Newsletter Issue 15 : June 2015

DATES FOR YOUR DIARY | GCN NEWS | BUILDING AN EVENTS BUSINESS TO SELL | INDUSTRY NEWS | JOB BOARD

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Dates for your diary

Conference Awards
Fri 3 July 2015
The Hurlingham Club
Event Marketing Summit
Fri 2 October 2015
30 Euston Square
Early bird rate expires
1 July
Conference Golf Cup
Weds 14 October 2015
New Zealand Golf Club
London Venue Awards
Fri 16 October 2015
Emirates Stadium
Conference Summit 2015
Fri 4 December 2015
Savoy Place, IET Venues

GCN News

With just over a week to go until the Conference Awards 2015, we have a fantastic number of companies attending to discover who will take home the coveted trophies this year. The Awards will be hosted by the very funny Lee Nelson and are taking place on 3 July at the Hurlingham Club. A few places are still available – do contact sian@conferenceawards.co.uk for more information.

The full speaker line up for the Event Marketing Summit, 2 October, has now been announced, with 17 industry professionals covering the very latest in event marketing, from content to community, from data to personalisation. Early bird rates expire on 1st July so do book your places now.

The new London Venue Awards, 16 October, to celebrate the very best of all types of venues in London is still open for entries – but do submit them soon – the final deadline is 26 June! The event has a stunning panel of judges and promises to be a must attend for the London Venue Industry.


Questions to consider when building an events business to sell

Valuations, exiting and due diligence

Introduction to Valuations and Exiting

When you start a business never lose sight of your end game. This is easier said than done in the madness of the early start-up years with all hands on deck and securing all-important cash flow. Are you building a life-style business or are you building a business to exit in 5-10 years? If it is the latter, what type of sale would you be considering and who is your likely buyer – private equity, trade sale, venture capitalist etc? Are you aware of the key stages from exit review to completion? From day one of a start-up, it is critical to have your ultimate business strategy front-of-mind, as with any form of exit you will want to maximise your multiple and end valuation. The type of business you develop - the format or platforms and scale of events you create will very much shape the final multiple you achieve – as much as the geo areas, industry niches, communities and sectors you specialise within. There is a potential range of multiples from 4 to double-digit pending the event platforms and revenue and distribution channels you develop. However there are numerous additional aspects that need to be considered if you wish to maximise any sale value.

My own business I co-founded in 2009 was valued by a mid-sized boutique m and a house. The process was eye-opening and very positive. It enabled real focus on how to grow the business and to overcoming any potential vulnerabilities in the business model. In my earlier years, I founded and developed the IQPC German business from 2002-2007, I presided on the board at WTG events, grew large–scale events from scratch in APAC region for Marcus Evans as Regional Production Director (having set up their non-sales divisions in the new Berlin office in 2000) and as CEO I have recently co-founded a new start up Vinelake Ltd where our focus is on high-quality technology events, however importantly empowering our people and always doing things differently. I am also currently a NED at Noord-Group Ltd.

There are core elements to consider when valuing a business and as an owner who is building a business for exit you should certainly consider the following basic questions.

Questions for consideration before selling your business

Why is your business special? What do you do better than others?

What is the make-up and strengths/weaknesses in your current management team: Do you have specialist excellence? Is there a clear succession plan in place within each department?

Have you demonstrated a track-record in geo-cloning and rolling out products to international or emerging markets?

What best practise and KPIs are there already implemented and rolled out across the business? Who do you have to execute plans?

How robust is the business model – can you demonstrate qualitative earnings and retained revenues?

What is your record of event growth and sustainability – and evidence of innovation/driving new business?

How have you expanded and diversified your revenue streams? How have you monetised digital and content offerings?

What are the inherent weaknesses or threats to your business model?

What are the strengths and potential opportunities for the business in the next 3-5 years?

Within your portfolio are there branded, flag-ship products that are recognised as must-attend events? How scalable is your business?

What are your revenue channels – is there an over-reliance on any particular channel? What are the future opportunities and threats?

What is the current rate of renewable business – what measures is the business taking to improve levels and focus on the customer experience? How are you doing things differently?

How are you using technology to maximise ROI for your customer-base and improve the customer experience?

How have you invested in technology or upgraded legacy systems including internal CMS, database and latest event technologies in recent years?

Your offering and USP

Can you clearly define your offering, your USP and differentiator? There are plenty of event organisations, associations, digital and publishing businesses with events, indeed in recent years a dearth of new start-ups (a high volume however that don’t make it beyond year two or three) have popped up and the industry is rife with new events. How do you stand apart from the crowd? Not all of them are successful of course. Some are out of their comfort zone coming from a world of subscriptions and memberships, but not always able to translate that to high-end content that can be monetised running contrary to the exhibition platform generating high-volume, transactional connections, but trying to better leverage content and drive more meaningful connections for a greater return for their stakeholders. Each operates in a different world with a different customer experience.

What is the opportunity for a potential investor or acquirer? You need to be able to define succinctly (on a tweet or a post it note) the investment opportunity and potential return. You of course provide detailed financial analysis for every level of your business – and you may choose to pay handsomely for a detailed financial document from a mainstream accountancy firm or investment bank – but real due diligence is about lifting up the bonnet and looking beneath the legal framework and the financials to discover the operational and management workings of the business, the leadership, the products and what makes it successful; the actual essence of your business and what underpins that success and potential growth for the future.

Due diligence

What are the questions you will need to prepare for? This is especially pertinent for M and A advisors for the media industry offering services to private, corporate and PE clients ie: such services include private equity, valuations, corporate services etc – what questions should they be asking of your business?

These types of organisations are more often than not acquiring a business on the basis of the financials presented and potential for growth and end return (ironically the scrutiny on management or operational issues and the detailed minutia on the workings of the business don’t always get as much coverage as the numbers). They won’t always appreciate the nuances and minutia of what makes a 70% GP margin event, how you monetise video and other content, why some businesses are yielding well-below industry averages in sponsorship sales or having to give away their delegate places for free (that’s another article!). They may not consider questioning the vulnerability of a business if 70% of its revenues are driven by telesales and that should the top tier sales personnel leave, the business model may falter. How robust are the communities they claim to represent – how can you drive subscriptions? So it is mission-critical to assess the underlying operational and commercial robustness of any event business by tackling the details – not just the financials and legalities.

Final thoughts

It is the ability to formulate the simple questions and keep the end-goal in sight that will bring about business success. Latest technologies and event platforms aside, the b to be media world is essentially a people and content business – all of which has to be put into the right context, for the right audience. And to sustain this, you will also always need the right mix of talent and the right construct at Board level to drive success. That’s the next article!

Jane E Noordhuis, CEO, Vinelake Ltd and Co-Founder and NED, Noord-Group Ltd


Industry News

Is UBM’s strategy the real deal or not?

Reed's Rusbridge announces retirement

ARK Group launches curated KM industry news site

Top Right posts record revenues

New government to push forward events strategy


JOB BOARD

For more information about GCN Talent see: www.gcntalent.com

Senior Sponsorship Sales Manager - £50K base £100K OTE – London

Portfolio Director – International Real Estate Events – London – up to £48K base £78K OTE

Sales Account Director – Membership Organisation – to £50K base, £75K OTE – Atlanta, USA

Senior Content Producer, LSEs - £28-30K plus profit share - London

Head of Sales – Conferences & Exhibitions – up to 50K plus commission –London

Sponsorship Sales Executive – Public Sector Events – up to £35K plus commission –London

SPEX Sales Manager – Defence Sector Events – circa £35K plus commission – London

Senior Programme Manager – Public Sector Events - £30K plus profit share –London

Project Executive – Global Real Estate Events - £25K base £40K OTE - London

If you’re a recruiter looking for help with a particular vacancy or recruitment campaign, please call us on +44 (0)20 8123 5805 or email kevin@gcntalent.com and we’ll be delighted to discuss your requirements and how we can help.