Nothing came close to the epitome of cool in the ’90s than Planet Hollywood. The famous themed restaurant was all the rage in the ’90s. You couldn’t walk a few feet without bumping into one.
It was backed and endorsed by some of the biggest and brightest Hollywood A-listers and stars such as Sylvester Stallone, Arnold Schwarzenegger, Bruce Willis, and then-wife Demi Moore. Other stars such as Whoopi Goldberg, Patrick Swayze, Don Johnson, and Melanie Griffith also became investors in the promising business venture.
But the once-popular themed resto experienced an epic fall as fast as its meteoric rise. Here, we recount the story behind Planet Hollywood’s rise and fall.
Hollywood’s Answer to Hard Rock Cafe
Back when novelty restaurants were a thing, perhaps the most famous of them all is Hard Rock Cafe.
Bryan Kestner, who had a small role in the Arnold Schwarzenneger movie The Running Man, approached Keith Barish, a movie producer, with a business proposal. His idea was to start a themed restaurant franchise that will be Hollywood’s answer to Hard Rock Cafe. The theme would be based on major Hollywood movies of the time with the name Cafe Hollyrock.
However, the name was shot down by Barish but he liked the concept so much that he decided to bring in Robert Earl, former Hard Rock Cafe CEO, and started working on plans.
Barish would then use his influence and contact some of Hollywood’s brightest stars to join them in the project as investors. This is where Stallone, Schwarzenegger, Willis, and Moore all come in, along with several other A-listers taking up about 17% of company ownership.
These celebs would then make appearances at branch openings (for a fee, of course) and drop in now and then to dine in different locations, much to the excitement of the diners.
Each branch opening cost about $2 million. This covers everything from construction to professional electrical services, movie memorabilia, and flying artists for their opening appearances.
The business was doing very well that when it became a public corporation back in 1996, it seemed like there was no stopping this juggernaut.
Bears Steam estimated its value at $1.2 billion with prices going over $32. This sudden increase further boosted Planet Hollywood’s meteoric rise as it became a $3.5 billion corporation. However, as things took a turn for the worse, prices plummeted to a mere 75 cents.
This led Earl to decide to open more branches in rapid succession in his desire to keep their stockholders happy. With dozens of branches opening worldwide, it seems the famed restaurateur bit off more than he could chew.
Opening branches cost a lot of money (at least $2 million) which makes the return of investment too long to recoup. And as more and more branches opened, fewer people came. The novelty had worn off and folks were ready to move on to the next big thing.
Coming from the Brink of Destruction
Just like in action movies, the restaurant went on a downward spiral of dilemmas and conflicts. It came to the brink of destruction in 1999 as its stock was de-listed and the group of restaurateurs and investors declared bankruptcy.
Earl recognized that it was a huge mistake to open that many branches in so little time.
And like any action star, he did his best to remedy the situation so that he can still ride off into the sunset after a long hard fight.
He reorganized and downsized, reducing the number of branches and locations down to 35 from a whopping 87 worldwide. Doing this allowed their stock to be relisted but a couple of years later, the restaurant went bust again. This time, they credited the loss of business to the huge decline in tourism following the September 11, 2001’s terror attacks. They came out with the announcement a month later in October 2001.
Are They Still Around?
The question now is, after all these years, does Planet Hollywood still exist?
Despite the company’s rocky history, yes, they’re still around. They have successfully opened four hotel resorts, the most recent being Planet Hollywood Beach Resort Cancun which opened in January 2021. They have seven restaurants in operation as of now: Las Vegas, New York, Orlando, Los Angeles International Airport, Disneyland Paris, London, and St. Julian’s, Malta; a far cry from its heyday but far more manageable business-wise.
However, according to reports, they aren’t doing very well. We can just imagine how the company has been impacted by the COVID-19 pandemic. Maybe just like its action superstar endorsers before, the company is just regrouping and taking the necessary steps to make sure they win the fight and come out triumphant and victorious in the end. Only time will tell.