Hitting the Right Note: Lucky Voice

As firms look to cost cuts in every part of their business, Lucky Voice, Martha Lane Fox's upmarket karaoke company, is pressing ahead with its expansion plans.

Founded in 2005, the company is about to open in Brighton with its bar partner Tiger Tiger.

There are currently four Lucky Voice bars - two in London and one each in Manchester and Cardiff - and other openings are in the pipeline, though the pace of expansion will depend on whether economic conditions are suitable.

Lane-Fox stops short of calling Lucky Voice recession proof, but she is decidedly upbeat about its future. "I think there is something interesting in our model," she says.

The model, originally copied from a Japanese business, works by merging on-line and off-line characteristics. The karaoke pods in bars, which are run with Tiger Tiger, are complemented by an online service with downloadable karaoke songs that can be performed at home. "No one can afford to ignore online and see how it is translated off-line," says Lane Fox.

Lane Fox set up and then grew Lastminute.com through the dotcom boom and bust with business partner Brent Hoberman. Her experience of that downturn informs her assessment of the current recession. "This is not like the dotcom bubble," she says. "There was not a consumer lack of confidence then, it was a stock market lack of confidence but businesses continued to thrive."

So what is it about Lucky Voice that gives Lane Fox the confidence she'll succeed?

First, it has entered a fractured market with no clear market leader and few if any recognisable brand names. This presents a clear opportunity for Lucky Voice to "clean up and dominate" says Lane Fox.

Second, it is a business of its time - at its simplest level Lucky Voice offers people the chance to forget about their daily stresses and enjoy themselves inexpensively.

Julie Meyer, chief executive of Ariadne Capital, says: "In the recession and in general, the best times are very simple ones. It is logical that people don't want to pay huge amounts of money."

Third, Lane Fox's association with Lucky Voice gives people confidence in the brand. Meyer, who was part of the original team that invested in Lastminute, says that Lane Fox exudes an energy and charisma that is hard to match. "She brings a spirit of fun and an energy to whatever she does. Lucky Voice will be entertainment for our times and she is the perfect person to bring it to life."

Lucky Voice also has an impressive board, which includes Spark Ventures chairman Tom Teichman, who invested in Lastminute and is an expert in nurturing niche businesses, and Karen Jones, the former chief executive of Spirit Group, whose unrivalled knowledge and contacts in the pub industry is a huge asset for Lucky Voice as it looks to expand.

Other businesses can learn some useful tips from Lane Fox's example:

• Don't underestimate the value of a strong, experienced board - especially if it includes people who have traded through previous recessions.
• The Lucky Voice business model was 'borrowed' from a successful Japanese model, which gives a blueprint for growth and trading when times are hard.
• A passionate leader can encourage a team.
• Lucky Voice identified a gap in the market and has a long-term plan to grow a sustainable business.
• In recessionary times there is a desire for cheap, fun entertainment.
• Be prepared to flex your plans if the economy dictates.