By Andrew Patterson
Having a centralised website that details almost every event happening across the country makes perfect sense.
With discounted airfares now the norm, the ability to take advantage of festivals, concerts and a myriad or other events outside of your home city or town has never been easier.
Start-up internet events directory Eventfinda has successfully created a business model that creates a win-win for both event organisers and potential attendees by centralising all the necessary information within a single website that’s arranged into categories.
It’s a good example of effectively aggregating information as a way of creating a successful business model.
And now Eventfinda has its eye on several markets outside of NZ to add to those they have already established by licencing the platform to other users.
The brainchild of Auckland based entrepreneurs James McGlinn & Michael Turner; Eventfinda allows users to customise their own weekly “what’s on” newsletter to include events based on their own personal preferences.
“When we started Eventfinda in 2006, it was very difficult to find event information online."
"The market was very fragmented. There were some websites that would tell you what was happening in a specific category of events, while others focused on a certain geographic location. We saw an opportunity to really bring together all of that information into a single website which is how Eventfinda come about."
"Put simply, our goal was to make it easy for people to find out what was happening around the country from a single website.”
While the idea was simple enough, building the back end of the system was a lot more complicated with multiple users, multiple events and multiple locations. There was also the need for simple navigation within the site and the ability for event organisers to list their events easily.
McGlinn says building the site presented plenty of challenges and at one point the complexity of what they were trying to achieve almost threatened to overwhelm the project.
“Had we known exactly how complex it would be when we started out I think we might have reconsidered. Essentially what we've done is build up probably the largest venue database in the country so that it's now very easy for promoters to come in and list their events.”
“What also makes this sector particularly challenging is that most events have multiple stakeholders. So you might have publicists, band members, venue owners, local councils and a raft of others all of whom have an interest in the event taking place. There are certainly challenges there and the goal for us has been to make it as easy as possible for those event stakeholders to manage their own event information.”
Building the back end
Eventfinda has no actual involvement in any of the events they list, they simply provide the platform. It’s an aspect of the business that sometimes has users confused.
“We see ourselves as the online marketing channel but a lot of people do think that we put these events on ourselves. We'll often come in on a Monday morning and have emails and phone messages from people who've left their bag under a counter at a bar in Gore for instance asking us to retrieve it for them!”
Putting the site together has provided plenty of challenges beyond dealing with multiple stakeholders. Simply finding and listing the information on all various events taking place across the country quickly became a major headache.
McGlinn, who graduated from the University of Auckland in 2004 with degrees in commerce and computer science and formed an active network of over 850 local web developers, says when he thinks of it now the process was very hit and miss and not particularly efficient.
“When we started, there was no event information on the site. Michael and I would literally be looking at posters for events, at TV ads, and going home and entering the information into the system. We literally listed every event ourselves. We quickly worked out that the challenge for us was to educate the event promoters and stakeholders to list those events themselves.”
“So we got to work building a system that was easy as possible for them to do that and it worked. Within a few years we had literally 100% of the event content on the website being listed by those responsible for the events. From that point things began to get a lot easier.”
A uniquely NZ model
Despite the simplicity of the idea McGlinn says he’s yet to find similar sites internationally that use the same approach.
“We're constantly looking, but we haven't yet found another business that operates the same way that Eventfinda does. There are plenty of other websites that just list event information, but the way that the Eventfinda platform works is we have the event listing and then the syndication that allows other media channels to also carry the event content. Then we have a ticketing platform built in as well, and so far we haven't found another system that replicates that approach anywhere else in the world.”
Rather than focusing on expanding the idea internationally themselves, Eventfinda has taken a more logical route by successfully licencing the system to other users globally.
“In 2009 we were approached by an Austrian media company who wanted to run events themselves on their own websites, or have event content on their own websites, but couldn't find a solution to do that. So they asked us if they could license our system. We ended up doing that and after licensing Austria we also decided to run the same system in Australia and about a year ago we licensed the platform there as well. We're currently in the process of finding a licensee in Singapore and we'll be looking for other locations around the world after that.”
Intellectual property issues
Dealing with intellectual property issues can often be a challenge, but McGlinn says he quickly discovered a simple work around for a potential hurdle when it came to trademarking the company’s name.
“The interesting thing for us was when we went overseas and tried to get an international trademark on our name, which at the time ended with “er”, as in ‘Eventfinder’, we actually had quite a lot of difficulty because it was considered too generic. So we had a good look at the brand, and decided that the simplest solution was to change the spelling to 'Eventfinda', with an 'a' at the end. With that in place, we were able to easily obtain the international trademark for the name, which has given us a lot of confidence now as we go into overseas markets.”
“However, at the time I recall it was something that did create some difficulties for us. We liked the brand as it was, and I think a number of people around New Zealand were very familiar with it as well and we were a bit concerned about what it might mean for us by changing the spelling and perhaps causing some confusion amongst users. But in the end it's certainly been the right thing for us to do from a business perspective and having the trademark protection is obviously important.”
While the site itself offers plenty of user applications and an extensive array of information, the business model isn’t entirely obvious. McGlinn says it’s a question he’s often asked to explain.
“When we first started, display advertising was where Eventfinda made its money. Unfortunately not too long after that, the global financial crisis (GFC) hit and we saw 80% of our revenues disappear from display advertising. What we did see though was an opportunity for giving events better visibility through the Eventfinda platform."
"We have around three quarters of a million people coming through the website each month, and a quarter of a million people on our email database that goes out once a week so we realised that we had managed to capture a significant slice of the market.”
“So we were able to provide premium placement options to events that wanted to be in front of that audience."
"We also looked at syndication, and we were able to monetize the API, and the white label products that we have for media partners. We also developed clients in RTOs, the Regional Tourism Organisations that exist up and down the country along with a number of major councils."
"Then we moved into ticketing. We make a very modest per-ticket fee on the tickets that we sell through the Eventfinda platform. Then there are the overseas licensing fees we earn so in total we have five different revenue streams. Quite diverse and robust, and that provides us with a lot of confidence going forward that we're not going to be hit by another GFC that threatens to wipe us out.”
In addition to the suffering the ravages of the GFC and wondering if the business was going to survive, McGlinn says there was one other heart stopping moment that also stands out.
“In 2006, only nine months after we launched, a competing website came along with an events calendar on it run by the Government called NZLive.com. That caused us some difficulty in the early days, and certainly a bit of soul searching as far as whether this was the right direction to continue on, but we persevered and the story actually had a very happy ending. In March 2010 we formed a public/private partnership with the Ministry of Culture and Heritage and effectively merged the two competing events websites into the Eventfinda platform. It’s been considered a very successful example of how a public/ private partnership can work effectively in New Zealand, so obviously we’re very happy with the way that particular situation turned out.”
Disruptors not always welcome
Ticketing practices might eventually have to be the subject to an investigation by the Commerce Commission. Customers are regularly slugged with a variety of booking fees that result from a cosy duopoly that exists between the two principal agencies Ticketmaster and Ticketek who negotiate exclusive ticketing agreements with venues excluding businesses such as Eventfinda from such arrangements.
“Ticketing is really divided into two types. We have general admission ticketing, which we have been doing now since 2009, very successfully. But then there's allocated seating ticketing and major venues in New Zealand tend to have exclusive contracts with one of the large ticketing agencies either Ticketek or Ticketmaster for example. That makes it very challenging for new entrants like us to enter the market. These contracts are designed to exclude competitors; often for periods of five to eight years is not uncommon.”
“That makes it very difficult for us to come in, even with lower pricing and create advantages to consumers. It's often not the promoters who have a choice about which ticketing company they're going to use. They often will only have a selection of one or two venues they can choose for the type of act that they want to have for their event."
"The venue will often dictate to them, based on these exclusive contracts, which agency they must use for ticketing. It's a real problem in New Zealand, and it's one that's causing us a lot of difficulty at the moment, as we try to expand our ticketing business. It’s an issue we really believe deserves some attention. It's been the status quo for a while, that these contracts are considered standard or normal, just because it's the status quo doesn't mean it's actually right.”
Ultimately it means that the consumer is paying for what appears to be a distortion in the market.
“Generally speaking, these ticketing companies will pay a considerable sum of money to be able to put these exclusive contracts in place. Those fees of course need to be recovered somehow. Ultimately those are added to the ticket prices, and result in higher tickets for consumers. I think it's reasonable to expect that with higher ticket prices the promoters are going to be selling fewer tickets, so ultimately it's the promoters and consumers who are paying the price for that.”
Eventfinda sees itself as a classic disruptor brand.
“We believe that we have technology that makes those sorts of arrangements obsolete."
"It's no longer necessary for a ticketing company to spend tens of thousands or hundreds of thousands of dollars putting in expensive turnstiles and access control systems, we now have mobile validation through an iPhone for example, and simple apps that make the whole process much, much easier."
"We've got what we consider to be an industry-leading box office product now, which is all delivered as software as a service, through the web, which just negates the need for the expensive up-front infrastructure costs. We would like to think we'd be able to use those innovations to disrupt this market.
|Sector:||Online event marketing and ticketing|
|Turnover:||$1 mln +|
|Annual growth rate:||85%|
|Biggest market:||New Zealand|
|International offices:||Sydney, San Francisco|
|Domestic / Intl sales split:||70 / 30|
|Recent highlights:||Licensing Australia and launching allocated seat ticketing services|
|Expect to IPO:||Yes, either IPO or trade sale|
|5 year goal:||To provide event discovery and ticketing services in every developed country in the world|