Selling the Show: When Is It Time to Let Go?

By Gary Tufel -- Tradeshow Week, 3/26/2007

You launched a show, nursed it from infancy and, hopefully, watched it grow into a success, but the time will come when you must allow it to leave the nest. As with any offspring, it's hard to know when is the best time to let it go.

Tradeshow Week asked some investment bankers and show managers: When is the right moment to sell a show?

Basically, it's when a buyer is willing to pay the most and you've done everything you can to leverage your show's value, said investment banker Anver Suleiman, CEO of Luntz, Suleiman & Associates.

Sell when buyers are bullish, agreed Andrew Everett, conference management and event marketing consultant, and founder and former president of Wilshire Conferences.

Even when it's not a sellers' market, there are factors that could still make selling attractive — or necessary (i.e., ill health, increased competition or just knowing that the show's future isn't rosy), said Suleiman.

Bob Birkfeld, managing partner of the Compass Group Intl., said that the worst time to sell is when you're forced to.

Some experts also believe owners shouldn't sell shows that have achieved unimaginable success. Instead, they should put them on the market when they're trending upward.

"One could argue that there is no reason to sell if you own a thriving show, but I think Alan Meckler did very well by selling Internet World in 1998," Everett said.

Sometimes, all the factors come together to make the timing just right. That's when Scott Goldman sold the show he had created.

In 1999, Goldman, president of Eaton Hall Exhibitions, had been looking for a topic for a show launch when he had a conversation with Carl Pugh at a Boston meeting of the Society of Independent Show Organizers. They debated the reasons why Internet World had grown so quickly (at the time, it was doubling in size every year). Pugh said it was because the show served such a fast-growing industry.

Then, Goldman noticed a front-page story in the New York Times about food safety. He "immediately thought that was the fast-growing topic" he'd been looking for, he said. He launched the Food Safety Summit (now the Food Safety Summit & Expo), and it took off.

Eight years went by quickly, and Goldman thought about selling. He considered himself a serial entrepreneur and was ready for a new challenge.

"Even my wife said, 'You'd rather be starting something new,'" he said. The fun for Goldman is in conceiving, creating and growing a show.

In Goldman's case, one serious buyer, Stagnito Communications, an Ascend Media company, had been pursuing the show for a couple of years, believing it had synergy with Stagnito's own business. Goldman got a valuation on his show from Kathleen Thomas of Berkery, Noyes.

With the valuation of his show in hand, Goldman started conversations with Stagnito. At one of their first meetings, a Stagnito representative asked Goldman why he wanted to sell.

His reply was simple: "Because you want to buy."

He could have shopped the show, but he had a good, strategic buyer, so he moved into the term-negotiation stage.

Sometimes at this point, Suleiman said, a good offer can get even better. For instance, one of his clients told him he wanted $10 million to $12 million for a show. Suleiman advised him to take a year to build the show further. After that year, "we sold a half interest for $15 million," Suleiman said. "Then in another year, the entire thing went for $50 million."

Goldman said the best advice he got about selling came from his buyer, who had sold his own business just a couple of years earlier: Always treat a sale as if it's not going to happen.

"So, we didn't change how we did business, didn't postpone or defer expenses, and didn't get at all attached to the idea of selling," Goldman said. "We went on about our business as if there were not a sale in discussion. I think that helped keep us focused on running a successful show, as well as keeping from getting emotionally attached to the idea of a sale. We remained, at every point, willing to walk away if the deal wasn't right."

He was also "absolutely and completely forthright about the business and any bumps or imperfections there might be from the very outset."

A new competitor entered the field just as Goldman started sales talks, and there were major changes taking place in the food security world. He and Thomas were open and direct with the buyer about these things even before an offer was made. This guaranteed that nobody could "find a leaky roof," he said, and allowed him to negotiate confidently and from a position of strength.

"We were as transparent and candid as we knew how" to be, Goldman added. "Our buyers did exhaustive due diligence, and we knew there wouldn't be any surprises for them. That added to our ability to negotiate with a strong hand, and with integrity."

Once the sale closed, three months prior to the show, Goldman worked hard for the new owners. He actually postponed his other events in order to get the new owners up to speed. He remained highly visible on the showfloor, doing his usual "care and feeding" of show participants, handing out T-shirts to attendees and chocolate chip cookies to exhibitors.

One problem for many who sell shows they've created is the emotional attachment, Goldman said, but for him that was never a factor.

"If you can't let go of your emotions, you'll sell too late," he said. "I can do this again."

In fact, he just might. The inaugural edition of his latest launch, School Building Expo, took place earlier this month. If all goes according to plan, in about five years it too will be on the market.

It's the if-all-goes-according-to-plan part that sometimes makes things interesting.

"When you start a show, you think it's forever," Birkfeld said, "but circumstances change, whether it's marriage, divorce or health problems. Such things can re-organize your priorities."