Home TypeFeatures How private equity changed Nineteen Group

How private equity changed Nineteen Group

by Emily Wallin

Nineteen Group are the poster child of owner run trade show businesses backed by private equity.
Peter Jones
and Alison Jackson told Emily Wallin how support from Phoenix Private Equity has given them the chance to grow with unstoppable speed. 

Not one to shy away from speaking out, Nineteen Group CEO Peter Jones, says Covid-19 was the best thing to happen to events businesses.
From Nineteen’s ever-expanding Wimbledon office, Jones says: “I’ve no medical background – I’m not talking about the health side, but commercially I think Covid-19 is the best thing that ever happened to the events world. It flattened the events world, smashed it into the canvas, but we have got up stronger. It has proved like no other test could have done; how valuable contact is. There’s three things as a human being you need, food, water and human contact. It’s why when you’re first born they put you in the arms of you mother or father. That’s not changed in two million years and there is no virtual or digital that will replace that.
“When we opened the shutters at the Emergency Services Show in September, we didn’t know what to expect. All the speculation over whether visitors would return was extinguished. There was a tsunami of thousands of people. That moment we realised ‘wow, people need to be together’.”
Group managing director Alison Jackson agrees: “The look of joy on everyone’s faces. They wanted to be with their tribe, not at a virtual drinks party.”

Investment
Phoenix invested in Nineteen in November 2018 – attracted, Jones says, by the ‘high performance and hugely ambitious’ culture of his business. Jackson came onboard at the same time and they started making acquisitions. Since then, they have continued to grow.
And grow they have. They did not cut a single job during the pandemic – and have now increased their staff from 22 to 66, have just beaten their January targets and are aiming to grow organically – aside from acquisitions –
a further 66% this year.

Warning
Despite warnings not to get in bed with private equity, Jones listened
to his long-time mentor Phil Soar’s advice before taking the leap in November 2018.
“‘Don’t do it,’ is what all my family
and friends warned. There’s always a sharp intake of breath. There’s a warning about private equity, ‘those guys are ruthless’,” he says.
“The reason it appealed, and it’s not going to be for everyone, is it’s a high-performance culture, and we’re a hugely ambitious business. Some owner/drivers are very happy running a lifestyle business, they have very comfortable lives and great shows. I respect that but in the private equity (PE) world there’s a hyper-ambition for growth. It also gives you the luxury of not working for someone else, it still feels like your own gig, but with an inexhaustible amount of funding behind you. Literally limitless funding behind you to grow. In the UK there is a trillion pounds sat in PE bank accounts undeployed.
“PE houses are under huge pressure and their biggest challenge is to deploy capital. If they find a target, like Nineteen, then their will to deploy capital is huge. It gives you the luxury to be able to build, to be creative, it removes the normal worries of fretting Monday to Sunday over cash flow, robbing Peter to pay Paul, worrying about the salary run and trying to delay payments with Olympia. Constantly delaying, stretching, borrowing. It just takes all that out the way. From day one there is a significant fund that goes into the war chest and that removes all the worry.”

it’s a high-performance culture, and we’re a hugely ambitious business.”

Jackson is quick to point out that they want to know where every pound is spent and see a return on their investment – but Nineteen’s results stack up.
“We’re now in fourth year of being with PE,” says Jones. “We’ve grown at a phenomenal rate including through the pandemic. Last year, we turned over £8m, this year we turn over £13m the year after it will be close to £20m. That’s organic before acquisitions. One of the reasons we can grow so quickly is because we can pump an enormous amount of investment up front.”

Partnership
The partnership with any PE backer works like a marriage, Jones and Jackson say.
“Phoenix went to great effort getting to know us,” says Jones. “They want to really get under the skin of who you are, right back to my mother. There’s give and take. Things get tetchy, but it’s how you work through that as a team.
“Some entrepreneurs have the kind of personality ‘you are not playing with my toys, this is my gig’. Is it giving up? In a sense it is giving up, it’s no longer your toy, but the benefits that come with it, we have access, not just to funding, but we have access to a huge pool of intelligence, and expertise, and these guys have done this hundreds of times. They’ve seen it work, fail. Worked with management teams of
all shapes and sizes.”
“They are not trying to run a show, they’re not trying to run your business,” Jackson adds. “They would probably come to the NEC and think ‘how does this all happen?’ They are the ones behind the scenes who know where the cash is, how we
might access capital, navigating a way through a pandemic. But it’s a good marriage.

“I can’t imagine anyone in private equity being able to put on a show

“I can’t imagine anyone in private equity being able to put on a show. It’s a good combination though.”
Looking to the future, Nineteen are always looking for new acquisition targets. Jackson says subject matter is top of their wish list, “B2B shows in markets with great potential”. They say they have three or four imminent deals.
When acquiring shows Nineteen are keen to keep the best assets – and that usually means the people, Jones says. “We are certainly never arrogant enough to believe we can run a show or understand that market better than the people already in it. We know how to run an exhibition business, we understand infrastructure, how to run sales, operations, marketing, support, rigour but any acquisition target we look at, it’s the people driving that we really need to get behind.”

People

The business is all about the people concludes Jones.
“We’re a business about people that happens to do great events”
“We’re committed to our culture and people are encouraged to bring their best version of themselves to work, then our vision, our profit, number of shows, acquisitions or whatever, will take care of itself.”

 

This feature appears in the latest issue of Exhibition News

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