XP Factory (XPF) - Paul Mystery Shops The New Bournemouth Site! (with Pictures)

20th Oct '22 by Paul Scott

14 comments 2336 reads

Hi,

** STOP PRESS! ** Article updated 24 Oct 2022, at the end, with more pictures, and slightly controversial comments! **

This seemed a bit off topic for the SCVRs, so I've created a separate post.

I've covered XPF (stands for experience factory) 6 times this year so far, in the SCVRs. It's caught my imagination, as an interesting small caps idea, and I picked up a bit of stock personally after deepening my research earlier this year. It is speculative, as there isn't yet a track record of profitability.

Here is my recent audio interview with the CEO, Richard Harpham, which I think is very interesting, it strikes me that he knows what he's doing, and has relevant experience previously in strategy & business development at both Pret, and Constellation Brands.

XPF now owns two rapidly expanding "competitive socialising" themed leisure brands -

Escape Hunt - escape rooms. This was the original company that reversed into an AIM shell called Dorcaster in April 2017. To be honest, I never thought much of it, and the shares were a disaster. Then of course the pandemic struck, so being locked in a confined space with a group of people, was possibly the worst business model imaginable! However, it survived the pandemic, and in 2021 things started to transform, with a 30p fundraising to acquire -

Boom Battle Bars - this is the bit that interests me the most. These are "competitive socialising" bars, with bespoke games to play, whilst having drinks, and a limited menu of "street food" - so pizzas, nachos, fries, chicken wings mainly. Hence only a small, lightly staffed, low overheads kitchen. Fees charged for playing the games, in addition to high margin drinks & food, make this an unusual, high margin business model. It's also securing stunningly good deals on large new sites in the current depressed market, with landlords funding most of the fit-out costs.

Have a listen to my audio interview with the CEO (NB. my interviews are independent - I do not charge any fees, although in this case I do hold a personal shareholding, intended as a long-term investment. These are not advice or recommendations, I just do them for general interest).

Anyway, enough of the background. The point of this post, is that new sites opened today in sunny Bournemouth (where I spend a lot of my time)…

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Foodie

21st Oct '22

Brilliant!

rhomboid1

fantastic review Paul…

Lefty99

Awesome review Paul, love the photos.

Shelley Kiddle

As a Bournemouth resident I’ll be check this out!

Snazzytime

Terrific review Paul. You've gone to great lengths to share this so thank you for that.

It's clear that you are very optimistic and enthusiastic about these new 'experience' bars.

Regrettably I can't share your enthusiasm and am inclined to view this as being a novelty that will wear off as I don't feel it has the pull for repeat customers. Just a one off experience in my view but happy to be proved wrong.

jinjah

Hi Paul, thanks for a useful introduction to the business. Looks like you had fun.

I would like to know how much one has to pay for the games, or are they free if you are buying drinks? How would things be organised if there are a lot of people in the space?

cheers,

organictrader

Great balanced review Paul, thanks for sharing.

Snowbum

Great article Paul, I noticed there’s one in Glasgow too, in the St Enoch centre, another great location!

Think I might take a trip there too with the missus and will suggest it for a night out for my shift colleagues to investigate along the same lines you’ve done. Will be sure to report back here thereafter.

Paul Scott

Hi Forbsy!

Great stuff, I'd be interested in your feedback from visiting their Glasgow site, do let us know!

I think it would make a terrific night out for a work outing. Most of the games seem set up for 4-10 people, and they're more cost effective that way too.

Regards, Paul.

Hi jinjah,

Re the pricing of the games at Boom Battle Bars, if you go to their website here, it shows the games at each site, and the pricing under the "Learn More" button next to each game. They're not cheap! For example, the augmented reality darts, which I tried (it was great), is £40 for a hour, but that is for 2-8 people. So it makes sense to go in a large group, which would be £5 per person (group of 8), for an hour's entertainment. Not too bad. It would be crowded though, so maybe more suited to a group of 4, which would be £10 per person, for an hour.

Axe-throwing is £35 for 30 minutes. That's 2-10 people. There's more space here, so I'd say a group of maybe 6-7 would be comfortable, so that would be £5-6 per person for half an hour - OK. Or for 3 people, just over a tenner each.

I liked the NOLF (not golf), which is £10 per person, unlimited number of people. It's approx.45 minutes, but at quieter times I think they would probably let you play for longer.

American pool tables are £15 per hour, for 2-4 people. That struck me as very expensive, but I'm benchmarking against 50p per game at Uni, in the 1980s LOL! I questioned the cost as seeming high, but as the staff said, there are not many places that have pool tables any more, most pubs got rid of them, and people still want to play.

Ryan told me his favourite was the Shuffleboard, I didn't try this. It's a huge, long wooden slide, that you try to slide something down without it slipping off. That is £15, for 30 minutes, and 2-6 people can play.

I think BBB will probably most suit group outings, and I can see it being super-popular for Xmas parties, hen/stag, birthday parties, etc. So more of a destination night out, than a standard night out, I reckon.

The flagship London Oxford Street site is due to open soon, I believe. Details here.

Hi Snazzytime,

I know what you mean, that was my attitude towards Escape Hunt (XPF's original brand) too. However, I challenged XPF's CEO on this point in my interview with him, and he replied that sales continue to build at Escape Hunt's sites, and in 5 years they have not replaced any of the rooms, they're all original (albeit closed on & off during the pandemic).

As regards Boom Battle Bars, I think you should visit one, to see what it's like. Even though I visited on opening day, with only a soft launch, with a handful of customers in, the whole experience was just much more lively & interesting, and fun, than being in a conventional bar. I left wanting to go back again, with some friends, and have a proper experience there. Although the cost does seem quite high to me, that's my main concern.

Also, bear in mind that all the games are free-standing, modular units. They're designed that way, to be moved about, replaced, rotated between sites, etc. So I think the strategy is to replace any games which under-perform, and do regular refreshing of games. There's an in-house creative team that design all the games & come up with new ideas all the time.

I don't think this is a fad at all. But we don't know for sure yet!

wolfspirit

25th Oct '22

Your flat, like the one I had in London shows the vast gulf between new properties and old properties. I use to have the heating on partially for 2 months of the year (Jan and Feb usually).

I've also lived in an old brick building where Sept - early May was normal. I'm guessing that the regulations will be burnt as part of the conservative govt. policy. Good design and build costs money, damn red tape!

Really interesting to hear an alternative perspective on the BBB. I came across something similar many years ago, this seems like they have learnt a bit from that and are executing better. I think the risk of the Rev bars "needs constant maintenance" is a risk.

As an alternative perspective I like the Escape rooms bit. They keep them updated and can rotate the kit from site to site (as they seem to for the BBB games as well!). They also leverage brands that most escape rooms don't. Daleks, Alice in Wonderland etc.I don't think anyone ever repeats a game so it needs to update to get people to return. People will travel a long way and pay a lot to go to them as well. It would be nice to have "post-match" entertainment on hand in the form of BBB.

Also many escape rooms are "enthusiast led" in disused buildings in less populated areas (read dodgy!). They don't want to commit to leases and can't afford most of them. Bringing it to the high street will help grow it - but I do wonder how they make the economics work (I tried but couldn't). Sharing staff is a definite plus.

I hope the joint concept gains its place on the high street. I think the Franchise model is really suited to this business. I think it mitigates the "constant maintenance" issue as the person who has the most to lose is able to make decisions on site.

I get it is a soft launch - but you can't see Bournemouth on the Escape Hunt booking yet! That is too soft for my liking!

9th Jan '23

Well, I did promise to let you know how it went after visiting the Boom Battle Bar, so here goes with my account following our ‘mystery shop’ of the Glasgow bar.

For context, this was on Dec 22^nd, 2022. There were 10 of us on a work day/night out. Our booking was for 3 games, 3 x 1h slots. This included a round of drinks, so value was fine at £25 p/h. The location was good, top floor of St Enoch shopping centre so very central and easy to get to / find. The unit is large, took up around a third of the upper floor area so hope they got a good rate on the rental charges!

Disappointingly, axe throwing required that no alcohol had been consumed so we were unable to book before the visit this as we were meeting in another bar beforehand. Axe throwing had a small surcharge of £3 p/p.

On arrival at around 3pm, it seemed quite busy for a Thurs afternoon, there was a decent sized queue on arrival to check in for our booking, but this moved quickly. On entry, it appeared like there was a wide age range among clients in the venue which was encouraging.

For game 1 we played augmented reality darts. Staff member gave us a quick run through on how to operate the game then left us to it. He was a nice chap, explained things concisely. 10 of us, 2 lanes of 5 in each, for 1h. We managed 3 and a half games in the hour; killer, half’s, bricks (300), killer again (time ended mid game). This was great fun, we all really enjoyed these games, the variety available kept things interesting too.

My colleague throwing, playing ‘half’s’ shown above.

Once we’d finished here, we had a session of pool reserved. We again got two tables and stayed on this game for a double slot. The other games weren’t fancied by the other group members despite my urging to have a go at Nolf !

The pool tables were true and in good condition, plenty decent cues and chalk available. All were American tables. I’d like to have tried some of the other games, but general observations of them were that Nolf took up a massive floor area of the bar and no one played it the whole time we were there! The darts, pool and table tennis were generally busy and always occupied with people enjoying them. Beer Pong had folk playing most of the time, shuffleboard was sparsely used and axe throwing similar; I saw maybe around 1 in 5 groups appearing to do this on arrival.

Bar – this was card only, don’t see why this is necessary. Staff were happy to open a tab with pre-payment already taken for 4 people who couldn’t attend, which was useful. One aspect that I didn’t like though, was the requirement to go to the bar during games, was ok for pool as you could go when not playing but during the darts caused lost game time, there could possibly have been a server here to prevent wasting game time at a busy bar imo (5-10 min wait for drinks).

Gents toilets, this was not the best experience at all! Urinals were all covered with cling film, marked ‘not available for use’. 3 cubicles were the alternative, with a queue for one every time I went to the facilities. Two had a broken seat and poor levels of cleanliness. The wash hand basin was flooded too. I really should have complained but couldn’t be bothered with the hassle factor at the time and it was also just after a cold snap so had initially given the benefit of the doubt re. burst/frozen pipes. Later in the evening I encountered a staff member draining the sink into a bucket – around 2h after first seen. When I asked them about it, it had been like that for 4 days, and it was indeed apparently due to burst pipes. A plumber should have been called earlier imo.

In terms of seating, they weren’t very comfortable. Metal chairs and wooden tables didn’t feel in any way premium, unlike the drinks’ prices! The areas away from the games and bar were quite empty most of the time we were there though, it felt like a large venue to fill tbh so I’d like to return again at a peak evening / night to see how packed it really gets.

Overall verdict then, fun for a night out due to the novelty value, the darts in particular was really entertaining. The rest of the games though I’m not sure about. The pool was overpriced for what it is and there weren’t enough tables imo to make it a ‘pool destination’; pool lovers will go to a ‘pool hall’ instead. I have concerns as a potential investor over its longevity – will people try it once and not return?

It could work out as an investment…. but for now, I remain on the fence and I’m happier to be a customer rather than an owner/investor.

For further investigation, I also fancy checking out the escape rooms of XP Factory (LON:XPF) too but it’s through in Edinburgh unfortunately so less accessible, if I do go will be sure to report back here again.

Cheers,

Forbsy.

XP Factory (XPF) - Paul mystery shops the new Bournemouth site! (with pictures)

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Paul Scott

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