Salesforce Park’s notorious NFT-backed restaurant goes silent

“Memberships as NFTs allow holders innovative ways to interact with their digital assets,” the Sho Club website reads. “… You can make money from your membership when you sell it, stay anonymous or publicly claim ownership, and be a part of an entirely new type of community.” Each membership tier comes with increasingly luxurious benefits, though restaurant reservations would also be available for nonmembers. 

Seven months later, things don’t seem to be going very well for Sho Club or for Sho Restaurant. I recently walked over to Salesforce Park and peered inside the shell of the building that’s supposed to become a restaurant; I saw an empty space that looks almost exactly the same as it did in August. The mock-up design photos that journalists looked at during the “groundbreaking” in August remain strewn about on the floor. Permits for Sho Restaurant haven’t been issued, the result of Sho Restaurant designers not yet responding to a number of San Francisco Department of Building Inspection notes, among a host of permitting steps that haven’t been completed.

Sho Club social media accounts have been radio silent since late September. The Sho Club website lists the restaurant’s grand opening as “fall 2023,” but other important events have been scrubbed, including quarterly Sho Club member meet-up dates. It’s not clear how well-attended those events would be, given that Sho Club appears to have sold around 100 NFT memberships, rather than 3,275, as Sigel originally projected.

I repeatedly reached out to Sigel, to Sho Club, and its public relations representatives. No one replied to my questions. A spokesperson for the Transbay Joint Powers Authority, which leases the Sho Restaurant space, told me to direct my inquiries to Sho Club, and then stopped responding. After that, I submitted a public records request, seeking emails sent to and from key members of the Transbay Joint Powers Authority about Sho Club and Sho Restaurant; they forwarded me the results of that request on Sunday night.

The public records were insightful, though not as much as a barely viewed YouTube video I stumbled upon. In January of this year, Sigel — a 40-something startup evangelist who describes himself as an “entrepreneur, thought leader and innovator in the technology, hospitality, and food and beverage industries” — sat down for a chat with someone from Family Office Insights, which the investment group later posted online. During the chat, Sigel was prone to hyperbole, calling Salesforce Park an “iconic location”; he also said the Salesforce Transit Center is a “beautiful structure” and “many people refer to it as the Grand Central Station of the West.” More pertinently, Sigel unintentionally answered some outstanding questions about the status of Sho Restaurant.

One such question: What’s going on with the NFT memberships? It turns out there hasn’t been an influx of sales. Sigel told potential investors that even though NFT memberships can bring Sho Club $20 million in proceeds, he opted to temporarily cut off NFT membership sales at 100 people, because his fall “pre-sale” went smoothly enough to demonstrate a successful proof of concept. “We’ve put that on hold,” he said.

Contrast that to what he told the media in August, when he said there was a “fantastic” desire for Sho Club NFT memberships, and that “thousands” of people had submitted their personal information online, indicating they wanted to purchase a membership. In fact, Sho Club upped its $300,000 tier from 10 potential memberships to 20, additions made due to “demand and interest,” a spokesperson emailed me in August.

According to public records, until well into the fall, Sigel was still signaling that there would be a broader NFT membership sale. On Oct. 13, he sent out a “Sho Club public sale update” to prospective members, writing, “Over the past few months, we have received an overwhelming amount of enthusiasm and interest… we will begin selling memberships to the public in late October / early November.”

On Nov. 4, in an another email to prospective members, Sigel was no longer explicitly mentioning a public membership sale or any specific dates — just that emailed recipients were welcome to apply to Sho Club. “Please note that your application does not guarantee membership,” the email read. “We have a limited number of available spots to ensure SHŌ Club continues to represent a diverse and vibrant community.”

By December, Sigel was sounding defensive about the future of NFTs. On Twitter, he replied to someone who had asked what the deal was with the lack of construction at Sho Restaurant, and if Sho Club was still moving ahead with NFT memberships, given the complete and utter collapse of most NFT prices during the fall and winter months of 2022, when FTX imploded.

“I assume the NFT market you’re referring to is primarily comprised of Artwork,” he wrote. “However, utility based NFTs continue to rise in popularity as they have real life utility and value. The NFT market you are referring to has no baring on our project.”

Hey @ddt I assume the NFT market you’re referring to is primarily comprised of Artwork. However, utility based NFTs continue to rise in popularity as they have real life utility and value. The NFT market you are referring to has no baring on our project.

— Joshua Sigel (@JoshuaSigel) December 30, 2022

The January chat with Family Office Insights also featured Sigel tiptoeing around the construction status of Sho Restaurant. At one point in the YouTube video, he claimed that “we’ll be fully permitted within the next four weeks.” That still has not happened, according to San Francisco Department of Building Inspection records. 

In the same video, Sigel addressed another significant barrier: raising money. The total project costs, including construction at Sho Restaurant and a separate venture called Sho Market, have reached a whopping $30 million, which — in January, at least — Sigel was trying to offset by raising $20 million through debt funding that converts into equity.

Archived versions of Sho Club’s website provide other hopeful project updates, many of them scrubbed from ShoGroup.com but available on Wayback Machine. In August 2022, the site declared that construction would commence in September 2022; this was amended to “Q4” in September 2022, then deleted entirely. Other since-deleted posts included plans for an October 2022 “Fall Members Event,” a February 2023 “Winter Members Event,” and a May 2023 “Spring Members Event.”

One thing that’s been added to the Sho Club website is a 50% membership discount for significant others. (One might assume if they paid $7,500 or $15,000 for a membership, then their partner could waltz into Sho Restaurant whenever they pleased. Apparently not.)

Rigid as that may seem, Sho Club did at least include a top-of-mind solution for Bay Area startup founders who want to embrace the significant other add-on, but have complicated romantic entanglements. “Members may update their significant other every two years,” the Sho Club FAQ states. “Exceptions will be considered and granted by the SHO Club membership committee.”

There was one other tidbit from Sigel’s January chat that caught my attention. Previously, Sigel sought to make humble overtures to the general public about how Sho Restaurant would indeed welcome — even embrace — passersby, that this was not a snooty private club.

“Without the public support, this restaurant is not possible,” he said. “So serving the public at large is a critical component for us, and extremely important.”

But Sigel took quite a different tone while talking to possible investors, affirming what Sho Restaurant will really be — if it’s ever constructed, anyway.

“The restaurant is on public property, so we’re somewhat obligated to keep it accessible to the public,” Sigel lamented. “But the membership component really gives us an opportunity to curate and create experiences, and provide a level of access and service that you just can’t do at scale.”

Sigel provided an illuminating example to prove the perks of being a Sho Club member. “Most people enjoy the ability to come into a space that is coveted, limited in terms of access,” he began. Yes, the restaurant will be open to the public, but that’s the appeal for members: an unparalleled opportunity to lord over everyone else.

“Sometimes I use the analogy it’s like flying first class,” Sigel said. “Oftentimes it’s not as fun, or doesn’t feel as elevated, if you were to get into a plane, sit in first class, and the coach section was empty.”