In Ruth Carter’s final feature as EN guest editor (before handing over the baton to incoming Simon Parker), she speaks to Raccoon Events founder Mike Seaman about investment, expanding Stateside and the future of hybrid.
Ask anyone about Mike Seaman, chief executive and founder of Raccoon Events, and they will describe him as a nice guy, a clever guy, a decent guy. But don’t be fooled. Whilst the nice guy appearance is not a façade – this is genuinely how he is – behind that is a really interesting mix of personalities.
On the one hand, Seaman is self-assured, confident and pathologically convinced about the direction, purpose and standards that he wants in his company. But he is also equally pathologically convinced that others may know better than him and shows a fearless approach to being wrong, learning from others and changing his mind if necessary.
Having had a strong 2019 and, with the first few weeks of 2020 looking great for Raccoon after the National Running Show in January, Seaman was planning on a bumper year. But like everyone else, March came and changed all those plans.
How does he feel now looking back on 2020?
“Really good now. Last year we went through crazy highs and crazy lows but it is starting to settle into something that approximates the plan. It has been horrific, awesome, terrible and brilliant.
“I have learned so many new words, like furlough! I have also learned so many new skills such as the importance of cash flow, the ability to run many different plans at once and the mindset of ‘being comfortable being uncomfortable’. At the start of this pandemic, I saw a lot of people trying to ‘be certain’ but I quickly realised that there was no way we could predict what was going to happen. So we decided we would make a guess and then run three plans: a best-case plan, a medium case plan and a nuclear one. Unfortunately, like so many others, within months we went to Plan Nuclear, and even that had to be continually adapted.
“But waiting until everything blows over is not smart and is not taking advantage of the opportunities that are emerging. There are opportunities emerging all the time even if no one knows when they are going to happen. Lots of people think our return to some sort of normality is going to take ages and some think it is going to be soon, so you need to be prepared for the best as well as the worst.”
Whilst Seaman talks confidently about the changes and adaptions he had to make last year, he also puts much of his success down to asking for advice wherever possible and remaining agile.
“I make sure I have access to really good advisors. When I set up Raccoon, one of the first things I did was to join the AEO. The main reason was because I wanted to go and get mentoring, talk to clever people and get them to tell me why my business was bad. I don’t need anyone to tell me why it is good, I wanted them to pull it apart. And now a lot of those early advisers are on the Raccoon board, they have invested in the company and are fully involved and supportive. I now have what I would class as a ‘group of mates from the industry’ who have been there, seen it and done it and I just make sure I aggregate all of their advice.
“I am also very happy to change my mind about things, be persuaded and try new things. Often people reduce their limits by thinking you have to choose either A or B. But why can’t you be bold and change your mind if the evidence is there? That is being smart and that is how business should work.
“I have to admit though that it does make me frustrating to work with! I have a plan that will be really clearly articulated which we will go for but I will then see something else and simply change my mind. But there is always a rationale behind that change and, if you take the time to explain it, people will come with you.”
2020 was not plain sailing for Raccoon, though, and Seaman was forced to make some tough decisions about the business which he now sees as being pivotal.
“We sat down early on last year and realised that we could get to a certain point in time but then we were going to run out of money.
“Of course, we had the option to retain exhibitors’ money or cancellation fees. But I am an ethically-driven human and had made myself a cast iron promise that there would be no way I would hold on to exhibitors’ cancellation fees if they didn’t want to do a rescheduled event. We haven’t delivered the service at the time they had expected it to be delivered and so we should refund that money. Building that refunding into the cash flow model made us realise that we were going to run out of money.
“So, in October, we went to market and brought in two new investors. The injection of cash not only enabled us to shore up the balance sheet for that projected cash flow hole but actually also gave us the money to be bold and ambitious.”
Seaman is not someone to sit on his hands, and saw this change in Raccoon’s circumstances as an opportunity to accelerate the business.
“We saw that everyone else in the market was shrinking back but we decided to take advantage of the situation and saw it as a high opportunity. We sit in the health and wellbeing markets which have been booming. So we decided to launch products for this sector to capitalise on that booming market. It actually became illogical for Raccoon to stand still because we had cash in the bank, we had a loyal community and no one else was doing anything. Everyone else was still thinking about cutting overheads whereas we were able to reinvest and start hiring people.
“Ironically, we would not have thought about investing and expanding if it hadn’t been for the challenges of 2020. I don’t want to be flippant about this as I know it has been a horrible time for many. But for us, without the cash flow challenges, we would not have gone out and sought investment. We had been trading well, we had good cash flow and measured growth plans and that was initially probably enough for us. But, once you have cash behind you, it gives you options and you stop making near-term decisions but start looking to the medium to long-term. And that is when you really start to see good return.”
As well as opening opportunities in the UK, the investment into Raccoon gave Seaman the chance to tick another item off his bucket list – namely launching overseas. He talks candidly about their plans and also shares some of the critical thinking they use to assess launch viability.
“I have always wanted to launch overseas and geo-clone the Running Show. I believe I can run that show in pretty much every major country around the world. It is a really easily replicable formula. So we did our due diligence and then launched the Boston Running Show and will be launching a second US running show within the next month. We intend to have five in the US in the next three years as well as taking our other brands over there.
“How do we decide where we should geo-clone a product? Above all other things, it is about finding areas of high disposable income combined with high market participation. Additionally, it is about looking at what is the same and what is different and being really clear on those factors. Finding things that are easily replicable overseas with your existing products but also being aware of the differences both in the market and in the exhibitor experience.
“Make sure you have on the ground resource. There is nothing better than someone who can walk you in the door and bring a contact book with them that would have taken months to develop on your own. And finding that person is something that you need to bring a high level of rigour to. Whether you choose to hire someone or use a representative, they are essentially an extension of yourself. Particularly when you are looking to launch in another country, you have to go through a really in-depth diligence process with that person to make sure that they are going to reflect your brand in the way that you want them to.
“Just ask questions of everybody. Sometimes, entrepreneurs don’t want to tell anyone about their new idea because they are worried people steal it. And that is smart because there are some people out there who will do that! But it is also dumb because, if you don’t share your ideas with other people, you will just end up in an echo chamber. My favourite thing to do with a new business idea is to go to my mates in the industry and say “tell me what is crap about this idea and why doesn’t it work”. And don’t be precious about it. Don’t defend it. When they tell you why it won’t work, listen. You don’t always have to agree with them, but it can’t hurt to have that open critique. As long as you’ve got smart friends that is!”
Seaman has his feet firmly planted in a consumer mindset and sees his events as highly engaging specialist retail businesses. He talks about how the Running Show model works, and how he feels you need to differentiate between a festival and an exhibition.
“Essentially, our whole premise is to provide the coolest shops for outdoor enthusiasts at the right time that they want to buy and to make it fun. Yes, you put celebrities in there and do fun things but you promote the event squarely as a retail experience and not as a day out.
“There is a very fine line between running an exhibition and running a festival. The festivalisation model says ‘come and do the things you want to do at our event and whilst you are there, buy this stuff’ whereas the exhibition model says ‘ come to our event to buy all the stuff you need to do the activities you love doing’. Subtle but important.”
And he doesn’t stop there with the need for differentiation. Seaman feels that it is fundamentally important to decide whether you are on the ‘side’ of the exhibitor or the visitor.
“My view is that you have to pick a side. I have worked in businesses where we were trying to make money on both sides of the coin and they contradict each other. It makes it really difficult to make some choices and can you end up compromising both sides. If you are reliant on ticket revenue, at some point there will be a trade-off between visitors and exhibitors – they will be competing revenue streams.
“We are very squarely on the side of the visitor. We bring an audience of active consumers to our show, who want to spend money and our exhibitors like that. We say to our exhibitors that we don’t need to make money out of the visitors, we love them, we protect them and we will bring as many of them as possible to you. And the exhibitors think ‘yes, that’s cool’. It also takes the risk out of the business model because we know that more people equal more value.”
Consumer confidence has meant that many in the exhibition industry, possibly driven by expected lower footfall this year, are now starting to talk about quality versus quantity. Seaman does not think there needs to be a compromise.
“Why does it have to be one or the other? Why can it not be both? You only come to, say, the National Running Show because you like running. Our shows are quite niche, they are narrow and not generalist. We do not sell our shows on big experiences with bars, bells and whistles. It feels like a tradeshow from 40 years ago where you only go if you are interested.
“Because of the niche nature of our shows, quality isn’t an issue, and, the more people we can stack in the better.”
With the first Raccoon show in the UK planned for late July, how confident does Seaman feel about delivering that show?
“We already have 17,000 people signed up for the National Running Show South in July, so the numbers are looking good.
“In terms of managing them on the day, there are a number of different ways we can get those people through the venue, using inside and outside space, and we have, quite literally, a myriad of different plans. That is absolutely necessary because on 21st June, everything could open up – there could be no restriction, no masks and events could be back. Equally, one of the pilots could suggest that we have to have a new way of operating and we have to be ready for anything.”
Many organisers are looking towards omnichannel as being the next big thing for their strategic direction, but Seaman take a very simplistic, uncomplicated view of how his business should be structured and is highly sceptical of the current trend toward virtual and hybrid events.
“Our events are lovingly simple. We don’t have any pretence of being special or unique. We are glorified car boot sales men who create an event, bring a lot of people along and let them sell stuff. Quite simply, we don’t try to overcomplicate it. We don’t want to be particularly clever or intelligent – we want to be quite simple and easy to understand. Buyer meets seller is pretty straightforward to understand.
“As to omnichannel, I am a huge sceptic of virtual or hybrid events. I think this is something that has been forced on the consumer over the last year as it has been the only game in town. It is not a change in behaviour. Virtual events just don’t do what we need them to – it is not a good idea to try and hammer something in with a saw.
“Digital is different and I distinguish between virtual events and digital. Digital is an obvious platform for us as we are essentially data businesses. I sit on a bank of tens of thousands of active consumers who brands want to talk to. What we need to do is facilitate those conversations – back to buyer meets seller – and we can do that with a couple of live events a year. But if we only do that, we are missing the rest of that piece of engagement. It makes sense to optimise the community through some kind of a web platform.
“If you consider the media platforms as a pyramid, we have got our events at the top, underneath them we have our websites and then underneath that we want to layer ecommerce. That is when you suddenly start to become a really useful community owner.
“In reality, we are very much an omnichannel business but are very clear about what our core is. But basically, omnichannel is still about buyer meets seller and finding lots of different ways to do that.”
So, despite being a ‘nice guy’, Seaman shows flexibility, agility and a fanatical passion for growth mixed with creativity. What advice would he pass on to others.
“The first piece of advice is to value people above anything. Raccoon prides itself on being accountability-based rather than hours-based. We do that quite deliberately because it opens up new talent pools. We are flexible with people around working relationships and have been since we started. I don’t care where you work or what you do as long as you get the job done. You simply have to care for people beyond the numbers.
“Trust your people. We are very ‘people first’ and the loyalty we have shown to people has never let us down. If they don’t fit, get them out quickly. If they do fit, then look after them and value them as they will pay you back in spades.
“Secondly, just get on with it. I see so many people who over-plan, over-write and over-think but forget to go out and test stuff with customers and the market. Don’t just sit inside with your perfectly formed business plan and think your work is done. Your business plan is the starting point for your business. Test it with the market, let them help you shape it and then you adapt it. Instead of a rigid business plan, you actually end up with something that is formed by your customers, in which they have a shared ownership and which therefore, they will love.
“So stop dicking around and just do stuff.”