Marcus Carey and Damon Lawrence, Homage Hospitality
Hospitality rising stars Marcus Carey and Damon Lawrence are shaking up the hotel industry with Homage Hospitality, one of the first brands catered to the African American traveler by honoring and preserving black culture through design and programming. With one property open in New Orleans and three more on the boards, it seems they’re onto something.
Stacy Shoemaker Rauen: Hi, it’s Stacy Shoemaker Rauen, editor in chief of Hospitality Design magazine. I’m here with the Homage Hospitality guys, hi Marcus Carey how are you?
Marcus Carey: Stacy, it’s good to be here, thanks for having us.
SSR: We’re really excited to have you. You too Damon Lawrence.
Damon Lawrence: Excited to be here, thank you Stacy, appreciate it.
SSR: Let’s get a sense of how you started in hospitality. Was that something that you grew up in or that you always had a love for? Marcus, can you kind of tell us?
MC: Yeah, for me, that story goes back to 11 or 12 years old, a cousin in Detroit where I grew up has a birthday party and back then, birthdays just meant just go get a hotel room and invite your cousins and have a good night, have a good sleepover. That’s what we did. Yeah, so my parents take me to the Hyatt Regency hotel in Dearborn, Michigan just outside of the inner city. It’s just this huge building. I mean it’s 700 rooms. I’ve learned since what it really is. It’s 700 rooms, it’s got a monorail connected it to the mall. It’s directly across the street from Ford’s headquarters, so it was intended to be this huge meeting hotel, and I was just awestruck as soon as I walked in the lobby, I just hadn’t seen a space like that before. That was the first thread for me that was excited about hotel spaces and curious about them, wondered who owned it, and quickly found out that we weren’t, we as in our community, our people, we weren’t quite represented in the management and ownership ranks. At 12 years old, I was excited about the concept of bringing something like that closer to us, and I had no idea how we’d get there and then here we are.
SSR: Amazing. Damon, what about you?
DL: I was in my senior year at Howard, needed a job, found one at a hotel, which was the Donovan House, a brand new Thompson Hotel, the first one outside of California and New York, right in DC and fell in love with the industry. I had every intention of being a lawyer. I was pre-law and had plans on going to USC for law school and coming back home and fell in love with this industry so much I said I kind of put things off, and kept putting it off, getting new jobs, working for Dupont Hotel and Ritz-Carlton, all these different brands and soon after said this is what I want to do. I want to own these and I want to have my own brand.
About four years ago, I finally quit my last hotel job and then got really serious about it. Like so many young professionals, I just fell into the industry. Had no intention on being in it through college but it found me I guess you could say.
SSR: What was it that you loved so much, especially at the Donovan House?
DL: I saw the inner workings of how the operation works, because when I took my interview, I needed a hard hat to even walk in and take my interview. It was still being built. I tell Marcus all the time, you know the little placard on the back of the door, I put that on every single room. That was my job one of the early days.
MC: No one thinks about how the placard gets there. You got to have those fire instructions. Nobody thinks about that.
DL: Yeah, you’ve got to know those fire instructions, and so to see it from kind of that ground-up level and to also know that it was a Holiday Inn before, right? I knew it was a Holiday Inn, totally transformed. I was really exciting to see that, and then to see Jason [Pomeranc], the way he operated, the way he moved around as an owner. That was something that I admired. I was like okay, I don’t want to be my GM, I don’t want to be front office manager, I want to be him. He calls the shots. He comes in, he’s the coolest dude in the room, and so that was it.
MC: To this day, Damon tells me stories about times where he knew that Jason was a cool guy. You know, like times where he saw Jason walking in and just every indication was there that he was living a pretty great lifestyle.
DL: I’ll never forget the first inauguration in DC, and we had this creative coalition after party at the Donovan House and he knew everybody. From being at the Hollywood Roosevelt and all the parties that they would have there, he knew everyone in the room and it was literally a who’s who of celebrities, both the entertainment music, and he knew everybody. He was literally the coolest dude in the room. It was his space, he was calling the shots, and I was like I want to do that.
SSR: Jason was our guest editor a couple years ago and what I’ve always loved about him is how he can merge art design and operations and really understand how a hotel can live and breathe through design, form, and function.
DL: Yep. He’s cool. He’s still cool.
SSR: You both went to Howard University, but you didn’t know each other there.
MC: Yeah, Damon and I did not know one another. I’m four years younger than Damon, so we effectively just completely missed each other and have completely different friend groups at Howard. Look, he gets serious about it four years ago. He moves up to Oakland, California and he gets an article in the San Francisco Business Times about what he wanted to do. I read the article, and I was a little taken aback. It’s a Howard guy working on something as audacious as hotels, and he hasn’t given me a call yet.
At that point, I was used to Howard students calling me about their business ideas. I had never heard of his name or never seen him before, so I sort of sought him out. I just love being around idea people. The universe sent him. No one made an introduction, he just happened to walk into a day party on a Sunday afternoon in Oakland, California and I was in the same party and he happened to have a young woman with him who was wearing a shirt that said Homage. He had already had merch. He didn’t have any hotels, he already had merch. He had articles and merch. No property identified.
After meeting at that party, we sat together over coffee a week later and he pulled out 12-year-old Marcus, who was inspired by that Hyatt Regency. He reminded me that I was inspired, what, three years ago or so. We’ve sort of been off to the races ever since. To your point, we missed each other at Howard and that was to our benefit. We effectively covered eight years of relationships and people from one of the more important universities in the country.
SSR: Can I go back to people used to call you about ideas? Were you like a connector? What was going on?
MC: I spent some time working in New York, working on Wall Street and some time in private equity so just having a finance background and being able to talk about numbers, people felt comfortable to talk to me about those types of things.
SSR: Got it, and Howard’s really tight-knit.
MC: Howard’s very tight-knit. You’re talking 8 or 9,000 students total. The undergrad population is less than that so yeah, we all know one another generally speaking.
SSR: Can you talk a little bit, Damon, about what was Homage? What did you want to do? What was the initial beginnings of it?
DL: I sat at my computer just doing as much research, I would do it at the front desk a lot of times on those slow nights and tried to find out if there was someone else that looked like me in the space that was branding and creating boutique properties and I couldn’t find it. Every time I would Google, I was always taken to these stories of people from the ’50s and even earlier than that, that created these hotels that only black people could go into. That was the closest thing I could find as inspiration. I was like man, there has to be a way for me to pay homage to that. That’s where the name came from.
SSR: Those hotels weren’t anything glamorous.
DL: No, I mean you think about the Green Book, right, if you think about that and think about those spaces. Some of them were glamorous for us. There were jazz grace would do things in the speakeasys in the basements and from all across the country, DC, Harlem, Harlem Renaissance era, so they had great names culturally within the black community, but didn’t reverberate outside of that.
SSR: Okay, so you guys meet, you have a conversation, what’s next?
MC: What’s next?
DL: Met for coffee, talking about every cool hotel that we love in New York, every cool hotel in DC, what rooftop we’ve been to.
MC: We sit down for that conversation and I’m thinking this guy doesn’t know anything about the best hotels, right? At the time, I just moved to the Bay Area. I spent a bunch of time in New York and in DC and just I knew all my favorite lobbies. You ask my friends who hung out with me when I lived in New York, if it was a Saturday night and we were looking for something to do, I was the one like leading the group to Dream Hotel’s lobby so we could all just sit at Dream Hotel, get a drink, and then figure out what we do from there. That was my MO. When I sit down for coffee with this guy, I’m like man, he’s probably never walked into Dream Hotel. Let me get him really ready and to my surprise, he knew all of my spots and even more. He knew all of my spots, he knew why they were my spots. He knew what I liked about them and then he had more to add to the list that I hadn’t heard of prior.
DL: That really stemmed from working for Thompson and then trying to come up from DC every weekend that I possibly could just to stay at a different Thompson property and then find out, research what other properties were opening in the area. There was a really cool blog that I love called Hotel Chatter that I used to stay on weekly and get all the new insights on what was opening and where. I would come up to New York just to explore and see what hotels were doing what.
SSR: You have this idea, I mean it’s easy to have an idea, but how do you make it a reality? How did you guys go about opening your first hotel?
MC: Yeah, that’s the genesis behind Damon looking at me and saying, ‘Hey, come join me on the journey.’ At the time, I think he had maybe five or six individuals identified to be a part of a full team. Some people had HR capabilities, some people had branding and marketing capabilities. Early on, we would all get on Google Hangouts to talk about this sort of concept to how we were all going to work together as a team and the truth is, as time wore on, people sort of self-selected either in or out of the journey. It took maybe two months to figure out that it would pretty much be he and I sitting here together at the table. It would be he and I to continue forward on the journey because he has both an operations background but also a creative brand to put these concepts on paper. Then I have whatever sort of language necessary to talk to capital about the vision.
That’s sort of how the cofounder relationship ended up forming just through natural selection, natural process and then we’ve got another young woman who unfortunately sits in New York, so we couldn’t quite spend a ton of time with her because we were in California, but she’s been instrumental to our journey, her name is Chimene Jackson and she’s just a creative thinker. She’s got a master’s in design thinking from Parsons, and so a lot of our creative ideas are fused both from his brain as well as her brain, so we call her our chief innovation officer, but yeah the sort of two and a half or three of us are going down that road and capital was just the first kind of step, right?
DL: We had to learn how to navigate the space, right? Having not raised a dollar in my life and doing it the first time alongside someone I just barely met for the first time. We had to learn how to work with each other and then we had to learn the language and how to pitch and to really raise capital for such a large capital-intensive industry. It was tough, it was touch early on.
MC: We’re sitting in a city where entrepreneurship is defined by youth but not capital-intensive. A young guy or girl could come walk into the office and pitch me on your idea and I’ll give you a million and you can serve 500,000 customers with a million bucks. You know, we just can’t do that so we’re just in that environment talking to people in that environment about this idea and we an into a lot of road blocks. We ran into a lot of no’s on that road, and then we found out where there are some yeses. Those yeses ultimately led us to New Orleans and lead us to open up out first property last summer.
SSR: Why New Orleans? Was it just the right place? The right deal? What was it?
DL: It was we had raised some seed capital. We were having a hard time finding the bigger thing and we had an investor that said to us, ‘You know what? Consider getting something smaller just to get the brand and the name out there. It’ll do wonders for you. Your investment meetings will be that much stronger once you have that project to actually point to and say, ‘Hey, we did this.’ When we were looking at properties, we really couldn’t do anything. We didn’t have that much money, right, so we couldn’t do anything in San Francisco or Oakland. Those markets were too expensive. We started looking elsewhere and felt like New Orleans was the perfect market. It was the perfect start and it’s always been the perfect start for so many other things that are important to our community from jazz music, that was the first place where African-Americans were able to buy real estate. It was just impactful in so many different ways that we were able to go there to start and plant our seed to grow this brand nationally.
MC: Yeah, I wish that we could say that this was like some sort of smart, strategic thought on our part, that we were targeting New Orleans from the very beginning because it’s such a cultural-heavy, tourism-heavy market. We were not.
DL: Yeah, but those were some of the conversations though. I think behind the scenes, we looked at where we could go, New Orleans was really because of the tourism market, you know?
MC: Yeah, and the context is you know at the time, we’re partnered up with a very large developer about a project in downtown Oakland, California, 100 rooms and sort of they were paying for it and we were supposed to sort of program this thing. We were running into trouble to that process going, to get the architects and the designers in a room, and we start really working on the way that this thing will be programmed, and we just got frustrated. I mean we’re entrepreneurs, we got really frustrated by that process getting bogged down. Every week we would get on a call with that big developer, and they wouldn’t really have an update because the city hasn’t given them a green light yet.
It’s that frustration that leads Damon and his mother down a rabbit hole on Zillow, and Zillow sort of shows them a property in New Orleans that was affordable that we had the money to get and we felt like we could at minimum just break even, but like Damon said, get the story out. A lot of people sort of experience some piece of what we think we can deliver. Here we are a year later, it’s been huge for us.
MC: We’re a completely different position than we were a year ago.
SSR: You call it a mix between a hotel and a house.
DL: A house hotel.
MC: House hotel. This brother here has a lot of domains under his ownership.
DL: My GoDaddy account is stacked. I’m just holding onto them.
MC: Yeah, I don’t know, tell us more about the house hotel brand.
DL: Back before Airbnb really got started in such a major way, I had this idea that it was confusing to work at the Ritz-Carlton for graduations and have extremely wealthy families come into Georgetown or [George Washington University] to watch their son or daughter graduate, and they were leaving mansions in New Jersey and New York and they fit inside a 600 square foot hotel room, and it just didn’t make sense. They’re coming with their dogs, the whole family, they need an extra cot in their suite.
MC: We ran out of cots.
DL: We ran out, exactly. We did. Every time. It was like man, there has to be another way. People should be renting homes in cities to do this instead of a hotel room. When I moved back to California, I had this idea like there should be homes, houses that have the hotel amenities and so I was like okay, house hotel, right? Makes sense. What I did, I’m from Pasadena, California, the Rose Parade is like the biggest event that we have and I said, ‘This is my opportunity to start that.’ I got these fliers printed out and I went to every mall in the area and put them on the dashboard of every single car in the parking lot, so I would just walk around the parking lots and I got real leads. I had a website domain. People putting in their contact information. I would come check out their house, see if it was suitable to be set up for this home sharing kind of model.
SSR: What year is this?
DL: This was ’07.
SSR: You’re ahead of Airbnb.
DL: Yeah. I should’ve stuck with it.
MC: That was your Obama O’s. Obama’s cereal in Chicago. What was DNC that year? Was it Chicago? Wherever the convention was, they did the cereal.
DL: Then when we were going to do this smaller property, I kind of had this name that I just have a domain for, if we end up doing this and it has legs and we end up doing more of these, we should brand that concept. That’s how we got the name.
MC: Yeah, I mean it’s a year ago where we’re getting ready to put the property on the internet and allow people to book it and we had the name, we felt really good about the name, the Moor. We played up and paid homage to the Moorish people of Northern Africa and the Middle East, and so we felt good about the name the Moor, but we needed a tagline for people to really understand what it was. We had grander ambitions beyond properties with that size profile, so we didn’t want anybody out there to think this is what our business does. That was just a beta test, a taste of what we do, and so we put the tagline: A House Hotel by Homage. Kind of thinking through whether or not we would do more, who knows. Maybe we will. I mean we’re focused now on bigger things, which I’m sure we’ll talk about.
SSR: For those that haven’t seen it, can you tell us a little bit about what the hotel is like or how you wanted people to feel, what you were trying to deliver for your guests?
DL: We’re on Canal Street in mid-city so everyone knows Canal if you’ve ever been in New Orleans, and we sit right outside of the trolley car stop that takes you right down to the French quarter. The building is a very unique property in New Orleans because it has like Spanish stucco feel and vibe to it. It’s very differentiated as a property. We felt like the interior should match that and have more of a Moroccan, Mediterranean feel to it. That’s how we go to the Moor. It’s like how can we play that up, but then slant it to in a black Afro-centric way? Yeah, so we sourced our stuff a lot of different ways. We went to thrift stores, we went to every single thrift store, spent hours debating over which lamp shade should go on what lamp. Got some really cool art work to go in the space. It came out amazing.
MC: I think Damon’s be a little modest about the topic. He uprooted himself from Oakland and moved down to New Orleans basically at the beginning of 2018, so from January until we opened doors in July, he was there fulltime. I stayed back in Oakland, sort of focused on managing relationships with our existing investors there and then figuring out where we would go from there. It wasn’t until about May that some alert went off in my head that said I should probably get down there and be more helpful in the building process.
I, thankfully, trust him so much on a creative side that I know he can make these decisions on his own, and so that’s mostly what he was doing, just making decisions on programming the space but when I got down there, we grew so much as a partnership when we got to paint walls together and change lighting fixtures.
SSR: You guys did everything in-house?
DL: Yes. We got a bathroom tile, and that was probably the only thing that we had done by somebody else. Everything else we did.
SSR: What are some of the lessons learned or key takeaways from that? You said it grew your relationship but what else?
MC: We can talk about cash being king or we can talk about design stuff.
SSR: You can hit on them all.
DL: We learned how to work together. I think that’s one of the biggest things that we learned. Like he mentioned, having to roll up your sleeves. We sat in a room until three o’clock in the morning sometimes just trying to get stuff done and we were behind the eight ball because we already had reservations. We had reservations booked and the property wasn’t even close to finished, right? We knew we had to get ready and we were preparing ourselves for Essence Fest that year and that was kind of our big event unveiling and grand opening for the property, so I think that was the biggest thing is we learned how to work together very intimately. Before, it was like phone call, meetings.
MC: It was meetings and yeah, it was a lot of that.
DL: Yep. I learned what kind of music he likes.
SSR: Are you guys a lot alike?
DL: Drastically different.
MC: Yeah, drastically different.
DL: We don’t even like the same type of women. It’s just like totally different.
MC: Damon, wait a minute now, this is a recorded conversation.
DL: I’m just being honest. It’s like totally different. Nothing in common, but that’s what makes it work, really is that we’re so different that we cast a larger net because of that.
MC: And we trust each other so he’s got cart blanche access to my agreement, the agreement side of my brain. He can access it at any point. He can find a way for me to say yeah, that’s a good idea. Same way in the other direction, I can find a way for him to go yeah, that’s it yeah, let’s do that. A lot of trust. I mentioned cash being king earlier. I want to go back there.
SSR: Yeah, go back there. I was going to ask you.
MC: Cash inflows and cash outflows, you could have a budget all you want. However much you expect to spend on something is what you expect to spend but is the cash there? Is it available at the time you need to make the purchase happen? In that month of June, just prior to people checking in on July 1, or I think July 2 is when we got the first check-in but yeah, we just had real challenges on cash availability. Just having spent so much in the months prior and unexpected expenses, we learned so much both sort of the pre-opening budget, how to think about cash for the pre-opening budget but then also post-opening when customers are coming in and their cash, when do we recognize that revenue and when do we feel like it’s appropriate to use it on expenses and what if they need to cancel? What’s our cancellation policy?
Small dollars but at the time, a year ago, these dollars mattered a lot to us. Somebody paid us $700 for a few nights. We could punch that right into our capital budget. We had needs so going forward on every project, we’ll just be thinking about, from a budget perspective we’ll be thinking about cash inflows and cash outflows and trying to time that as best we can and be prepared for those headwinds. Sorry to take us to that place.
SSR: No, I think it’s good because I think any business needs to realize that, especially a very cash-intensive business like yours. Guests check-in July 2nd, I’ve heard from may different hoteliers that that’s the day it starts, right? Like you think all the things you do to open a hotel is everything, but it’s really once you see people use and live and work in a space is when you really see your idea come to life. Was that the case? Is there things that you saw and have learned from or tweaked or been excited about since people have been in this space for the last call it a year?
DL: Yeah, we learned a lot about who our demographic is. When creating the brand, we thought a lot about the African-American male and creating safe spaces for African-American men because we saw that there was so much negative press and things happening in the media regarding African-American men, so we even tailored our marketing towards that, to pay homage to that. Then when we launched, what we realized is we had more women than anything that booked with us. Even if they were booking for the family, they were the ones who were making the decisions. They were the ones on the phone, and we were the ones answering it, but they were the ones on the phone and they were the ones making the decisions and they appreciated our branding.
That was very interesting for us and then some of our partners now were being very strategic about who we partner with because now we know who is really gravitating towards our brand, and who is actually making the decisions in black households to spend the money when they’re traveling. That is impacting how we do business.
MC: I think another unique insight is as much as we want our spaces to say to a certain consumer, hey, this is for you, we want everyone to look at our spaces and then say, ‘That’s beautiful. There’s a line that we could draw sort of between those two realities, and so we try to walk that line as often as possible not only with the Moor, and I think we did a great job there. When we opened, we sold six months worth of rooms within five or six days. We sold six months worth of rooms for four units so small numbers but was still important and 95-plus percent of those guests were African-American.
We sold all those rooms direct, so those were all on our website and then at the top of the year this year, we launched on Airbnb and now we’re seeing a mix. I think what, are we, you feel like 40 percent African American is probably a good number?
MC: Since January, 40 percent African American and 60 percent all other and we’re still hearing good responses from people about the rooms and these rooms are, the apartment suite, for example, is very clearly black-inspired, and people are still enjoying themselves and enjoying their stay.
DL: That was very impactful for us, because we didn’t want to be boxed-in to being the black hotel or the black hoteliers, we wanted to get the credibility from everyone. Getting up and coming hotelier this year, that helped to get the credibility amongst our peers, but prior to that to get that credibility amongst our consumers.
MC: Our customers, yeah.
DL: Yeah, it meant a lot.
SSR: You said four rooms, and so are they larger-sized rooms? Are they more apartment-style? I guess we should’ve touched on that back there.
DL: Yeah, so each room basically is its own apartment. Yeah, so kitchen, bathrooms, kind of living room spaces, like studio apartments basically, yeah.
SSR: When you say black-inspired, can you delve into that a little bit more?
DL: From the artwork to the music, to the magazines that we have in the room, Louis Armstrong will meet you. We had that turned on as soon as you walk in. Then all of the art work is black-inspired in some kind of way.
MC: The Moor is again, just a taste of what we want to do and so in the larger properties, it’s reflected obviously across the staff. We look forward to hiring really diverse talent in our ranks and making sure diverse talent finds its way all the way up to upper management, equity incentives and so forth. That’s it. That’s a really important part of black-inspired is to make sure that it flows through the people in the building. Yeah, those are the types of things we’re excited about and inspired by, as long as we can have subtle but impactful references to black culture, which is so varying than we know that a certain consumer will feel at home. That consumer spends a lot of money and should be respected for their dollars. They should be welcomed and celebrated for their dollars.
We want to do that for that consumer. We’re not going to sort of cross the line into a space where all of our other consumers don’t feel like they’re welcome. We’re just not going to cross that line. The Moor is one representation I think, and the new projects will go even further on that.
SSR: How would that translate to amenities and programming?
DL: It definitely will translate to amenities and programming. We talk about amenities all the time and how when you go to hotels, those amenities are not designed for African American skin, and the pigment of our skin. It’s like putting on water. We talk about how ashy our skin is all the time after we use the lotion, and so that’s big for us. That’s huge for us, it’s huge for our demographic and so we’re excited about that, and what kind of programming we can include into the space that invites everyone to experience the heart and soul of some of these cities that are being impacted greatly by a number of different forces.
SSR: Yeah, and you know how you see hotels like the Eaton taking a social activism role and trying to start that community and those conversations, do you see that happening in your hotels, especially the larger ones that you’re working on?
DL: Most definitely. Yeah, most definitely. Love Eaton and love what they’re doing. They’re kind of showing us that there’s a market for that and it’s a strong one so for sure.
SSR: Can we talk about some of the upcoming deals that you’re working on or properties that you’re planning?
DL: Go ahead, Marcus, let them know.
MC: Yeah, happy to. We are, let’s see it’s June 2019, and we are under contract on a few really exciting locations. When we think about the next couple years, we just think about setting ourselves up for what could be a larger brand expansion, but we want to be careful about how much we allow ourselves to do. We don’t want to do too much. We want to focus. We’re in California and California is a destination for practically every human that walks the Earth but certainly, every human as a resident of the United States. We’ve been there for three years.
Once thing that we learned doing a New Orleans project is it’s tough to lay our head in Oakland, California and get on a three and a half hour flight down to New Orleans to make sure things are moving as they should. When we started the year, we reset and focused in on California, and opening up spaces so that all the folks that make that a destination decide to come out. Oakland, California is of course one of those focuses that as a hotel marketed deals with a lot of spill over effect from San Francisco, people are paying $700 a night for Holiday Inn experiences in San Francisco. Look, that’s no shade to Holiday Inn but technically, it is a lot of shade to Holiday Inn.
We just don’t think that that’s right and obviously, the people that end up paying those amounts also don’t really like that. Oakland’s just this phenomenal hotel market that does not have boutique product at all. We are going to open up in maybe 12 months from now, we’re going to purchase this summer and open up a roughly 100 room building at Lake Mary. There’s a huge lake, I don’t know if you’re familiar with Oakland but huge lake in the center of the city and there’s no hotel surrounding it, we’ll open up a 100 room hotel right at the tip of Lake Mary.
We’re really excited about that, and then LA is of course also a focus of ours and we love Downtown LA, I have for a long time and we found a beautiful site that’ll be subject to a ton of natural light, so we say the attraction will be the natural light. Directly across the street from LA Convention, so Downtown LA, LA Convention, roughly 130 rooms with some out-of-this-world programming ideas and retail partners that are going to join with us to get Downtown LA done.
Those two are where we’re spending a lot of time. We’re raising money. We’re talking to a lot of people about those deals right now. Then I guess the other one we should probably mention is New Orleans. We want to double down on New Orleans and go a little bit bigger. We opened a four unit and saw how many people were calling about coming to get a drink and we can’t serve you a drink at this four unit. We’ve got site control on a ground up project in the Treme neighborhood of New Orleans to build a 100 room ground up. That’s our pipeline. That’s where we’re spending our time. California is sort of the center and then doubling down on New Orleans.
SSR: Do you guys think more ground up, more renovation, or there’s just more about finding the right the right deal.
DL: It’s just trying to find the right deal. Two of those, downtown LA and New Orleans are opportunities on deals so we’re excited about that. It changes the way we raise capital on those, but then for Oakland, it’s not an opportunity zone but it’s a great opportunity. Yeah, we’re just being bullish about finding the right locations, good locations to stand up our brand.
SSR: For these bigger properties, are you bringing in now designers and consultants to help you? You’re not going to be painting every room?
DL: Those days are done.
MC: Those days are over.
DL: Yeah, we’ll be painting forever trying to paint a couple of these properties.
MC: Yeah, you know we’ll have some in-house design expertise and some ideas that we want to fuse into our projects, and then we want sort of the community of designers to be a part of everything we do, because what we do we think is differentiated enough to just fuse in a differentiation and then allow younger people of color, designers to get involved so they can feel like they own a hotel too.
DL: I think it’s just important for us to find the most creative people that we can across whatever industry and see what they can bring that’s new and fresh to the hospitality space. I think we kind of get frustrated with what we see in the space sometimes because everything starts to look the same. I tell Marcus, I don’t know how many times I could see that lamp that has like the little cords going 20 different ways in the hallway of a lobby again. I’m just ready to see something new, something fresh, and we automatically represent that, but we have to reflect that in the properties that we put out to market.
SSR: Yeah, and you said you had some really interesting programming in the one in downtown LA, are you guys rethinking lobby space and how you want that to look and feel and is coworking part of it? There’s so many different things happening now in lobbies, how are you guys going to kind of approach that in larger spaces?
MC: We always got to make sure that we get buy-in on both sides of the partnership before we start announcing people, but when we used to pitch the effort a lot and would try to get people to understand what’s possible, we would always point to music as a good way for them to get it. We envision a future, so from a program perspective, this is not necessarily about space use or where things go, I don’t know that we have, I don’t know if we’re rethinking how the lobby looks per se.
But from a programmer perspective, I can’t really think of any hotels that as a brand acknowledge the cultural impact of music releases and center the music release experience into their program. I just can’t think of any that do it. Early on, and we still believe that this is possible. Consumers should know that if such and such artist releases their body of work that we’ve been waiting two years to get. Well, the day that it releases, the night that it releases you should know that you can go to your neighborhood, your local Homage property and you could hear it on the sound system sort of throughout the property.
We all enjoy it. Drake dropped an album and we’re all in our own corners of the world listening to it on our headphones. We should probably do something like that together when and where possible. Yeah, that kind of programming use will exist for us and with us, and a ton of other kind of out there ideas that we want to test.
SSR: Now that you have that one property in New Orleans, has it been less nos and more yeses? Has that been true that once you kind of show what you want to do or can do on a smaller scale, has it made it easier for you?
MC: It’s made more meetings happen, so we’ve gotten more meetings in the past year than we got prior, which are important.
DL: Which translates to more yeses.
MC: Translates to more yeses, but it also translates to more nos. As entrepreneurs on the entrepreneur journey, we still have to deal with the mental impact of having someone say like, ‘Hey, no, this is not a fit for me.’ We luckily, after three years of running at this thing together and a little bit longer for Damon doing it solo, we got the mental fortitude to deal with that, to take that hit and keep running.
DL: Yeah, it’s a numbers game. You’re going to hear so many nos before you get a yes, but having a property now in the market made those numbers increase. We have more people to reach out to, which automatically means that we get more yeses but we also get more nos as well.
SSR: I mean you were sharing with me the first time I met you, some of the numbers of the African American traveler.
MC: Their impact is huge and we think they’re the most ignored consumer in travel. We’ve heard people make arguments that other sort of types of demographics are the most ignored and I say okay look, we’re splitting hairs. There are ignored consumers in travel and we should start paying more attention to them, honoring them, making sure they show up in branding and marketing sort of activations. We should just do more to acknowledge their spend. On the African American side of the house, they spend roughly $70 billion as of last year annually on travel. That’s African American only. That’s global travel. That includes air and hotel and everything else.
A third of that $70 billion number is the hotel number. We can’t point to one brand across all aspects of travel that are intentional about saying hey, you’re welcome here. We can’t point to one. We can point to a ton that have these incidents, these isolated incidents but nonetheless, important incidents where people don’t feel welcome. Yeah, market size plus need, market size plus incidence of unwelcoming is all that we need to say okay, let’s bet our life on this, so we bet our life on Homage.
SSR: It hasn’t been easy, right? Like there have been times when you guys drove Ubers and Lyfts to make ends meet. I’m always looking for different speakers for the different events that HD does and somebody that we’re bringing on to an event we’re doing is how to make the impossible possible and everyone has an idea, but actually making your idea come true is easier said than done. A) I applaud you for that and B) can you talk a little but about sum up more of what the journey has been just mentally and physically?
DL: Yeah, I will speak for myself. I always been very creative and always come up with these ideas, but I spent so much time in the past and so much time on the idea that I’ve worked it through in my brain so much that I get tired of it, and hotels were the one industry where I never got tired of it because you can always change, and it will forever be different. The music programming, there’s so much that goes into creating spaces. Hotels, I was so enamored with it, and I got excited about it and Marcus mentioned it earlier that I had a brand, I had marketing materials, but I had no property, right?
What happens when you put it out there to the world, is that now you are held to that. I told the world what I was going to do and now I’m actually held to it. All those times where you have a hard day or you hear a bunch of nos, you realize like hey, the world is expecting this. No matter how long it takes, I have to get there. Otherwise, what type of person am I, and what does my word mean in the future if I don’t follow through. That’s kind of what I’ve stuck with throughout the journey is just do what you said you were going to do and that’s it.
MC: Yeah, it really does breed a bit of a chip on your shoulder certainly in my experience and that [motivates me to] kick open a door and then leave the door open. Like kick it open and make sure it stays open so a ton can come after us. I was writing about this recently, there’s so much creative energy inside of marginalized communities and smart enough brains to execute on those creative ideas. There is an obstacle beyond the ideas and the brains to execute.
There is an obstacle beyond that, that maybe should or should not exist in the world and we should start to think about how to get rid of that capital-related obstacle so that we can unleash more positivity into the world. More value creation. For those that are listening in, you think I’m talking nonprofits. No, value creation in the world can be unleashed if we figure out how to start speaking the same language to one another and see value across color lines, familial lines, religious lines, we just start to see people for who they are and let them be who they are and still create. That’s a deeper discussion. It’s tough, but I think that’s what my journey in this company is about. This company’s about kicking open a door and leaving it open.
SSR: Have you gotten any feedback from people thanking you for starting a hotel that speaks for them, speaks to them I should say?
DL: Yes, actually we have our first repeat guest in a couple weeks. They stayed when we first launched and loved it, enjoyed themselves and decided to come back and bring the entire family for another go at it, so we’re excited about that.
MC: Yeah, I’m excited because right now as we speak, there are two young boys, they’re brothers, the Mack brothers out of Detroit, Michigan. They’ve been watching our journey for a little while and they got to meet me in person maybe a month ago for the first time and their mother and the two boys came up to me and told me how much they enjoyed watching our journey. Then a couple weeks later, they just went ahead and booked a room and so they’re there now, two 8-year-old boys who are already entrepreneurs, they’ve written a book in Detroit and I think they cut grass. They’ve done some sort of small off jobs, and then they have a bigger idea around corporate housing that they shared with me.
These are 8-year-old boys. That’s why we do it. They’re right now in New Orleans and she just texted me an hour ago and said, ‘We’re having a great time.’ I think we made sure they got beignets or something to take care of them. Yeah, it just warms my heart. We didn’t even make the Moor for kids to be there. There are no video games in the room, but they’re having a good time and so that’s why we do this.
SSR: Yeah, and I’ll ask just because I’m really curious, but how do you market to the African American community without alienating the other 60 percent that you said are using the Moor?
DL: Yeah, so it’s a fine line that you have to tow. I think that marketing in general, when we think about the most impactful community to popular culture, you have to think about African Americans, right? They impact it in such a major way. When you speak that language, the world already knows how to listen to it. We just speak with our own voice, the same way that you would listen to Jay-Z speak with his own voice, we speak with our own voice, and I think we are at a place in society where everyone understands that. We get it.
We’re used to hearing our voices now, and so that translates into the marketing. Chimene handles our social media and she’ll think of a caption and then she’ll call us and say, ‘But how would you say it? I need your voice to really sell the brand because the way you say it, that’s what people respect and understand.’
SSR: Well, so many other questions but I think that’s a perfect place to stop our conversation for today and I can’t thank you guys enough for being here and we’re really excited to see where you take this.
MC: Thank you. Thank you so much.
DL: Thank you very much, Stacy. Really appreciate it.