Jonathan Segal

An American ‘student’ puts his best foot forward in Vegas

By Brian Sodoma

 

For a moment, Jonathan Segal, CEO of the growing hospitality company, The ONE Group, reflects on of all things Rock Galaxy, a bar he opened in 1989.

It was his first “high-energy concept.” The 100,000-square-foot spot on Jersey, in the Channel Islands south of England and north of France, covered quite a bit of entertainment ground. By day it was a family fun center, restaurant with lounge; and by night a club where “you were standing on the bar singing ‘Y.M.C.A.,’” Segal says.

With food offerings like beer, pizza and burgers on a beach-lined island, it probably could have been replicated in San Diego or Miami. But Rock Galaxy wouldn’t blossom into a chain. It eventually burned to the ground, leaving only memories for locals and tourists.

While venues like this seem a far cry from sophisticated ONE Group offerings like STK, New York’s Asellina or the Bagatelle concept in New York, Los Angeles and a soon-to-be pool version of it in Las Vegas, it’s also representative of the tinkering and research Segal brings to his entertainment game. At one point, he offered steaks and vodka bottles at Rock Galaxy. It worked. And it demonstrated Segal’s approach: Ask questions, listen, take notes and make a move — even if it’s unconventional.

Today, he’s particularly attuned to the needs of women in stereotypically testosterone-heavy environments. STK is an almost club-ish steakhouse concept, with smaller portions.

“You don’t need half the cow on the plate,” he says.

So far, the concept is a hit at Las Vegas’ Cosmopolitan Resort and Casino. He will take his art of listening to the girls a step further when, by the end of the year, he opens Heraea (the name harkens to the first recorded women’s sport competition in ancient Greece) at the Palms, a sports bar idea, to satisfy both men and women, without that overtly male edge. Expect fine food, even three-course meals with music and DJs. And, yes, the boys can catch the game, too.

“Everybody likes to party the same way. We just like different accessories when we’re partying,” he adds.

Studying environments on a local and broader level are key to Segal’s success. He is at the helm of an international hospitality and restaurant company that employs nearly 2,500 people and expects $175 million in revenue in 2013. All this — 30-plus venues either built or in development — in eight short years. And with restaurants spanning some of the most discriminating locales, including New York, Los Angeles, Miami and soon London, his ideas must be unique and accessible.

The hospitality “student” began at 15 as a high-school dropout, a restless teen who had battled dyslexia. Although he wanted to be a lawyer, the formal education route didn’t work. Even now, he always has an opinion to share but says he has enough humility to laugh at himself when he leaves a meeting with his tail between his legs.

“The company has a manual for how to read the company manual. But at the end of the day, if there’s a better way to do something, I want to know,” Segal adds.

 

The itch

Segal’s early years were spent following in his father’s footsteps in the hospitality business and growing up on the 45-square-mile island of Jersey. He helped run and form the hotel booking company, Expotel, and later co-created WorldPay, the predecessor of PayPal.

But in 2001, he grew restless again. He tells his female friends it was akin to “being on your period for two straight months.” In November, the grouchy entrepreneur, weary of helping run empires he had created, came to New York. He rented a 100-square-foot office, bought a printer and computer and conducted business from America, while walking New York’s streets daily.

“I wasn’t going to be better, faster, more clever because I came from England. So many have come from England completely (self-)consumed and failed in the American system,” he said. “America is much more disposed to adventure and trying, where we’re a little more conservative. Being off the beaten path doesn’t feel very comfortable for us.”

After a year of studying the American hospitality industry, Segal realized he had about a third-grade knowledge of it and needed to rely on others to make a run at things here. Among his go-to’s is Vice President of Operations Celeste Fierro, a ONE Group veteran since the first restaurant opening in New York’s Meatpacking District.

 

Vegas

ONE Group’s Bagatelle will open at The Tropicana, perhaps by the end of this month. Memorial Day weekend was the initial launch date, but Segal struggled with the small kitchen and ultimately went for an overhaul that delayed the opening.

“It’s very much about the outdoor dining experience, not just five dishes at a poolside,” he added.

ONE Group now owns the nightclub and dayclub portions of the Tropicana site and has put $4 million into making them perfect. Bringing a pool to a French-style restaurant is certainly ambitious. The space, formerly the RPM nightclub and several other failed ventures, needs the stability Segal has been entrusted to provide. He wants to open more Las Vegas venues, a city that affords both a crowning moment and a chance for another hospitality industry “class.”

“I always said that when we go to Vegas, what we learn there we will import to other areas of the company,” he says.

And what has Vegas taught the 35-year industry veteran?

“It’s the way they handle repeat business and take ownership of the client,” he says, “and the outstanding competence of the busers, runners and waiters.”Segal suspects there is something beyond decades of experience behind Las Vegas’ hospitality prowess, something at the city’s soul, sublime and otherwise.

“The city is predicated on dollars,” he says. “Literally, its product is money, whether in gaming, tips, entertainment, hotels … I think that inspires a tremendous amount of enthusiasm to do well.”

For someone like Segal, the time is now, it would seem. For years, analysts have cited the decline in gaming revenue at the expense of entertainment. Today, non-gaming revenues on Strip properties run at roughly 62 percent, says Bill Lerner of Union Gaming Advisors.

Lerner said it’s also a great time to capitalize on the sea change in dining in Las Vegas and on the Strip — a time where value is king, not a celebrity chef.

“What we do need is well-priced, not particularly formal, but high-quality food and thoughtful, creative offerings, even if it’s a burger,” he says. “We need offerings that align with the pocketbooks. But that doesn’t mean it shouldn’t be fun, seductive and high quality.”

 

London Calling

In the next two months, ONE Group will open several venues in England’s dynamic capital, just in time for the Olympic Games, including an American-style casual bar, restaurant and lounge at the landmark Hippodrome Casino. Don’t expect any vestiges of the Rock Galaxy there. Segal notes a design request for a 100,000-square-foot “Vegas-style” casino.

“They don’t want the feel of Brighton Park or a Paris casino. They want a Vegas casino. … Vegas is an icon in America and an icon the world over. … This is the biggest invisible ‘export’ America has.”

Other ventures await as well. The ONE Group will oversee room service, catering and events at the ME Hotel. And STK London and Cucina Asellina, an early-Italian concept originated in New York, also make their London debuts this year.

Spending the bulk of his life on a small island between England and France didn’t provide the savoir-faire Segal wanted for operating in London. It took a jaunt across the pond to do that.

“We’re a British company and I came to America to learn about a new way of hospitality,” he says, reflecting again for a moment. “But, for some reason, I never really felt comfortable in business in England. But I feel more confident now, and now it feels like I’m going home.”