Is Live Events (still) an entrepreneurial industry?

As you may have heard, we announced the launch of the Events Venture Group last month. You can read about my thesis on why this idea makes sense here.

I was talking with a good friend, partner, and industry leader a couple of days ago, and he asked the question, "Do you think that this (live events) is still an entrepreneurial industry or only big companies with tons of capital and resources going to be able to launch and build new events?.

My answer and reaction were: Of course! Great Founders will continue to have tremendous opportunities to launch and build successful live events in any industry or category (B2B, B2C, etc.). I honestly believe this is the case, but let's elaborate a bit, and we will probably see that it is not as easy as it sounds.

I wrote a blog post about "building the perfect entrepreneur" many years ago. Since then, I learned a lot from listening to suggestions from friends, investors, and founders, and I adjusted and improved my list of great things that perfect entrepreneurs should have. I continue to believe that a great entrepreneur will be able to build successful and scalable business opportunities in the live events industry. Still, compared with tech or other industries, we have some additional challenges in creating businesses that justify the risk and effort level required to build a successful and profitable live event.

Let's review some of those challenges.

1. Scale. To survive and be profitable, you must achieve scale and sustainable growth. It's normal for events to lose money in their first or second edition (and we will cover that later as additional challenges), and unless your event achieves some specific scale and becomes profitable after that, your survival chances will be low, or your equity value will not be interesting enough to justify your time, stress, and efforts.
2. Financial resources. When I launched my first event almost thirty years ago (yes, I'm old!) I could finance the launch with my exhibitors' and sponsors' cash flow and limited (minimal) additional capital. I think those days are over. Some people in the industry disagree and believe it's still feasible. Still, venue and vendor costs, on top of increasing demands and expectations from exhibitors/sponsors that will trigger incremental SG&A costs in your business, will probably require significant capital to support the first couple of years. We are not talking about massive amounts of money like in other industries, but more than most people could invest. That was part of our thesis launching Events Venture Group to support the right founders who may need extra money and strategic support.
3. Expertise and industry validation. Because competition is higher and you can see many events in each decent industry, you will face formidable competitors (big, medium, and small) trying to validate their events as "the" place for that particular industry or community. You need to be able to position your event and team as best in class to ensure your survival chances are high. I keep saying that nobody wants "more events," but everyone wants "better events."

I can see many more challenges, but I also see many great opportunities to become a successful event entrepreneur. The live events industry is getting bigger and better in a post-COVID world. Nobody argues anymore that live events are a solid marketing tool and investment and probably one of the most effective ones when executed properly.

Many industry associations, investors, advisors, and companies (of all sizes) continue to educate a new generation of live events professionals. Some great education programs, like the Business of Events Masterclass and many others, share fantastic expertise on the subject.

Better and more sophisticated venues and hundreds of successful event tech startups provide excellent tools for event organizers to create better experiences and higher ROI for all stakeholders.

Being an entrepreneur is one of the most challenging ways that a human being could choose for a career or make a living. In any industry, live events are not the exception.

Nevertheless, great founders will still succeed and bring a new generation of successful events during the next few decades. The reward for creating a successful and high-growth event is high, and M&A in the industry continues to validate double-digit Ebidta multiples in many deals; because of this, founders and investors should be rewarded if they can build successful and profitable events. We don't have to rely exclusively on industry incumbents and big companies. Actually, I would bet that we will see more and better new events coming from entrepreneurs than incumbents.

As always, I am open and curious about comments and suggestions. Feel free to share here or DM me.