Tales of Sin City Roppongi
On September 26, 2008, the Financial Services Agency ordered Leman Brothers Japan to cease operations, following in the footsteps of its central office in New York, this unleashed even more the financial crisis of 2008 or as experts in the sector call it: the Leman Shock
I remember that before the Leman Shock, in the city Roppongi, were more than 25 clubs between big and small that were dedicated to entertain Brokers, Bankers, and executives of multinationals.
Those times were part of what we call: The good old times.
In our club we had as clients all the top executives of the largest investment banks in the world, Leman Brothers, Morgan Stanley, JP Morgan, Goldman Sacks, Nomura Securities, etc.
Those were good days for the industry and for the dancers. I remember days when I had 10 black american express cards in my pocket to open customer’s tap, my partner the other club manager had another 10 and in the front desk others more. Almost all transactions were paid by the client's company, we had many company expenses for customer entertainment. There was no day during that time that we did not have clients related to the financial industry.
Many of us who worked on the floor received many tips, sometimes we could receive up to 30 or 40% of our salary in tips, here in Japan the lowest demonization bill is 1,000 YENES approximately 10 USD, and we received many of those.
All the clubs had a large volume of sales of champagne, the volume that was moving was incredible, so much that Dom Perignon released a special bottle for Japan. I'm referring to Dom Pérignon Reserve of L'Abbaye (also known as Dom Pérignon Gold, or simply Gold Reserve). This is a stand-alone series of vintage releases for the Japanese market only and a product that you rarely hear about in the UK / Europe.
I remember that on many occasions we finished the entire stock of Dom Perignon, during the night.
There were days when we had more than a hundred clients, we had a waiting line and everyone offering money to enter. Sometimes we had many problems where to sit the top executives of the investment banks, because they came with a client with whom they wanted to close an account and this client was also in the sights of the other banks, we saw how millionaire contracts were closed in a matter of minutes. I personally saw the aggressiveness and the greed of many agents who tried at all costs to engage in conversation with other clients from other tables.
And what about the dancers, well many made a fortune.
As in any club of this nature in America, the girls paid a house fee, which increased depending on the volume of sales they made, but the girls could assume that expense without any problem.
There are countless stories of parties at investment banking offices with strippers and banned substances in New York, but here in Japan it was no different.
Many of our clients work 24, 48 or 72 hours non-stop closing business and transactions and came to the club to see their favorite striper, which in the end became their favorite dealer. It was a crazy thing and very difficult to control.
We wanted to sell drinks and dances, but many people were dedicated to doing their own business outside the club. For us it was difficult to control everything and we preferred to be away from the dark side and only do our job. But many colleagues decided to get into that fast and easy money game.
Among the bankers of the time, they passed the word where to go and what girl to look for to be able to continue the party 24 hours without stopping, return to the office and continue playing with the money of the investors.
There are many scenes from the Big Short films by Adam McKay and the Wolf of Wall street by Martin Scorsese that do not stray far from the reality there in America as here in Asia, especially in Roppongi where all the offices were concentrated.
After our work around 5 or 6 am, another world started in Roppongi, it was the underground world, where all the organized groups met in some clubs. It was common to see club managers, dancers and dealers at the same table, talking about customers and their consumption habits.
It was very common to see many girls who were top earners, in sentimental relationships with the leaders of those groups, it was a circle of never ending and the waste of the financial industry in Roppongi made other businesses flourish.
For 2004, 2005 or 2006 maybe only in clubs of our industry in Roppongi, the clubs moved approximately ¥ 2,000,000,000 monthly in sales, without counting bars, restaurants, discs, etc.
About $ 18 million dollars per year, annually $ 216,000,000 USD in gross revenue, distributed among all the large, medium and small clubs, approximately 20 or 25 clubs in an area of 1.15 km². And maybe 70% of that came from the financial industry.
Much of that revenue belonged to girls. Many made a fortune, I remember that sometimes after work some of us male staff, we had free breakfasts because the girls invited, it was nothing, for someone who received 500 to 1000 dollars in tips in one night.
I also remember girls who traveled to Thailand and returned after spending $ 50,000 in 3 weeks.
At a time when I started to make some money they recommended me with a financial advisory firm based in Azabujuban, that was my first meeting with investment funds and after a long talk with the person in charge, she told me that she did not have any prejudice by the type of industry in which I worked and that some of our girls were clients of his firm.
I think that all of us who were at that time were dazzled by everything that the investment banks meant. Some colleagues even made friends with some clients and left the nightlife and started working as brokers.
It was a very hectic moment and it seemed like it would never end.
It was good days, until 2008 ...
It is true that Leman shock and the consequent financial crisis affect all industries equally, but I only speak of the gentlemen club.
I always comment with other club operators, the modern era of our industry is divided into before and after Leman Shock.
After the crisis, the Leman Brothers branch in Roppongi Hills closed. Those offices were about 500 meters from the red zone where our club was. Many of our VIP clients flew to Singapore and HKG. The companies began to put a lot of restrictions on entertainment expenses, even in some of the big companies they were forbidden to pass receipts from clubs like ours, they had a list of all the places and ours was listed on the list.
For a moment there was an uncertain time, the volume of sales decreased by 50% and continued to decline. It took a while to accept that things would not be like before, although some were reluctant to believe it, little by little the girls left Japan, Tokyo was no longer an attractive place, and only some stayed, many continue to work in clubs in Roppongi.
In 2010 when the initial low panic, I decided to go to USA to my first Gentlemens Club owners convention, and the theme was Optimism. There was light at the end of the tunnel.
I learned a lot from the panelists and had the good fortune to talk with some of the biggest club operators in the world.
And they commented on how they went through the storm and how they had to readjust some prices.
Rick Lagan from Ricks Cabaret said that they had to sell beer for 2 dollars every Tuesday in order to attract more market and fill the place with a number of people.
He also told us that this moment of crisis had been a great opportunity to acquire more clubs and find more affordable prices, since people had to sell and because they could not do it, they would do it for less price.
In terms of human resources also change, because many hospitality professionals lost their jobs and found opportunity working in nightclubs, which according to RIck contributed a quota of quality and education in the night business.
In a project that we had in the Philippines in 2008 I remember that we were designing the kitchen in the club, and I began to study the whole process and different ways of working with food. And I found the story of Stu Irving's an award winner chef from Vancouver, who lost his restaurant during the crisis and started working at a strip club, obviously the club's food raised its quality exponentially. So many positions within the clubs were filled with more and more professional people.
Unfortunately here in Tokyo things did not go so well, the lack of ideas to innovate, the lack of professionalism in night work, no regulations, nor appropriate laws made it all turn into a jungle where acquaintances and friends prevailed.
Many clubs had to close gradually, and very few survive now.
Before the girls paid for work, after the crisis the club had to pay for them to work.
It was not so attractive for the girls to work all night, because people do not spend as before and therefore fewer commissions, and it does not make much sense to work drinking every day and dancing for less and less money.
In addition, the crisis led to many tax measures and immigration laws that made the work of girls and club operators more difficult.
After many years I remember with a certain nostalgia those times, I do not write this article with the desire to find conclusions or some kind of learning, I think that none of us who were at that time regretted having lived a good life, for all of us I think that was part of that bubble and illusion in which we all lived. I write this article only with the eagerness to entertain myself remembering all those stories that we passed at that time.
The only conclusion is that the few who remain decided to innovate and move forward, and try as much as possible to work with business ethics.
This article is not to talk bad about the bankers or brokers of that time, just only to recall some of the crazy times We lived.
I have to say that I have met incredible people working in the finance industry, and they were really dedicated to deliver their promises to their shareholders. I wish they continue in the industry, because they are people with values. But I still see that some bankers of that time, are still in the same industry, and I hope they have learned the lesson.
However I have to say that I see again with uncertainty the future of the financial industry as we know it. Greed will always be an important factor for growth ... but at what cost?
I have many stories of those times and if you have any share them here.