Felix Barrett: Up to his ears in theatre

He is the king of 'immersive' drama – so why, asks Brian Logan, does he want to set up a travel company?

Felix Barrett: 'When a child cries we scoop them up and give them proper jobs to do - it's the cast's mission to get them through' (Justin Sutcliffe)

Theatre is changing. Can you imagine Sir Peter Hall directing Shakira's world tour, or Sir Nicholas Hytner starting a travel agency? That's what Felix Barrett has been up to recently – and Barrett has a fair claim to have been the hottest theatre director in Britain in the past decade. With his company Punchdrunk, he brought large-scale "immersive" theatre into the mainstream with a series of hit performance-installations – including Sleep No More, an award-winning promenade Macbeth, which has been running for over a year in a warehouse in New York. But commercial success hasn't dimmed his restless experimentalism, says Barrett: "If someone else has done it," he says flatly, "I'm not really interested in doing it myself."

I'm talking to Barrett on the eve of the revival of The Crash of the Elysium, which sees Doctor Who given the Punchdrunk treatment. The Elysium is a spaceship, and the show starts with the young audience being invited to excavate its wreckage. It was a smash hit last year in Manchester, and you can see why. What schoolchild wouldn't want to don a bio-hazard suit, enter the world of everybody's favourite Time Lord, then save the world from his most ghoulish adversaries? The show was tailored for children – adults aren't allowed in without them – and was, by all accounts, electrifying.

"There's nothing better than giving something to an audience that has no idea what they're walking into," says Barrett with relish. "That raw shock when the rug is wrenched from under their feet. I love it. That's what it's all about."

But The Crash of the Elysium was also huge, and recreating it elsewhere (Ipswich, this time around) has been a daunting challenge. "We wanted to create a touring show for the first time," says Barrett, 34, a gentle chap despite his Viking appearance. Punchdrunk events are usually conceived with a particular building in mind – Barrett creates work by "listening to the building and hearing what it wants to have performed inside it", he says. "But when you're doing something that's fully experiential and three-dimensional, and everything has to look and smell right and be totally believable – well, that's not easy to relocate and reinstall."

It's also expensive: with the exception of Sleep No More on Broadway, Punchdrunk shows don't make money. "My ambition is too high," says Barrett, whose events cost film-sized sums commensurate with the cinematic experience he offers audiences.

But The Crash of the Elysium is more involving than any movie. When Barrett and Co tested it on a pilot audience "a lot of the children were upset and frightened", he says. The company tried removing scared children from the experience – but found that to do so singled them out as failures. So now, there's no escape, says Barrett.

"When a child cries and is frightened, we scoop them up, empower them and give them proper jobs to do. It's the cast's mission to get them through. And when they do, the sense of conquering their fears is vast. This has become the most profound show we've worked on, because you can see the growth of these children over an hour – from being far out of their comfort zone, to whooping with joy at what they've achieved."

Nevertheless, eyebrows were raised when this Punchdrunk/ Doctor Who tie-in was announced – and indeed when the company worked on the launch of a new Louis Vuitton store in central London, or on a catwalk show for the fashion range McQ. Barrett views his company as artistic risk-takers – but these projects could be seen as taking the easy, corporate option. Of The Crash of the Elysium, Barrett says that "the new Doctor Who is so big-budget and cinematic ... [the challenge was:] could we create something as high impact as that show?"

It was worth a go, not least because Doctor Who provided for kids what Punchdrunk's adult audiences get with Macbeth, or Doctor Faustus, or Edgar Allan Poe (whose Masque of the Red Death was a huge hit for the company at the Battersea Arts Centre, in London, in 2007): a familiar source material that lets Barrett skip the exposition and "cut to the quick, shortcut to the narrative, go straight in, really deep into the world".

As for the corporate work, "I'm doing it because, when you take yourself out of your comfort zone, different parts of your brain are stimulated," he says. "We use those projects as research." Directing the Colombian pop diva Shakira's world tour, for example, allowed Barrett to see whether his detailed, intimate aesthetic could transpose to the arena scale. (Answer: it couldn't, or at least didn't. "It was a tough experience," he says.) And the recent promos for Sony and Stella Artois were used to road-test ideas for Barrett's current hobby-horse Punchdrunk Travel, whereby the company offers overseas holidays on which real life and theatre become indistinguishable. "It's unbelievable seeing what that does to an audience," says Barrett excitedly. "They're in a crowded street, and anybody on it could be a performer in the film of their life. That level of theatrical threat is amazing."

Punchdrunk Travel won't be available to you for the time being – it's on ice while the company works out its challenging economics. But Barrett remains excited about the ideas behind it, not least because they reduce the company's dependence on finding vast empty buildings to host their work. A long-awaited new London project has just been delayed again for that reason.

"All we want to do is make work for our audience, and if we can't do that, our raison d'être is removed from us." So now, he says, "I'm interested in removing the façade of theatre, in blurring the boundaries of reality and fiction. The duration of a performance can shift from being an hour in a studio theatre to a whole year, anywhere. And it can happen unexpectedly, at any point." This is, he explains, the end point of the immersive theatre phenomenon, whereby, instead of an audience immersing themselves in a show, theatre spills off the stage to envelop the audience's life.

Barrett both blames and credits technology for the boom in bespoke theatre experiences. On the one hand, soulless, digitally-mediated modernity has created a craving for "real sensory experiences". (He's about to have one: his wife Kate, a media producer at the Tate, is pregnant with their first child.)

On the other, new media and new technology provide "whole worlds of theatrical potential that no one's tapped into yet. For the theatrical explorer, there's a lot of uncharted territory yet to be claimed", he says. "It's going to take a couple of years, but I'm ready to shake things up all over again."

'The Crash of the Elysium' is at the Ipswich Arts Festival from 15 June to 8 July. Details: 01473 295900; www.2012crash.co.uk