3 · Club economics

💡 Revenue, capacity and margin sensitivity. The assumptions must be reconciled before presenting a forecast to investors.

Revenue actually collected

Using the dossier’s assumptions: €179 including VAT ÷ 1.20 × 95% realization × 97.6% collection = €138.31 per member-month, or €1,659.69 per year.

Ancillary sales are assumed at 12% of membership revenue, with a 55% gross margin. These amounts are calculations under fixed assumptions, not realized sales.

Capacity consistent with the building

One candidate property’s 1,335 m², divided by the assumption of 1.5 m² per member, gives approximately 890 members. Yet parts of the dossier assume 1,200 members. The model must use the same building and capacity across all its sheets.

This ratio is a planning assumption. Actual capacity must be established from peak-hour usage: class seats, gym floor, recovery, showers and changing rooms.

The initial minimum of 1,000–1,200 m² applies to the full program with a gym floor, studios, recovery and social space. It does not automatically apply to the compact format.

Break-even still needs reconciliation

The initial study states 66 to 79% of membership capacity at break-even, depending on rent. The costs in the export do not reproduce these results. A workbook with six tabs and 189 formulas is mentioned but absent from the published dossier.

Verification must bring together rent and service charges, payroll and instructors, energy, cleaning, insurance, software, payment fees, marketing, maintenance and equipment. Each cost must be counted only once. No projected EBITDA is validated at this stage.

Margin sensitivity

Taking 66% break-even as an assumption, the other exported parameters produce an 87.08% contribution margin: ancillary sales and their cost, consumables at €76.25 per member-year, and marketing at 4% of revenue.

Formula: 87.08% × (capacity utilization − 66%) ÷ capacity utilization. Fixed costs are derived here from the assumed break-even point; this simulation does not validate their amount. Rent and equipment lease costs must be included when assessing operating performance.

At 80% of membership capacity, an actual break-even point of 75% would reduce that margin to 5.4%. The profitability of a comfortably busy club matters as much as that of a full club.

From site profit to return on capital

Distinguish site contribution after rent and operating costs, central overheads, group EBITDA, then maintenance investment, taxes, working capital and debt service. An EBITDA margin alone does not measure cash available to the investor.

In 2024, Soho House reported a 26% contribution margin at House level, compared with approximately 11% adjusted EBITDA margin at group level. The scopes and denominators differ; this comparable illustrates the transition from site to group without providing a target for the chosen launch market. Official 2024 results.

Opening investment must include fit-out work, equipment paid for upfront, pre-opening expenses, contingencies and ramp-up cash. The approximately €200k of equipment mentioned in the study is not a complete opening budget. Without fit-out quotes and a cash-flow plan, the payback period cannot be defended.

The compact format’s own economics

Removing the gym floor could reduce space and equipment needs. Members then use class seats and instructor time: their marginal cost cannot be assumed to be close to zero.

Build a model from the number of classes, seats per session, actual attendance, instructor costs and visits per member. Test the investment and operating costs of a compact recovery space separately.

Acquisition: a budget assumption

The €334 used in the initial study is an acquisition-budget assumption. Deriving it from a marketing budget of 4% of revenue requires explicit assumptions for attrition, new members needed for growth and lead conversion.

Measure the cost per paying member and its payback period from the contribution actually generated. Stated intent or cost per lead does not establish a validated acquisition cost.

Ancillary sales: choices in the initial study

The following items remain assumptions to recalculate for the chosen building and traffic. They must not be used to offset a structural loss in the club.

Reselling food supplements: yes

5.5% VAT compared with 20% on memberships, a reasonable gross margin, low stock, fast turnover and, above all, consistency with the performance/longevity positioning. This is additional revenue that does not consume floor space.

Branded apparel retail: no

Opportunity cost: €34,690/year. The reasoning: space allocated to retail produces neither memberships nor services. At the margin per m² of a club at this price, an apparel corner needs sales volume that traffic from a 1,200-member club cannot generate. The brand is better expressed through items provided to people (staff uniforms, onboarding gifts) than through a shop. This is not a judgment on merchandising: it is a floor-space allocation decision.

Pre-launch: €677,000

The €677k stated in the initial study represents a modeled reduction in the cash-flow trough between opening from zero and opening at 40% of capacity. This amount is neither collected presales nor secured funding. Presales must be measured through paid commitments, then incorporated into the actual schedule for fit-out work, opening and cash collection. The financial workbook is mentioned in the working notes but is not attached to the published dossier. Margins, break-even and opening funding must be reconciled in it before a fundraise.