After five minutes with Amir Chen, it becomes clear that an investment banker's life is not always a happy one. It may be a well-paid, exciting career but advising entrepreneurs isn't the same as being one. "It's not really getting to the meat of it," says the Israeli-born head of caf chain Apostrophe. So when in 2002 he got the opportunity to advise a group of friends who had opened their own little caf chain a year earlier, it seemed the perfect time to turn his back on a "lifestyle that was quite tiring and all consuming".
Modelled on a traditional French patisserie, Apostrophe's original aim was to bring a bit of Parisienne caf culture to London streets. "You had your Starbucks and your Coffee Republic, but they lacked a strong food offering, and where you had decent food you had terrible coffee," he says. So "it was a great concept". The only problem was that "it was definitely on a loss-making track... none of the shareholders really wanted to spend the time [looking after it]". Chen offered to come in as managing director, saying, "give me a few months to run the business, let's commit to investing a certain amount of money... and by the eighth outlet I will deliver you a self-funding business."
They agreed and after an immediate cash injection of £1m, Chen became MD in May. He immediately began spending time at the company's four outlets, looking for ways to turn it around. Chen formalised every procedure, from rotas to recipes, "making sure there was consistency between different branches". By August, just three months later, the chain was breaking even, and by the end of the year it had reached profitability.
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But finding new sites was tricky. "As a company that didn't have the most beautiful financials and was only working with four branches, it was quite tough." Landlords would demand bigger deposits and stricter contracts than they expected from larger firms. Chen tried to get around this by inviting landlords to his existing outlets so that he could prove the business was sound. "I explain to them how we work, I take them to the bakery, I show them everything, and they get comfortable with it... they see it's a solid business with great attractions."
His approach worked. By the time he was opening the seventh outlet, he had persuaded the Crown Estate to allow him to open another Apostrophe cafe as part of the regeneration of lower Regent Street in London. "That was a great coup for us from then on it was a lot easier having the Crown Estate as a positive reference." He's since developed good relationships with big landlords, such as Land Securities, the Grosvenor Estate, and now BAA, and has plans to open a 12th outlet in Heathrow's Terminal Five next year. "I think there's still a lot of room for us to expand in London. But we're not going to be on every street corner."
With the firm set to turn over £6.5m this year, Chen has no plans to return to the daily grind of banking. "You can continue rolling in banking for many, many years and make tons and tons of money. But I definitely don't miss it. I can see myself staying in this sector it is something that's probably going to keep me occupied for some time."
Jody studied at the University of Limerick and she has been a senior writer for MoneyWeek for more than 15 years. Jody is experienced in interviewing, for example in her time she has dug into the lives of an ex-M15 agent and quirky business owners who have made millions. Jody’s other areas of expertise include advice on funds, stocks and house prices.
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