This article was written for Stone and River by me, Lucy Orr-Ewing
I interviewed Chris Miller from White Rabbit Fund on what his thoughts are with regard to Value Creation in Private Equity. His meticulous approach is turning heads in the Private Equity sphere and he was fascinating to talk to. Have a read!
“I’m obsessed with the customer experience”Chris Miller, Founder of White Rabbit Fund
Chris’ passion for customer experience and his forensic attention to detail developed early in his career when he worked as Commercial Director for Soho House Group. His former boss, Nick Jones, is an obsessive perfectionist and has proved that scalability should not come at the cost of quality experience, which is something Chris clearly instils in all the brands he works with.
Chris founded the White Rabbit Fund in 2016 whilst still working at Soho House. Initially he began ‘moonlighting’, giving early stage investment advice to upcoming restaurants such as MEATLiquor. Chris learnt to spot true business value when he worked in corporate restructuring. Rebuilding businesses from the brink of collapse fuelled his excitement for the industry; this passion is immediately evident when speaking to him.
White Rabbit was born out of a lack of something similar in the market. It is one of a few funds that offer a hands-on approach, falling in between huge investments from major private equity funds and more informal rounds of crowdfunding without advisory help. It emulates the incubators and accelerators of the tech world, dispelling the ‘them-and-us’ aspect of more traditional investor-portfolio relationships.
White Rabbit’s investments are early-stage when brands have 0-3 sites and need financial advice, frameworks, and industry expertise. “Private equity used to be about coming in and helping with a roll-out plan for 20 restaurants a year,” Chris tells us. “Those cookie-cutter rollouts just don’t work anymore”.
Chris’ approach is refreshingly balanced; he’s just as fanatical about numbers as he is about people and brand, “I find someone creative then I do the boring stuff and put in basic structures and aim to make myself redundant as quickly as possible”.
“I try and build on what people are really good at and evolve the day-to-day. The DNA is in the founder and if you take it out, you risk very quickly killing the brand”Chris Miller, Founder of White Rabbit Fund
He has a team of experts that work around him: a Head of Operations, a Head of Marketing, a Head of HR, and a senior exec chef who specialises in making food profitable. The benefit of this model is that Chris can bring in a trusted team of experts at an early stage in the investment and growth plan, when the founders might otherwise not be able to afford that level of expertise. It also enables the founders to be freed up creatively to deliver their original vision for their business.
The size of Chris’ portfolio means he can tailor each site with careful consideration and keep them continuously improving through a keen eye for consumer experience.
White Rabbit currently has four brands in its portfolio: Kricket, Lina Stores, Island Poké and Kym’s. On the surface they have little in common, but a step inside each links the brands inextricably through a palpable obsession with quality and design. They are “somewhere you’d be proud to take someone on a date to”, Chris says.
While food is the keystone, Chris believes it isn’t enough to differentiate you today: “you need to start with a good quality proposition. That’ll last you about two years in London. Then it’s all the other things that keeps people coming back”. Channelling Soho House and its “famous overspends”, Chris spends time and money generously on making each site above and beyond the norm. “Lina’s is definitely not the only restaurant out there doing Italian food. But it’s about doing something that people know and love and doing it a bit better. With Instagram and the review economy, that’s the difference between a two-hour queue and an empty restaurant”.
“As soon as you’re no longer obsessed with the food, you very quickly don’t have a business”Chris Miller, Founder of White Rabbit Fund
Chris sees the main drivers of value lying in this obsession with food primarily, as well as quality, design and menu development which ultimately ensure the level of customer satisfaction he believes is paramount to a brand’s success.
He talks sympathetically about the decline of Jamie’s Italian, believing its collapse was symptomatic of the current climate of crippling challenges but ultimately due to its being run by financiers, not foodies, and losing sight of quality and customer experience. “The first few sites were amazing,” he points out.
For his portfolio’s menu development, Chris says he takes a ‘Goldman Sachs’ approach to dishes, ‘firing’ the bottom 10% performing menu items to keep in line with customer demand. In keeping with Chris’ attention to detail, menu items are reviewed every day: “It isn’t enough to look at it every month because by the time you can do anything about it you’ve then lost two months,” Chris says. He meets with the restaurants every week and if one dish is incurring even only a couple of complaints, he’ll go in himself, order it, and if it’s not good enough, take it off the menu and get the team to work on it until it is right: “there’s just no room in this business to not be good enough”.
He mentions Instagram as not only useful for customer experience, but also as an essential tool for monitoring the aesthetic quality of every dish that goes out on their page. Chris can keep an eye on quality and design from around the world, and has the open and honest relationship with the restaurants to call them out on it when it’s not up to scratch.
“We keep our staples but are always trying new things out and changing our menus seasonally”. But he does acknowledge that focusing too heavily on numbers takes away the ability to be creative and keep people excited. This is exemplified in the ‘guest bowl’ initiative at Island Poke, where a celebrity or chef have their own dish on the menu once a quarter. “It’s about being comfortable to not make money on quirks but acknowledging they’re what keep you relevant”.
Chris points out that at the heart of a good customer experience is a strong team ethic, and a shared goal, something that is an even more pressing challenge in the current climate. “Staffing is getting a hell of a lot harder. The reality is people just aren’t coming from the rest of Europe as much. So you need to attract and retain, and create a real team environment where people want to have a career.”
“Restaurants are never going to go away as people are social creatures and will always want to go out to eat. So it’s about creating a really exciting experience in that restaurant, which has got to start with great tasting, beautiful food and excellent service”Chris Miller, Founder of White Rabbit Fund
Chris’ advice to brands has always been to “get some grey hair on your board who can look at your business from a different angle and to learn from their experience and past mistakes!”. Chris admits “there’s definitely easier ways to make money, but it’s a lot of fun”, and left us with a few watch-outs for restaurant owners:
- Never take your eye off the consumer – stay relevant, interesting and exciting – you’ve got to keep people coming back
- Obsess over quality, and lots of it – the little things can make a huge difference to consumer perception
- Nailing your product and service is the easiest way to ensure a great customer experience
- Have foresight and be comfortable with spending money on getting it right. In the restaurant business if you just focus on money you very rarely make any!