A little over a month ago, Dave McComb and I announced that we had sold the Semantic Technology Conference, as well as the SemanticUniverse.com web site, to WebMediaBrands. Lots of people sent congratulatory messages, which was gratifying and much appreciated. Thank you again to all of you who have wished us well.
Of course people also ask questions like:
- Did you do well out of the deal?
- Why did you sell?
- What’s going to happen with the show in future?
They’re all great fodder for gossip of course (which is half the fun of asking!) but now that the dust has settled a bit, I wanted to try and satisfy the curiosity and provide some answers to these questions.
Did we do well out of the deal?
So this of course is a polite way of asking “How much did you sell for?” and as you might expect, the specific details are confidential. But no, we weren’t “forced” into a fire sale by the recession, nor are we now in a position to buy oceanfront property in Monte Carlo. It was a fair deal reflecting the performance and potential of the business. Both buyer and seller were happy, and are happy.
Why did we sell?
Like any entrepreneurial venture, you always have an exit strategy in the back of your mind. In our case, we figured ours would be in another 2-3 years when the SemTech event was larger, and we had a more valuable asset. But you also never quite know when opportunity will emerge. So shortly after this year’s SemTech event in San Francisco, Eric Hoffer of Second Integral (see Eric’s blog here) – who’s been a friend of SemTech for several years, and one of the savviest connectors of people and ideas I have ever met – suggested I should have a chat to the folks at WebMediaBrands. Of course, you never shut your mind off to these things, no matter how remote the possibilities may seem, so Eric lined up a meeting between us. That’s what got the ball rolling.
Within a few days of that initial meeting, we had an offer from Alan Meckler, the Chairman of WebMediaBrands. Though we’d never met, I’ve known Alan by reputation for many years – he has a long history of success including as the founder of Internet World, which was by far the biggest conference and trade show about the Internet during the dotcom boom. He made it clear that he felt the upside potential of the semantic web is enormous and that acquiring SemTech – as the leading conference in the space – was an important part of his strategy. Alan is extremely decisive and his team is really focused so within a week we had agreement on terms, and contracts were signed about a month later. I’ve been through a couple of acquisitions before, but this was by far the most efficient and responsive process I’ve seen.
But still, why did we sell and not hold? Why did we exit now, and not wait till we had a larger asset? Well, it was a combination of factors, but truthfully I would describe it as a “risk averse” choice. It enabled us to eliminate our downside risk while still participating in some upside opportunity. To fully understand why this was important to us, you’d have to understand how devastating the last couple of years have been for our core business. SemTech actually didn’t suffer too much during this time – revenues were down a little in 2009 but they bounced right back in 2010 - but the other side of our business which produces enterprise IT events was hit incredibly hard during 2009. Frankly we were lucky to survive and that experience was still a recent memory.
Other factors that came into play were the increase in competition and workload that appeared right around the corner. The conference business is hyper-seasonal – we have intense periods of high activity where we need to double our staffing levels, but then we have nothing for those people to do when the show is over. Likewise, we realized that as competitors started emerging, we needed additional resources and skills that would take a major investment. Sure, we could continue to build SemTech slowly and surely, but if a competitor with deeper pockets came in and pushed us aside – we might not have a valuable asset to sell in the future. So again, we thought to ourselves, with a good offer on the table and a way to stay involved in the future, it was a prudent business choice.
What’s going to happen to the show in future?
The annual SemTech Conference will go ahead exactly as was planned prior to the sale. Dave McComb and I are confirmed as Program Chairs for at least the next two years, so we will keep up the momentum and evolution of the educational agenda. We have dates booked in San Francisco for the first week of June, in both 2011 and 2012. The Call for Presentations for the 2011 program will be issued in a week or so.
Staffing-wise, I’m pleased to say that my long-time colleague Eric Franzon has move into the editorial and community leadership role here at the new SemanticWeb.com site. Of course there have been some behind-the-scenes changes in operational and sales staff, as those functions have been transferred to the super-competent WebMediaBrands personnel, but everyone you previously worked with at Wilshire Conferences remains gainfully employed. Likewise our good friend and bizdev guru Steve Bastasini, has accepted a wonderful opportunity with the search start-up Semantifi.
The most exciting news about the future is that SemTech will be launching in London and New York in 2011 (this is a great example of something we wouldn't have been able to do without WebMediaBrands help). Dates will be forthcoming soon, and again, Dave and I will manage the educational agenda for both events.
Anyway, I hope this answers the questions that were asked shortly after the sale, and provides reassurance about the continuity of the conference, as well as the community resources we provided previously.
All the best,