The EIS Navigator 91 Why investing in profitable companies matters more than ever with Harry Heartfield of Edition
When we last spoke with Harry Heartfield of Edition, the leisure sector was all about recovering the pandemic. Fortunately, we have moved on so we thought it was time to get him back to discuss where we are now, how his investment philosophy has evolved and what the prospects for exits are now.
We covered a lot areas in our discussion, including:
- the unevenness of the current recovery
- the difference that geography and target market makes
- the need to rebalance portfolio risk now
- how live entertainment and hospitality are doing
- how to run live events professionally and Edition's role in supporting that
- prospects for exits
- how the landscape of purchasers looks
- the challenges of making rollups work
- why profitability matters more than ever
- how and why to set up EIS deals six months in advance
Its another great discussion - Harry is both erudite and insightful, and the lessons are not just about the leisure sector . Enjoy!
00:50 Harry introduces himself
03:00 Why Edition is more than a fund manager
05:00 How does the leisure sector feel now?
08:00 the unevenness of the recovery
10:00 where is recovering and where isn't - geographic and demographic differences
13:40 rebalancing risk in portfolio
15:30 how live entertainment and events are doing
19:30 the return after pandemic
20:30 how to get professionalism in live events
25:30 the prospects for exits returning
28:10 political games amongst the big players in live entertainment and the structure of purchasers
31:20 making rollups work - the danger of multiple arbitrage and focus on synergies
35:45 how long to build a company?
40:15 the importance of profitability in the current market and when there is a trade off vs growth
44:30 messaging around doing something different
47:30 why Edition is lining companies up for investment 6mths in advance
50:20 the challenges of agreeing deals 6 mths in advance
54:00 favourite questions
Links
Edition Capital - https://www.editioncapital.co.uk/
Harry on LinkedIn - https://www.linkedin.com/in/harry-heartfield-2275983a/
Email harry.heartfield@editioncapital.co.uk
Subscribe to the EIS Navigator podcast on most services here: https://the-eis-navigator.captivate.fm/listen
Suggested book and media
If This is a Man by Primo Levi
The Body: A Guide for Occupants by Bill Bryson
Bio
Harry Heartfield
Senior Partner, Edition Capital
Harry has over 15 years’ experience in the leisure sector. In 2011, he joined boutique asset manager Ingenious becoming a Senior Investment Manager in their Live Entertainment Team. At Ingenious, he was responsible for working across several investment funds including several Venture Capital Trusts with a focus on leisure assets. During his time at Ingenious, he also developed and launched several investment products aimed at the retail market, including EIS products which raised more than £25m, and was Head of Investments and Acquisitions for Impresario Festivals plc until the sale of the business to media group Global for more than £28m.
He set up Edition alongside the other Edition Partners in 2015. At Edition, he has overseen the development of Edition EIS and Edition Capital Projects, which have raised over £50m between them. He also was appointed as Strategic Advisor to Superstruct Entertainment (a Providence Equity backed company) from 2017 to 2020 as they made their first acquisitions including Sziget Cultural Management (Hungary) and elrow (Spain). In total, Harry has overseen deals in excess of £220m across the UK and Europe. He sits on the board of a number of Edition’s investee companies including WatchHouse Coffee, Borrow A Boat and Tailwise.