Exhibition News March 2019 - Page 25

Cover Feature From left to right: Phil Soar, Kevin Keck, Alison Jackson, Peter Jones and start again, an opportunity to sell the show and go into a big corporate, but the thought of rocking up to the City to my desk every Monday morning wasn’t particularly appealing. Private equity felt like the best of both worlds. We’re still small and nimble but with the funding to implement the structure and resource that we need to grow. We still have the entrepreneurial flair of a small organisation. NM: Is it a matter of working out your identity as you continue to grow? AJ: We’ll buy lots of different businesses and each will have their own identity. At some point someone will ask what our ‘culture’ is, and the reality is that we don’t know yet. But I think it won’t look like a corporate. We’re not going to attract people by saying ‘we have an amazing office’, it’s not the right environment for someone who would prefer to work in a corporate world with lots of processes. It’s a small business with huge potential. PJ: I’ve been in the position so many times when I’ve launched something and tried to encourage really good people to work on it and a lot of people get excited about the word ‘start-up’, because ‘start- up’ means excitement, it’s edgy, it’s the unknown and uncharted. Now we can attract people with the reassurance that we have the structure and the support behind us, whereas previously, being a one-man band, it was far more risky. The appeal of the exhibition industry The past few years have seen private equity companies such as Blackstone and Inflexion taking an active interest in the exhibition industry, particular businesses that organiser trade events. We asked Phoenix director Kevin Keck why Nineteen Group felt like an attractive investment. KK: Phoenix has been an investor in the sector before with CloserStill and we’ve been looking for the best opportunity to reinvest since then. We believe that Nineteen is the best way for us to invest again in the sector. There’s the common link in Phil Soar, who chairs CloserStill and chairs Nineteen as well. Peter and I met, and it became clear that there might be an opportunity. PJ: From the early meetings with had with Kevin’s team it was very apparent that it was a different type of private equity house in terms of its support. NM: What are some signs of an attractive investment in the exhibition industry? KK: First and most importantly is the people that we’re working with and obviously that’s a two-way street. From our point of view, finding a team who’ve built a business successfully in the past is important. I think one of the things they have that’s unusual is the proven ability to successfully launch events as well as build then. That is not an easy skill to develop, nor is it one that is prevalent in the sector. Lastly, having a real focus in terms of sector and strong positions within interesting sectors. NM: How has the private equity view of the exhibition industry changed since your investment in CloserStill in 2012? KK: It’s much more popular! There have been a lot of private equity transactions since 2012, here and internationally. People are aware of the very strong characteristics of good exhibitions businesses. First and foremost, from our point of view, is the ability to grow if you have the right team, whether it’s growing existing events, launching events, acquiring individual shows or groups of events and internationalising – there are lots of ways that businesses can grow. NM: Will private equity investment in the industry continue or has it peaked? PS: I appreciate Informa/UBM wasn’t private equity, but the total value [of industry deals in the last 18 months] was £7.3bn, if you include the NEC, Informa and Clarion. It’s a phenomenal number, but it’s always foolish to say things can’t go up. However, in 2018 the big sellers were all quite predictable, but if you say to me who’s next…I’m not sure where the big players are. It’s hard to see where the assets are. NM: What do you attribute the popularity of the industry to? PS: Trade shows are an interesting sector to invest in. As areas to invest go it’s proven a good area to place your bets. It doesn’t require an enormous amount of cash to try things – some work and some don’t but the odds are quite good. And, of course, Kevin is a well-known star investor in all sorts of products. NM: It’s a safe bet? PS: The trade show industry by and large isn’t run particularly well and that’s due to a lack of the Darwinian effect – the margins are so good that people don’t need to improve. That’s the key to the success of the exhibition industry worldwide. NM: And where does the UK industry sit within the global industry? PS: The UK is a provincial market – it’s of no great consequence in the totality of things – but we have this strange effect that so many of the large world groups are based in the UK. Virtually all the big organiser groups are based in the UK, with Emerald as the obvious exception. If you also exclude the Messe’s and Comexposium the rest are UK-based, and that is worthy of debate. EN March — 25