UK-based entertainment venue operator The Venue Group (TVG) Hospitality has raised $50m in a funding round led by musical instrument manufacturer Gibson Brands, the Financial Times reported today.
Funds managed by investment banking groups Goldman Sachs and LionTree took part in the round, which represents TVG’s first external funding.
Multiple partners at investment firm KKR filled out the participants in the round along with musicians, financial professionals and technology investors such as Stewart Butterfield, Joe Gebbia and Tom Kartsotis.
TVG was co-founded in 2015 by musician Ben Lovett and his brother Greg, a finance director at private club owner Soho House’s North America branch. It runs live music venues Omeara and Lafayette, and bar and dining zone Flat Iron Square in London, and is set to open Orion Amphitheater in Huntsville, in the US state of Alabama, in May 2022.
The company intends to expand to US cities including Washington DC, Nashville, Austin, Detroit, New York and Los Angeles as well as additional venues in London.
Ben Lovett told the FT that TVG initially sought private equity funding but instead opted for a consortium of private music and financial industry executives in order to maintain autonomy in its decision making.
“I have been travelling around the world for 15 years now,” Lovett said. “I have gotten to know them away from the spotlight. They are all passionate about music and community.
“TVG is of the music industry, and is supported by people who know a thing or two about how to invest.”
Lovett added TVG is exploring the possibility of replicating the Flat Iron Square complex in the US, combining entertainment facilities such as eateries, community space and bars with live music performances.
Under this model, venues will be able to run programmes continuously throughout the week and not just for an evening. Lovett explained: “The traditional venue model is pretty brutal – you are paying rent 24/7 and you can only open the doors to make any money a few hours a day.”
Although the lockdowns caused by the covid-19 pandemic and the resulting social distancing measures affected performance venues negatively, Lovett said it also helped confirm that there is no substitute for in-person socialisation and cultural engagement.
Gibson Brands chairman Nat Zilkha, who holds a board seat at TVG, said: “Music venues have been an underinvested asset class for years and TVG is bringing to life a much-needed supply of world-class venues.
“Rather than attempting to compete in a mature music industry with entrenched players, TVG has created a way to partner with the industry and build for the future.”
Image courtesy of TVG Hospitality Limited.
