Shaper: Des Gunewardena and David Loewi

Show aired on 25th April 2015

Transcript

Elliot Moss
That was I Put A Spell On You from Nina Simone here on Jazz Shapers, with me, Elliot Moss on Jazz FM. Good morning and thank you very much for joining me. Jazz Shapers the place where you can hear the very best of the people shaping the world of jazz, blues and soul alongside their equivalents in the world of business, a Business Shaper. I have a double act, a big two people Jazz Shaper special here today. I have got Des Gunwardena and David Loewi; they are the co-founders of the D&D Group; restaurants and hotels are their thing. Not just in the UK but internationally. You will be hearing lots from them very shortly. In addition to hearing from Des and David you will be hearing from our programme partners at Mischon De Reya some words of advice for your business and on top of all of that of course, a fantastic mix of music from the shapers of jazz, blues and soul, including Ella Fitzgerald, Nancy Wilson, Trombone Shorty and this from blue’s man, Eric Bibb.

That was Shine On from Eric Bibb. This is Jazz Shapers as I said and my Business Shapers I am pleased to say are Des Gunwardena and David Loewi; the co-founders of the D&D Restaurant and Hotel Group, they are international and it is unusual having two of them here but they are both here because they are both very important people. Des and David as I look at them both, thank you very much for joining me.

David Loewi
Thank you for inviting us.

Des Gunwardena
Nice to be here.

Elliott Moss
Excellent. Des I am going to start with you. You set this business up – how long ago?

Des Gunwardena
We set the D&D London business up in 2006 following the buy-out of the restaurants from Conran but actually I have been in the business back in the Conran days since, God it’s 1991 when I was working with Terence Conran. He was the chairman and I was the CEO so that was, we worked out of a little flat.

Elliot Moss
So give me a run down before we go back to those heady days in the ‘90s. Name me some of your favourites; of course they are all your favourites?

Des Gunwardena
Yeah.

Elliot Moss
But just give me a few because you’ve got many many restaurants in the group.

Des Gunwardena
Yeah we’ve got restaurants that people will, people will know from quite a long time ago, they’ve been here for decades like the Le Pont de la Tour, Bluebird, Coq d’Argent in the City, there is also restaurants that haven’t been round quite so long, which maybe not everybody knows like time Skylon in the Royal Festival Hall and we have got about twenty five in London. We also have one in Leeds which we are very proud of, well two actually and we are in Paris, New York and we have two restaurants in Tokyo.

Elliot Moss
So lots and lots and lots. Now then, apparently David, you can tell me if this is true, Des does the numbers stuff but you make sure that these places look fantastic and work really well. Is that a fair, a fair summary?

David Loewi
Yeah we work very closely together in all aspects but I do all the fun stuff really, working with the chefs, making sure the menus are right, working with the front of house and just making sure that the DNA, that everything is working and that we evolve and you know, no day is the same in the restaurant world so just making sure we are on top of it and our chefs are on top of it and our managers are on top of it.

Elliot Moss
Now both of you have worked for big organisations and you know, Des you have worked with Gerald Ronson for many years, David you have been in the Hiatt Group I think and you were the food and beverages head over there. When did you both realise you wanted to do your own thing? When did it start to bubble for both of you and was it a collective thing or were they separate little moments and then you started talking?

Des Gunwardena
I think they were separate moments. I worked with Ronson when I was very young, in my twenties. Then I worked with Terence Conran and actually the decision to create D&D came really from a discussion I had with Terence because he wanted, he really wanted to get out, well I say get out – he felt that we were really growing fast and probably getting to a size where he felt a little bit more comfortable staying smaller and so he said, ‘look why don’t you get together with David and find some backers and buy the restaurant business from Conran’ so… So really it was the realisation that I wanted to do something different, something on my own or with David independent of a bigger company came from an evolution of what Terence Conran wanted to do and what I wanted to do with the business rather than an overnight getting up one morning and saying, ‘look I want to do something which is not connected to Conran anymore’.

Elliot Moss
And for you David, you had actually left the Group, you had gone and set up the Wolseley and then this, this happened – this moment happened? You came back?

David Loewi
Yeah I suppose I always wanted to do my own business from a very young age and because that’s what you can do in the restaurant business but then I joined Hiatt International and worked with them and loved it and thought I would get more experience working with them and then I went and opened Mezzo with Des and Terence and actually the exciting part of working in Conran restaurants in those days is that the empowerment that one had, you could actually… it was like having your own business. You were running your own business and the DNA, the culture of the company was to do that and it still is. But then I grew up in the company then and became development director and I think I had more jobs than anyone else in the company, I kept changing my title. So then I went along and joined Jeremy King and Chris Corbin and opened the Wolseley and then I think it was a while later that Des said, you know, why don’t you come, you know, we talked and would do this management buy-out which was incredibly exciting and who could say no to that?

Elliot Moss
Indeed who could say no to that and you are going to hear lots more about that buy-out itself and what happened next. Stay with me here on Jazz Shapers, time for some music right now and this is aptly The Best Is Yet To Come from Nancy Wilson.

That was Nancy Wilson and The Best Is Yet To Come. Des Gunwardena and David Loewi are my Business Shapers, the founders of D&D International I hasten to add group of restaurants and hotels. We were talking just earlier both of you about before it all happened and the coalescing of the two of you and almost being brought together and I’ve heard that story before Des in terms of the person who has been running the business, who’s business it is you know, the eponymous here if you like in a business saying, ‘actually it’s not for me but I can see a way through’ and very generously saying, ‘I think you should take this on but I am not gonna do it’. When you realised that for both of you that opportunity was there and then you had to raise the money I imagine to do the management buy-out, was that looking back now, still the most exciting thing that has happened to you? Or have many many things overtaken that in terms of emotional power?

Des Gunwardena
Yeah it was the most exciting, for me, the most exciting thing that we did. You know, in terms of you know, creating that and making that happen. But what was, what was interesting about the buy-out was that it wasn’t really a conventional buy-out where you have a big company saying ‘okay I’ve got… Terence saying I’ve got Des who is a CEO wants to buy the company so let’s go and talk to higher advisors and you know, talk to a lot of investment banks’ and then have beauty parades. It was really a shake hands deal. It was a shake hands deal between Terence and myself on the price which we bought the restaurant business and it was actually a shake hands deal between the HBOS guys, in fact I had known Peter Cummings in the old days and we, we… I said, ‘look come in, there’s this opportunity and I want to do this and if you put a deal to us which we think is, is fair, we will do it. We won’t spend months and months and months negotiating’ and it was a very straight forward and very nicely done.

Elliot Moss
Kind of old fashioned in a way. I mean and that sounds good, that sounds like, as you said, the trust of the handshake. Was there doubt at the same time? Both of you strike me as being confident and now very successful in your own right people but was there a little small doubt in both your minds going well we’ve said we’ve wanted this, so Terence thinks we can do it, can we really do it? I mean David did you ever experience that or was there complete belief?

David Loewi
No because we were doing it before Des and Terence and I were working together before so in fact Terence was taking more of a back seat so I am not saying it was more of the same, it was incredibly exciting and meant, you know, now we can change, you know, let’s work on the culture, who we are bringing in to the company, what chefs are coming into the company and it was down to us. However the way that I worked with Des and Terence before, we all worked together, it wasn’t, it wasn’t a massive change except Terence took more of a perception from outside the company that it was a massive change.

Elliot Moss
Okay. Because his name is so big, I mean is a…

Des Gunwardena
Yeah and I think there is an assumption that when you have a big name like Terence Conran that Terence Conran must be making all the decisions and he must be running the company but that the reality was that that really was not the case. He was very involved with the design but the management of the business, I was, I had been CEO for over ten years so I was really running the company and obviously working closely with Terence particularly on the design side but I was running it. So, so if you, if the question is, ‘well were we worried as to whether or not it was going to work’, the answer is really no because we felt that we were running the business anyway. There was certainly I think, there was a feeling from outside the business that it could go either way. Either there is going to be a really new energy, there are going to be changes in the way Conran restaurant business is run and it could be a change for the better or it could be a change for the worse but actually did we have the confidence that we would make it a success, I think absolutely we did.

David Loewi
And we went on, straight on to open Skylon and that was our big opening after the…

Des Gunwardena
Yeah, yeah and actually what happened immediately after the buy-out was we went through a period of quite rapid expansion.

David Loewi
Huge expansion.

Des Gunwardena
We opened Skylon, we opened restaurants in Tokyo, opened restaurants in Copenhagen, so we went in a… so it wasn’t like ‘oh we bought the business and let’s we stay quiet and don’t do very much’. We went straight in to expansion. Then of course we ran into ‘08 and Lehman’s and so we…

Elliot Moss
Held back a bit?

Des Gunwardena
Held back a little bit to make sure the world didn’t end and then carried on after that.

Elliot Moss
Stay with me for more from my Business Shapers, Des and David, the D and the D in D&D London the International Restaurant and Hotel Group. Latest travel in a couple of minutes and before that some words of wisdom for your business, from our program partners at Mishcon De Reya.

This is Jazz Shapers with me, Elliot Moss every Saturday morning you get to hear me talking to some inspirational, informative Business Shapers, people who are shaping a business in their industry. If you have missed any previous shows and there are over a hundred and fifty of them now you can go to iTunes and put in the words ‘Jazz’ and ‘Shapers’ and you will find a fantastic number of brilliant people in there. CityAM.com is another destination where you can hear many of the best guests that we have been lucky enough to have. Des Gunwardena and David Loewi are my Business Shapers today. They are the co-founders of the D&D Group; came out of Sir Terence Conran’s portfolio of restaurants but as you have been hopefully hearing earlier, Des has been the CEO, was the CEO in that group for many many years and in a way, as the gentlemen were saying, things kind of carried on as they were before and actually then grew very very fast. I just want to talk about the partnership between you because it’s not quite you finish each other’s sentences but there’s obviously trust, there’s understanding, you don’t think either of you is going to undermine the other, there’s no… it strikes me immediately and one would assume that from, from the business success. Do you both have the same understanding of the word ambition? Did it mean very similar things to you back then and does it now? David?

David Loewi
Yes I think so, I mean at the end of the day we have both got a vision together and we share that and it’s to grow the company and do exciting things. It’s not just to grow for the sake of growing, it’s like the excitement and inspiration of taking an amazing building and putting life back into it. We were both very very excited about going back into the hotel business; I came from the hotel business, Des and I we did the Great Eastern Hotel many years ago and then to do South Place and then now from there to grow and to get the right people round us to carry on growing. So there is always an excitement there together and we both share that vision and passion to grow quality and grow the right businesses to grow the company.

Elliot Moss
Now obviously Sir Terence is known for his aesthetic, his design look and feel. What’s yours? You’ve alluded to it David the sort of quality piece and a vision of rebuilding things and creating something. In your own words Des, what is that creation? What is that vision beyond the numbers. Because those numbers are a function of you guys having that vision. What would you… how would you capture it?

Des Gunwardena
I think the, you know when you have worked, Conran, Terence Conran was principally a designer and a retailer even before he was a restauranteur and so design in terms of business and my personal life is you know, is a very very important part of, of how I feel about things so good design continues to be one of the driving forces of, of, of what we do as D&D in the way it was in the Conran days. I think the other thing about, in terms of me personally, I worked with Gerald Ronson, I was a financial strategist in that business and I was a financial planner in the glory days of Ronson in the, in the ‘80s, that’s where I cut my teeth in terms of learning how to do business and property is something that I have had an interest or some expertise in I guess over the years.

Elliot Moss
And critical part of the restaurant business? I mean fundamentally.

Des Gunwardena
Absolutely critical and actually we as restauranteurs far more than design, the projects that we take on are often property led – they are interesting buildings so we are opening – our next big project is a German gymnasium in Kings Cross. I mean why we are doing it, most restauranteurs would run a million miles away from that building, it is thirteen thousand square feet, it’s, it’s a listed building, it’s old, it could be potentially complicated but that is exactly the project that we love and so the drive and passion for the business obviously is food, you know, we are big into food and big into wine, as most good restauranteurs are but for me personally, that property and taking an old building and bringing it to life with great designers is very much the absolute DNA and USP if you like of us as a business compared with, you know, some other comprable restaurant companies.

Elliot Moss
Stay with me for more from my excellent Business Shapers today, Des and David, the D&D founders. Time for some more music, this is Geoff Bradshaw and Trombone Shorty with New Orleans Groove.

That was Geoff Bradshaw and Trombone Shorty with New Orleans Groove. Des Gunwardena and David Loewi are my Business Shaper and we have been talking about all sorts of things, design aesthetics and partnerships and the importance of property in this business that you work in. As you look forward to developing your business David, are there obvious challenges that are different now to the ones that you encountered when you first took the business over properly and if so, what are they?

David Loewi
Yeah I mean the world of restaurants and hotels in London is evolving so fast and so exciting and so many different things are going on.

Elliot Moss
Much more competition now than there was?

David Loewi
Yeah more competition but that’s not a bad thing, you know, I mean that’s making London a destination obviously and concentrating on London at the moment but that’s making a destination of people coming here and talent coming here, chefs coming back here, managers wanting… everyone wants to work in London because it is such a dynamic city. So yeah there are challenges, there are always challenges getting the right people to help us work in these new exciting businesses and attracting the best but a challenge is a good thing.

Elliot Moss
Yeah. Is there a challenge now… you’ve, I believe there was an investment round, you have a different partner now; LDC, the private equity house. Has that made a fundamental difference or no difference, or somewhere in the middle in terms of the way you operate the business?

Des Gunwardena
I don’t really think its made much of a difference in terms of how we operate the business, they are, as were our previous private equity investors, and Conran actually retained a stake after our first, our first buy-out.

Elliot Moss
Not any more though is that right?

Des Gunwardena
Not anymore, so Conran has no remaining stake in the business. I don’t think it has made a difference in terms of how we manage the business. I think, I think what has been a big difference since the buy-out is that the economy has improved and the financial markets have suddenly changed massively; they have become… back in three or four years ago it was very difficult to you know, get finance to expand your business whereas now it has changed completely in the economic climate in terms of eating out, people eating out. We have gone into, what we think is a pretty good period. Now who knows what will happen after the elections and so on but certainly we have had a couple of very good years but in terms of how we manage the business I think we are probably, well we definitely are more ambitious and expansive than we were three or four years ago but I am not certain that that is due to LDC coming on board, they are great the investors, they are very ambitious alongside us but I think we become more ambitious as we’ve seen how our restaurants and hotels are performing and as we see the opportunities that are available to us.

Elliot Moss
Final chat coming up with Des and David plus a classic track from Ella Fitzgerald, that’s after the latest traffic and travel here on Jazz FM.

That was Summer Time from Ella Fitzgerald and actually that is the song choice of David Loewi, my Business Shaper, one of my Business Shaper’s today because we are going to have two song choices, how lucky they are and how lucky we are too. We’ve been talking about all sorts of things and what I want to just ask you as we draw to a close, you’ve obviously built this business successfully, it looks on the surface of it revenue goes up, margin goes up, vision intact, culture intact – there must have been bumps along the way. When there are do you look to each other and if you do, are there other people that you bring into the inner circle as well? Have you had enough support because people often say it is very lonely running a business. I hear that a lot. What is it? How is it for you David? How has it been for you?

David Loewi
Yeah I don’t think it is a lonely business because it’s a people business at the end of the day and we have… yeah of course there are bumps along the way but that’s the excitement of this business. People say ‘how and earth can you work in the restaurant and hotel business you are so reliant on people’. It’s the challenge. Every single day is different and of course there are bumps and there are challenges and there are you know, you are running a great restaurant and the chef leaves, well it’s a challenge, we have to either try and make them stay or I mean, there is always a challenge along the way but that’s the business we are in.

Elliot Moss
One of the questions that strikes me, you have a business and it has scale. You’ve got twenty eight restaurants and yet you want to retain this independent culture if you like for each of the restaurants. I look at the restaurant business and you said David, many people think ‘how can I do that’. They think it because it’s a really hard relentless 24/7 all sort of and there are all those issues with people. Is it only possible to be super successful if you have got scale in the restaurant business or can the lone independent still make it?

Des Gunwardena
Well of course the lone independent can still make it. We were very successful when we had one restaurant because that restaurant was profitable and you know, if you decide you just own one restaurant or three restaurants you can make a very very nice living thank you very much.

Elliot Moss
But your systems behind, your bulk buying ability all those other things, the HR structures that you have put in place, all those things must help save.

Des Gunwardena
Yeah I think as you grow the things you can do better, yes the obvious things are you are buying more so you can drive better deals and so on but I think the other thing which is quite important is when you grow, particularly the way that we’ve grown and grown in London but also in Paris, New York and Tokyo, you just have a lot more knowledge and expertise so when we decide okay here’s a building, what are we going to do in that building? We are talking about developing concepts which are coming out of stuff we have already done but they are also things which come out of what David and I and other people in our business who are sitting round, it’s not just the two of us.

Elliot Moss
No I am sure.

Des Gunwardena
Groups of people have seen working maybe in Tokyo or maybe in New York and so I think you’re creative powers really and it might be a little bit counter intuitive because a lot of people say well big companies, well probably big companies is that they are not very imaginative and they don’t have great ideas. The scale that we are at and let’s be clear, we are not the size of Compass you know, we are a hundred million turnover company, we are not a multi-billion pound company. I still think of ourselves as a small company and I think another important question is how do you as you go from two or three restaurants, a lot of people say to me, ‘well look how can you possibly be as good with thirty restaurants as you were when you were three?’ and it is all about developing culture and people who are buying into that culture. It is a very management intensive business. Our challenge is to have around us a group of people who are doing what we were doing ten, fifteen years ago and who are doing it in the same way as well or better than us and that is the absolute be all and end all of our ability to grow or our ability to have grown from ten to a hundred million and the next stage to grow from a hundred million to two hundred million.

Elliot Moss
It makes perfect sense. Just before I ask you your song choice Des, one last question. Is there joy for both of you in the business still and if so, what’s driving the joy? What makes you happy David in the business?

David Loewi
Going into a restaurant and feeling the buzz and energy, having a fantastic meal and being really proud and looking at happy customers around. That’s you know, people really and saying ‘wow I really love that restaurant’.

Elliot Moss
And that can happen every day.

David Loewi
Yeah.

Elliot Moss
Brilliant and Des for you?

Des Gunwardena
I think really the same and I think the… it’s also great when, when people say things like ‘oh I went to, for example, Quaglino’s’, we have just re-launched Quaglino’s, an iconic restaurant and it has been a huge success and when people are emailing me and saying ‘I went to Quaglino’s last night and we had a fantastic dinner, what a great buzz’; that makes me feel good.

Elliot Moss
Fantastic. Thank you both so much. I’ve really enjoyed meeting you. Just before I let you go Des, because we have had David’s; what’s your song choice and why have you chosen it?

Des Gunwardena
Well I have chosen a song called Clean Up Woman from Betty Wright which isn’t really jazz it’s more blues but it is a song that maybe not many people know but It’s absolutely one of the great dance songs of all time in my view. I absolutely loved it when I was in my 20s and 30s; I occasionally play it now, people look at me as though I am crazy but I say ‘what’s one of your favourite songs?’ and I say ‘Betty Wright, Clean Up Woman’ and they say ‘what the hell is that?’ but I love it.

Elliot Moss
Fantastic. Both of you thank you very much, here it is, it’s Betty Wright with Clean Up Woman.

That was Clean Up Woman from Betty Wright, the song choice of one of my Business Shapers today, Des Gunwardena alongside David his partner, they were two super impressive people; focussed, clear about what they want to achieve, critically understanding the importance of people in their plans to grow their business. Fantastic stuff. Do join me again, same time, same place, 9.00am next Saturday here on Jazz FM for another edition of Jazz Shapers. In the meantime, don’t go anywhere, stay with us because coming up next, it’s Mr Nigel Williams.

Des Gunewardena and David Loewi founded D&D London, which owns and operates over 30 leading restaurants in London, Leeds, Paris, New York and Tokyo, in addition to highly acclaimed South Place Hotel in London.

CEO Des Gunewardena and Managing Director David led the buyout of Conran Restaurants in September 2006, including iconic restaurants Bluebird, Le Pont de la Tour and Coq d’Argent.  They have since overseen new ventures including the Old Bengal Warehouse, South Place Hotel and two sites in Leeds, in addition to the recent acquisition of Madison.

Follow Des and David on Twitter @DandDLondon

Listen live at 9am Saturday.