easyHotel is recruiting a CEO

With 15 businesses in the easyGroup and with recent big expansion at easyHotel, the latter now needs its own full-time CEO. Advertisements for the position will be appearing in the media starting this week.

easyHotel.com is already showing signs that it could become the best investment ever made by Stelios under the easy brand when measured by ROE. As an "asset-light" business, easyHotel now seems capable of producing very high returns on equity for shareholders without any further equity investment by the current shareholders thanks to the use of franchising for expansion. The challenge in hand is to select and monitor franchisees carefully and build a global budget hotel chain for the 21st century.

The company already reported a modest profit in its first year and is poised for better results in the year ending September 2006.

Using one of the best known budget hotel brands in Europe the company is poised for extraordinary growth over the next five years that could lead to IPO. The company is looking for a CEO based in London to implement this growth plan.

The current expansion plan:

From a standing start in August 05 when the first corporately owned easyHotel (14 Lexham Gardens, London W8) opened its doors to customers with unprecedented media attention for a property of 34 rooms, the business has been going from strength to strength! One month later the first franchisee opened his own hotel in Basel, Switzerland having signed his contract before the first opening. In April 2006, after months of intense negotiations with Istithmar, the Dubai based investment house, easyHotel announced a landmark agreement that will effectively put the company firmly on the map of budget hotels worldwide. This master franchise agreement covers 16 countries and 38 properties in the next 5 years! More recently, Stelios and the small management team focused on signing franchise agreements with individual owner-managed properties in the UK and 2 more properties are to open in London in the next 12 months (36-40 Belgrave Road, Victoria and 44 West Cromwell Road, Earls Court). The current plan is to continue to sign up individual site agreements in Europe whilst offering master franchises in countries further a field.

The brand promise to the consumer:

A safe, clean, consistently decorated private room, with en suite WC and shower room, at a great price!

Room sizes vary from 7 to 15 sq meters and are priced accordingly and in line with the yield management principle of book early pay less. In converted properties and where allowed by local law, windowless rooms will be developed to increase the number of rooms in any given property. Housekeeping is an optional extra during stays and there is always one member of staff on the premises (but not many more than 4 staff employed per property). No f+b offering is required as part of the concept.

The business model:

Here are some of the reason why it works for both the franchisee and the franchisor: the smaller rooms and the no frills decor allows more rooms in any given property thus maximising the EBITDAR per square meter. So far all the sales have been generated on a direct basis by the corporate website www.easyHotel.com without the need for travel agents. A very high occupancy rate has been achieved so far.

Good ancillary revenue in the form of commission on sales of room-nights in other hotels has been achieved in partnership with hotel room broker Octopus travel who are present on the easyHotel.com website and benefit from its high traffic.

The position:

Based in London the new CEO will take full P&L responsibility for easyHotel on a global basis reporting to Stelios who will remain on the board as non executive chairman. So far the acting CEO has been Stelios himself on a part-time basis. The main task of the new CEO will be to attract, select and sign up more franchisees whilst ensuring that brand standards and profitability are achieved and maintained by all properties in the system. Maximise cash flow and position the company for IPO in the next 3-5 years.

The ideal candidate:

Will have worked for at least 10 years in a senior position, with full P+L responsibility of at least a significant country or brand, with one of the top tier hotel franchise systems in the world. Experience with a budget brand will be a positive factor but not essential if the candidate can demonstrate understanding of the budget sector and is willing to stick to a no frills philosophy. Preference will also be given to candidates with previous direct experience of selling franchises internationally. The ideal candidate will be willing to think outside the box and work with the entrepreneurial founder to maximize shareholder value.

A competitive package will be available for the right candidate which could include stock options on a co-investment basis.

If you think you are the right person for the job please email Stelios directly on ceosearch@easyHotel.com not later than the 10th of June, 2006. Not all emails will be acknowledged.