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Report on Small Business magazine

The big splash

From Report on Small Business magazine

Among the many things Charles Khabouth has learned over his quarter century as a nightclub impresario is that novelty is crucial. Take Tattoo Rock Parlour, one of his latest experiments on the Toronto entertainment scene. The year-old venture is an unusual hybrid: part club, part live-music venue, part restaurant. Oh, and then there's the tattoo shop, for scenesters looking for a permanent souvenir of their night on the town.

When Khabouth says “there's nothing like it anywhere,” it's easy to believe him. The funky interior–designed by ahead-of-the-curve local designers 3rd Uncle–draws curious club kids out strolling Queen Street West, but on a recent evening Tattoo Rock Parlour also hosted a lively crowd of 400 being feted by an advertising firm with dinner, music and temporary tattoos. Companies vying to make their events the talk of the town have flocked to Tattoo's edgy atmosphere, making it a popular spot for corporate functions on the Queen West strip.

All of which means that so far, the innovative space is working. But the man behind the concept admits that a little unorthodoxy can be a dangerous thing. “Novelty is something you have to be very careful with,” says Khabouth, who currently owns six venues. In the entertainment business, today's trend can quickly become tomorrow's failure. So if business drops at the tattoo shop, he'll move fast to put in something else.

For Khabouth, gauging a new spot's prospects isn't so much about opening-night receipts as the vibe in the room: “I watch people, their reactions, their faces, how fast people are leaving.” He'll often stand near the door to catch what customers are saying as they walk out. (Eschewing flashy three-piece suits for understated rock-inspired style, the low-key club owner fits in with most crowds.) He'll tune out the gladhanders to eavesdrop on strangers' conversations, hoping to learn what they think of the music and decor. When Tattoo first opened, he says, attendance was low: fewer than 150 people on average in the first couple of weeks, in a venue licensed for 450. But he saw that those who came stayed for hours, and he knew he had another winner.

Once he'd established that, he set out to do what he always does: Start planning another. And another, and another. His Toronto-based company, Ink Entertainment, is poised to launch a handful of ambitious new ventures, including three restaurants (one a high-end relaunch of the once-trendy foodie destination Rain) and a 45,000-square-foot event space in Coral Gables, Florida, a co-project with fellow impresario Nick Di Donato (who also owns a stake in Tattoo Rock Parlour). There's also talk of the pair establishing another live music venue on Queen West. Not to mention the creation of an international hotel brand, which Khabouth plans to inaugurate with the opening of Bisha boutique hotel in downtown Toronto. All in all, he's aiming for a 20 per cent increase in Ink's business this year, on annual revenues of more than $30-million.

I’m very, very open-minded to bringing people on board to teach me and show me what I don’t know.— Charles Khabouth

The prolific string of start-ups, in the worst economic climate in memory, suggests that the 48-year-old entrepreneur has either been touched with hubris or he's glimpsed a unique opportunity. And while Khabouth is the first to describe himself as a striver, his more than 15 venues to date–several of them risky departures from the till-then tried and true–have taught observers to curb premature skepticism. The fact that he has no direct experience in the hotel industry, for instance, doesn't faze him. “I'm very, very open-minded to bringing people on board to teach me and show me what I don't know,” he says. “I think it's crucial that before you get started on any project, you say, ‘This is what I can do and this is what I cannot do.'“

So what can Charles Khabouth do? His formula for success combines a few strengths that others in his industry envy: Identify a promising market, conjure up an aesthetic vision that's one of a kind, and find the right partners to help him create it. After that, all it takes is a 70-hour workweek to keep the places running.

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