The guy behind the No. 1 nightclub in the country used to fetch ice for drinks.
Back in the late 1990s, concertgoers and late-night revelers at the House of Blues would find a young Jesse Waits behind the bar, supporting bartenders and confusing patrons who thought the same guy had just checked their IDs outside. (That was his twin brother, Cy.)
Thousands of up-for-it tourists had to be equally confused some 10 years later seeing the two of them running around—or, more appropriately, just running—XS, the Encore venue where they served as managing partners.
Nowadays, you’ll only see Jesse there. In the summer of 2010, XS lost both Cy and its other managing partner, Victor Drai, with whom the brothers had worked at his namesake afterhours operation and Tryst, another Wynn nightlife property. This left Jesse solely responsible for running the nightclub tied for No. 1 in the U.S., according to Nightclub & Bar magazine, along with No. 9 Tryst.
Almost five years later, XS still (and exclusively) owns the No. 1 slot, reportedly grossing over $100 million last year—a remarkable feat given the nightlife scene’s considerable overgrowth and subsequent competitiveness, fixation on the newest shiny thing and three-year relevancy limit for most venues.
On the eve of March 28’s 6-year anniversary party—coinciding with the return of its internationally beloved resident DJ, Avicii—the club still carries an air of newness, thanks to a recent $10 million renovation, as well as one of relevance, due in part to a formidable exclusive-talent roster that includes dance-music giants Diplo, Kaskade, David Guetta and Skrillex.
Jesse Waits’ sudden lone-wolf status didn’t evolve easily, despite a decade of nightclub management experience. But he had a vision, and a chance to implement ideas that would allow XS to progress in the increasingly cutthroat nightlife scene—ones that Drai previously opposed, like booking expensive DJs aligned with the nascent commercial dance-music movement, which new competitor Marquee was already doing.
“I was ready to move,” he says. “There were opportunities missed. I wanted to cultivate [DJ] relationships. Things needed to change.”
And change they did. After Waits convinced Steve Wynn of the roster’s profitability—pointing to the sky-high numbers generated from XS’ second anniversary party, headlined by the ascending Deadmau5—Waits spent most of 2011 developing a resident program that would simultaneously spur lucrative bottle sales, break ground for the local nightlife scene and draw fervent music fans that would buy presale club tickets.
“Imagine paying tens of thousands of dollars for artists you’re not used to [booking],” Waits says. “When we started the program, we were selective and careful. I was pitching and pushing for it, and kind of bringing performers to keep this coming.”
Waits himself brought aboard a handful of DJs like Avicii and Afrojack, and hired entertainment director/EDM enthusiast Zee Zandi to round out the rest. A roster was unveiled in early 2012 and officially kickstarted XS 2.0, an alternate name Waits uses. “It changed us,” he says. “It carried us into the next three years.”
But it’s only one aspect of XS’ second wind and durability. Waits maintains that his accessibility to all patrons and his face as its brand ambassador are also important, as is the club’s Encore location and design. “People can’t replicate what we have,” he says. “They walk in, they’re comfortable, they explore, they play blackjack, dip their feet in the jacuzzi, go talk to girls.”
However, one factor looms over all the rest: VIP sales, the bulk of XS’ revenue. Before signing off on any six-figure DJ, hi-tech upgrade or any other club-related decision, Waits must consider whether it will fill more tables or sell more bottles of alcohol. That careful strategization is why XS is one of two nightclubs that can claim over $100 million in annual revenues.
“We built all this stuff outside of the club to build more energy outside, to make people feel like they’re indoors, and build that business outside,” Waits says. “Two-thirds of the business is outside. We built the DJ booth to have two faces: inside and outside, [so DJs] play to both. ... Production took us two years to figure out, and it was all about customer service and making our ROI.”
So how does Waits evolve XS from here? He’s already tweaked the DJ program, is booking table-filling residents more frequently than before, and signing on more hip-hop-friendly and open-format talent as EDM becomes less culturally dominant—though also dropping more house-oriented names like Robin Schulz for potential “new flavor and relevancy.”
There’s also the March 30 launch of a new monthly Monday promotion called High Society Mondays, which will incorporate local and international artists and their artwork. “After six years, you see the same party and you stop going,” Waits says. “So this is for new energy.”
And speaking of new energy, Waits foresees XS—and perhaps the rest of local nightlife—returning to a more communal and less observant atmosphere once people tire of the current DJ headliners. “What we’re planning to do is go back to the customer again, that nightclub integrity, to have people basically interact with each other and not the LED screens. Like a social scene,” he says, clearly eager to move on from the trends he’s helped establish and steer Strip revelers toward a new experience—maybe XS 3.0.