Passkey Acquires Event411

The effective demise of attendee management site Event411, and the subsequent acquisition of its assets by group housing provider Passkey, has suppliers grappling with the death of one of the most well-funded companies in the space and publicly reasserting their own financial stability.

Event411's failure was not a tremendous surprise to many—as rumors about its ill financial health persisted and product development and public communication slowed—but few knew the extent of their troubles or that Passkey had emerged as the company's leading creditor.

Little light was shed on the complex situation by the two companies involved. Event411 president and CEO Steven Koltai could not be reached for comment, nor has the company issued any sort of public communication regarding the foreclosure. Passkey officials declined comment beyond a statement e-mailed to Meetings Today by president and CEO Greg Pesik.

"We were the primary creditor to Event411 and acquired the assets of the organization through an asset foreclosure proceeding, and subsequently attained all rights, title and interests in their reorganization strategy," Passkey's Pesik said. "The system remains live to allow Event411's existing client base uninterrupted use of the registration application while we finalize our strategic direction regarding the technology."

Event411's Web site, however, remained static at press time.

Also unclear is Passkey's intentions regarding Event411's products. Should Pesik and the company's management team decide to directly offer those products, including Event411's signature PremierPlanner attendee and meetings management module, to the corporate market, it would mark a departure from Passkey's established strategy. Passkey markets its main group housing products as citywide event solutions to convention and visitors bureaus, hotels, associations and large independent meetings management firms. It also develops single-property group housing solutions for hotels.

Should Passkey decide to offer PremierPlanner as well, it would likely pave the way for the company's most direct foray into corporate meetings management. However, Event411 did not have a robust roster of corporate clients.

Whatever happens, the flameout of Event411 represents the first real dot-com company collapse in the corporate meetings industry. The inevitable concern is that Event411 won't be the last industry Internet casualty, though opinions are split on the topic.

B-there CEO Christine Berthet said her company received another round of financing late last month, but gave no further details, and confirmed B-there has explored a possible merger. "We have been looking at merger opportunities," Berthet said. "We have to look at the market and see how it evolves, and we need to constantly look at opportunities. But we're continuing to acquire new customers, and I don't know if a merger would be more of a diversion than anything else."

Berthet would not elaborate on any potential B-there merger partners. "We're very confident about our growth prospects," Berthet said. She was ambivalent about Event411's demise. "On one hand, everyone expected consolidation, and it simplifies the industry, but it could spook customers about the viability of their suppliers."

"There have been big changes foisted on the industry in the past five years, and planners are still trying to figure it all out," said industry technology consultant and speaker Corbin Ball. "We'll see a couple other major flops in the next year, as the financial markets are still shaky. One other major player will hit the dust."

Rodman Marymor, president and CEO of Cardinal Communications, which recently sold its online registration application RegWeb to StarCite, also questioned whether Event411 portends further shakeout.

"Is it a precursor? I don't know, but I'm surprised some companies that are around still are," Marymor said. "Many of these companies got going when it was easy to get a ton of money, then they put in an expensive infrastructure. How long can you last given that expense, now when it's so much harder to get funding?" Marymor said single-solution technology providers need to find ways to offer more options, as the corporate market continues to seek a wide variety of applications. "More people want more things," he said, "just not necessarily the same things."

Event411's competitors argued that the company's troubles aren't indicative of anything industrywide, and, in fact, said it bodes well for the industry.

"It's good for the industry and for clients, because the players that remain will be able to deliver," said SeeUthere vice president of marketing Helen Loh. "Sometimes those companies that go under were not giving clients what they needed. Consolidation is a sign of better things to come. Look at their product development versus B-there's or SeeUthere's. We're doing new things; perhaps they weren't." Loh also pointed to recent deals her company has signed with several online self-booking vendors, including TRX, Galileo and KDS, some of which involved equity, as evidence of financial health. "Those partners did their due diligence," she said.