those who already have access which make the call on who may join.