Building a self storage business twice: Fred de Ryckman de Betz, HOLD

People will rarely drive past 2, 3, 4, 5 of your competitors to come to you across town through traffic just because you've got a nice brand. You know, I understand that. But I think that there are 2 areas where it does matter. First of all, vis-à-vis the customer, in the margin, it makes a difference. So if a customer is faced with a choice and it comes down to you and one other operator, if you've got a better brand, they will choose you.

Hello and welcome back to Scaling Self Storage. Today we are really, really happy to be joined by Fred Rickman de Betts from Hold Storage in London. Thanks for joining, Fred.

Thank you very much for having me, Gavin, and 10 out of 10 for pronouncing my name correctly. That's always a challenge. It's the reason why people call me Fred, and you've just discovered why. So thank you very much. It's an absolute pleasure to be here.

Yeah, thanks so much for joining us. Before we get into some questions, can you give us the background and your history in self-storage?

Wow. Condensing 20 years into 30 seconds.

Yeah.

So, I mean, I'm a chartered accountant by background, and Originally, I worked in corporate restructuring, corporate finance in the City of London, and there's a reason why I chose that career path. And I started my first self-storage business. I spent 2007 getting ready and launched my first business in Bow in East London in March 2008. So that was Attic Self Storage. And I was doing that until August 2022. And then from September, October '23, we launched Hold. So this is my second self-storage business. Wow.

Excellent. Thank you for that. Yeah. So you launched in 2008, March 2008. Great timing.

Absolutely fantastic timing. So I gave up a very promising career in restructuring to move into a property business just before the mother of all property-led recessions. So it was certainly very, very challenging. The first 3 years were particularly difficult. Yeah.

So going back to that time, What was it that led you to make that decision to leave a very different type of career and move into self-storage, something probably not that many people consider?

I think I'm clearly not very bright. Look, I'd always wanted to be, I think since the age of about 12 or 13, I'd wanted to be an entrepreneur. I'd wanted to run my own business. Unfortunately, my grandfather went into business and he went bust, and my uncle went into business and he went bust, and my father went into business and he went bust. And so, that burning ambition and desire was still there, but I was quite afraid of getting it wrong. So I decided that the best thing to do was to figure out what not to do. And that led me into a career in restructuring. And that's how I became a chartered accountant, to try to figure out what not to do. And I did a lot of work in receiverships, administrations, business reviews, business turnarounds, that kind of thing, which I thought would give me a good grounding in, you know, in business and trying to minimize the risks of getting it wrong. I had a number of crazy harebrained ideas of things that I wanted to do that people weren't yet doing. But I was quite concerned that they were high risk. So I was looking for something that was relatively safe. And I came across self-storage. And so I thought, well, this is— this would be a great industry for me to cut my teeth, prove my credentials, raise a bit of capital. And then once I'd exited my first business, I could then go and do all those crazy things. And that's kind of how I ended up in self-storage. I was I knew a little bit about the sector, but I didn't know a huge amount. And I was traveling down the M1 in early 2006, spring 2006, driving a Luton van. And my mum had passed away unexpectedly quite young. And that was her life content, you know, her life's work in this little Luton van. And I rang up the Access Storage in Ballam and said, I need some storage. They didn't pick up the first 2 or 3 times I rang. Then eventually someone picked up the phone and they said, we've only got 2 units, a 50 and a 60 square foot unit. And I said, we'll take the 60. And I got, I think, 2 or 3 rent rise letters in the next 18 months. And I thought, hang on a minute. I went to visit the place, I think after about a year, and they were building a side extension, 4 storeys tall. And I thought, customer service, totally absent, completely full, expanding, and they keep putting the prices up. What is this industry? And so I started to look into it. And the more I looked into it, the more I thought, actually, I really like the fundamentals of this sector. High barriers to entry, but very scalable, with good cash flow income streams, and a good M&A market for an exit. And so I thought, if I can crack those barriers to entry, I've got a good opportunity here to build a business.

That's some story. So that was 20 years ago that you discovered self-storage? I think one of the unique things about your experience in self-storage is you have set up 2 distinct self-storage businesses. When you were setting up Hold Self Storage, so the most recent one, what were some of the things that you took from your time at Attic that were just no-brainers to keep doing?

The first one obviously is people, 100%, without a doubt. So bringing good people across was the single most important thing. That's probably the biggest thing that I took across from Attic. And that was a business that I had built over many years. And so, you know, I had some good people there. And I'm very, very fortunate to have, you know, most of my team constituted of former colleagues from Attic. But also having the benefit of a lot of experience, a lot of very hands-on experience operationally as well.

Yeah.

I'd done lots of things and I'd kind of figured out what works and what doesn't. And so I knew where to double down and where to really focus my time and effort and resources. So, you know, I remember with Attic, remember very, very clearly, and a lot of your viewers will think this is crazy, but, you know, I'm this old, believe it or not. On a Sunday afternoon when I was in reception and this customer came in and he put a phone on the desk and it was an iPhone. It was the first iPhone. And I said, wow, is that one of those touchscreen phones? You know, and it was. So, you know, I've kind of spanned the Yellow Pages and Thomson Local Directory part of this industry through the Google era into the AI world.

Yeah.

And through all of that, I've done a lot of hands-on stuff in all the different aspects of the business. And because I had to bootstrap and it was 2008, '09, '10, '11, we had no money at all. I've really had to kind of figure out what works and what doesn't. So you get to bring, you know, when you go again, you get to bring the benefit of that experience and not just yours, but your teams as well.

Yeah.

to bear in the new business that you launch. And when you do it the first time, always whenever you launch a business, you think, I'm going to make this the best it can be. And you do the best that you can. And so the first challenge that you have is, oh crikey, how am I going to do this better? Right. And at first you think, I can't do it better. But then you sit down, you roll up your sleeves, you get to work, and you realize you can do it better. And every single thing that we do in Hold, We take as our benchmark where we were previously, which I think was already a pretty high level. And we think, right, okay, we want to go further and not just a little bit. We're not trying to iterate. We're trying to go a lot further because time is marching on and everyone's improving as well. So that's probably the thing that is most fun as well about setting up a new business is that, you know, you get the opportunity. In my case, I got a completely blank sheet of paper with very significant funding. an experienced team, a lot of experience on my part, but none of the overhead or overhang of having a business that was 20 years old. I got to start from scratch. And that was fantastic. Absolutely brilliant.

Were there any specific things about the way you wanted to operate the whole business that, you know, were sort of like, what were some of the core things that when you sat down to sort of redesign this new business, that were most important to you?

So I think, again, drawing on experience and learning from what happened in my time with Attic, I think people and culture, which was always important to us previously, but having a real zero tolerance approach to the wrong people. So I call it my no dickheads policy. We just will not suffer anybody who clearly is toxic in any way, shape, or form anywhere around the business. So whether that's in our capital stack, whether that's partners, professional consultants, developers, or within the team, that you just cannot allow anybody into the team that isn't going to be value accretive, not just from a balance sheet perspective, but also from a cultural perspective. And I think that one of the mistakes that I made before was thinking, giving people the benefit of the doubt and thinking, well, actually, If we put our arm around this person and show them the light, they will show them the way, they will see the light and it'll be okay. And I think the reality is that, you know, whilst that may be possible, it's really difficult. And in the meantime, it causes issues. So I think, you know, taking the lessons of what a strong culture looks like and how effective that can be, but also understanding where the threats to a strong culture can come from. That was really important.

And what about operationally then? So I know Addick and Holdick, you're in London and you tend, from what I have seen, you have prime spots. You really build it right. You're building fantastic indoor self-storage sites. Is there any part of operationally when you came to think about this, is it Okay. With Houl, we're trying to find prime sites in central London. Have you considered going outside London? Is there any— what about operationally in that sort of, when you think about how you build the best self-storage business, how do you think about that?

So I think for us, a lot of it is iterative. And that is because with Attic, I had the opportunity to test a variety of different theses, and they were they were proven to be right. So I knew that these ideas worked. So it was a case of doubling down on that and doing it more. And I think one of the issues that we see in our sector is that because it is still a relatively immature and new sector, and you'll talk to Ollie Saunders and he will tell you the sector is maturing, but he's looking at it through a very different lens. He's looking at it through potentially a capital lens, for example.

Yeah.

But if you're looking at it operationally, the sector is far from mature. And the example I will give you is the coffee shop that we just went to, right? There are so many different industries where there is massive competition, and there has been for a long time. And people have got to figure out how to survive and thrive in a very competitive environment. We don't have that in self-storage. But I still adopt that mindset in every aspect of the business, whether it is site selection, whether it is design, development, operations, technology, back-of-house functions, every aspect of the business, we try to do it in a way that is as defensive as possible from a competitive perspective, but also being on the offensive and trying to be the best that we can be. And we do that because it's important to us to be best in class. It's important to our culture and who we are as a business. But I'm also very mindful of taking a very long-term view on these things. So I'm not in this industry to make a quick buck, to get out in 3 years' time with a 25% IRR, right? I'm trying to build a business that's got genuine long-term value. And if I build something today where I'm kind of like, I'm compromising on the location a little bit, compromising on the build a little bit, compromising on the technology a little bit, compromising on the staff a little bit. Very quickly, within 3, 4, 5 years, that business is going to look very tired. And if anyone opens up nearby and they're doing it well, you are going to suffer.

Yeah.

And my experience, again, going back to restructuring, my experience of business is that it's a lot harder to fix problems that have occurred than it is to get it right in the first place. So if you embed mistakes in the business, in the foundations, it's very, very hard to fix, especially if you're trying to grow. So getting it right day one with a long-term perspective, I think, is absolutely key.

Are there some areas particularly that you think it's really important to get right? Because there's always going to be some trade-offs, but there are areas where, I think what you're saying is there are areas where you can't you have to really demand the best and really focus on doing a good job. What are those areas that for you are the most important?

So, I would say 2 things, brand and people and culture. And the reason I picked those 2 is because those are the 2 things that are going to deliver you to where you want to be. You need to be very, very clear about where you're positioning yourself in the marketplace and what your USPs are. And you build your business to suit that, right? So I'm not going to sit here and say it has to be the best location and it has to be the best fit-out and it has to be the best people and it has to be the best everything. That's not the case. I think, you know, you might position it— I'll take Shawgard as an example. Everybody knows Shawgard, you're the largest operator in Europe, also the biggest discounter. You know, their business model is, it's like a Costco in Iceland. It's, you know, build them big, sell it cheap. And that's absolutely fine. It's a legitimate business model. They're very successful doing that. They run a very lean business model. They build things as cheaply as they can. We're at the other end of the spectrum. And that's okay. The market is there and it exists to serve all people. We have Iceland and we have Tesco and Sainsbury's and we have Lidl and Aldi and we have M&S, don't we? And Ocado and those guys. So I think, you know, it's not about dictating where you need to be in the market. I think you need to understand exactly where you want to pitch yourself.

Mm-hmm.

And stick to that discipline. And then you need a brand that's going to really reinforce that. And you need people and a culture that's going to deliver that particular strategy and that particular positioning for you.

How important do you think brand is in self-storage compared to some other industries? Like, you just mentioned some retailers. How do you think about brand and its role in self-storage? Because on one side, it's kind of because self-storage can be a bit different. It's like, well, I need self-storage, look it up online, phone a few, move in. Some people would argue that's the case, brand isn't important. How do you feel about brand in that context?

So it's a very interesting question. Brand is clearly very close to my heart, and you will no doubt get that sense from looking at both Attic and Holt. And it's true to say that Self-storage consumers are largely brand agnostic. Certainly, you're not going to persuade someone who's moved from Germany to London to come and store with you just because it's SureGuard and they store with SureGuard over there, right? It's not how it works. People will rarely drive past 2, 3, 4, 5 of your competitors to come to you across town through traffic just because you've got a nice brand. I understand that. But I think that there are 2 areas where it does matter. First of all, vis-à-vis the customer, in the margin, it makes a difference. So if a customer is faced with a choice and it comes down to you and one other operator, if you've got a better brand, they will choose you. Brand is how your business, your logo, who you are comes across to a customer. And we know that people make purchasing decisions on an emotional basis. Right. And we try to be logical and rational about these things. But the reality, and there are many studies that demonstrate this, reality is actually a lot of the time we don't. And a lot of how we experience a brand is actually subliminal or subconscious. And you talk about cognitive dissonance, right? So if you build a brand, it's got to be very, very consistent in terms of the messaging to your customers and how it makes people feel. And we can get on to talk about this if you like, around how we kind of constituted these brands. So I think it's very, very important to make sure that you have a very solid first impression with your customers, because in the margin, it absolutely will make a difference, right?

Yeah.

I know we're not a Nike. I say Nike because that's what everyone calls it now. I still call it Nike. But I understand that we're not Nike. I understand we're not a globally recognised brand. I understand that people aren't going to come to Hult because it's this amazing international brand, but it does make a difference in the margin to our customers. I think that's the first point that I'd make. So largely, I'm agreeing with you, but I do think it makes a difference. I think the part that people miss and part that people forget is kind of leaping through what I just said around the importance of trying to run it as a really good business, not just self-storage, but a really good business, is the brand doesn't just speak to your customers. The brand speaks to your people. It speaks to your partners. It speaks to everybody that interacts with your business. And it helps you to drive the performance you want to get to where you want to get to. And a moment ago, we talked about the importance of understanding where you want to be in the market and how the brand is one of the things that kind of reinforces how you're going to get there. And we're not on our own, right? We've got a team of people that we employ, but we've got a whole bunch of consultants and we've got accountants and lawyers and bankers and we've got architects and engineers and we've got loads and loads of third-party suppliers, all of whom we regard as members of our team. And the brand really speaks to all of them as well as our teams. It's a core part of how we drive our culture and drive the passion for the business to help us get to where we want to get to. So, a brand isn't just facing externally, it's also facing internally.

Interesting. Okay. Okay. And I can definitely see how in the margin there, certainly from the customers making a decision, consistency in the brand, the website, the experience they have there, the experience they have with your staff when they arrive, that all can be matched up really well to deliver a great brand experience. It doesn't necessarily mean that you're going to sell on— you get the sale because of the brand initially, but just in the margins, it's an interesting way to see it.

Absolutely. And it's worth remembering that we do operate in a marginal business. So, One of the things unique about self-storage that I love about it, it kind of suits my personality, is it rewards iterative behaviour. So a pound on the top line is a pound on the bottom line, and it's £20 to £25 on exit. There aren't many industries that give you that level of reward for that amount of small iterative improvement.

Yeah.

And it's all in the margin, right? And you know this. If I can get— if I can improve my conversion rate by 1 or 2%, if I can improve my marketing ROI by 1 or 2%, if I can improve my yield by 1 or 2%, all of those things compound and add up to quite a significant pound note value on the way out.

Yeah.

This isn't an industry where I think it's hero or zero and you win by being amazing or you completely lose. I think it's all about those margins and the difference between an average operator and a good operator. An average operator is still going to make money in the sector. There's not enough competition out there for you to lose money and go bust unless you've got it horrendously wrong, right? So you're going to look clever just by doing an average job. But the difference in performance between a really good operator and an average operator speaks massively. So one of my favourite sayings is, self-storage is an easy business to run, but it's not an easy business to run well.

Interesting. And so how many sites at the moment do you have at Hold Storage?

So we have one trading store in King's Cross, which is just under 60,000 square feet of MLA.

Big site.

And we've got another 6 development assets that are coming through. We've got planning on 5 of those. They're all ground-up new builds. in London on prime arterial roads. We won't compromise on location. We'd rather just skip a beat and not develop than compromise on location. And they'll all be sort of 60,000 to 70,000 square foot MLA new builds with electronic locks and all the kinds of things that you would ordinarily expect of a sort of best-in-class asset.

So a ground-up new build, does that mean it's an empty site and you're building a Brand new building, specifically for self-storage?

Yeah, pretty much. I mean, there are not many empty sites in London, so it usually means demolition.

Demolition. But you're not converting an existing warehouse or building into self-storage?

That's a very interesting point. So I've done 3 conversions in London. Obviously, conversions are great because it's lower CapEx and it's a quicker time to trading and it's a better cash-on-cash return. The challenge in London is that the price of land is so high that you don't get the density that you need to if you buy an existing asset.

I see.

So the sites that might work, that have high efficiencies, high land use, and maybe you're talking about 80% or 90% built mass on the plot, and you're talking sufficient height in terms of the eaves and a sufficiently modern building that you would want to develop. All that kit is institutionally owned and it's not available for sale. And if it trades, it trades as part of a big portfolio from one institution to another, right? So the kit that we are picking up, a lot of it is owner-occupied. So it's, I don't know, for an example, it might be a plumber or someone who's bought a warehouse 20, 30 years ago, cost nothing, built his business, and he's got to a point where he wants to retire. The business isn't worth anything, but the land's worth 6 or 7 million quid. So we pick it up, but the warehouse has only got 5 or 6 metre eaves height. It only occupies 40 or 50% of the landmass. There's absolutely no way that that hurdles. So we have to intensify it. So we have to flatten it and we put up a brand new building, which will be 90,000 to 100,000 square foot of GIA. And we have all the wonderful planning hurdles and hoops that they want us to jump through to get to that point.

So whenever you think about growth, so you've got the A big site at King's Cross. You've got other sites in development, different stages of development, all inside the M25.

Yeah.

All in London, on key locations. Do you ever consider outside of London? That's obviously a specific strategy. Why that strategy?

Why there?

And do you ever consider moving outside London with the same approach, or do you think it's a different approach outside London?

I think the approach would be largely similar. I think that there are certain things about the London market that are slightly different to the regions. For example, I don't think you can succeed in London and not be 24 hours because it's a 24-hour city, right? And because getting across town is painful, traffic, tubes, all that kind of stuff. If I'm in Norwich, I don't need to be a 24-hour facility. I can open late on a Thursday and open for 4 hours on a Saturday and people can get to me. It's not a problem. In London, it's a lot more challenging.

Yeah.

So I think you need to be 24 hours in London. So there are some differences in terms of the markets. But the reasons why we stick to London are, you know, there's a number of reasons. One is it's a market that we know very well. We know London, we understand London very well. London has high barriers to entry, but we figured out how to overcome those barriers to entry. And so that place, you know, we're uniquely placed to be able to deliver growth in self-storage in London. I also think that you get better returns by being in London. So, If you assume all things being equal, that the return on land investment is the same in London as it is elsewhere. You know, the cost of the steel, the cost of the curtain walling, the cost of the cladding, the cost of the copper cabling, it's the same. So my return on my CapEx in London is higher than it is outside of London. And when I come to exit the business, I've got a portfolio in what is a global city.

Yeah.

And I remember having conversations with investors separately, separate sector, years and years ago. And they were looking at buying the Westfield Shopping Centre in Derby. And these Americans got on a call and they said, Derby? Where's Derby? And there's a reason why that asset was trading at a cap rate that was about 30%, 40% higher than what it would have been in London, right?

Yeah.

So if you've got a portfolio in London, when you come to exit, you're talking about a global pool of potential buyers, global capital, which is going to drive the best cap rate for the business and going to give you a better exit. So I think there's another reason strategically why we're in London. I think the second part of your question is really around the concentration aspect. And we see a lot of operational efficiencies out of concentrating in a location. So if I had one facility in Norwich and one in Bury and one in Milton Keynes and one in Bath and one in Bristol, I could sit here and say, oh, we're in 5 cities. But it would be hugely inefficient operationally, because I've now got, from a marketing perspective, I've got 5 separate campaigns. I've got 5 different locations where I'm trying to be on page 1 of Google. I've got 5 different teams. If I've got someone who's off sick in Bath, I can't easily cover for that. If I want to go and visit all my stores, it's going to take me 2 or 3 days to drive around the country to get to them. So operationally, there are efficiencies and economies of scale that you get when your stores are close together. You get a clustering effect.

Yeah.

And this is one of the things I learned from, from, from my first time in self-storage, which was, you know, if you are, if you've got one site in London and you're trying to rank for self-storage London, it's really difficult, right? If I'm in Norwich, Norwich self-storage, I'd probably just by opening my store, I'm on page 1 because there aren't that many stores. In London, it's a real challenge. There are so many operators. And Google's actually doing its job by not putting me on page 1 because I've only got one small store.

Yeah. Yeah.

So what we set out to do with Hold was from the very beginning, we wanted to cover the map. So we made sure that our first acquisitions gave us central, north, east, south, and west London. So we immediately got that London footprint to help with that. So again, the strategy that went into those locations that goes beyond the demographics and everything else that you might choose, and they're all easily accessible locations, we can get around them quickly and easily. So we have those operational efficiencies.

So Fred, you were also the chair of the SSA UK for a while.

It was a long time ago.

I was, yeah. But you know the industry well, you've spoken to lots of different operators. Is there anything that from your time there, from your time speaking to operators that you could say you can see that other operators who are involved in one business might not see about how to run a self-storage business, how to think about improving it, how to build a better business that it might be hard to see when you're only in one business.

Yeah, so I think that's certainly one of the great arguments for being a member of the SSA and going to conferences is that you get to meet a lot of people and you get to learn a lot about how other people approach things and see things. Probably the thing that was most eye-opening to me when I became involved with the association was the sheer range of what I'd call professionalism. professionalism in the industry. So, you know, you've got some people who really are doing a very average job or almost completely hands-off.

Yeah.

Either by design and choice or just because they don't know any better. And right at the other end of the spectrum, you've got people who are absolutely nailing every single thing as much as they can, squeezing the pips out of it. And that's not related to scale. At all. So, you know, there are operators who've got multi-site or even some of them in multiples who are frankly just doing a very average job. And then you've got single-site operators or small operators who are really trying to push the boundaries. So it doesn't map to scale. I was quite taken aback by how wide a range of operational capability there was in the sector. And I think what that means then is that absolutely, if you do want to improve your business, you take the time to go to these conferences and to talk to people and to engage with people. For a lot of operators, there's a lot of low-hanging fruit and very easy things they can do to improve their business. It's not rocket science, but you need to have the curiosity to go and ask the questions and actually do something about it.

Are there any specific things that you would say dictate the difference between an operator who is operating okay versus who's really at the cutting edge of operating their self-storage business?

So it's difficult, isn't it? Because In this sector at the moment, you can make money just by opening a store and filling it. And you're going to sit there and feel very clever because it's throwing off decent cash. And you're like, wow, this is doing really well. I'm doing amazingly well. And unless you're really pushing everything, you've got no way of knowing whether you're where you should be unless you go and compare yourself to other people.

Yeah.

And because it's, as we touched on earlier, because of the marginal returns in the business, it's very hard to sit here and say there's one single thing Yeah. That operators need to really get right, because actually it's a combination of lots of different things. And it's not just getting lots of different things right, but also making sure that the sum of the parts is worth more. And that's how everything interacts. It's the interconnectedness between everything. Now, we talked about brands. I think there's a huge opportunity in brand, for instance. I'm constantly amazed. I understand why people use these colours, but people use bright yellow and bright red and black. And I don't get it because these are nature's danger colours. For millions of years, we've been pre-programmed on a subliminal subconscious level to identify those colours with dangerous insects. Right? So if you're like, I'm going to make it bright red because it stands out.

Yeah.

Actually, that cognitive dissonance, right, is actually having the opposite effect. Most people who use self-storage are experiencing some kind of life-changing event, which is highly stressful. The things that we find apparently that are most stressful, moving house, Getting married, getting divorced, having children, all that sort of stuff. And people are engaging with your business or your brand at precisely that time. And you're giving off signals that are danger signals, for example. So, for me, it starts with brand. It starts really understanding how you want to present yourself to your customers. And then it moves on to delivering on that promise.

Yeah.

In terms of the online experience, I think a lot of operators aren't really delivering the online customer experience that they should be. We've got a lot of stuff that we're looking forward to launching that we've done that we haven't yet launched because we're waiting for our new stores to be a bit closer to, you know, because it's a competitive landscape and people will look at what we do and they'll copy it. But there's a lot that can be done to make it a lot easier for customers.

Yeah.

And it goes all the way through, you know, systems, you know, picking up a really good PMS like Stora, for instance. I mean, you guys are doing things that 5, 10 years ago nobody was doing in the sector. And it makes it so much easier for operators to run the business and run it well, and to have access to data and intelligence to know what to do all the way through to, yeah, you know, just raising rates and being brave enough to raise rates and know how to do that and go and do it. But if there was one single thing, I'd probably just say, you know, self-storage can be a lifestyle business.

Yeah.

And that's absolutely fine. There's no judgement if you want to run it as a lifestyle business, that's fine. But if you actually roll your sleeves up and get involved, you'd be amazed how much more juice there is in the tank because every pound on the top line, is a pound on the bottom line.

And as you also said a while ago, it's not just a pound on the bottom line. If it does come to you want to sell the business, it's maybe 10, 20, 25 times that pound as well.

Precisely. Massive rewards for effort. So it really is. I mean, by all means, sit on a beach and take the income and get that. My age, increasingly appealing. But yeah, conversely, there is massive reward if you can be bothered to actually roll up your sleeves, go and get some help and get stuck in. You'd be amazed how much more juice there is in the tank.

Well, one example of that is, I know one operator who has a container site with, I think, about 150 containers. He's had it for a long time. When he realized this is not about being 100% full, this is about really running this as a business, which ultimately means I'm going to optimize my revenue for this business, I'm going to push it a bit more. He doubled his revenue within about 18 months without a single expansion of the business. Just about optimizing, managing the price. Because I got into self-storage because of my uncle and his site in my hometown. He's still at 100, I think he charges £120 a month plus VAT. He's still there 7 years later. He was there 14 years ago when he started. And he's got customers. He won't touch the price. So, it is a lifestyle business probably for him. That's how he sees it. Whereas somebody else coming into a business like that, thinking about it differently, could probably grow that business rapidly. That's one area where we see that a lot.

And because of the operating gearing in the business, to take your example, that operator who doubled their profits, that's probably a 3 to 4x on profit.

Yeah, double the revenue, 3 or 4x their profit.

3 or 4x their profit. And if it is a lifestyle business, It might be worth just taking a few weeks off the beach to do that because you can maybe go to a nicer beach next year.

Exactly.

It's a massive reward. Let's be honest, from our perspective, not a lot of effort, to be honest. So, yeah, absolutely.

Yeah. Interesting. Okay. So, I just want to ask now a little bit about how you see your business competitively and how you react to changes in the competitive environment. Because I think this is something that UK and European operators are seeing more is things are becoming more competitive. We are still quite early, but there are more and more sites opening up all over the place. And so, thinking about how to react to competitors, I think, is becoming more and more important, whereas maybe 10 years ago, it wasn't really a consideration so much, especially if you were outside London. So, if somebody does open up near a site, one of your sites, comes in with lower pricing, you must have seen this a million times, How do you react? Do you change the prices? How do you think about that? How do you react to a competitor coming in and undercutting you?

Well, I think that for us, it starts with having confidence in our business model. And you've got the sense from everything else that I've said so far on the podcast today, everything that we do in the business from the very beginning, from the branding exercise, which is something that we spent months, you know, and plenty of time, effort, and money getting right. Those people just go, oh, let's go to the pub and pick a name right on the back of a beer mat. And that's the name and pick a color and they'll draw, get my 5-year-old to draw a logo. I mean, everything that we've done in this business, everything we do in the business, we do with a view of thinking about it as a business first and being as competitive as we can be, irrespective of whether there is any competition in that particular area today.

Yeah.

What that then means is, coming to your point, is that if somebody opens up down the road from us, we already have a degree of protection from that operator because we will only buy a position where we can— a site where we can be outpositioned. So we will never buy a site where we can be outpositioned. We'll only ever buy a site that is not prime if it's impossible to outposition us. So for instance, in central Zone 1 in London, you might buy an underground car park because no one's going to do as 60,000-foot above-ground store in Zone 1. It's very, very difficult. You can, but it's very rare and very difficult. But if I was in Zone 5, you know, and there's a street with, you know, 5 warehouses on it, I'd want the one on the roundabout. Otherwise, I wouldn't. I'd be like, hang on, if I'm on the back of the industrial estate, I'm the only one there today. But in 2 years' time, someone opens and they outposition me.

Yeah.

So it starts with really good, solid strategic thinking before you even select a site. That gives you an element of defensiveness before anybody opens up. Number 2, when they do open up down the road, we're looking at them kind of going, well, what's their brand like? What's their website like? What is their operating capability like? What are their people like? And very rarely do we encounter competitors that we look at and think, these guys are really on their game. So we have a lot of confidence in our product, our service, our team, our capability to go out and win if we go toe-to-toe. Why is that important? It's important because it means you don't need to undercut your competitors. If you match them on price, you will win because you're delivering a better product and service. So you don't have to undercut them. And pricing is one of the hot topics in the sector, right? So what tends to happen then, to your point, is that the people who open up down the road, they will drop their pants on price because they want to lease up. And to be fair, we do the same thing when we're leasing up because we have a whole lease-up strategy. It's a 5-year strategy, right? But the first thing that you do is when you become aware that someone's going to open up down the road, and if you're plugged into the sector, you know when people are going to be opening up. So you're forewarned, especially in London, where most of them are new builds, and they take time to build. So you can see it coming. So there are certain things that we do in the business to prepare ourselves operationally for that new competitor coming. So we do certain things defensively, so that when they open, we're already in a very strong position.

Okay.

Then what we do is we maintain pricing discipline. And wherever possible, we say to the team, help our competitor. So this may sound counterintuitive, but if we are getting people who are coming in looking for sizes we don't have, or if they are looking for a price we don't want to match or whatever, we send them to our competitor because we want our competitor to fill up as fast as possible. I thought you might say that because it's an interesting way to think about it. And the quicker they fill up, the more relaxed they'll be about life, the less hard they will fight us, the less they will discount, et cetera, et cetera. So actually, if you've got a very competent competitor, and I'm quite happy to name-check Big Yellow here, they are a really, really good competitor because they really understand the sector. They know what they're doing. They have their own plan. They focus on their own plan, and they don't play games. So if you open up next to Big Yellow and you're both in lease-up, They're very grown up about it. They're like, okay, we both need to lease up. We're both going to lose if we try and discount. So let's just accept that there's a certain amount of market. We'll divvy it. Don't divvy it up in a sort of a, you know, we're not screwing the market kind of a way, monopolistic kind of a way. But we just accept that we'll win some, we'll lose some. They'll win some, they'll lose some. And we kind of go on that journey together, right? It's not adversarial. If you have someone open up down the road, And they do 8 weeks half price, or you do 8 weeks half price, and they go to 12 weeks half price, you go to 12 weeks half price, they go to 16, you go to 16, you're still completely level. It makes no difference in the marketplace. You've just both given away loads of free storage for no benefit. It doesn't help, right? So I think you need to be very mature and very grown up about it. Hence why I'm saying actually help your competitor.

Yeah.

Right. Because the quicker they lease up, whatever their strategy is, whatever their price point is, the quicker they lease up, the better it is for your business. But don't, whatever you do, engage in a race to the bottom on price.

Yeah. So then, taking that advice and turning it around and opening up a new site somewhere. So you're the people coming into a new site, which you've done before and you'll be doing again. How do you go in and price there? What is your process for figuring out what's the right price to open up here at?

So it actually starts before we acquire the site. And I'm not going to go into too much detail, but there's a whole load of data that we look at. We obviously look at what the competitive landscape is and what people are charging, and we monitor what they've been charging over a period of time. And you can use software like StoreTrack. There's some data in StoreTrack. Different people trust the data there to a different extent, but it's a data point. It's a reference point. What we will do is we'll start manually checking the pricing ourselves and keeping an eye on that. We also look at the quality of those operators, their locations, the quality of the facilities, the quality of the service they provide, the quality of the website to try and sort of adjust for equivalence. We do a whole bunch of analysis around the demographics in the area that go well beyond sort of income levels.

Mm-hmm.

to come up with what we think the price should be. And then we triangulate between that and where the competition is and where we think it should be. And we come up with where we think we want to start. So that's our process of figuring out what goes into the acquisition model, into the investment thesis. Prices will then move between then and the day that you open, because that's what happens in the sector. And as we now know, because we've been here long enough, they don't always go up. Sometimes they go down. That's fine. It's a long-term game. We then have a lease-up strategy. My lease-up strategy is a 6-year strategy, and it's 6 years because it starts 9 to 12 months before we open the store.

Okay.

And then it lasts for 5 years post-opening. And this is going to be different for every operator, right? And this is based on London, big stores, competitive markets. And that's kind of why for us, it's a 5-year post-opening strategy, because actually every year in that lease-up journey is different. And we might get there in 3.5 years, we might get there in 6 years, right? Because you flex it, you don't rigidly kind of go December 31st, we're doing this, January 1st, we're doing that.

Yeah.

But what you do is you go through a period where, you know, for the first 9 to 12 months, it's bums on seats. We just want to get to breakeven as fast as humanly possible. You want to stop losing money, right? So that's what you do in the first period. And then gradually you shift away from occupancy as the occupancy moves up towards rate. And again, if you talk to the values in the sector, they keep banging on about maturity, 85% is mature. But they're talking about occupancy. They're not talking about rate maturity. And actually, occupancy maturity, you get there relatively quickly, say within 3 years. But it takes you another 2, 3 years to mature the rate.

Yeah.

To get to a place where you've now got a store that's at 85% occupancy and is where it should be in terms of rate. Because your occupancy comes first, then the rate comes second. So through that entire process, you're constantly rebalancing your strategy and what your priorities are, the occupancy versus yield question, which customers you're after, what type of customers, the churn rate, everything else. So it's actually quite a detailed strategy in that phase. So we talk in the industry about churn and everyone's like, everyone gets very stressed about churn. And I don't understand why people get stressed about churn because stress— sorry, because stress is normal actually. Churn is normal in this industry. And not only is churn normal, churn is an opportunity. And churn is part of how you go from opening a store and having £18 yield to having £65 yield 4 years later. Without that churn, you're going to really struggle. You need the churn, right? So, it kind of changes all the way through.

Part of opening then, I presume, involves discounting as well.

Yeah.

Okay. And whenever you think about discounting, Where's the line? Where do you think the line is between a discount that helps the business and just kind of giving money away?

So anything that you do must be value accretive. So our objective as a business isn't to grow occupancy, and it's not to grow rate, it's to grow revenue. So if your MRR, monthly recurring revenue, is growing month on month, You're doing well. If it isn't, you're not. So everything we do must be done with a view to growing MRR. So discounts that— let's simplify that and say discounts that increase occupancy are good discounts. I'm simplifying because you can increase occupancy and reduce your MRR, which is not a good thing. You don't want to be doing that. I'd rather have lower occupancy and a higher MRR. But that discount must be doing something specific for you.

Yeah.

It could be defensive, which is also viable or worth doing if you've got an operator who's opened down the road and you're still only at 55% occupancy and they're just doing 12 weeks free for the sake of it and they're just not being mature and they're not engaging and they just keep— okay, whatever, right? You have to match them to try and— you'll never offer a higher discount, but you might match them so you can continue on your journey.

Yeah.

But it's got to have a purpose. And so, and again, you know, and you know this because you've built this in your software, you can target your discounts according to different unit sizes. So if you've run out of 15-square-foot units, why are you giving away 4 weeks half price or 8 weeks half price? It makes no sense. Whereas if you've got loads of 35s, you want to give the discount there. Why are you doing that? Because you want to increase occupancy in the 35s. So the discounting must have a purpose.

Mm-hmm.

So when we engage in our store launch process and when we do our lease-up strategy and we do our reviews through that whole sort of 5-year cycle, we have— it sounds very boring and bureaucratic, but I have a form that I make my team fill in that says, this is what we want to do. This is the marketing initiative, sales initiative. And it says who initiated the idea, what they're trying to achieve, why they want to do it, when it's going to start, when it's going to end. And then we run it for a period of time. It means that we can turn the PPC campaigns on and off when we need to. We can turn it on and off the website when we need to. It means the marketing team will know what to do. The sales team know what to do. The operations team, everyone's kind of lined up on it. It also means you can sit down and review it and say, what was the objective? What objective did you set when you started this initiative? And have we met it or has it done something different, which could be positive, not what we expected, or negative, right?

Yeah.

But I think a lot of people in the sector, offer discounts and do things from a market-facing perspective, marketing, sales, because everybody else does it. Rather than sitting down and saying, what's the objective? Let me write that down on a piece of paper so I can come back in 2 or 3 months' time and look at it and say, if I'm being honest with myself, that was the objective. Have I achieved that objective?

Yeah.

So I think writing it down as a point of discipline is really important because people's narrative changes over time. It's human nature, right? So you'll rewrite history. So you'll start off saying, well, we're going to introduce this discount because we want to increase occupancy. And then 3 or 4 months later, you're going to talk to your salesperson and say, oh no, no, no, it was never about occupancy. It was about retention.

Right.

So you'll change history to suit what's happened. So if you get people to write it down on a piece of paper, it's not about being right or wrong. It's about making sure you learn the right lessons so your discounts are targeted and are achieving exactly what you want them to achieve.

And then how do you think about managing existing customer prices as well? Do you run a price increases schedule there, or how do you manage that?

This is a very hot topic at the moment. I'm going to break that down into 2 different parts, because there's a difference between what we call yield management on customers in a lease-up phase or in a growth store, versus yield management or rate increases on customers in a mature store.

And the difference between those 2 is what?

Your occupancy rate?

But sorry, how do you go from one phase to the next phase? Is it hitting a certain occupancy level?

Yeah, it's not just occupancy, it's occupancy and rate. So once you've kind of gotten to where you want to be on occupancy and rate, that's when I consider a store to be mature. At that point, let's assume that you are, in our case, because we're trying to be a best-in-class asset, let's assume that we are at 85+% occupancy and we're achieving a top-of-market In that scenario, we would then be moving on to scheduled rate increases. And this is not a secret, so I'm quite happy to share it. You know, what we do is we look for an increase after 6 months, and then thereafter, every 9 months, we target 6% on each of those increases. So if you're doing it every 9 months, it translates to 9% per annum increase on your existing customer base.

9% per annum?

Yeah. But you're doing 6% every 9 months, right? And we don't do it once a year or once every 9 months. We do it on a daily basis.

Yes.

So you do it on a daily basis on the anniversary of the last increase or their move-in. And there's a whole bunch of stuff that you look at to make sure that that rate increase is correct. We don't just do 6% for everybody. We target that as an average, but there'll be some people who might get 15%, some people might get 2%, right? So there's a lot of other things that you look at to come up with what is the right number for that rate increase. But that's kind of what we aim for as our to drive our revenue growth going forwards. It's easy to say that on a podcast. It's a lot harder to deliver in practice, especially when the economy is flatlining, when there's a lot of new supply coming onto the market in London. So your ability to deliver those increases, of course, is hampered by that. And at the moment, we don't have a store in that profile. So the King's Cross store was one that I opened in November 2016.

Mm-hmm.

It was run under the Attic brand, but not owned by Attic. It was owned by the family office that back Hold now. And so we got that store back in March 2024. So it became a Hold. It was the first Hold store. And that was a really interesting one because that was technically a mature store because it was opened in 2016. But when we counted the chips at the end of that first day of trading as Hold, it was sitting at 45% occupancy.

Wow.

So we had this really interesting situation where I had grown and maintained mature stores and I had grown lease-up stores, but I never had this kind of, hang on, this is a lease-up store, but it's also a mature store kind of a situation. So we engaged a lease-up mentality in that store and we got it up to 85%. And we're now on that rate kind of repair or rate growth journey. The rate is not quite yet where it needs to be for me to say the occupancy's mature and the rate's mature. I think we would've got close this year, but trading conditions have been tough. It's a gold mine of self-storage. You've got 13 competitors within 2 miles, but it's getting there. I think if I had a portfolio of 5 stores in London today and they'd all been trading for 5 years, or rather they'd been mature for 5 years, would I be able to achieve 9% year-on-year growth? I think I'd struggle.

Yeah.

In the current environment.

Okay.

But these things come in waves, right? And so what we've seen is we've seen a lot of new development come onto the market in London, which is obviously our local market, off the back of strong performance in COVID and a lot of institutional interest at the same time as the housing market's really slowed down. And so we're now seeing a very big reduction in new developments in London. And this is occurring in residential developments and PBSA and BTLs and offices as well. It's not just self-storage, but there's a real marked slowdown in new developments in London. So what's going to happen is, and I've seen this before, the benefit of having been around a long time is that you see these cycles. So what's going to happen is all this new supply is going to come to market. It'll act to reduce or depress rates for a period of time, especially if operators don't really know what they're doing. But then they'll lease up, and then suddenly all the stores will be full, rates will shoot up again, and then people will start thinking, oh, we should build in London. And then you get a growth in development again. So these things kind of come in waves, don't they?

Okay.

So it's not as simple as sort of saying, this is what we do. I think you've always got You've just got to be very aware of where you are in your lease-up journey, what the competitive landscape looks like, and where your customers are and what they can afford. I mean, if you're the only operator in Bury and you have high churn, but you're increasing your rate by 9% per annum in this environment, live with the high churn because you're just growing your revenue, you're growing your profitability. So it's a more complex equation.

So you took over the King's Cross site approximately 7, 8 years after it opened. It was 45% occupied, which is obviously not where you want it to be. What has to What happens at a site like that where it ends up at that occupancy level? You did touch on it, but what are the most important things then to change that from 45% to 85%? What are the key things? So how does it happen and then how do you fix it?

So I actually opened that store in November 2016, and my team and I traded that store up and it performed really well. I'm not at liberty to talk about some of the issues around that. The team that we have today, a number of those people, including the store team, traded in that store before. So they're the same people.

Yeah.

And so I think it's about, you know, you just doing everything well. It's about having a really good brand. It's about having really good people, really good culture, real attention to detail, and being very disciplined about your sales and your marketing and your pricing. It's very easy for people to turn around and say, for example, oh, it's a very competitive market. market, or someone just opened up down the road. Right. But I mean, we were bookended by 2 Suresh Guards who we know are discounters. And it's not a criticism, that works very well for them. And you had a Big Yellow that opened their flagship store on York Way, 110,000 square feet of edible space or something, 3 years ago, just down the road. And it would be easy to say, well, that competition means it's impossible to fill up, or rather it's impossible to stay But actually it goes back to what I've been saying throughout the podcast, which is do everything as well as you can. The things that people think, oh, that doesn't matter, or you're doing that for ego, or you're doing that because you want it to be the best because you just want to be the best. No, that's our market positioning. And if you do all of those things right, it does work. And we've seen this time and time again where we've opened up in markets where on paper it shouldn't have gone well, but it's gone really well. And we delivered that here. So we were a completely new brand, new website, no Google presence. We'd all worked together before, but we turned up to the store that we had traded previously on day 1, and we had virtually no systems, very little data. We were literally using Excel on the first day. There was very little handover. And we made it work. And so I think that it just shows that if you pay attention to all the things that we've been talking about, you can win in the most competitive markets, even if you've got someone really good like Big Yellow opening up and leasing up a really big store down the road. And for the record, they've leased up and they've increased their rate. We've leased up, we've increased our rate.

Yeah.

So it just goes to show that some people in the market there will have suffered. But if you pick a good market and if you get all the basics right, Then you will perform.

If you're running a— if anyone watching this who's running a— who's maybe got 1 or 2 sites outside of London and is thinking, like, I see this as a great business and I want to expand this, want to grow this, what would the most important things for you be, do you think? What advice would you give them?

It's probably— so you're talking about going from sort of single site to multi-site?

Yeah.

I think probably 2 things. The first one is Make sure you've really nailed your business before you look to expand. So make sure you really understand it, make sure you're really squeezing everything you can out of that first site, not just because you want it to perform really well, but because you'll learn a lot by doing that. You'll learn a lot about what works, what doesn't, and that'll help to inform your rollout strategy.

Mm-hmm.

But also because, believe me, I mean, I haven't made that mistake, but I've seen other people make this mistake. If you start growing and scaling, but you've got problems in the background that you haven't resolved, you're going to fall between 2 stools.

Yeah.

Growing is hard. Fixing problems is hard. Doing those 2 things at the same time is really hard. And it's not for the faint-hearted. It's not for those who haven't got the skills. So, you know, if you've got problems or weaknesses embedded in your single-site business and you now start to scale to 2, 3, 4 sites, you're asking for trouble. At the very least, you're going to underperform, but you're asking for trouble because you're going to embed the same mistakes in the new sites.

Yeah.

And you're going to not be entirely sure whether you should go and focus on trying to grow that site or trying to fix the problems in that site.

Yeah.

You don't want to be fighting rearguard action. You want yourself and your whole team to be focused on one thing, and that's going forwards. And that brings me on to second point, which is really people. So the great thing about self-storage is that it's a very scalable business, but you still need people.

Yeah.

So if you're going to grow the business, do not make the mistake of thinking you're going to do it on your own. Be prepared to do what it takes to get good people on board.

Yeah.

Because it's good people that make the difference between a successful business and one that doesn't succeed.

When you think about the next 5 years in self-storage, or even going forward 10 years, how do you see the industry evolving over the next while? You've been chairing the Technology Forum in the SSA for a long time. You know what's going on in the tech world. You see the changes that have happened over the past 5 or 10 years. So yeah, I'd love to just hear what are your thoughts about What's coming?

That's a very interesting question. And of course, the stock standard response is, I don't know, because technology is evolving so fast. And, you know, I'd be a fool to try and predict what will be the case 5, 10 years from now. But I do have an answer for you on that question. And this has been a constant for me going all the way back to 2008. And that is people. So in 2008, '09, '10, the whole chatter in the industry was about Google and about whether or not you needed a prime location anymore because people were no longer driving past your site. They were finding you on Google. You didn't need a prime location. And I wasn't willing to take that risk with my first site, obviously. And then after I'd been trading my first site for a while— and again, one of the benefits of doing everything yourself is that you, you're in all the detail—

Mm-hmm.

I realized that 3 quarters of the people who were finding me on Google Do you know what they typed into Google? They typed @excelstorage into Google.

Yeah.

So yeah, they were finding me through Google, but they were typing my name into Google, which means that they'd driven past the store. So very early on in those debates, I was saying, no, no, no, no, location still matters. And there were conferences where people got on stage and said, location doesn't matter anymore. And then they realized that location still matters, right? And so I've lived that sort of change, as I said earlier, going from Yellow Pages and Thomson Local through Google to now the AI world. And seeing through all of that. And again, I was the first operator in the UK to fully fit out a store with electronic locks. So I've lived all of this kind of technology coming into the space. And one of the things that I find quite depressing is— I'll give you a little anecdote. Have you got time?

Yeah, of course.

30 seconds. So in Stockholm in 2015 or '16, might have been '17, I went up on stage and I gave a presentation. Because we had just launched Europe's first online check-in and account management portal.

Okay.

It was very, very painful to do because it didn't involve your software because you didn't exist at the time, which was an incredible shame because it would have been so much easier. I won't mention who it was, but it was so painful.

And did you have locks at the time in your site or was this before the locks?

Manual padlocks. It was a manned store, had reception, manned reception, you know, padlocks because electronic locks were not yet a thing. But the point was that people could check in online. And I went up on stage and I said to people, this is crazy what we're doing in this sector. We're asking people to come in and sit down for 15 minutes. They have to bring a passport and utility bill. They've just moved house. They've just packed all their stuff up, right? But you want a utility bill that's less than 3 months old. And then you're going to ask them to sign in duplicate a 15-page license agreement, which you're going to photocopy. I mean, if you've got an Apple Watch, and this is 10 years ago almost, even back then, you could book an EasyJet flight to Madrid and turn up the next morning with your passport and boarding pass in your Apple Watch, get on a plane, right? But in self-storage, we're asking— it was just insane. Didn't make any sense to me. And I think we've continued to see the evolution of that. And we've seen the evolution with the advent of electronic locks towards unmanned stores. And one of the things that frustrated me at that very first conference where I spoke about the online check-in system, The first hand that went up was, have you been able to save any staff costs? And then when we did the electronic locks, same thing, you know, how much money can I save? And I find it's such a reductive approach to business, really. You know, for me, staff costs— staff are not a cost, they're an investment. My job is to get an ROI on the investment. But it also, I think, illustrates how people are really missing what really matters in business and in self-storage. And that's people, and it's the human touch. And all the way through, I've said I'm not against unmanned stores, do satellite stores. I had the idea to do satellite stores a decade ago. We'll do them when it makes sense. I get it. But I'm not pulling people out of my business because I think they add value and I think they make a difference to customers. And all the chatter about AI, there's a lot of chatter about how AI is going to threaten jobs and make people redundant or unemployed. And it's the same chatter we had when you know, word processing came along and typists disappeared, or if you want to go back to the railways or even to the canal boatmen, right? We've been here before. Coachmen. We've been here before, and I'm sure that we will be here again. And people talk about the impact of AI on the creative industries, and I'm getting slowly back around to your point. And there's a real fear around AI decimating the creative industries. I think that AI actually will have the opposite effect on humanity insofar as I think what AI will do is it will place a greater premium on what is genuinely human.

Yeah.

And I think, interestingly, I think we're already starting to see that where people, they might not even be able to really tell, but somehow intrinsically, they prefer human-generated content. They prefer human imagery. In the same way, you know, why do people go to the theater when they can watch something on TV? Why do people go to live gigs or buy LPs? When you can buy a CD, but people don't buy CDs anymore. I'm showing my age again. You can download music and listen to music on Spotify. It's perfect. It's digitally perfect, but it's not the same as listening to an LP.

Yeah.

An LP is alive, right? So I think the intrinsic value of what makes us human and human contact and human interaction will not only remain, but become even more valuable. So I'm going to go against the grain here. And I'm going to say that I think that technology is going to continue to drive efficiency in our businesses. It's going to enable us to hopefully generate better profits and share those profits with our customers in the form of lower prices and with our staff in the form of higher wages. But I predict that we are not going to become completely manless throughout the whole business. I think the value on people will go up. So for example, I might no longer have 4 people on a site and have sales assistants and assistant managers. I might have a caretaker manager. But they might be paid a lot more because they have a much more important role. And they're no longer doing the admin, the check-in and the checkout and taking the payment. But what they're doing is being human and looking after people, and they'll be paid accordingly. So I think actually, whilst we're going to see a change in the nature of the roles and how we run the business, I think the value placed on people will actually increase over time.

Yes, it's funny. I actually find that myself, even when I'm doing anything now, a hint of AI writing content.

Turn-off, isn't it?

It just completely turns you off. And this was the way I think about some of this, like an online check-in flow. It's not about cutting cost, it's about giving your customers the option to do that if that's the way they want to go. I imagine they can still come in and do it in person if they wish, if they really want to. But it's just with giving people the option. I would prefer I prefer to check in for flights on my phone and turn up at the airport and just go straight through security. But I know I can if I want to go up to a desk, and some people want to do that and they still have desks. And I think if there was no desk and no person at the airport, things would feel very different, I think. Because I always know somebody's there to help if I need.

That's a really interesting example you've given. And by the way, I'm always I'm always really pleased to see people, most flights I get onto, there's always somebody who's got a couple of printed off boarding passes. I find it quite quaint, but it really illustrates that example beautifully. And I think the US Congress has just recently passed a law saying that every commercial airliner must have not one, but two pilots in their aircraft. And why have they passed that law? Because they don't want commercial aircraft to be flown by AI. And people don't want to get on a plane that's flown by AI.

Yeah.

So I think we're going to get to a point where we realize that Whilst there's a threat from AI, there's also a lot of opportunity, but also people really matter. And what it's going to enable us to do, it's going to be a lot of change, it's going to be a lot of upheaval. And if you're not with the program, you're going to lose out. For sure, there's going to be winners and losers. I'm not disputing that. But I think what it's really going to do is it's going to enable us to make the most of what makes us human.

I agree. Okay. So final question then, Fred. Where do you see the whole business going in the next 5 to 10 years?

So it's a really interesting question. When I started Attic, I wanted to build 5 to 10 stores in 5 to 10 years, and that got completely derailed. And when we started Hold, the ambition was 10 to 15 stores in 5 to 7 years. So like a million square feet of best-in-class London real estate self-storage. And I think that is a level of scale that really kind of opens up a lot of opportunities in terms of exit. And that remains the ambition. We currently have about 450,000 square foot, either trading or under development. We've got our hands on 7 sites. I think the pace of growth has definitely slowed, given the macroeconomic and macro-political environment that we're in. But our ambition remains still to deliver at least 10 to 15 stores. Beyond that, who knows? Ultimately, we're wholly owned. We are backed by a family office, which is great because it means it's not private equity money. There's no ticking clock or time bomb or anything else. It means that they take a really holistic, long-term view. So we may get to 2035, say, and they may say, want to sell it? Or they may get to 2035 and say, we love this business, keep growing it. Who knows? So at the moment, I'm just really enjoying Working with them in a variety of different capacities in different ways. The team's really enjoying the journey with Hold. We think there's a lot of opportunity. And yeah, we'll see what comes.

Excellent. Fred, thank you so much. Thanks for coming over. Great to have you here. No, thanks for having me. Thanks for all the insights as well.

It's great to be on the Scaling Self Storage podcast. And I think it's fantastic to see you doing this because I can't remember how long ago it was. I mean, it feels like 8, 6 or 8 years ago when you, when you first set up Stora. I remember meeting you back then and you've done so phenomenally well to scale your own business within the self-storage sector. So I think it's very apropos that you're now doing this. So congratulations.

Thanks very much. Thanks, Fred.

Absolute pleasure.

Thank you. Thanks very much for watching. We'll see you in the next episode of Scaling Self-Storage.