With my last company’s (Social Tables) acquirer, Cvent, going public (for the second time) last month with a $5B valuation (at the time), what does that mean for other event tech startup valuations?
I’m often asked this question, and it’s a pretty interesting one to delve into, as the landscape has broadened significantly. With pandemic-fueled tailwinds, event tech has expanded to become an ecosystem of software that includes a mix of traditional incumbents and rising stars tackling all aspects of the event and meeting experience (both online and virtual, in real life and in the metaverse).
It's finally reasonable to say: Event Tech is a serious software category.
And it should be. As I say all the time, events are the oldest form of human interaction. Therefore, the primary activity we engage in should get the attention it deserves and the experience is due for an upgrade: better marketing, better welcoming, better onboarding, better safety, better facilitation, and better engagement are all features facilitators and attendees alike are craving.
What does that mean in terms of the category's outlook? We know that tech-at-large is in a prolonged, multi-year bubble, which has created a valuation bubble, which extends—of course—to event tech. In 2018, Social Tables sold for roughly 6x ARR. Today, it would have sold for 10 or 12x.
Of course, big numbers come with their own set of issues, namely pressure to perform. Often, companies are not able to catch up to their potential as quickly as valuations suggest they will. But given how important the category is—especially in an age when virtual and hybrid components have become a mandatory aspect of events rather than a nice-to-have—maybe those valuations are reasonable from a big-picture perspective.
At the time of publication, Cvent’s market cap dropped to $3.79B. But don’t bet against them. With its original founding team still intact, Cvent continues to be a growth-oriented public company and it will weather this storm as it has many others.