Spot On: The Spot Experience

New Yorkers sure do love their dogs. You can barely swing a Chihuahua in the five boroughs without hitting a doggie groomer, a dog-sitter, a dog-related retail shop, or even a dog-friendly bakery. New Yorkers would do anything for their furry four-legged friends—but they also need to work, too.

This was the position that Mitch Marrow found himself in several years ago. A UPenn Wharton grad working at a multibillion-dollar hedge fund, Marrow spent 14 hours a day on Wall Street—which was 14 hours that he couldn’t spend with his two dogs, Reggie, a 220-pound St. Bernard, and Hank, a 165-pound bullmastiff. “I could never find any place suitable for my dogs,” says Marrow. “I would spend time I didn’t have looking for some place that I could leave these two dogs and feel comfortable doing so. And I just had horrible experience after horrible experience.” Besides the fact that Marrow often couldn’t get a simple answer about the handlers’ training at various doggie daycare centers, he would sometimes see dogs fighting, or a dog shivering alone, in the corner of the room. “It was sad and it was scary,” he says.

At the same time, Marrow was involved with some publicly-traded pet industry businesses. “I was really enthralled by the pet industry and the growth that was happening, even as the economy was really tanking,” he says. “From a business standpoint, I had been doing a lot of research into the services end of the business and it became obvious that it’s a huge unmet need.” From his research, he found that there were approximately 25,000 registered dogs in his neighborhood on the Upper West Side. “There were a handful of doggie daycare–type places out there, but that could only account for about 500 of those dogs if they’re totally packed. And it was these same kinds of numbers showing up at all the different neighborhoods in and around the city,” he says.

So Marrow took the leap and left the hedge fund, buying two doggie daycare centers on the Upper West Side, about 10 blocks away from each other, and rebranding them as The Spot Experience in early January 2011. From the start, he knew he wanted to do things differently. Spot offers premium pet care services, such as daycare, overnight boarding, grooming, training, and walking services, along with transportation services and retail.

Aggressive Growth Plan

Spot employees are all certified to handle dogs after undergoing more than 50 hours of training in the Human Alpha Instinct Method, developed by Spot’s canine behavioralist, Brewster Smith. Each handler, many who come from a veterinary technician or assistant background, must pass the Human Alpha Instinct Method training regimen in order to be certified. Spot also offers total transparency through their use of webcams, allowing dog owners to see what their pets are up to 24/7 via computer or smartphone. Their location on 72nd and Columbus also has New York’s only private outdoor dog park, an Astroturf-ed garden complete with white picket fences, ramps, and a little pool. “It’s all for human consumption, to go see a place and it looks nice and cozy and the fixtures are pretty—but at the end of the day, your dog doesn’t really care. Your dog wants to be in the right environment and feel comfortable while he’s away from his mommy or his daddy,” says Marrow. “We staff it 24 hours a day, so we don’t stuff dogs in cages. We really, really treat these dogs like you would want them to be treated, as an owner.”

Spot’s first two locations were so successful that in the fall of 2011 Marrow bought another two locations downtown, one in Tribeca and one in Chelsea. Spot now has a staff of over 100 people, and Marrow has plans to expand steadily throughout the coming years. “We have an incredible expansion plan for 2012 and 2013, involving over 500 hires and between 25 and 50 new locations in and around Manhattan,” he says. “There are so many dog owners out there that, even if we had 150 locations in just Manhattan, we wouldn’t even be scratching the surface.”

To fund the initial purchase and subsequent expansion, Marrow leveraged his relationships with the investment and real estate community that he built while working on Wall Street. “Our investor base is really strong. We’re really well capitalized, which is nice. And then our banking relationships are also pretty deep, because although I’m fairly new to this business, the underlying existing businesses have a history of financials to show,” he says. “We have almost tripled revenues since I’ve taken over the existing four stores. It’s very easy to show the bank that ‘Wow, these guys are doing some amazing things.’”

Must Love Dogs

With the new locations come new hires and Marrow wants his employees to consider Spot an opportunity for a career path. “Most of our people, except for the more senior management, are people that were sort of pigeonholed into hourly wage-type job opportunities. They really wanted training and a career path, but never got it,” Marrow says. “We’re putting the money and the time into training them and Spot’s growing astronomically. We’re promoting from within and we’re giving our people that started out as hourly people the opportunity to move up and become supervisors and managers and eventually run a store, or a few stores.”