Spotting opportunities amid crisis

July 12, 2020 | By Rupkatha B

“I have spotted the opportunity to start two new businesses amidst the on-going COVID-19 pandemic,” shares serial entrepreneur, Ibrahim Abudyak – co-founder of unconventional entertainment concept The Smash Room.

Abudyak is not new to failure, as two of his start-ups before The Smash Room had failed leading to a huge loss of money. “But that didn’t deter me from launching the third venture, The Smash Room, followed by two other pandemic-proof businesses,” he states.

Despite his positivity, it can’t be denied that the leisure and entertainment industry – that was buzzing – had to take an unprecedented hit due to the COVID-19 pandemic. Temporary closure of entertainment venues made the operators bleed beyond imagination.

“There was a definite sense of unease during the initial days, when we had to temporarily close the doors of The Smash Room for 90 days,” Abudyak admits. “It meant we weren’t making any money, but had to still incur certain fixed costs and support our team.”

Also read: The Smash Room is unapologetically unconventional

We’re still bleeding financially

Overnight, The Smash Room’s revenues declined drastically. The unconventional entertainment venue that used to draw at least 400-500 people and record 250-300 transactions monthly plummeted to zero.

“We are not even close to 30% of the sales that we did last year. We are bleeding financially,” Abudyak shares. “Being an indoor entertainment venue, summer months – especially June, July, August and September – are really busy for us. So far, our best record month was July 2019. This year, we have already lost a good portion of our peak period. From AED120,000 in sales, we have seen business literally vanish.”

During the lockdown, the entertainment start-up launched an at-home kit The Smash Box, but that really didn’t offset the losses incurred on The Smash Room. “It isn’t a replacement for The Smash Room. That initiative was aimed at keeping the team positive and engage with our valued guests, even if they weren’t able to visit us. The Smash Box has helped us to build our database, helping us widen our consumer base.”

We’ve embarked on a transformation journey

“The Smash Box is actually the starting point of our digital transformation journey to venture into new experiences and products,” Abudyak points out. The at-home Smash Kit offering will expand, going forward.

“We have tremendously ramped up our communication with existing and new guests leveraging digital and social media. For instance, Tik Tok has worked really well for us as a new social media channel, helping us to convert fans into guests on reopening our venue. While the offline experience will always be at the heart of The Smash Room, we are on a serious digital transformation journey,” he adds.

Abudyak is getting ready to launch a mobile game built around The Smash Room concept. “We are also in the process of deploying virtual reality (VR) at our facility and on our digital platform, which will allow our guests to smash things virtually. Further, with an aim to take The Smash Room experience closer to people’s homes, workplaces and events, we are thinking of launching an on-demand, mobile ‘smash’ bus that will move around the city. Finally, in order to offer contactless services, now our guests can reserve and pay for their sessions on our website.”

We can see light at the end of the tunnel

In July, so far, The Smash Room has registered 20% increase in guest numbers over June. However, it still doesn’t come to its plans for the year. In 2020, The Smash Room was on track for a 10% year-on-year growth. It was attracting a lot of corporates for group activities at its venue, which has now disappeared. That’s not all; the brand was close to signing two new locations in March in Abu Dhabi, which obviously fell through the cracks.

“But we aren’t losing hope; we can see light at the end of the tunnel. What we are, however, doing is efficiently managing cash flow to ensure business continuity, without reducing our team size. We have relooked at the budget for the Al Quoz location, adapting to the new reality of a gradual comeback,” Abudyak states.

The Smash Room also had plans to open at least 40 locations around the world over the next five years, following the franchise route. “We are talking to our strategic franchise partner to readjust the five-year plan. For now, we are focused on protecting our existing venue and then think about expansion. We have to first get through the tough times,” he concludes.


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