91 Why investing in profitable companies matters more than ever with Harry Heartfield of Edition The EIS Navigator

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 recoverythe difference that geography and target market makesthe need to rebalance portfolio risk nowhow live entertainment and hospitality are doinghow to run live events professionally and Edition's role in supporting thatprospects for exitshow the landscape of purchasers looksthe challenges of making rollups workwhy profitability matters more than everhow 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...