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Veritix secures $100 million line of credit in bid to take on Ticketmaster
Convinced that it needed more monetary muscle to compete against rival Ticketmaster, digital ticketing solutions provider Veritix has secured a five-year, $100 million line of credit that the company said it will use partly for upfront payments to venues, teams and promoters it hopes to lure into contracts.
According to Veritix CEO Sam Gerace, the reality of competing against the deep pockets of Ticketmaster, which merged with concert promotions giant Live Nation this year, made the move necessary because such upfront payments can run in the millions depending on the deal.
"In addition, this funding gives us the ability to remain competitive in an environment where offering significant cash advances to arenas, teams and performing artists has become common practice, and in some cases, an absolute requirement," Gerace said in a statement.
The funding is a shot across the bow of Ticketmaster, and a dig at how the company has long conducted business, which is to blow its competitors out of the water by boldly outspending them. But now, with Veritix' decision to play by the same rules, Ticketmaster is finding itself in more of a fight in the ticketing space than it has in recent years. In addition to Veritix, other competitors include rival Comcast-Spectacor and Fred Rosen-run Outbox Enterprises LLC, in addition to TicketFly, TicketBiscuit and AudienceView Ticketing, among others.
Veritix secured the financing from private equity firm Rockbridge Growth Equity, and the company did not rule out trying to secure additional funding in the future, whether from Rockbridge or other investors.
Jeff Kline, president of Veritix, told TicketNews that the move also was designed to blunt industry whispers that the company was undercapitalized or possibly hurting for money. Over the last couple of years, Veritix has signed a slew of ticketing deals, but the company still lags far behind Ticketmaster. Among the deals Veritix has signed include ticketing contracts with the Denver Nuggets, Utah Jazz, Houston Rockets and Cleveland Cavaliers — and their respective arenas — college football's Boise State and NASCAR's Dover Motorsports, among others.
"This allows us to level the playing field," Kline said. "It's been frustrating at times. We've been told by some venues 'we like your system, we like the technology and the flexibility, but what are you going to do for us?' They want to know what's in it for them right now, not the benefits of our system down the road. That's the precedent that been set. That's what we're up against."