Venture Capital News: Festival Transaction Services Funded by $8.5M
SEATTLE, WA, Festival Transaction Services announced that it has closed an $8.5 million investment led by Reverence Capital Partners.
Festival Transaction Services, Inc. (FTS) based in Seattle, WA today announced that it has closed an $8.5 million investment led by Reverence Capital Partners, a New York-based investment firm. The former Chairman and CEO of Visa Inc., Joseph W. Saunders and W. James Tozer, Jr. also participated in the investment.
'FTS has developed a comprehensive set of financial services for fairs and festivals that help reduce event operating expenses and generate new sources of revenue,' said Milton Berlinski, Managing Partner at Reverence Capital Partners ('RCP') and former Senior Partner and Vice Chairman at Goldman Sachs. 'The event industry is large, fragmented and underserved; and we are excited about the potential of FTS to deliver value to its customers and shareholders.'
In connection with the closing, which took place on December 31, 2013, two partners of RCP have been nominated to the FTS board: Peter Aberg and Alex Chulack. Mr. Aberg recently retired as a Managing Director at Goldman Sachs after 28 years, where he specialized in the consumer financial services industry. Alex Chulack also worked for Goldman Sachs before becoming a Managing Director focusing on financial services investments at General Atlantic LLC. Both have deep financial services domain expertise and will play active roles in helping to grow FTS.
'Events deal with mountains of cash which is difficult to track and account for,' said Peter Aberg. 'FTS has developed a solution which gives events real-time visibility and reconciliation for all of their consumer and vendor transactions. There are other benefits to the FTS service, but this capability alone justifies adoption by events.' Alex Chulack said, 'We are particularly impressed with how FTS has leveraged partnerships, including one with Visa, to bring the infrastructure of the U.S. financial services industry to bear in solving the events' revenue and cash management problems.'
While some service providers are offering closed-loop solutions that expose events to expensive and legally complicated escheatment issues, FTS is leveraging the regulated U.S. financial services, eliminating these issues and expense for events.
In addition to Messrs. Berlinski, Chulack and Aberg, FTS will benefit from the experience of Muneer Satter, a former senior partner of Goldman Sachs who raised and managed $30 billion for the mezzanine finance group. Mr. Satter said 'FTS has integrated processing, payments and promotion to offer events a trifecta of benefits, including operational savings, increased sales from traditional sources, and new recurring revenue from retail sponsors. The bridge FTS is building between events and their retail sponsors provides a mutually beneficial virtuous circle of value for the events, their attendees and their sponsors.'
'We are honored to have attracted such exceptional investors to FTS. This financing represents the last key ingredient in achieving our mission to strengthen events and help them build lasting connections with their attendees,' said Charles Brown, FTS CEO. 'It also positions FTS to deliver sustainable growth for its shareholders.'
Concurrent with the capital financing, FTS also announced that Joseph W. Saunders has accepted the position as Chairman of the Board of FTS. Mr. Saunders served as the Chairman and CEO of Visa from May 2007 until he retired in April of 2013 Mr. Saunders said: 'FTS has assembled an impressive operating team and now has a commensurate board and investor network. I am excited to serve as Chairman and help FTS develop this significant opportunity.'
About Festival Transaction Services, Inc. (FTS)
FTS offers transaction services to the fair and festival industry including card processing, cashless event services and integrated promotion through FTS's innovative prepaid Card-as-Ticket offering. FTS also operates Festivals.com, the largest Internet resource for information on community festivals, fairs and events, with more than 40,000 events in 80-plus countries classified by Arts, Children, Culture, Motorsports, Music and Sports.
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