For many attendees at the 2021 Executive Vendor Summit (EVS), it was their first return to non-virtual business since Covid-19 – and for most, their first large in-person event. A record 103 attendees enjoyed stimulating speakers, long-missed networking opportunities, and creative evening events at the Loews Vanderbilt Hotel. The event was organized by Hospitality Upgrade and Hospitality Financial and Technology Professionals (HFTP) and sponsored by CallTek. SHR CEO Rod Jimenez captured the sentiment well, saying, “The 2021 EVS was extra special because it was in many ways a symbolic return to normal for all of us; there was a special energy and a lot of enthusiasm in every conversation.” Mark Holzberg, CEO of Cloud5 Communications, said, “It was incredible how good it felt just to be with everyone in person … good yet sterile Zoom and email relationships formed during Covid-19 literally ended up with hugs and kisses as we departed on Friday.”
A Shot in the Arm: The Outlook of the US Hotel Industry
Jan Freitag, National Director for Hospitality Market Analytics from STR, kicked off the program with an overview of the industry outlook. Demand is recovering, he said, but is still stronger on weekends, where it is already back to 2019 levels, and weaker on weekdays. He expects that overall demand will return to 2019 levels in 2023, although average daily rate will likely lag by a couple of years. Regionally, North America and China are recovering much faster than Europe or other parts of Asia. Freitag highlighted the rapidly emerging labor shortage, noting that current US hotel employment of 1.48 million is still 600,000 short of the pre-Covid level, and that wages are rising rapidly.
Legal and Privacy
Greg Duff, a principal at the law firm Foster Garvey, specializing in hospitality, travel, and tourism law, spoke about several key trends his firm saw with hotel clients. He said that hotels now want to work with vendors differently; that there have been many unilateral contract changes as hotels sought cost relief. In the group space, force majeure contract terms were invoked with many cancellations, but in the end most of the parties simply threw out the contracts and “tried to do the best they could.” Many hotels converted to alternative residential and other uses during Covid-19, some of which brought their own legal challenges, such as the eviction moratorium that made it difficult remove residents when it was time to convert back to a hotel. He also spoke about the pitfalls of hotels arranging or collecting fees for medical procedures such as Covid tests, which can make them subject to HIPAA health privacy regulations.
How Real is the Ransomware Threat to Hospitality?
Clairvoyix CEO Mike Schmitt, celebrating his 10th EVS and receiving the traditional bobblehead award from Rich Siegel, spoke about the 304 million ransomware attacks that occurred in 2020. He said the pandemic had created a “perfect storm” with remote workers, dissolving network perimeters, and expanding attack surfaces. His two critical recommendations were to never give privileged access management to anyone working from a remote location, and to have adequate cybercrime insurance.
Association CEO Panel
Association CEOs Mike Blake of HTNG, Frank Wolfe of HFTP and Bob Gilbert of HSMAI spoke about the role of associations and the challenges they faced during the pandemic. Blake noted that the associations met an important need for people without jobs to connect. Association revenues were severely affected, and more so for the ones that were most dependent on event revenues. All three talked about events they were combining for the first time this year, both to reduce the demand on attendees’ time and to achieve better attendance and value for sponsors and exhibitors. HITEC will be combined with both the HFTP Annual Convention and HSMAI’s Marketing Strategy Conference and will continue its alignment with HSMAI’s Revenue Optimization Conference, while HTNG’s European event will be combined with British association HOSPA’s HOSPACE event.
Investor View of the World
Next on the agenda was an investor’s view of hospitality technology, presented by Dexter Hopen, partner at Serent Capital, which has investments in seven companies in the hospitality technology sector. Three fundamental characteristics it looks for in any sector are total addressable market, which determines how big a company could grow; market tailwinds, which determine how efficiently it can grow; and competitive dynamics, which determine how profitable it can be at scale. In evaluating companies in markets with strong fundamentals, Serent looks for both a solid foundation (value proposition, customer metrics, competitive position and differentiation, technology stack, and most importantly the team) and growth opportunities, which can come from customer acquisition, an increase in revenue per customer, new product revenue streams, or mergers and acquisitions. Hopen also talked about “option value” as an important element; this means any major upside opportunity that is too speculative to include in their base financial case, but still reasonably plausible.
A company with several such opportunities may well see one come to pass, which makes it more interesting as an investment. Hopen concluded by noting that the best companies to invest in are usually not selected by investors, but rather select the investors they want. They are looking for more than just capital, which is a commodity, and want investors who can provide industry expertise, can add value, have shared values and integrity, and have philosophical alignment.
Roundtable
You Think You've had a Bad Year? The first day concluded with a roundtable session, with attendees participating from their seats around the edge of the large ballroom and John Burns of Hospitality Technology Consulting wandering the vast expanse in the middle as moderator. The topics included the trials of the pandemic, where the industry is now, and how it is preparing for the future. Some of the surprises that participants voiced included how well the vendor community stepped up and stayed together; how small the number of vendor failures had been; and how quickly we moved to remote work and improved communications.
Some noted a divergence with remote work: many people excelled and were more productive, while others found it very stressful; much of this depends on each worker’s home environment. There was also encouragement at the pace of innovation during the pandemic. A lively discussion ensued around partnerships between vendors, owners and managers during Covid-19, which were described as “sometimes fantastic, sometimes bad.” A key comment, also echoed in other sessions, was that hotels were talking about their appreciation of the many vendors had stepped up to help them … but also that “they will remember the ones that did not.”
The event included many less serious interludes. The registration raffle raised $1,600 for the Nashville Humane Association, which graced the afternoon break with a litter of adorable puppies, and the two evening events were very entertaining. Wednesday’s icebreaker got 100 attendees singing a rousing karaoke version of Neil Diamond’s “Sweet Caroline,” and Thursday’s dinner entwined several attendees as suspects in a murder mystery and everyone else as crime solvers. First-time Attendees Were Impressed. Jeff Loether of Electro-Media Design said, “In a word: Wow! It was great meeting other vendors and technology consultants and exploring collaboration opportunities! We’ll be back!” CEO of MIS Computer Neal Berz said that when he was deciding whether to attend, “Rich made the event sound almost too good to be true. After attending I realize he was underselling, and I now plan to attend every year.”
Longtime attendee Mike Gray of NEC said, “I always walk away from EVS with new ideas and relationships to help me do my job better.” Dan Bell, SVP Shiji Americas for Shiji Group, said, “There is nothing that can substitute for this event (especially now), bringing industry leaders together to learn, contribute, and network with industry colleagues.” Raj Singh, CEO of Go Moment, said, “EVS was a spectacular way to reconnect with vendors and hotel tech leaders. The unique and thoughtful activities made it fun to make new connections.” Luis Segredo, CEO of Data Travel (Hapi), noting that it was his first business trip since the start of Covid, echoed what I heard from many attendees: “Having the opportunity to go beyond meeting for a purpose online, and being able to interact in a social setting, reminded me why business travel will not end.”
A special thank you to the 103 attendees who took time from their busy schedules to be with us in Nashville, and to HFTP for their logistical assistance. And a big thank you to our event sponsor CallTek.
