Eugene Remm on Scaling the Right Way: 'You Can’t Fake Hospitality'

0:28The success is in the deal. My name is Rich Kleiman, and today we are in Soho, New York with a very dear friend of mine, a very successful restaurateur and entrepreneur. And I'm very excited to talk about his journey and about two of his red hot establishments in New York City today. So please welcome to the show my friend, Mr. Eugene Rem. Thank you so much for what a wonderful introduction. I appreciate it. Excited to be here. I'm excited to be here too. And this restaurant is one of the hottest restaurants period I think we're probably an hour or two from opening do you still get the same type of excitement being at one of your places every day I think I never got too excited even when I was younger in the business I think I was always looking for what was gonna go wrong success is it's a rarity it's not a given some people are like super surprised like when something doesn't work I'm surprised the other way I'm surprised when everything does work so for me to have the amount of people who work in this restaurant they're all excited and that gives me excitement And I think just it all feeds from each other.

1:28But what I am most certainly is grateful. I am blessed every moment that I walk into these stores. I'm grateful for these stores. And I and I'm just super happy to be in them. I was at the 86, your new establishment, and I watched you and you were in it. Right. And it's your place. And I would imagine that every great restaurant tour or hospitality mogul knows that ultimately they've got to be on the grounds. Yeah. Go to La Bernardin and you still see Eric Prepare walking all around the restaurant. Is it imperative for you to still be in it like this every night? I think in the early stages, whether it's a child, whether it's a business, whether it's anything, you have to be there in the beginning.

2:0510 years ago, maybe you had to be in it every night for a year. Five years ago, maybe you had to be in it every night for five months. Now, it's gotten less and less. But I will tell you this, the corner store when we opened it, I think I counted, it was 98 days straight. In the second week, this place got white hot And we didn't plan to have a security guard on Sunday night to be at the front door. And I was like, no one's here to do security. So I just stood there from 5 p.m. to 11 p.m. and ran the door of the corner store and said no, because it was getting overwhelming where people were just coming in and just trying to get a picture and just trying to like be part of it.

2:41But the team that we have, they've been around for a really long time. They understand where we're going and what we're doing. And I have specialists. So the answer is if you're getting better at your business, hopefully with time, it becomes less and less. And as you scale, like in the last 12 months, we've opened the corner store, catch Dallas, catch Scottsdale and the 86. So there's no way you can be in all places at all times. You have to put people in place to do a good enough job. And the last thing I would say on this is as I scale, maybe one store will always be an A plus if I was in it every day, but I'd rather have 10 A minuses than one A plus because that's much more of a scalable business.

3:18Yeah. And is that just like that extra attention and a detail that may get lost without you on the floor? I get to focus on the 1 % because the team has done the 99%. If I had to sit here and make sure that all the monitors were on and all the registers were set and all the traditional stuff that happens in the pre-opening of a night, I don't know that I would ever get the chance to pay attention to that 1%. That is a difference from good to great. That's the difference of just a good restaurant that you thoroughly enjoy to like, man, this is culture. This is of a moment. This is New York. Speaking of culture, I've seen before on Instagram these kind of motivational speeches that you give to your staff.

3:55Understand it's a special moment. Understand this is the seed that plants a tree. If you look at a big tree, you would never believe it came from something this small. Social media has a lot of people selling a lot of stuff. And the most authentic way for me to share how I feel about my business is through these pre-opening kind of like speeches. This is how I share my love and care. And I want to share that. And I think if it helps people in other businesses, I'm down for it. To have sustained relevance and sustained success, there must be some method for you in your hiring process and what the hiring culture looks like.

4:26We hire people who care. We really care. It's not about being cool as a team. It's about making sure that the guests have a truly great experience. And I want you to walk into any space that I'm involved in and be like, I knew that host was going to be nice no matter what. I knew the lighting was going to be right. I knew the music was going to be right. I would argue that there's a lot of restaurants that do food and service really well, vibe not so much. And there's a lot of great vibe places and food and service not so much. Now the key is, can you hit on all three? And can you treat them all with the dignity and respect that they deserve?

5:00And that's the key. So if you could focus on the food, the service, and the vibe and hit all three of those things, that's when you have the trifecta. And I think that's what makes it unique. Do you prefer that staff are people that want to be in the restaurant business? This business is a platform to whatever it is that else that you want to do and I don't expect you to stay here for your entire professional career There's always stops on the train. Yeah And different people take it all the way up to the Bronx and some people are getting off that you know Whatever 34th Street, so not everyone is meant for the long way, but while you're here Take care of each other take care of the staff take care of the guests Those are the three principles so we lead every decision with what is best for the team overall our internal team.

5:42And then once that's set, they're like, all right, what's the best for the guest? And then ultimately that's gonna pay the bills. So don't make any decision where making the money is the first and foremost priority. And if you do that, you will probably make the most money. So let's talk about Catch for a second because Catch is on this 14 year run, right? As you talked about like food service vibe, but when you build a brand, that's a whole other variable. And, you know, I'm somebody that can acknowledge like a great brand, a strong brand. Explain a bit about like the concept originally, how you've started to build that restaurant and that following while maintaining the brand.

6:24And then over time, how you continue to like manage that brand equity as you scale the business. Originally, we started in the nightclub business and there was a restaurant above us. And we looked at that restaurant above us and we're like, I think we could do this. in 2011 when we opened it was like why would you ever have dinner with less than 16 people yeah why would you ever have dinner before 10 p.m and why would you ever not want loud music i wouldn't even understand it so i think in those days we were a nightclub company that did pretty good food and that's how the brand was born and one night i'll never forget it i'm standing there on a tuesday at five o 'clock and we're on like an hour wait right out the gate and i realized we're not paying attention to the restaurant while the nightclub is the one that's getting all our attention, which isn't even making the most money.

7:09So there was an aha moment for the entire team where we're like, okay, we're no longer a nightclub company. We're a restaurant group with some nightlife DNA. And that was the pivot. And it took some failures to make those pivots. But we realized by expanding into other restaurants that didn't work so well, and they failed, like, let's just call it straight up. They failed. Catch was the engine that could. When you start, I mean, neither you and your partner Mark Birnbaum at the time were food guys, right? Like you were. No, we were not food guys. We were nightlife guys. We loved, we loved the clubs.

7:40We loved the lifestyle. We, we, I mean, we appreciated a good meal, but honestly, I could barely afford a good meal. We didn't have the money to go out like that. And I think as we became a bit more successful, we kept pushing the food product and then our chef team kept pushing the food product. And then our ops team kept pushing the level of operations. And then every store seemed to be getting better and better. From New York, then came LA. And that was a huge success. And when New York and LA hit, that's when Vegas noticed. And that's when we got our deal with MGM at the Aria. And from there, we expanded into the catch-stake concept.

8:18And then during COVID, our partner, Tillman Fertitta, his view is to always grow. We signed three deals. We're really aggressive. And we got Miami, we got Dallas, we got Scottsdale. So those are the new ones that have launched. So as I've grown, as a team has grown, as our tastes have matured, even Catch, its own brand has evolved. And it's so hard when something is super white hot to contain it. So you either go up and fall down. So our job is to make sure when we got up to land it evenly. So that's where we're hoping Catch is today. And right now we're doing, you know, we're in the plans to do a massive multimillion dollar renovation on the original, which will launch next year.

8:57So, yeah. When you've managed a brand and you've run your own business, to find the right partner is the challenge, right? So you mentioned partnership with Tillman Fertitta, and that was in 2017. Clearly, he had the pedigree. But what was the expectation of that partnership and the vision from that moment? The idea is to scale, but how do we maintain this and what can we get from this infrastructure that we're now partnering with? Finding the right partner is important and picking the wrong partner can absolutely end your business I think finding someone who understands and is in your business is a really great place to be and someone who's in it for more than just The money of tomorrow, right?

9:37So if you're working and the only thing you need to do is I need to hit 20 % margins year over year over year You can't build a brand what you're doing is just feeding the machine of that year And if you're looking at everything in a one-year two-year even three-year business model, I think you're in trouble. And the great part with Tillman and the Fertitta family and the entire Landry's organization is they have a long-term view on everything. And because he's in the business when things were great in 2019, he expected it because things were great at all places. When things went down during COVID, he expected it because things went down.

10:09When things exploded post-COVID, when everyone had crazy fake money that they didn't even know where they came from it's all part of it his perspective is take care of the best people find great locations what do you do when you have one location get two after two get three this this one to ten notion ten to a hundred notion a lot of young people get excited about i'm going to grow a brand i'm going to build a business but the reality is they don't focus on going from one to two to two to three and they focus on this big macro thing so the partnership had a lot of benefits number one the structure systems and process things you don't think about a lot like hr and accounting and construction, but those are the things that'll topple you.

10:46And because he had all that infrastructure for 40 years, it allowed us here based out of New York to really just focus on the creative and the brand and the fun things that people see. But there are parts of the business that are not that fun that are crucial. So let's talk about Corner Store in 86. Let's start with Corner Store where we are right now. This thing came on the scene and just like exploded in popularity. And even talking to you about it leading up to it, I could see this like new kind of like startup founder energy in your eyes. Like you knew you had something in your mind. You had this concept.

11:19You had this piece of real estate you were excited about. What you heard in my voice and in my mind was fear. That's what I really had to do. It felt like excitement. Yes, which is what unfortunately gets me excited. So I need to get uncomfortable to do anything creative. But I think everything that we've ever done had the word catch on it for the last 10 years. So I didn't know how the menu was going to flow. And I didn't know how the tables were supposed to be sat. And I didn't know how 70 seats were supposed to work because I'd never been in a 70 seat restaurant to operate. So I was really worried about it.

11:48At the same time, I kind of had like an effort mentality. I was just like, let's just go for it and see what happens. So the first thing was I wanted a local spot that I would generally like. Where can I go for a business dinner at five? Where can I go with my wife at seven? Where can I go with a group of guys that just wanted a night out at 10? It was supposed to be just a cool Soho spot. And comfort food, right? Was that ultimately some of the concept? Look, I'm from New Jersey, so, you know, I want everything on the menu to make sense. I don't want to make people feel stupid. And it's also really hard to make simple food interesting and really good.

12:26And that's what I think we are very good at. And that's what we focus a lot of our time. We're straight down the middle. We know who we are. We are unapologetic about what we do. And this place is like, hey, this is American cuisine. And yeah, I'm going to have a pizza roll on it. and it's going to be made from five different types of cheese, but we're still calling it a pizza roll, and that's fine. And we're going to do things that are fun, and we're not going to take ourselves too seriously when it comes to the branding. When it comes to the execution, we take it very seriously. You know, for the first week or two, we were just taking reservations and figuring it out, and we're like, hey, come on, walk on in.

12:59I stood at the door and greeted every single guest from 5 p.m. on and checked if they lived in the neighborhood. If they lived in the neighborhood, we gave them, you know, a special code so that they can get reservations. Did you think it was going to be a neighborhood spot more so than this like magnet for like the most influential people in New York? Yes. You did. 99 % with the 1 % of I wonder if it could be this other thing. Yeah. But it was really in the background. It wasn't like, oh, we're going to be the most exclusive and hottest place in New York with all the most famous people coming here every single day.

13:29Like that, I would vomit on myself if I even heard myself speak like that. It was like, all right, people are going to like this because this is going to be authentically New York. I think about like throughout my time in New York growing up, there have been these restaurants that like there was no phone number, the Waverly Inn, right? The spotted pig in the beginning where you just couldn't even imagine getting a reservation unless you wanted to wait for a few hours. How do you juggle that? And like, what is your reservation policy? We're much more structured than that, right? So we have a full team.

13:57Like we have an army of 78 people. So it is not something super simple. And I think the reality is there have been a bunch of people who have supported the business for the past 15 years. They are priority number one, two, and three. If you meet my vision of what we think a New York spot should be, I want you here. Greatness in all different aspects of this thing we call New York City. So I love the idea of a CEO of a bank next to the CEO of a music company next to even, you know, a young 25-year-old startup, you know, tech company. Like, I love that. And that curation is the most fun part of it for me.

14:34celebrity is no different than business people. They're the best at what they do. They are in the 1%. And when they are in a room, it makes the room feel better. And I'm not, I didn't make those rules up, but those are the rules. So we're happy to have them, but in an authentic way. It's a mentality of just get in here and be a New Yorker like everybody else. Celebrity can either be gasoline or water on a fire. So you have to just be really careful. So what we've done is kind of disappeared. So if you think about the cornerstone, the only thing we post on our social media is when we talk about our cocktails, our food, or our staff.

15:06But it's hard. You have to do the opposite of everything that came natural to you when you were in the nightclub business. In the nightclub business, someone famous comes in, you want to tell as many people as possible because that is the hype that allows you to sell a$20 bottle for$1 ,000. That is the only fairy dust that gets someone excited to pay that. And a restaurant will stand true on really good food, really good service, because that's hard to do. So the key, I think, for us is trying to be iconic. What makes you iconic? You surpass the length of time. Do you turn celebrities down sometimes for reservations?

15:38If there's 70 seats on a plane and you're number 71, then yeah, I mean, we don't, I mean, look, we'll make things happen if things need to happen. If there's a friend of mine for 20 years and that night, he, it's a 640 second visit and I'm like, yo bro, I need you to eat at the bar tonight with your buddy, then I think we can make an exception. Is a place like this not something you can scale to multiple locations because of what it's supposed to represent? I don't know. Because iconic New York venues, for the most part, I could be wrong, aren't scaled, right? Like they're not a pier, maybe Vegas, but you're not going many other places.

16:14I think this generation's iconic spaces should scale. And I think people who want to make a good living and create good opportunities for their team members need to scale because that's the only way to grow the pot. I don't think you could blitz scale, which is like, I'm going to open 10 of these in every single block. It's not a franchise. It's not a burger joint. It's not a bagel shop. It's not any one of those places. There's too much character in these. But find a place that works in another market where that market would really vibe with what you're doing. Then you do it. Yeah, and to be honest, not comparing the two brands, but to your point earlier, catch didn't blitz scale, right?

16:51Like you were very strategic in it. No, and when we weren't strategic, we failed. When we were chasing the dollars, we did a franchise agreement in Dubai in 2013. Disaster. Failed. When I chase dollars, at least I can talk about myself personally, I have failed. When I create things or I'm part of a team that creates things that fit, and there's like a special space in Los Angeles, and it was born to be a catch, then you do it. Now your newest baby, the 86, and probably my favorite space in New York City on Bedford Street, the old Chumley's. Yeah. Like a prohibition bar from back in the day with the little door with the slide window.

17:25That's real. Yeah. I mean, that space is epic. I went to eat there. And as I told you, you nailed it. Thank you. The vibe, let's start with vibe, was absolutely incredible. Food service, incredible. It's a special establishment, right? Like, and there's how many tables in that? Ten. Ten. We're the custodian of the space. the space speaks for itself right like there's so much history it's our responsibility not to like mess that up we paid homage to what it's supposed to be we gave it our interpretation on it and honestly what i know that i want from it is an amazing 10 table restaurant in the heart of the west village seven minutes from where i live so i can walk to there check on it see great people and once those 10 tables are full there's nothing to talk about yeah so my research told me before where you're the most in demand on Resi.

18:11I don't know what that means, but I think that's a good thing. When you limit supply, you increase demand. It's a simple formula that's thousands of years old. And when you increase demand, when people get there, they feel a specialness. When there's two things for that. One is they're gonna enjoy it because they're happy to be there. But two, it puts a lot of pressure on our team because we have to deliver. Because if you wait and wait and wait, and then you finally get into that experience, and then we don't execute again on those three pillars, food, service, and vibe, then you're like, all that for that?

18:37And then, you know, that's the unfairness of this business where, you know, if you have a bad day, it's not like we can say cut. Let's say that again. Like it's an interactive off-Broadway show where every night that's all that customer knows it to be. They don't care how the other 364 days were. 300 seats is the catch brand. 75 seats is the corner store brand. 35 seats is now the 86 brand. The goal is to build a hospitality brand that has a lot of different sub-brands in it. And the idea is you don't want the same experience every single night. You're doing a great job. Thank you. So how do you vet new now, right?

19:13You have 300, you have 75, you have 35. You have this incredible partnership that allows you this flexibility to try things. Or do you feel like your plate is full? No pun intended. No, my plate is not full. I will never feel like my plate is full. I am constantly moving and looking for new things. Doesn't mean I do all of those things, but I'm constantly looking. So we signed a lease across the street from the corner store. it was the Principe space and we're opening a new Mediterranean restaurant in January with Chef Nadav Greenberg, who's a Michelin star chef. We're doing a big renovation of Catch New York in March.

19:48There's something in Vegas that we're going to announce. So the key is to see everything. And this way, you know what you should take and what you shouldn't. Once you get into one of these things, one, it's millions of dollars. Two, it's multiples of years. And if it doesn't work, it's hard. the success is in the deal not even in whether you're successful so if you do ten million dollars of revenue and make a million dollars but you spent seven that's a bad deal yeah corner store 86 and the space across the street they're all second-gen restaurants so we're taking places that already have infrastructure already have a basic understanding of where things go so they're one less expensive they're faster to turn around and you have an understanding of what you're working with so that puts you into a better position to be successful before you start most restaurateurs don't understand this so you you have to be very careful about the deals you make and really focus on the financial side of it no one no one shares that when you talk about the sexiness and the excitement but that's the part that i spend a lot of my time on do you even take outside capital anymore in the structure you have um i never want to say never but right now the idea is that we do everything internally we use our own cash, we do our own deals, and we control our own destiny.

21:01Amazing. Is New York still in your mind, or was it ever, or is it now the best city for food and dining? I think for me, there's no place I've been on planet Earth that makes me feel like New York City. There's no group of people I feel more connected to than New York City, and the energy and swagger and vibe that I feel today. I feel that New York is at the epicenter of all things, cultural, food, beverage experience, lifestyle, all of it. So you think New York hospitality is in a good place right now? It feels like it's in an interesting place, right? I think that hospitality is in an interesting space because there's no middle anymore.

21:40Yeah. There's either the places that are red hot, that are amazing, or there's the places that are ultimately and utterly convenient or inexpensive, and you go there for price or speed. And I think everything in the middle is dead. When any business lives in extremes, it's probably not best for the overall business as a whole. But for us, you know, as we live on that one side of extreme experiences and curating those three pillars, I'm good with it. Yeah, so the entire world is living in extremes right now. It feels like moderation of any kind does not exist. But what I'm learning, though, is I'd rather lean on the side of amazing experiences because I'm good at those and our team is good at those and it's very different than trying to make five cents on a burger concept it's just not what I do and what I've learned is I don't like get up in the morning like what will make me the most money today I kind of think about it like what's gonna make me happy today what would I like to eat what would I like to enjoy what would I like to call you and actually say yo you should come try this new thing I think you're gonna like it yeah if I can't say that authentically I probably shouldn't do it.

22:47I'm excited for your new spot. I'm excited that I am lucky enough to be able to get a table here at the corner store and at 86. And it's been fun watching your constant evolution and and the pivots and the successes, man. And I'm excited to see what's in the future. And it's been incredible catching up with you, bro. Learned a little bit about you, man. Thank you. I appreciate you taking the time and congrats to you on all of your success. Thank you. Appreciate it. Well, thanks for tuning in to another episode of Boardroom Talks. Again, this is eugene rem restaurateur catch 86 the corner store and much more to come tune in go to boardroom subscribe listen all that speak to you soon