Eventbrite IPO Tracks With Growth In Music Festivals

Online ticketing platform Eventbrite has filed an S-1 to go public in a $200-million IPO.

The company's growth goes hand-and-hand with the rise of the music festival industry as it battles industry giant Live Nation Entertainment, Inc. LYV.

Eventbrite has become a beneficial platform for small-to-medium-sized live event operators, enabling them to scale their events on a type of platform that was previously unavailable to smaller players.

More than 95 percent of creators who used the platform in 2017 signed themselves up for Eventbrite, the company said in the S-1 filing.

“Our single global system combined with self-service functionality allows us to reduce cost of operations and optimize service delivery,” Eventbrite said.

Eventbrite said its growth strategy involves attracting new creators to the platform; adding capabilities to better service specific categories and countries; developing new revenue streams based on complementary offerings; and selectively acquiring businesses focused on serving creators.

Unprofitable, But Keyed Into Industry Trends

In 2016 and 2017, Eventbrite generated 27 percent and 30 percent, respectively, of its revenue from outside of the United States. The company is unprofitable, recording a loss of $40.4 million in 2016 and $38.5 million in 2017. Eventbrite has lost $15.6 million in 2018 so far.

Still, the company is leading the charge of the live music festival explosion.

“The economics of music and the fact that people are making more money on live events than recorded music these days all ties to the cyclical trend of real growth in the festival music category,” TicketIQ Founder Jesse Lawrence told Benzinga.

“That was not a category that Ticketmaster owned, it is what Eventbrite owned. The value they are seeing in the business is largely due to the growth of festival experiences as well as lower-end smaller events,” added Lawrence.

Eventbrite is standardizing festival operations in a way that hasn't been before, enabling mom-and-pop event operators to get the most out of a ticketing platform, in Lawrence's view.

Competing with Ticketmaster is tough, but Eventbrite is a good way to capitalize on the growth of live music, he said.

Eventbrite is set to trade on the New York Stock Exchange under the ticker "EB."

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