Show Master Douglas Emslie on M&A, Tariffs, Future Plans

Douglas Emslie sold his Tarsus Group to Informa for nearly $1 billion in 2023. Since then he founded Cuil Bay Capital, which has made nine investments totaling $20 million over its 18-month existence. The biggest and most notable have been a majority stake in Raccoon Media Group (running, outdoor, health); a minority stake in Jacobs Media (travel); and a minority stake in Easyfairs (manufacturing, hospitality, art).

There’s more to come, likely focused on investing alongside his current partners. Emslie, who lives in London, is helping to build out Raccoon and Easyfairs assets in the U.S., and Jacobs Media in the Middle East. He is targeting industries that are being disrupted—including supply chain, despite the trade war—and is specifically interested in backing entrepreneurs.

We spoke with Emslie this week about his plans, geopolitics and tariffs, M&A trends, industry challenges and market expansion. Emslie is an active investor, getting involved in strategy. He’s also a member of the Events Venture Group, which is making similar moves as a group.

He’s about to launch a big new show with one of his partners and expects to see interesting M&A activity as the industry sorts through the tariff situation as strategics and private equity.

The following has been edited and condensed for clarity.

Why are you building, where and how?

In terms of how I think about the capital allocation, I look at it in two ways. Firstly, geographically, where do I want to invest my money? I’ve got some exposure to the UK market. I really want to invest my money in two markets, and that is in the U.S. and the Middle East.

The U.S. is the biggest, most liquid market. It’s nearly 50% of the whole events space. Despite recent hiccups around tariffs, it’s still the strongest market in the world, and nothing’s really changed.

Secondly, the Middle East, which is going through massive change. I’ve been operational in the Middle East for 18 years. It’s growing very strongly, and it has at its core government who really understand the power of exhibitions and the importance of the platforms that they bring to grow their economies.

In terms of sector and what I’m really looking for—and this is what we did at Tarsus—is sectors where there’s lots of disruption, and that’s really what drives the growth of the event.

Easyfairs have historically had their base in niche industrial markets, in Europe and what they are doing is something that’s really radical and different: how can they make the exhibiting process easier, and have less points of friction? How can we make the experience of the visitor easier and have less points of friction? They are probably the best organizing company in the world in terms of the use of technology to do that.

They’re on a journey to expand geographically and with that, into the biggest market in the world, into the U.S. So this is going to be a change in story.

What’s one example of the technology that Easyfairs using to make things easier and frictionless?

What fascinates me is that whether you’re an exhibitor or a visitor every year, it’s like Groundhog Day. You start again. They’ve got all of your demographic information, everything they need to know about you, they’ve already got in their system. But you have to go through the same process when you want to go again and what Easyfairs have done is that if you’re an exhibitor, and you go to the same show every year, they’ve already got that, and all you are doing is updating that for anything that’s new.

You just make that process easy and it’s there until it’s edited, rather than constantly having to reinvent the wheel. That’s all about understanding the points of friction.

Where else might you invest from here on out?

To date, including some small venture investments, I’ve made nine investments in the 18 months of the existence of the company. I would look at continuing to invest, but where I am now is probably beginning to focus more on the opportunities into the existing vehicles. I wouldn’t want to have another 10 investments all held separately.

Take the last one, Easyfairs. If I get two or three interesting opportunities, it would make more sense for me to do that in conjunction with them, just from an efficiency of a management and time perspective.

I might do one or two more separate ones, but I’m beginning to think about how I put this into three or four buckets and become more efficient in how I manage my money and my time.

Are there any other sectors that you are interested in investing in?

If you look at the world at the moment, where are you seeing transformation, where are you seeing disruption? A lot of that is being driven by technology. I don’t mean that I would invest in technology per se.

I’d be more interested in a sector that’s being disrupted by AI, whether it’s material change or there’s material changes in the supply chain that’s been disrupted—we’re seeing that now with the tariffs. People are still working out now what this all means, and ultimately, how will supply chains be impacted.

We’ll see changes into the exhibition industry. With one of my new investments, we’re about to launch a major new show for the retail sector where there’s been fundamental shifts in supply chains, and it’s a trillion dollar market, and there’s not an exhibition for it.

People are still trying to work out how this is all going to work. They need the exhibition to actually understand, from an educational perspective, how the market is behaving, how their peers are behaving, what they can do in managing their own business, take advantage of a very fluid market.

What drives exhibitions is change. What you don’t want is a mature market where there’s very little change.

Talk to me a bit more about tariffs. Media and events companies are reporting earnings and their forecasts aren’t changing. But then we talked to [Firecrown’s] Craig Fuller who does supply chain media, and his view is very negative. What’s your view?

Those two views, actually, strangely, are not inconsistent.

Exhibitions are happening in the first quarter and most of that revenue was already booked. The impact of tariffs we won’t probably see until well into the second half of this year, and more likely 2026 because of the delays in terms of the occurrence of the exhibitions, the booking patterns and when products will come in or not come in.

On the other side, in terms of the scare factor, if you look at the container shipping in April out of China to the U.S., it has fallen dramatically. The longer this goes on, the greater the damage, because it takes time to get the supply chains moving again.

Look at two industries.

In the retail space, you look at apparel: 70% of U.S. apparel is manufactured in China. You look at the toy industry: 80% of toys are manufactured in China.

You’re going to see it flow into the exhibitions, and you’re going to see it in any show that relies on product from a transactional perspective, that’s manufactured in China. That covers a lot of sectors from automotive to aerospace, and obviously, retail.

You’re going to see a shortage of components, and that’s going to take time to flow through the supply chain, and it’s going to take time to flow into the exhibitions. That’s why you’re probably talking six, nine months before you really see the impact.

Take CES as an example—40% plus of the exhibitors at CES in Las Vegas in January are Chinese. Is CES going to be impacted? I would think so.

How does this new show that you’re launching fit into this scenario?

It’s perfect, because in retail, you’re seeing a market that’s being disrupted by returns—18% of retail is returned.

And then you’ve got supply chain with its issues—and we’ve got those in glorious Technicolor at the moment—and therefore that creates the need for people to get together to discuss these issues and try and figure it out. Without actually telling you what I’m doing—the thing about retail is it’s a very simple business. You manufacture the product. A lot of that manufacturing is in China. The brands then sell it to retailers, and retailers sell it to consumers. What has dramatically changed in the world is 18% of what the consumer buys comes back. Where does that go? That’s a trillion dollar market.

Historically, it goes into discount stores, it goes to second hand stores or it goes to landfill. And obviously, now it’s no longer acceptable for it to go into landfill.

Let’s be clear, tariffs are bad for trade shows. However, the bit that can get lost is in what Trump is trying to do in getting more domestic manufacture, I think is the way the world is going. We’re moving from a global basis to something that’s more regional. We’re going to have to have supply chains that are more sustainable on a regional basis rather than purely reliant on a few countries, which is what we’ve got at the moment.

Where he’s coming from, it’s not necessarily a bad place. It’s been incredibly badly executed. These things are long term structural changes. You can’t build factories overnight. You can’t massively change supply chains quickly.

The pandemic produced the same issues. It’s going to be less about global shows. It’s going to be more about regional shows. If you look at the recovery, where the trade show industry has not recovered back to pre pandemic levels—two places, Germany, China. Why is that? The largest international shows in the world were all in Germany, and the industry has fundamentally changed, saying, “We no longer want to come to the biggest show in the world. We want to go to the biggest show in the Americas. We want to go to the biggest show in Europe. We want to go to the biggest show in Asia.”

Those big global shows are still relevant, but not at the same scale as they were pre pandemic.

Let’s talk about M&A in the industry in general. Easyfairs and Nineteen apparently are going for similar if not the same assets in the U.S. What does that look like?

I’ve been doing this for over 30 years. It’s interesting how the landscape has evolved from strategics, a lot of them coming out of old media businesses, then becoming pure play businesses like the old UBM to become part of Informa.

[CEO] Stephen Carter has dramatically transformed Informa in the last 10 years from being a company with a small exposure to events to not only being the number one in the world, but being number one by being double the size of the number two to almost twice the size of Reed.

So you’ve had the strategics, but you’ve had a wall of private equity coming in. And I can only see that increasing. There is very strong appetite from private equity to put more money into this media form. I mean, if the pandemic can’t stop it, the tariffs are definitely not going to stop it. If anything, what has happened is that the media form has been tested and survived probably the worst possible scenarios, and actually has proven to be resilient, and therefore it’s been helpful in proving the case, and tracks more investment as a result.

So I see more and more private equity, but also we’re seeing something that’s actually not talked about: the movement of sovereign capital into the sector.

In Germany, it’s all about the cities, that are the government. And if you look in China, which is the second biggest market, it’s the government. It’s not as free a flow market as you would think. If you look at the change, you’ve had Abu Dhabi invest in our industry, but mainly through real estate, it’s got the Abu Dhabi center. It’s got Excel in London. It’s just bought the business design center in London.

Look at the Middle East. Look at what’s happened with Informa. Informa has probably, I’ve never seen this in 30 years, have gone into Saudi and built a business of scale in three years. But they’ve done that in partnership with the government. A month or so ago, they just announced a merger of their business with a Dubai business.

What you are seeing is the sovereign capital coming in and different structures because they’ve got to scale.

What Informa have done in the Saudi example and in the Dubai example, is really interesting in terms of the landscape change, in terms of how capital is flowing into our industry.

That’s big picture stuff, but I think what you’re seeing now is in terms of private equity via the new entrance, or relatively new entrants you’ve seen, obviously, in the former there are strategic but CloserStill, Nineteen, Easyfairs. They’ve got capital. They’re looking to deploy. Hyve will continue to be adding to their portfolios. The big question is when will some of the bigger transactions happen? And I think that is probably being delayed.

When you’re deploying hundreds of millions, if not billions, of capital, that’s going to take longer, because people are trying to work out the whole tariff thing, because in some shape or form these portfolios are exposed. When you get periods of uncertainty, what happens is the level of due diligence and questioning increases and just radically slows things down.

This is not going to be a sort of short term thing. People will get their head around and rework risk, and therefore rework the pricing. I think that by this summer, you’ll start to see things happening.

Should we expect bidding wars? Do we expect companies to pay higher multiples?

I don’t think so. There’s still a lot of competition. The uncertainty as a result of tariffs has probably put a little bit of downward pressure rather than upward pressure on valuations. But I think it’s at the margin. I don’t think it’s dramatic, but it’s a good thing, and just stopping the market getting too excited. People are a lot more thoughtful at the moment about valuation.