More picture galleries
(JB) Many people will only ever dream of owning their own pub but for 200 trusting investors in Luxembourg, this dream has become a reality.
On Thursday, the shareholders were able to see how their money was invested at the launch of new Luxembourg tribal bar Zulu Blanc in the Rives de Clausen.
“I don't know anybody else who has used this concept in Luxembourg. It's a mix of crowdfunding and being a real shareholder. It's a business model that's a bit unique,” explained Zulu Blanc manager Steve Darne, who came up with the concept with his business partners in February this year.
Shares were initially floated at a price of 37.50 euros with a ceiling placed on the number of shares an investor could purchase.
Interested investors, meanwhile, were vetted by the management team.
“We had people requesting to buy shares from Astralia, South Africa and the US. But, that wasn't the concept. We wanted to have our shareholders as clients. So they're in their own pub,” Steve said.
Dividends and discounts
Around 200 people were accepted as shareholders. If the business is profitable, they will receive dividends on their investment. All shareholders, meanwhile, receive a 10 percent discount on drinks in the pub and will be invited to special associate events.
The investors who responded ranged from CEOs to young people with no financial investment experience.
“What was very interesting was it wasn't the kind of clients we expected. I figured we would get a lot of 18 to 19-year-olds buying three shares. That would have been my dream, had I heard about this many years ago,” said Steve.
Steve is no newcomer to the world of bars and venue management. Since opening his first bar, The Pulp, at what is today the Sofitel, he has gone on to manage a cluster of bars and restaurants in the Rives de Clausen with business partners Jean-Claude Colbach and Mitch Passos.
More than one shareholder said that knowing this, limited the risk element in their investment.
“These (managers) are people who are more familiar with this kind of project so it's more safe,” said French national Cathrine, who bought 30 shares, and has previously invested in traditional shares and real estate. “It's just the beginning of the adventure. Let's wait and see,” she added.
For Luxembourger Carole this is the first time she has become a shareholder. “I thought it was a good idea for normal people like me who would never be shareholders normally because it costs so much,” she said, adding: “I love the bar concept. I think I will come here regularly.”
For others, there was little expectation about the return on investment. Tom, a Luxembourger who took 33 shares in the company, said: “It's not really an investment for me, it's fun, and a joke.”
For those who missed out on their chance to invest in a pub, it is not too late. The bar is seeking to double its number of investors. However, the share price has risen to 65 euros.
Steve said: “When we did the project, it was just a building site. People had to trust us and believe in the concept.”
He was confident that the shares would all be sold and does not rule out the idea of opening a chain of similar concept bars in other major cities around the world.
Do not miss the news - sign up to receive the wort.lu newsletter in English delivered to your inbox six days a week.