How an entrepreneur went from flipping burgers at McDonald's to opening some of the most famous beach clubs in the world

Jack and his familyArtman AgencyJack Penrod, founder and owner of Nikki Beach, with his family.

Today, Nikki Beach is famous for its luxurious ambience, lavish beach parties, and celebrity clientele. But before the beach club’s founder Jack Penrod became a successful entrepreneur, he was flipping burgers as a McDonald’s line cook.

Using clever marketing tactics, Penrod worked his way up the ranks of McDonald’s before eventually leaving to start his own luxury brand. He became famous in the ’80s for opening up Penrod’s Beach Club, reviving Miami Beach and turning it into a trendy spot for young travellers and spring breakers.

In 1998, Penrod introduced the first Nikki Beach club, combining music and dining with fashion, film, and art. Today, Nikki Beach has expanded to include its beach clubs, hotels, a charity, and even an entire lifestyle division.

We spoke to Penrod to learn about his fascinating rise to success, from the difficulties he faced to his triumphs.

Nikki Beach is famous for its themed parties, international cuisine, all-white decor, and the top DJs it draws in. The beach clubs were created to honour and celebrate the life of Penrod's daughter Nicole, who passed away in a car crash at the age of 18. The company fulfils its philosophy of 'Celebrate Life!' through its many events.

Penrod began working at the age of 9, doing everything from carrying newspapers to cleaning bakery pans to get by. In 1961, he was working at the Greenbrier Hotel in West Virginia when he heard about a new chain -- McDonald's -- opening up. He thought the idea had a lot of promise, so he left and went to Tallahassee, Florida, to start working as a line cook for 85 cents an hour.

Thanks to his enthusiasm, he was promoted to manager within a few days. Penrod, who was 21 at the time, asked his boss if he could get a share of the gross profit if he was able to make their location the most successful McDonald's of its time. His boss said yes, so he started using some interesting marketing tactics: creating free lunches for schools, delivering burgers to Miss Florida parties, and starting a birthday club at McDonald's.

Through these tactics, Penrod took his restaurant's yearly profit from $A111,360 a year to $A550,000 a year. Eventually, Penrod went on to acquire 16 different South Florida McDonald's within seven years. He left the company in 1975, after being offered the chance to buy out at a value of roughly $A13 million.

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In the early '80s, he shifted his efforts to entertainment, opening Penrod's Beach Club in Fort Lauderdale. Penrod's became famous for the thousands of spring breakers it drew in. Penrod would send buses to over 120 colleges, bringing in an average of 2,000 people a day during spring break. In 1984, the mayor of Miami Beach contacted Penrod to see if he could help revive Miami Beach, which in the years prior had earned a reputation for being packed with retirees.

Pernod was given a 40-year lease on beachfront property, and he opened a second Penrod's at One Ocean Drive in Miami Beach. 'I knew I had to do something to catch the world's attention,' Penrod said. He started hosting events like Beach Boys concerts, and he even brought in an Olympic skier to ride down a giant mound of ice piled on the beach.

In 1977, Penrod replaced the club's pool with a garden, calling it Café Nikki in honour of his daughter. The space became very popular, drawing in celebrities like Bruce Willis, Michael Douglas, and Madonna. Penrod continued to develop the beachfront property until he eventually opened the first Nikki Beach location there in 1998.

Penrod had studied beach clubs in Europe and knew he wanted to create a luxury brand. So instead of using rusty umbrellas and lounge chairs, he spent around $A1.3 million on each property's furniture, bringing in vintage wooden farm tables that were heavy enough for people to dance on, and director's chairs so that their guests could sit comfortably for hours.

They also made the company's logo a tipi, since Penrod, an avid pilot and hiker, always felt close with nature. It was also a symbol that could easily be identified around the world. 'Our goal was to create a high-end global brand, so that when people see our tipi, they can know to expect five-star service and our casual atmosphere,' Penrod said.

For Penrod, the goal wasn't to open a nightclub, but to have a space where people could dine, relax, and enjoy partying. His mentality was that as people grow older, they don't want to be out partying until 3 or 4 in the morning. With the concept of a beach club, they could come in, enjoy the party scene, and still get to bed at a practical time.

'We would dream up reasons to throw parties,' Penrod said. Across their properties, Nikki Beach's themed parties include everything from circus celebrations to jungle parties. The beach clubs are also notorious for their white party, an idea they conceived when Naomi Campbell hosted a white clothing-themed birthday party there years ago.

Eventually, they became so busy at their Miami Beach location that customers suggested they open another, which they did in 2002 in Saint-Tropez, France. They chose St. Barts and Marbella for future Nikki Beach locations.

While each location has its own unique elements, there are some features that remain constant throughout. These include the furniture and the staff uniform: white flowing palazzo pants and hand-carved leather utility belts from Nicaragua, which Penrod told us they wear because it's the ideal size for holding bottle openers.

About 50% of the menu stays the same in each location, while the rest is adapted to the local taste of the region. Menu items include a raw bar, sushi, fresh salads, hearty sandwiches, fresh seafood plates, and pastas. Nikki Beach also hosts its famous Sunday Brunch, when its culinary team creates rotisserie stations, a rolling sushi station, and an extensive dessert display.

They also host celebrities, producers, and VIPs both at its beach clubs and at pop-up locations they create for major events like the Cannes Film Festival and the Toronto International Film Festival. Some of Nikki Beach's celebrity clients include Woody Allen, Al Pacino, Jay Z, Kanye West, Justin Timberlake, Scarlet Johansson, and Ryan Gosling, among many others.

For Penrod, part of the success has come from the work habits he has developed over the years, as he worked seven years from open to close while at McDonald's, and he never took a day off.

He also told us it's also about ensuring you hire great people and take good care of them. When they opened a Nikki Beach location in Koh Samui, Thailand, in 2009, there wasn't much of a hospitality industry on the island. They hired 100 people, none of whom spoke English or had even seen a knife or fork, and worked with them so they could learn the necessary skills. They still have the same employees working for them today.

In 2007, Penrod decided to expand into the hotel industry with Nikki Beach Hotels & Resorts. 'I was thinking about what I could do for my family because with the clubs, you really have to be on your toes, but I used to be in the hotel business so I thought it would be easier to sustain,' Penrod told us.

Today, Nikki Beach has hotels in Greece, Thailand, and Turkey, and will be opening a property in Dubai later this year. According to Penrod, the goal with their hotel division is to ensure they're a good neighbour to those they surround, which is why they're working on features like noise-blocking walls.

The company also has a lifestyle division (with branding and clothing), a music label, and a lifestyle publication, 'Nikki Style Magazine.' They also operate a nonprofit charity called Nikki Cares, which partners with charities to host fundraising events for various causes.

'When I was 12, we were a family of seven children on welfare and I told my mother not to worry because one day we would be rich,' Penrod said. Today, his lifestyle brand is recognised around the world.

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