Gatecrasher & Booom!
No Wages for the Workers.
- Booom closes following long running legal battle.
- Claims that Booom owes wages back to August for up to 130 staff and ’huge debt’ with Social Security.
- Gatecrasher staff owed back wages to July and company fails to complete employment administration.
British club brand Gatecrasher opened in Ibiza in 2014 taking over the newly renovated Eden night club in San Antonio. Heralding themselves as ‘The Future Sound of San Antonio’ they opened their doors at the start of June with a well received eclectic mix of promotions including Kisstory, Speakerbox, Crèche, Bedlam and their own Gatecrasher nights.
Many businesses new to the island find Ibiza’s special trading practices and promotional networks a very steep learning curve and the first signs that Gatecrasher’s brand awareness would not be enough to carry the day without local co-operation and support came by way of the all important ticket selling networks. With ticket vendors complaining of poor service and communication a seed of negative publicity was sown that would prove difficult to turn around.
In interview with the Ibizan, Gatecrasher founder and supremo Simon Raine stressed that whilst they had made some mistakes the brand wanted to work with the local community and become an established name in the Ibizan tourist and clubbing market.
Despite this, rumours of DJ’s and promoters complaining they had not been paid started to circulate including one very public statement by one of the promoters on social media. The Facebook post stated that ’enough is enough’ and that after repeated promises of payment not being honoured they were to withdraw from Gatecrasher with immediate effect. The post was withdrawn very soon afterwards, but not before it had gained viral exposure amongst the Ibizan music industry.
One by one the remaining promoters cancelled, though there were replacement nights including Carnival.
Meanwhile Gatecrasher had adopted set price deals including drinks to attract people into the club—something you would be excused for thinking would have been welcomed by club-goers bemoaning inflated prices, however in Ibiza’s unique nature it was felt by many that this was counterproductive and, with the smell of desperation, only went to cheapen the brand, leaving Gatecrasher less attractive to the fickle clubbing market.
With a feeling of vultures circling the Club was by now fire fighting one problem after another with staff wages late and unpaid, and those who suffered loss from Gatecrasher’s financial difficulties in the UK joining the fray in adding to the negative publicity as to the company’s standing and ethics.
Gradually the club was open less and less nights each week until August 29th when it didn’t open for what had become it’s flagship promotion.
Perhaps the most damning information came via Dutch website Quote who published an interview with Eden’s owner Michael van de Kuit. The report, published on September 15th, states that Gatecrasher have received negative coverage due to malpractice, and states the non-payment of staff wages by way of example. Van de Kuit is quoted as stating “The men have fled. The Englishmen thought they could just come and put the island on his head, but they have made no friends.” He continued “We’re going to file for the bankruptcy of Gatecrasher and personal bankruptcy of founder Simon Raine.” Speaking of the future he said “Eden will be back next year, under Dutch management.”
We asked Simon Raine about the report the day after it was published and he continued to speak optimistically as to the club’s future. Simon stated that he was meeting Eden’s owners the following week to resolve issues outstanding and “one thing I can tell you is that Gatecrasher will be in Ibiza in 2015”.
The Ibizan had been contacted by several staff affected by the closure and for much of September and October we have been advocating behind the scenes on their behalf. In so far as outstanding wages are concerned our last productive communication was that a part payment had been made for July and a date set for payment of the balance. This has not been forthcoming.
Recently we have focussed on addressing the issue of Gatecrasher completing their staff employment administration. As it stands all staff, at least 20 known to us but possibly many more, are still employed by Gatecrasher’s company Scout Team S.L. This has frustrated the staff’s attempts to claim any benefits due to them.
We stressed the importance of Gatecrasher issuing the Certificado de Empressa confirming termination of employment and received assurances it would be completed. We received a further personal note from Simon Raine on 23rd October stating the company were working on the administration and should have answers in the next 24hours. Despite several further contacts on our part no response has been received and the staff are left in the limbo of the Spanish employment and Social Security system.
Entrepreneur Giuseppe Cipriani, owner of the Booom nightclub, had a legal appeal dismissed on Friday in Palma Provincial Court. The case was regarding contractual issues of the building’s lease and use of the building as a club.
Booom closed immediately, cancelling a well-advertised Halloween Party planned for the same night, along with the cancelation of the entire winter programme. The club, located on Passeig Joan Carles I in the chic marina area of Ibiza Town, has been embroiled in various legal actions over an extended period.
Much of the current case revolves around rights to purchase the building between Giuseppe’s company Club Play By Cirpirani SL, and that of his former partner, the Jordanian millionaire Eyhab Jumean and Nung River SL.
Cipriani is involved in criminal proceedings with his former partner who he accuses of stealing Booom’s original brand name Bomb.
Ibiza newspaper the Periodico reported yesterday that Giuseppe’s company had a “huge debt” outstanding with suppliers and social security. It also reported that sources inside the company had said the club’s 130 workers were owed wages going back to August.
Cipriani also owns an upmarket restaurant on the same street in Ibiza and has properties in Monte Carlo, Abu Dhabi, Moscow, Miami, Los Angeles, New York, Istanbul and Hong Kong.
No official statement has yet been released by Booom.
Long Hard Winter for the Workers.
- Editorial Comment
The arrival of Gatecrasher’s brand to Ibiza received a consensus of enthusiastic support in the music industry, and particularly within the ex-pat and San Antonio communities.
With our ’foreign legion’ approach to allowing the past to be exactly that when starting afresh in Ibiza, Gatecrasher were not judged negatively by their mixed record and reputation in the UK which at it’s best was a thriving and successful chain of clubs and record label, though low points in it’s history include bankruptcy and it’s flagship venue lost to fire.
Unfortunately their enthusiastic reception soon started to wane. It is completely understandable that a business of their size would attract many approaches from those looking to make a buck on their back, and any astute businessman would be very wary of the motivation of commercial advice received. Understandable, but unfortunate in that within that feeding frenzy for a slice of the Gatecrasher cake they missed the genuine advice outlining the importance of the unique nature of the Ibiza market.
Perhaps the most important failure, and at the same time the perfect example of how the Ibiza market differs, was in understanding the role played by the ticket sellers. In the UK most tickets are sold in what is effectively a retail outlet to whom you pay a commission for selling your product. The sale is conducted online and the buyer either already knows what they want to buy or, certainly outside of London and Manchester, will have only one or two options to choose from on a given date in a given geographical area. Whatever their options their buying decision will not be affected by any personal interaction at the point of sale.
Compare this to Ibiza where those of the target age can barely walk a few meters without another ticket seller keen to talk to them about lots of different options available to them every night of the week and all easily accessible within the confines of our small island.
Many tickets are still sold this way and even those who do buy online and on the door will still be subject to these ticket seller’s opinions.
Obviously it makes sense for any promoter to have good relationships with the sellers on the street. Some will work harder than others to ensure their nights are promoted ahead of the stiff competition.
Unfortunately for Gatecrasher they did not seem to grasp this and it was not long before I was hearing very negative comments. A very good example was the owner of a San Antonio pre-party bar who has absolutely every incentive to promote a San Antonio club and stop the ‘club-drain’ across to Playa D’en Bossa. That bar owner told me that they could not get actual tickets to sell, promises of promotional support were not fulfilled, and after repeated efforts they just gave up and crossed Gatecrasher off their list.
This one example lost them some sales and some word of mouth goodwill, however take it one stage further and the consequence really starts to kick in. For right reasons or wrong the street ticket selling industry isn’t renowned for operating with a strict code of ethics and fair play. The harsh reality is that if they are not with you there is every reason to expect them to work pro-actively against you. It is a cut throat business and if your club is the only one they cannot make a commission from the outcome is obvious. It won’t just be a case of not promoting your venue, they will go out of their way to ruin it’s reputation. “It’s rubbish, no-one goes” “It’s empty” “None of the main billed acts are really on the bill”, “they overcharge on drinks” and of course one that will have some credibility to the unaware punter “it’s so bad/we get so many complaints we stopped selling their tickets”.
It is hard to conceive of a worst marketing disaster than putting a hoard of people out on the street talking all day and all night to your potential customers with a negative axe to grind.
And of course the rumours spread, get exaggerated, and stick.
So the lack of understanding as to the different way Ibiza works results in one of the most influential groups of people working directly against you.
This is only one example, there are others.
Of course Gatecrasher are not the first and certainly will not be the last, business to struggle to come to grips with the Ibiza’s unique nature and particularly the importance of local support, reputation and referral. Many a redundancy package has gone down the drain with an ill fated assumption that opening the doors will be enough to get the tourists through the door.
The difference with Gatecrasher is the scale of the operation.
I know I am not alone in feeling a kind of collective ex-pat guilt that a British business has let down so many people, particularly local workers who can ill afford it.
I understand that if it has been a financial disaster the company may not have sufficient assets to pay staff outstanding wages, but, and this is an important but, when did the situation become impossible? The company could not fulfil the wage bill in July. What strategy, options, resources did they have to make them think the situation could be retrieved? If the situation was impossible at that stage they could and should have done the honourable thing and terminated the staff contracts allowing them to find other employment when it was still possible to do so. To carry on head first into the abyss may be the option of a businessperson who chooses a path of speculation and risk, but it is not fair to visit this on unwitting staff.
Also it is very disappointing that they have not responded to our repeated pleas to complete the staff administration and thereby allow them to at least claim some benefits for the winter month. To do so would cost them nothing but time and on balance you would think it is the very least the staff deserve.
I sincerely hope there is some background refinancing that may allow Gatecrasher to fulfil it’s financial obligations to the staff and others and, as Simon Raine still says, be in Ibiza next year. But even if this is the case it does not excuse or explain the lack of willingness to help people who through absolutely no fault of their own find themselves in a dire financial situation.
Thankfully Gatecrasher are not representative of British business in Ibiza. With companies such as Ocean Beach, Ibiza Rocks, and now Sankeys going from strength to strength we have plenty of home grown success stories to be proud of.
Perhaps Gatecrasher will go down as a cautionary tale for the future—being big doesn’t matter, being Ibiza-aware is the pre-requisite to success.
Booom is a completely different situation, though if the reports are true it is equally sad and unfair that unpaid workers may be the people to suffer most.
It feels as if Booom have been in a permanent legal battle for the past few years with openings announced and cancelled, wrangles over the name, wrangles over the building and licensing, and all of it portrayed in the media as Ibiza’s very own Dallas-esque story of business dealings with the larger than life figure of Giuseppe as the main protagonist.
It seemed that 2014 marked an end to the legal drama with celebrity punch ups grabbing the front page attention and the club itself coming into its own with several very successful promotions.
Though Giuseppe is as British as he sounds (i.e. not at all), there has been a strong British connection with Booom. IMF founder Danny Whittle was on board briefly in the early days and UK record label Defected have held two very successful nights there this season. Booom was also the club chosen to host Mike and Claire Manumission’s return to the club world this year in the guise of Phantasmagoria.
So does this latest legal decision mark and end to Booom? With Giuseppe’s reputation and track record I wouldn’t bet on it.