Ticket Evolution, the recently named group behind a new broker-owned ticket exchange, has given itself a deadline of mid-August to raise $4 million to develop the new Web site, according to several industry insiders with knowledge of the initiative.
The brainchild of Golden Tickets owners Steve Parry and Ram Silverman, Ticket Evolution held a closed-door meeting with dozens of brokers in Las Vegas, and via webcast, on Friday, July 16, where they unveiled the concept for the exchange, which will operate commercially from the domain name Events365.com. While exact numbers were not disclosed, the meeting is believed to have attracted more than 200 attendees, many of whom were in town at the recently concluded Ticket Summit and/or World Ticket Conference.
If the $4 million is not raised, Ticket Evolution intends to return the money it collects from brokers, which makes it is unclear how the project will then proceed. During the meeting, Ticket Evolution gave a demonstration of a draft version of the exchange, so without broker funding, the group could continue to develop the product and sell it or try to launch it on their own. Parry and Silverman initially considered raising $2 million for the development of the exchange, but they quickly readjusted their estimates as they began to work on the demo.
An exact launch date has not yet been set, but Ticket Evolution hopes to have the exchange up and running by the beginning of 2011.
According to sources, the exchange will utilize a cloud computing model, meaning the software and shared resources will reside on servers where they can be accessed by any of the members at anytime. In addition, the exchange will be developed using the open-source Web application framework Ruby on Rails.
Several brokers who saw the demonstration told TicketNews that they came away impressed by the technology, which offers real-time transaction tools and uniform data points across all aspects of the platform, among other features.
“They made a creditable pitch,” said New York broker Jonathan Radler, owner of Americana Tickets, who attended the meeting. “It seemed to be presented in an open and collaborative fashion.”
When reached on Sunday, July 18, with questions about their plans, both Parry and Silverman declined to comment. Sources who attended the meeting said the pair told the group that they hope to eventually raise $8 million for the development and operation of the exchange.
There are some challenges to creating the exchange, which will go up against more established exchanges StubHub, TicketNetwork, TicketsNow and RazorGator. Also, will the proposed funding ultimately be enough to develop and launch the site? Who will run the site daily, and how? When and how will the investors be compensated?
Another sticking point for some of the brokers is the proposed breakdown of the ownership percentages for the exchange. Parry and Silverman would each take a 10 percent share, followed by another 10 percent to the software developers, Ticket Cloud. Also, 15 percent would go to the future management team, who have not yet been named. That leaves the brokers with a total of 55 percent divided among them. Sources said Parry and Silverman are considering changing the percentages to give brokers a larger stake in the company.
TicketNetwork is the parent company of TicketNews.