Dubai If there's a happening party tonight in town, Joe Tabet wants to have first rights to it. More precisely, he wants his Cavalli Club in Dubai to play the perfect host to all the well-heeled, the chic and the trendy who are invited to these dos. The message seems to have filtered through loud and clear as the Club passed through the recession without missing a — dance — step.
Now he wants to spread the Cavalli cheer across a network of global hotspots, starting with locations in the Bric countries. Tabet reckons that for someone who wants to just have a good time, there's no such thing as a down time dictated by how the economy is doing. It's to them that Tabet wants to make the perfect pitch of ‘Cavalli equals Cool'.
Tabet, founder of the Pragma Group, explains how he's not just into thinking big, but can actually get it done.
Gulf News: Some would argue that a global expansion of the Cavalli Club franchise in these uncertain times can be difficult. How are you looking to mitigate the risks?
Joe Tabet: Whatever the Pragma Group operates today under its lifestyle side of the business, it's with 100 per cent ownership. That includes the Cavalli Club in Dubai, the Billionaire Square and the other F&B concepts here and in Lebanon.
To take the business to the next level, what's happening now is we have joint ownership in any new franchising agreement for new locations.
What about the Pragma Group itself?
Pragma is an investment and management group. We started off by focusing on technology and then moved into lifestyle. This way, we tried to combine the art and science of these two segments. That reflects our philosophy and character at the same time.
Pramga Technologies — and all the entities that come under it — is, and will, remain the core of the Group. It was the cashflow from technology that allowed us to get into lifestyle — when you trade in billions of dollars in one, you get the tens of millions needed to finance the second.
With the Cavalli association and the other concepts we introduced, there is the impression that we are predominantly a lifestyle company. It's not the case. Having been formed in 1987, Pragma has been through all the tech revolutions the region has seen — starting with the PC, moving into telecom, ERP implementation and consulting and then in gaming.
But I am a person who loves the good life and to get into lifestyle was logical, and eight years ago the Pragma Group did just that.
How did you effect that? And when did the association with Cavalli come about?
We started with a fine dining restaurant in Beirut, for which we worked out the concept with one of the leading chefs in France. It put us on the map. After a couple of years, we were ready to come to market with another, the Club 400. This gave us the first exposure in clubbing, and it was this which gave us the link to Cavalli.
It's the happening night spot in Dubai and used to host a lot of celebrities. We met Roberto Cavalli during that time and he wanted to do something over-the-top here. The timing was perfect — Dubai was booming, there was a lot of money and euphoria around. That set us off on a Dh85-million programme which culminated in the flagship Cavalli Club Dubai.
We had just one request to make off Mr Cavalli: "If we make it happen in Dubai, you give us the brand to take in internationally." And he did, just over a year-and-a-half ago.
Where will you have the new locations?
We are focussing on the Bric [Brazil, Russia, India and China] region, these are markets that are hungry for such concepts. We will franchise the concept, own 50 per cent in each property and manage it. That gives the partner the belief that we know what we are doing, while for us it means we can ensure the continuity of the brand.
But in territories such as Lebanon, we will own and operate the concept.
You talked about investing Dh85 million in the Cavalli Club Dubai. Will the new ones match this scale?
No way, each would cost between $8 million and $12 million, depending on the country and the location. The economies of scale are different here, which is why for the Dubai property, we will continue to invest and reinvest in adding new features.
We have already initiated talks for locations in Mumbai and Delhi, and they could have the same space as in Dubai, but certainly not the same scale of investments. In Istanbul too, the size could be the same.
How did the Club fare during the downturn?
We were growing between 35 to 40 per cent, and this year we are looking at a doubling. Even in a crisis, people with a lifestyle to maintain cannot stay at home and mourn all the time. Cavalli is a high-end lounge, a fine dining restaurant and after hours a club. Because of the recession, the clubbing aspect got highlighted more. And, yes, the margins are higher.
But it's a place where the entire family can come and have a good time, not just a certain age group. That's what the new marketing team will work to re-emphasise. At the Club itself, we will work to create a synergy among the crowds and on the floor. It's a spot of different areas that the Club will aim to be. I don't think it will take more than a couple of months to get it all right.
Any chance of a second Cavalli Club in the UAE?
It will not be the Club, but we are thinking of a Cavalli Cafe in Abu Dhabi. At the same time we acquired the rights to the Club, we got it for the Cafe, which will be a high-end delicatessen. Right now we are finalising the concept for the first one in Beirut. After that we will be ready to roll it out in Abu Dhabi or Saudi Arabia.
You have a lot of investments directed at Lebanon. Don't the recent headlines faze you?
I have seen it all, right from the first day of the War to what's happening now. There have been testing times and happy ones. Something happens and people are off the streets for two days, and then they are back out again, doing everything in a rush.
But don't go by recent headlines — the banking sector in the country wasn't that affected by the recession, nor was the tourism sector.
You have also set up a fund to develop the Cavalli Club concept. How's it shaping up?
I will correct that, the fund's for the entire range of Pragma lifestyle concepts. It means the fund the fund will contribute to the Cavalli Club expansion, create franchising opportunities for our own concepts in the region and outisde.
Anything on the drawing board?
We have acquired a new location, a prime one, in Burj Khalifa. Now in the coming weeks we will work on a cafe or bistro concept to launch there.
And in time, all of the additions within the lifestyle side of your business would add up to 20 per cent and more of the Group turnover?
Right now, it's in single-digits, and the short- to medium-term target is to get it up to 10 per cent and over. But the limelight and profile that the lifestyle side draws is beyond any measure. I like that.
Specialist firms: Tech fund mulled
The Pragma Group is weighing prospects to launch a technology fund that would pick up equity in specialist IT companies in the region.
"We are veterans in the IT space since 1987 and there are quite a few things we know," said Joe Tabet of Pragma Group. In fact we are the right people to launch such a fund."
