Inside Australian Venue Co’s $30M Push for Regional Live Music (EXCLUSIVE)
In August last year, private equity firm PAG Asia Capital bought over 210 venues, pubs, bars and restaurants across Australia and New Zealand when it acquired a controlling interest in Australian Venue Co (AVC) for around $1.4 billion.
Now, they’re investing over $30 million as part of a nation-wide music strategy to bring more live music to regional towns.
Speaking to TMN, AVC’s CEO Paul Waterson said that while it’s a tough economic environment for anyone in hospitality and live music right now, punters are “looking for experiences that don’t cost the earth.”
“That’s the market that we want to play in,” says Waterson.
“We spent about $27 million on live entertainment within our venues last year, and that’s something we want to grow materially because I think as the economic environment does get tougher, people are going to want to go out and have time with their mates in an affordable way. And that’s where I think pubs can step in.”
Baker Boy at The Esplanade Hotel
When asked what that material investment will grow to in the current financial year across the more than 200 venue spaces — like Auburn Hotel, Birallee Tavern and BrewDog Perth — Waterson said:
“I think it will grow to mid-$30 million,” he says. “And that includes ticketed and non-ticketed events, like the acoustic show in the corner of the venue, stand-up comedians, or any experience or entertainment that we offer within the venue, whether ticketed or not.”
Why Invest Now?
Venue closures, festival cancellations, tour pull-outs… It’s no secret Australia’s live and hospitality sectors are doing it tough. So why would the AVC double down in its investment?
AVC’s Head of Entertainment Ian Smith tells TMN that an investment in entertainment is not only a huge revenue driver, it also helps create community.
“A lot of our venues are the heart of our communities, and the entertainment that we put on really showcases our venue in such a positive light with our locals, our staff, and the broader community that we serve,” says Smith. “It’s such an important element of what we do. And it’s deeply ingrained in pub culture in Australia.”
Smith says a part of AVC’s wider entertainment strategy is to bring some of Australia’s biggest bands to the far reaches of the country.
Its venues have hosted one-off experiences with big name acts like Skegss, Dune Rats, The Rubens, Suicidal Tendencies and Unwritten Law in intimate settings.
This financial year will see the group increase ticketed shows by 135% from 850 shows last year to 2,000 before July next year, according to the company, with close to 80% of its venues hosting live music.
Jebediah at Cleveland Sands Hotel in July 2024. Photo courtesy Jared Hinz
Who’s Driving AVC’s Strategy?
While the increased investment in entertainment is due to PAG’s acquisition of AVC, Waterson assures it’s AVC that is driving the strategy.
“The management strategy has always been driven by the management team, and we still own around 20% of the business,” he says.
“[PAG] have a board role within the business. But the strategy and decisions around investment is made by the local management team, and that’s been working really well for us,” he adds.
The live entertainment strategy will likely see AVC add more venues to the stable. However, its investment in the over-200 pubs, bars and restaurants across the country sees a bigger focus on making the spaces gig-ready.
“We’ll invest in the infrastructure needed to put on these shows,” notes Smith. “One of the critical elements at the moment facing the music industry as a whole is the rising costs of touring; so fuel, accommodation…
“What we can do as businesses is invest in these venues putting up stages, PAs, lights and sound, accommodation where we have it, to make it much more viable for bands to tour around the country, and to expose themselves to more audiences.”
AVC’s Focus is on One-Off Experiences
Cognisant of how the cost of living crisis has affected consumer confidence, AVC is working with agents and artist management to put downward pressure on ticket prices to ensure fans in regional areas have access to one-off experiences.
It’s paying off.
One of AVC’s most successful solo presentations is Steve Kilby from the Church. With his band, he sells out venues like the 2,500 capacity Enmore Theatre in Sydney, but punters in Mackay or Redland Bay can catch him playing the Church’s greatest hits to an audience of 100-200 people at a ticket price of approximately $45.
“Some of these bands, the Rubens, Dune Rats… they all sell out 3,000 capacity venues in metro areas,” says Smith. “And then we’re putting them in regional areas and suburban areas, and the audiences are just loving it.
“They [the fans] don’t have to spend $100 on an Uber either way because we’re putting music where the people live, and we’re making it affordable for the bands to do so. So the bands are liking it. They get to tour more. We’re loving it because we get to have access to high profile acts, and we get to serve our community, which is why we’re there.”
AVC tickets its shows through Australian owned, independent agency OzTix and price each show between $40-$70, inclusive of the booking fee, depending on the act. According to Smith, a musician himself, “if you get that ticket price right, everyone has a win.”
“What I’m seeing a lot of now is more positive dialogue around how we can grow the pie and grow the industry together,” he says. “Rather than just take, take, take and chip away.
“I’m actually really positive about the future of the music industry. We’ve obviously hit a bit of a road bump recently [with Covid]. It’s a bit of a correction, but what we’re seeing gives us a lot of hope for the future.”