For club founders · a step-by-step guide
How to start a private members club from concept to opening night
To start a private members’ club, define who it is for and why they would pay to belong, choose between a member-owned club and a proprietary business, secure a site, get the right alcohol licence, recruit founding members before you open, and set fees that cover the building as well as the bar.
The order matters. The legal form decides the licence, the tax position and who controls the club, so it comes before the site and the fee list, not after.
Starting a club
01/ Starting a private members club
Seven steps, in the order that matters.
Most failed club ideas fail at step one or step five: a concept nobody needs to belong to, or a building opened before enough people have committed to pay for it.
The rest of this guide takes each step in turn.
- 0101
Concept and audience
Who belongs, and what they get that they cannot buy elsewhere.
- 0202
Legal form
Members’ club or proprietary club; then the entity.
- 0303
Site
Space that suits the concept, with planning checked.
- 0404
Licensing
Club premises certificate or premises licence.
- 0505
Founding members
A committed first cohort before the doors open.
- 0606
Fee model
Joining fee, subscription and what is paid as used.
- 0707
Business plan
The numbers that say whether it survives year three.
02/ Concept and audience
Start with who belongs, not the room.
A club is a community with premises, not premises looking for a community. Write down, in one sentence, who the members are and what they share: a profession, a city, a sport, a stage of life, a taste.
Then write the reason to belong. A member pays every year for something they cannot get by booking a table: the people, the access, the space being theirs.
Test it with the people you have in mind before you sign anything. If fifty of them will not commit in conversation, a fit-out will not change their minds.
For the wider family of club types, see what is a private members club.
How ready is your club concept? · 0/4 answered
01Can you name the members in one sentence?
02Is the reason to belong more than food and drink?
03How many prospective members have you spoken to?
04Do you know who would not be admitted?
Answer all 4 to see your result.
Our self-check for founders, not a forecast.
03/ Legal form: members’ club or proprietary
Decide who owns it before anything else.
Switch between the two models. Each row draws on HMRC guidance or the statute linked below.
HMRC describes a members’ club as one where “ownership of the club and its assets rests with the general membership who control the club and its dealings”, and a proprietary club as one owned by anyone else; the proprietary club’s profit from supplying members is taxable (HMRC, BIM24210, government guidance).
If you want a return on your capital, you are building a proprietary club. A members’ club cannot pay you from the bar: a qualifying club must have no arrangement for anyone to take a private financial benefit from supplying alcohol (Licensing Act 2003, s.64, UK statute).
Either form can be a company. A company is limited by guarantee if members’ liability is limited to what they undertake to contribute on a winding-up, and limited by shares if it is limited to any amount unpaid on their shares (Companies Act 2006, s.3, UK statute). Take legal and tax advice on the structure; this is general information.
→ Members’ club
→ Proprietary club
04/ Site and licensing
The building and the licence decide each other.
Choose the site for the concept: a work club needs daylight and desks, a dining club needs a kitchen, a sports club needs the pitch or court first.
Before you sign a lease, ask the local planning authority whether the intended use is permitted, and ask the licensing authority what it will expect for the hours and activities you plan.
For alcohol, the legal form already picked the licence. A qualifying members’ club applies for a club premises certificate; a proprietary club needs a premises licence, as any business selling alcohol permanently does (Home Office, Alcohol licensing, government guidance).
Under a premises licence, every supply of alcohol must be made or authorised by a personal licence holder, and there must be a designated premises supervisor holding one (s.19). Budget for that in staffing.
If you plan a club premises certificate, write the rules to meet the statute from day one, including the two-day wait between application and admission and the 25-member minimum (s.62).
Before signing the lease · 0/6 in place
To do
05/ Founding members
Sell the first members before opening.
Founding members fund the opening, set the tone and recruit the next wave. They are the club’s first proof that the concept works.
Give them a reason to commit early that does not undermine the price later: a founding title, a seat on an advisory group, a fee fixed for a set period, or first access to events.
Decide the selection process before the first conversation, and apply it to founders too. A club that admits anyone in its first year struggles to say no in its second.
Selection must stay lawful. A club with at least 25 members and a selection process is an “association” under the Equality Act 2010, whether or not it is run for profit (Equality Act 2010, s.107, UK statute), and it must not discriminate in who it admits.
For the mechanics, see the private members club application process and the private members club referral programme.
06/ Private members club business model
Three revenue lines, one of them dependable.
A club earns from three things: fees for belonging, spending while there, and anything else the building can host.
Soho House & Co, the largest listed club group, reports them separately. In fiscal 2022 it reported total revenues of $972.2 million, of which $272.8 million was membership revenue, $426.6 million in-house revenue and $272.8 million other revenue (Membership Collective Group, FY2022 results, company’s own reported results, US dollars).
Membership fees are the line you can plan around: they arrive whether or not members come in on a wet Tuesday. Set them to cover a fair share of the fixed cost of the building, not just the gap left by the bar.
For setting the fee list, see membership pricing and the dated published fees in private members club membership fees.
Recurring and predictable
- Joining fee, often waived or reduced for founders
- Annual or monthly subscription
- Category rates: age, distance, corporate
Variable with use
- Food and drink
- Bedrooms, where the club has them
- Events, private hire, treatments
Optional extras
- Retail and partnerships
- Hire to non-members, within licence limits
- Reciprocal and corporate arrangements
07/ Private members club business plan
A business plan outline for a club.
Our outline, built from the steps above. Tick off each section as you write it.
Model the membership line from the bottom up: how many founding members, how many join each month after opening, and how many leave at renewal.
Renewal is the number founders most often leave out. Our member retention guide covers how to plan for it.
Private members’ club business plan: sections · 0/10 in place
To write
08/ Are private members clubs profitable?
Some are; scale is no guarantee.
Profitability depends on the model. A members’ club is not meant to make a profit for anyone; its aim is to cover costs and reinvest any surplus. A proprietary club is a business and is judged on profit.
The public record for proprietary clubs is thin, because most are private companies. The one large listed group shows that scale does not settle the question: in the same fiscal 2022 results, Soho House & Co reported a net loss attributable to the company of $220.6 million on revenue of $972.2 million, alongside positive adjusted EBITDA of $60.7 million, a measure the company defines itself (Membership Collective Group, FY2022 results, company’s own reported results).
The same group reported about 259,900 members across its memberships at the end of 2023 (Soho House & Co Form 10-K, 2023, company’s own annual report). Large membership and large losses can coexist when a club is expanding and carrying property costs.
For a UK club that is a private company, its filed accounts at Companies House are the place to look before you benchmark against it.
09/ Help with the launch
Founding members are a marketing job.
Selling a club that does not exist yet is the hardest membership sale there is. Our private members club marketing practice helps founders build the waiting list, run the founding-member campaign and fill the club after opening.
Written by Dan Keegan
10/ questions
Starting a private members club FAQs.
How do I start a private members club?
Do I need a licence to open a private members club?
Can I make money from a private members club?
Are private members clubs profitable?
What is the business model of a private members club?
What should a private members club business plan include?
How many members does a private members club need?
For founders and new clubs
Open with members, not just a building.
We help club founders turn a concept into a committed founding membership, then keep the club full.
12/ sources
Every claim, and where it came from
- HMRC Business Income Manual, BIM24210 — Distinction between proprietary and members’ clubsGovernment guidance
- Companies Act 2006, s.3 — Companies limited by shares and by guaranteeUK statute
- Licensing Act 2003, s.19 — Premises licence: designated premises supervisor and personal licenceUK statute
- Licensing Act 2003, s.62 — Qualifying club general conditionsUK statute
- Licensing Act 2003, s.64 — Additional conditions for the supply of alcoholUK statute
- Home Office — Alcohol licensingGovernment guidance
- Equality Act 2010, s.107 — Definition of an associationUK statute
- Membership Collective Group (now Soho House & Co) — Fourth quarter and fiscal year 2022 results, 8 March 2023Company’s own reported results
- Soho House & Co — Form 10-K for fiscal 2023Company annual report (SEC filing)