Innovation, geo-cloning & going global with Easyfairs

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Audio Transcript

Tim Smallbone

Hello and welcome to Inflexion Point, the podcast that explores those crucial moments in a company's journey that change the trajectory of success. Through conversations with business founders and entrepreneurs, we'll explore what those moments look like and how to recognise and harness them. I'm Tim Smallbone and in my 20 years as a partner at Inflexion, I've been lucky enough to witness a huge number of those moments that are a part of every success story. Today, in a conversation with its founder, we'll explore the 25-year journey of international events company Easyfairs.

Eric Everard

We got cash and we said, okay, we're going to open 10 countries overnight. We're going to be copied, so we have to be quick.

Tom Green

This business has a super high quality of earnings, dispersed revenue streams, 12 geographies, multiple end markets, very attractive.

Tim Smallbone

A serial entrepreneur, Eric Everard had already founded a number of businesses before the idea for Easyfairs was ignited in 2003. Since then, he's seen it grow internationally, including the acquisition of flagship shows such as Comic Con, and he's led the company to consistently stay ahead of the competition when it comes to organisation, innovation and technology. And we're also joined in the studio by Inflexion partner Tom Green, who led our minority investment in the business last year and now sits on the board. Welcome to you both. Thanks for joining me.

Eric Everard

Hello.

Tim Smallbone

Hello, first of all, tell us a little bit about what does the company do, events?

Eric Everard

Events is a broad name. We are really doing two things. We organize trade shows, that's 90% of the business, and we manage exhibition venues, 10% of the business. So we are a trade show organiser.

Tim Smallbone

Just, you're clearly not British.

Eric Everard

Not exactly, yeah.

Tim Smallbone

Tell us a little bit about yourself.

Eric Everard

I'm so sorry for that. I'm Belgian, my father was Belgian, and my mother is German. So I'm a good mix of this creativity and organisational skills, which you have to be as an event organiser, as an exhibition organiser. You have to be constantly creative, and you have to be damn well organised.

Tim Smallbone

You started other businesses before you stumbled on this one.

Eric Everard

Yeah, as long as I can remember, I was an entrepreneur. I was 12, I was already selling animals to my classmates. I was 16, I was selling clothes to my friends. So during my university years, I had three companies. I was an insurance broker. I had a student agency, so I was delivering students in supermarkets. And I started a student magazine.

Tim Smallbone

This is all while you were still studying.

Eric Everard

Yeah, and learning Chinese. So yeah, so I have not been a very good student, but I did it.

Tim Smallbone

Did you ever have a proper job or did you just go straight into founding your own company when you left university?

Eric Everard

I did. I was due to continue to study Chinese. I had my airplane ticket to Taipei. I was going to Taipei University for two years learning Mandarin. And then the student magazine that I had launched, I gave it to other students to continue it. And after one edition in October, they said, it's too much work. Are we going to stop this? And so I was, there was my baby, which was about to die. And my girlfriend at that time, which was very unhappy that I was leaving for China for two years. She's my wife today and the mother of my four children. So, I decided to stay in Belgium and to give a chance to this magazine, to become a professional magazine for one or two years. And then I would go in China. China is still waiting for me today. And very quickly, I said, how can we give information to this community with another media than simply a magazine? And then came the idea of a student fair. And so that was the first exhibition we organised. I was 23 years old. And it was the first Belgian student fair.

Tim Smallbone

And it flowed straight on from having had the magazine. That's where the idea came from, that connectivity.

Eric Everard

Yeah, it's the same type of information. The advertisers are the universities in your magazine and the exhibitors are the universities on your.

Tim Smallbone

Bringing the two sides together, which is what the events do.

Eric Everard

Exactly. They are often a copy of an existing magazine. So what I discovered at that time was that a magazine is every month. In Belgium, we have two languages, so you have to issue 2 magazines every month, two different magazines. It's really, already at that time, it was, profitability was under pressure, but I was not counting so well, so I did not know it. And then suddenly, you organize a trade show, and it's once a year, and it was much more profitable. So I said, oh, maybe it's a better business to be an exhibition organiser than a pure publishing. And so we developed this company for four years. And we were kind of 40 staff. I was 26. It's tough when you are 26, 40 staff and everybody has the same age and everybody's first job. So everybody thinks he's right. It was kind of chaos. And I say, either I'm going to be burnout, which did not exist 40 years ago, but now I can imagine what it was, or I sell the company. And so I made a little file and send it to five companies.

Tim Smallbone

To sell it, to sell the company.

Eric Everard

To sell it, yeah, without an investment bank or a broker. And to cut a long story short, I sold to Reed Elsevier. And so I became quickly their MD for Belgium and then for Benelux. I stayed five years with them in Belgium and then I left for Paris. I was leading an important company there, Reed Midem, which organises great shows in Cannes, MIPIM, MIP TV, MIPCOM, during one year. So I signed with them for three years when I sold the company, and I finally stayed six years with them. And you know, at the end, you don't leave a company. You leave a bad boss, which is something I always remembered. And today, it's something we are really carefully checking within Easyfairs. How are the bosses doing with the teams? Are they good managers? So I had probably 4 different managers at Reed. The 4th one was not a nice guy. So I left Reed because I had a bad boss in Paris.

Tim Smallbone

So you otherwise were you were enjoying working for the corporate?

Eric Everard

Yeah, I was an entrepreneur when I sold, clearly. They made me a manager. They really transformed me. It's a very well-run company, as everybody knows. You look only at the stock price.

Tim Smallbone

So for you that was an education, that was a discipline.

Eric Everard

It was a financial discipline, strategic discipline, thinking before doing, which an entrepreneur usually does the reverse. He does first and then he tries to write a strategy around what he has decided. Here it was like professional management. So I had left my function at the head of Reed, Belgium since two years when I received the phone call, from Reed. I always remained very close to the top management of Reed exhibitions. Still today, they are great friends. And they said, Eric, we are leaving all the small countries. We are concentrating on China, America, you know, Germany. So if you want your company back.

Tim Smallbone

I have invited you to take it back.

Eric Everard

By the way, we have not done well the last two years when you left.

Tim Smallbone

Yes.

Eric Everard

It's now loss making. But for one Euro, you can have it back.

Tim Smallbone

You bought it back for a Euro.

Eric Everard

Yeah. It was not my choice to come back in the exhibition industry, but I mean, you don't refuse such an offer. So we had kind of 15 fairs. I sold 12 of them the next 12 months. I sold the shows which I thought were not strategic, kept the others or the ones I liked also, and started launching and acquiring exhibition organiser or even exhibition venues. At that time, really, or still today, nobody really wanted a combination of the bricks of a venue, the management of a venue, and exhibitions that were organised in the venue. There were three different....

Tim Smallbone

Three different skills.

Eric Everard

... Activities with three different buyers, potentially. But if somebody wanted to sell it as one company, it was not good for anybody. So it was good for me. So I bought those companies and we quickly became, maybe six years later, we were the absolute leader in Belgium.

Tim Smallbone

So you created the business, you sold the business, then you bought it back, you paired it right down and really focused it on a few shows. So what was it about those few shows that you then, that you could see, those are the ones I can build the company on?

Eric Everard

I thought I would have a cool life and I kept the antique shows and I quickly bought a contemporary art show, which is still one of the big shows of the portfolio today. So I had an art and antique division. So for a couple of months, I thought, I'm going to have a super cool life. I'm organiser of art and antique shows and that's it.

Tim Smallbone

Yeah.

Eric Everard

But then you don't do that to an entrepreneur very long. So after 5 minutes, he says, okay, what's next?

Tim Smallbone

Tom, if I could turn to you. We had already invested, Inflexion had already invested in an events business. So what attracted us to Easyfairs?

Tom Green

Yeah, so we invested into CloserStill and made a very good return. It was a very successful investment for us. And I think we developed an understanding of the exhibition space, that vertical, both in the sort of business services team, in the investment team and Inflexion, but at the investment committee level as well. So we mapped the market, as you always do when you have an investment, and Easyfairs stood out as the premium scaled player that was still privately held and a very high quality business. So in investor speak, this business has a super high quality of earnings, dispersed revenue streams, 12 geographies, multiple end markets, 150 shows, no dependency revenue wise on a particular show, flagship events. So from a pure sort of academic investment perspective, on paper, very attractive. And then when we met Eric, you've just heard a bit of the story. The business has this combination of strategic nous and entrepreneurial guile, I would say. These guys really know what they're doing in the space. And that's proven, that's played out for 20 years. And it's not just Eric, but it's the management team that sit below him as chair. And there's been some really considered thoughts and investment into the IT backbone, the sales and marketing processes. It's a highly backable business, plenty of opportunity globally. And I think our challenge, candidly, is now the business is very well capitalised with Inflexion behind it, the challenge is probably choosing those opportunities. There are too many opportunities to chase all at one time. So we're going to choose them. Where do we deploy our capital in time?

Tim Smallbone

So the business was developing, was growing, and you were by then a leader in Belgium? Where were you going beyond that? You presumably thought, I can take this outside of Belgium?

Eric Everard

That's not that easy because nobody has waited for you to organise exhibitions. Look, all the big international exhibition companies are based in London. If I go to London or to the UK and I organise a show, everybody will laugh at me. You have done everything before me. The same in Germany. If I, as a little Belgian, you have to imagine a country of 10 million inhabitants who will give a lesson to Germany or the UK about how to organise trade shows. They're going to laugh, you know, and with reason. So we indeed, 2003, 2004, we had done our strategic move. We were leading the country, seriously leading the country, a very, very nice growth. And in a small acquisition, we had a couple of traditional trade shows in this company. And in the cellar, a team was doing a packaging show, but the way they organised it was completely different than the way that all organisers are organising their shows. For example, it was forbidden for exhibitors to build their stands. The organiser, so this small company, was providing all the stands at your image. Send us a PDF. It's going to be your image on the wall, but we're going to build the walls. It's 2 days only. It's very, very specialised. You can only take 12 square meters modules, maximum 4.

Tim Smallbone

And this was totally different, was it?

Eric Everard

Yeah, because at Reed or when I was developing my company in Belgium, you tried to sell huge stands to exhibitors. The more they were spending, the more they were building their stands, the happier you were. But the consequence of that is that exhibitors are spending a fortune on their exhibition participation. And at the end, we are in a world where everybody started to count return on investment, return on the pound sterling invested in marketing. How many leads? And when you start doing this and you have spent a fortune on your stand, it's becoming a very painful exercise for everybody. And in this formula, we quickly called it the Ryanair of the exhibition industry because it was a low cost. It was 2,000 EUR or pounds for a 12 square metre stand, fully fitted, two days, very specialised industry. It was a great deal.

Tim Smallbone

Wow, just a completely different, just a real turning point.

Eric Everard

It was kind of the reverse. It was Ryanair versus British Airways. It was efficient, it was short, two days, cost effective, time effective. And so we said, I thought we stopped this because this is not our thing, you know. Maybe there is a story behind that. And from one little show in a cellar, we said, oh my God, but this might be the Troy horse to conquer Europe. Because there we have an offer that nobody else has in Europe. So we gave it a name, Easyfairs. It was the same price and the same facility than booking an ad in a trade magazine. That was our motto at that time. And so we started doing some of them in Belgium, and we immediately saw that all the SMEs, you say SMEs are the small and medium-sized companies that had left the exhibition space because too expensive, too complex, came back as exhibitors, and they were not looking stupid because they took maybe 12 square meters, and a multinational company was blocked at 4 modules, so 48. So the SME was not looking stupid. And it was time and cost-effective. So they came back. And there are many more SMEs than multinational companies. So suddenly we had 10s, hundreds of exhibitors coming back.

Tim Smallbone

That flip changed everything.

Eric Everard

It flipped. And so we said, OK, we gave it, we give it a name and we are low cost. So we need to be at the top of the tech. It was 2004. So internet was the beginning and you don't, you didn't have an iPhone. But we said we're going to be the best event tech company in the world. Because otherwise, our low-cost offer can never be profitable. Everything needs to be automated, and it needs to be very easy for exhibitors to book online and visitors, et cetera. So we invested a lot on our platform, which we are 20 years later still doing. And I think we can proudly say that we have the best technology in the event space. Then we said, OK, we are successful in Belgium. And very quickly, What does a crazy entrepreneur? He sells everything he has.

Tim Smallbone

Sold the venues themselves.

Eric Everard

The bricks. Not the venue management, the bricks. We sold the venues to insurance companies that were more than happy to get rent. We got cash and we said, okay, we're going to open 10 countries overnight. We're going to launch Easyfairs. It's such a good idea. We're going to be copied, you know. Somebody will see it and do the same. So we have to be quick. So we started geo-cloning, finding ideas in every country in Europe. And once we had a good idea in one country, immediately we studied how we could geo-clone it in all the other countries. So we had 15 little R&D laboratories in the different countries, finding out new topics. that were then centralised in Brussels and sent back to all the countries so we could easily share best practices on new types.

Tim Smallbone

And all that came from that one idea from that little packaging company that you bought, that new approach. It is a bit like a low-cost airline devastating an existing estate. It was a new approach focused on making it really easy for the customer. And then you just rubber stamp that country by country with geo-cloning, and that's how you build the business.

Tom Green

But that's what I think the special sauce of the business is. I think a differentiated proposition, totally different to what was incumbent in the exhibitions market. Being very quick to spot opportunities to launch new shows, which is a combination of geography and vertical. And I think Eric's underplayed the strength of the IT in the business, which is probably quite rare from our perspective. But I think the IT backbone could support a business four, five, six times the size of Easyfairs now. It is hyper-scalable, fit for purpose, very strong.

Tim Smallbone

This is technology which is focused on linking up the exhibitors with the visitors.

Eric Everard

The name is Easyfairs. So the idea, what drives us every day, is to make this industry, which is quite complex, it's a lot of work to exhibit, there are a lot of documents, it's painful actually, to make it easy. We have three clients, if you want. We have the exhibitor. How many clicks does he need to do to be booked? And we are constantly trying to reduce the number of clicks that an exhibitor has to do to be an exhibitor. Visitor is the second group. How many clicks do you need to do to be accepted as a visitor? And for our team, it's the third customer, it's our employees, to make their life easy so they can they have a system that makes that make the sales, the ops, the marketing that is for them easy also, so that we develop efficiency in the entire value chain.

Tom Green

It's very well considered. So you've built that end-to-end IT backbone in a very considered way from scratch, purpose-built for scaled exhibitions. That's what's quite unique about it. It's not third-party software that's stuck together. These guys sat in a room in front of a whiteboard once upon a time and worked out what the entire IT journey needs to be for all stakeholders to make it easy. And therefore it's super straight through, very scalable, very effective.

Tim Smallbone

The new approach focused on the customer, the customer being, he's the person who's paying the money to get customers. He's trying to find leads for his own business, to get his own customers. So the new approach, it was focused on just being off the shelf, solution for the customer on the pin by technology.

Eric Everard

100% of our visitors have, they have an NFC chip in their badge. And 100% of the exhibitors have, they have small readers. The visitor likes your machine, he takes his badge and he touches simply the reader and he will get an electronic information, documentation on this machine and the exhibitor, if he has paid the right option, we'll get the contact details. He's got the lead.

Tim Smallbone

He's got the lead.

Eric Everard

Yeah. There are 10s of small efficiencies that we have added to the business to make it a great return on investment for exhibitor, return on time for the guest. Another element, crucial element that I think Inflexion did appreciate when they looked at our company, it's that we lost money for seven years, but then we started making profits after that. And we have not paid 1 euro dividend the last 20 years. We decided to reinvest everything largely in IT and the rest in acquisitions. So we started to become a buy and build machine with limited means because we did it only with our free cash flow.

Tim Smallbone

And that was a big reason why you brought Inflexion on board. And Tom, presumably we saw a big opportunity in that.

Tom Green

Yes, wonderful privilege to be behind someone like Eric and the team. We've now got first world problems where we're very well capitalised and we've got to make strategic decisions about where we put this capital with the constraint really being management bandwidth. There's sort of too many opportunities out there that are good. And I think Eric's underplayed the sort of capability and muscle memory he's built in the team. It is an M&A machine. And now it's an M&A machine that is well capitalised. So our, my job...

Tim Smallbone

Is to do bigger deals.

Tom Green

Exactly. So we can do, we're now sort of asking you questions of, okay, so how do we take the business to the next level? Bigger deals, more strategic deals that might stretch the team from an integration perspective, but be bigger slabs of accretive M&A EBITDA to come in, and also let's look at new geographies. And there's a big geography you might have heard of called the United States of America, that the strategic discussion we're having at the board at the moment is, how do we enter that market? Because to Eric's point earlier, the geo-clone potential of very strong shows in Europe exists in the US. But it's very difficult to ask a management team who are very busy and flat out in Europe to penetrate the US with the same discipline and rigor and safety, if you will. So we're now having very accretive conversations as to how we do that with some interesting opportunities presenting themselves.

Tim Smallbone

Was there any particular show you'd want to highlight where you made a real impact?

Eric Everard

Yeah, it's this Comic Con show that we bought in Ghent, in Belgium, which was an annual show with 20,000 visitors a year. People come disguised in their favourite actors or comic, you know, and so it's amazing. We bought it and we said, but this is not organised professionally, so let's do it with our, you know, methodology. We did it. First show, 40,000 visitors, from 20 to 40,000 visitors, paying visitors in this case. So we doubled the revenue. So a couple of days after the show, I called the team and I said, guys, have you seen those guys coming disguised? It's their passion. They work during one year to get ready to show to the others their nice...

Tim Smallbone

Their fancy dress, their gang outfit.

Eric Everard

So it's a punishment for them, I said to the team, to have only a show a year. Why are we not doing it twice a year? No, it's not possible. I said, yes, we're going to do it. And six months later, we had the spring version of the autumn show. It was the same show, but twice a year. So 40,000 visitors. So you buy a show, 20,000 visitors. A year later, you have two shows, 80,000 visitors. So the business is times 4. And since then, we have geo-cloned it in Holland, where it's even bigger, in Sweden. So we now have 10 Comic Con shows and it's one of the growth levers of the company. So this capacity to geo clone is also when you have teams all around Europe, management teams in every big country in Europe, it's easy when you have a good idea in one country to try to launch it in other countries.

Tim Smallbone

So you were going nicely. You had a differentiated model, no one else had copied. You were starting to build an M&A machine. Everything was going well. And then COVID came along. I mean, that must have been pretty tricky because you can't operate a show when people can't get together.

Eric Everard

It's true, it's true. We had indeed to overnight almost to stop all our shows. And with our M&A strategy, we had leveraged the company. So we had 100 million EUR of debt when we entered COVID. I think it helped us. Because when you owe 1 million to the bank, you have a problem. When you owe 100 million to a bank and you cannot reimburse...

Tim Smallbone

That's the banks problem.

Eric Everard

So they recognised that first it was the interest, secondly, probably they would have to support the company. But if you are already at three times EBITDA, your EBITDA disappears and the bank needs to put more money. But they did. They did lend us tens of millions. to survive COVID and to postpone, postpone and postpone and postpone four times on average all our shows. The nice thing is that 60% of all our shows were sold already. So when we restarted post-COVID, all our colleagues, organisers, order books were empty. Ours was 60% full. So we could restart overnight, actually. And we had a pretty good year, almost as good as the pre-COVID year when we restarted September 21.

Tim Smallbone

But you must have worried that in the meantime, people have learned how to use Teams. Even I learned how to use Teams. And so we were talking to each other without having to get together.

Eric Everard

It's a good point. It's a great point. It was the acid test. If we would survive this crisis, it would be the demonstration that it's a very strong industry for the future. You work constantly at home now, home working. You are behind the screen the entire day. So when there is every year, the event for the industry, for sure, you close your screen, you take the train.

Tim Smallbone

And you travel.

Eric Everard

You travel and you are with humans. Like look at the restaurants, they are full, the bars, they are full. People need human interaction. And the industry demonstrated it has never been stronger than after COVID.

Tom Green

There was probably no better test of the sustainability of exhibitions than a really acute issue such as COVID.

Tim Smallbone

It was a proper crisis.

Tom Green

Yeah, don't waste a crisis, yeah.

Eric Everard

You know, entrepreneurs, they have weaknesses and they have strengths. One of my strengths is I sleep well. Then COVID arrived. I had 800 employees and no revenue. So I can remember, it was kind of 7 million months of overheads and no revenue. And for how many months, I mean. So it was kind of, I was tough. So what helped me, is to make the list of the advantages of going bankrupt.

Tim Smallbone

You looked over the precipice.

Eric Everard

Make the list of the advantages of being bankrupt. And you can do that in your entire life with many things. When you fear something, make the list of advantages, these events happen.

Tim Smallbone

So it becomes less fearful.

Eric Everard

It's becoming, it was, I had to stop because there were so many advantages. But my wife said to me, well, stop it. You're going to want to make the, and the day and the night after, I slept well again. It could happen, it would have been another life, a shorter life.

Tim Smallbone

Imagine the worst.

Eric Everard

But it would have been a nice life. Anyway, so it was then easier, and then we focused on saving the company, but not on our fears, only on saving the company.

Tim Smallbone

Eric, it's an amazing story, how you've built the company up, came up with something completely original and just completely transformed the industry. Thank you very, very much for spending some time with us. That's it for this episode. My thanks to Eric and Tom for joining me. Remember to subscribe to Inflexion Point wherever you get your podcasts so you don't miss an episode. And of course, you can check out our previous instalments too. Thanks for listening.

About the episode

Inflexion Point tells the story of Easyfairs, the international trade show organiser and venue manager, and how a low cost idea found in the cellar of a small acquisition became the blueprint for expansion across Europe. Host Tim Smallbone is joined by founder Eric Everard, the serial entrepreneur who sold the business, bought it back for a euro and rebuilt it, and Tom Green, the Inflexion partner who led the minority investment and sits on the board. They reflect on the moments that shaped it: the discovery of a fully fitted, two day, low cost show format they dubbed the Ryanair of exhibitions, the decision to sell the venues and open in ten countries at once before rivals could copy them, the bet on building the best technology in the sector, and surviving COVID with an order book already part full. Along the way, they talk about geo cloning good ideas from one country to the next, turning Comic Con into a growth engine, why human contact left the industry stronger after the pandemic, and how a well capitalised business now chooses between too many opportunities, including the United States.