Video Conferencer OpenExchange Raises $25 million as Virtual Conferences Become New Normal

By Sanford Bragg August 18, 2021

OpenExchange, a platform for virtual conferences and road shows, raised $25 million in Series D preferred stock as virtual events continue to be the rule rather than the exception. Proceeds will be used to fund acquisitions as well as organic growth.

The funding round was led by Kingfisher Investment Advisors, a San Francisco-based venture growth fund, and by Stonebridge Ventures, a Korea-based venture fund.  Including funds raised by KnowledgeVision Systems which was acquired by OpenExchange in 2019, the company has raised $54 million to date.

Thanks to the Covid-19 pandemic, the growth in the number of events OpenExchange facilitates has been exponential.  According to CEO Mark Loehr, the firm managed 4,000 meetings in 2019 which jumped to over 100,000 for 2020 and another 84,000 in the first half of this year.  Employees registered on LinkedIn grew from 25 in 2019 to over 300 currently (actual staff levels are at around 500 full-time employees not including around 1,000 part-time employees used for events, according to Loehr.) 

Clients include each of the top ten global investment banks, as well as four stock exchanges.  Approximately 60% of the events are conferences, 20% are non-deal roadshows and 20% are capital markets events such as IPOs and other deal roadshows.  During a conference, a corporation might agree to conduct five one-on-ones, a small group interactive meeting, a large group interactive meeting with 20+ investors and a view-only webinar or livestream for 50 to 250 investors. 

Although clients are planning to begin hosting in-person conferences beginning later this year, virtual capabilities are expected to remain components of the majority of events.  A survey conducted in April 2021 indicated that ‘hybrid’ events which combine in-person with virtual will become the new normal going forward.  Respondents expected that about 70% of investor events will be either hybrid or virtual in 2022 and nearly 60% of all investor events will have a virtual component in 2023 and beyond.  Since the survey was taken before the Delta variant became widespread, OpenExchange believes that sentiment has subsequently shifted back towards virtual.

The survey included responses from 30 investment banks including seven bulge-bracket banks and 3 major stock exchanges.  Most of the bulge banks expected virtual to remain a component for the majority of events in the 2023 and beyond period.   

Mark Loehr has been CEO of OpenExchange since 2011, overseeing the firm’s transformation from corporate access specialist into a leading virtual event solution provider.  Loehr was previously CEO of Wit Capital, an innovative online investment banking firm focused on the Internet and technology sectors.  After Wit Capital merged with Soundview Technology Group, a leading research boutique specializing in the technology sector, he became CEO of the combined entity until shortly after it was acquired by Charles Schwab in 2003.

Our Take

Even if Covid-19 were fully eradicated, it is unlikely that events will ever revert to the pre-pandemic in-person norms.  Because of its convenience and low cost, virtual is now well established.  For conference content, the virtual format is superior to in-person but cannot replicate the networking benefits of in-person.  Thus, investment banks anticipate that a hybrid format, allowing both in-person and virtual to become the new normal.

For OpenExchange, the pandemic as been a tremendous boon as it became an outsourced audio-visual provider to all the bulge banks and many of the non-bulge banks.  Through their usage, OpenExchange has also built a large footprint on the buy-side which could create interesting opportunities for the firm in the future.   

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