Private Equity

Brand authenticity: “Once you lose that magic it’s very hard to get it back,” says Lisa Boden Shah of Edition Capital

Written by Tim Maynard

Written by Tim Maynard

28th June 2019

Brand authenticity: “Once you lose that magic it’s very hard to get it back,” says Lisa Boden Shah of Edition Capital

In the latest of our Value Creation interviews, Stone & River caught up with Lisa Boden Shah, Partner at Edition Capital.

Since being founded just over three years’ ago, Edition Capital has steadily built a reputation for investing in eye-catching, experience driven consumer concepts.

Lisa Boden Shah is one of four Partners who set up Edition after leaving a boutique investment house where they were the Live Entertainment team, and has specific responsibility for deal sourcing, securing deals and portfolio management. With Edition’s heritage founded so firmly on the consumer experience, its investments are firmly underpinned by the Experience Economy.

Lisa Boden Shah

According to McKinsey, the criteria to success within the Experience Economy can be broken down into five pillars: loyalty and advocacy; having multiple revenue streams; strength of real estate; barriers to entry; and portability to new markets.

Harnessing the Experience Economy approach has enabled Edition to build a range of investments within immersive venues which are significant in breadth, yet each strikingly different from others in the portfolio; and all are experience driven at their core: Hotpod Yoga, Snowboxx, Crystal Maze Live to name a few, and earlier this year a £5million investment into Incipio Group, which transforms unused spaces into ‘social venues’ focused around food and drink.

“All the sites look amazing,” Lisa says of Incipio, “Their social media following is huge. I came across them through my Instagram and Facebook feeds and thought I had to get in touch. Each summer and winter they change the interiors and regularly change the restaurants. It creates great fresh content and additional PR.”

The Incipio founders, Lisa says, have incredible vision, and as with all investees Edition wants to ensure this creativity is never lost: “Once you’ve lost that magic it’s very hard to get it back.” This influences Edition’s approach to its investments, and its relationship with founders: “As investors we want to be reasonable,” Lisa says. “We try not to put targets to open X amount a year, as we want investees to take it at the speed it needs to go. We’re fortunate that we often invest at an earlier stage than others, so there’s more flexibility to find the right path.”

Operationally, Lisa suggests Edition are less creatively involved than other investors may be, which she feels that with the majority of the team having trained as chartered accountants they are more involved with managing the finances, as opposed to focusing on other areas such as proposition, service and the customer: “We will always give input and thoughts and we will have experienced everything we’re invested in several times, but we’re not telling people what they should be doing on those elements. Our input is much more on the finance side because with these businesses the cash has to be managed so tightly – it can so quickly spiral and get away from you.”

 

"As investors we want to be reasonable. We’re fortunate that we often invest at an earlier stage than others, so there’s more flexibility to find the right path."

Lisa Boden Shah

Lisa feels that the concept of ‘authenticity’ has transformed how brands can best create value over the past five years, and is now central to a consumer’s emotional engagement with a brand: “There’s so much more choice, loyalty is increasingly sought after, so being able to create value in that sense is incredibly important because people now care a lot about how their personal values align with a brand.”

Additionally, Edition Capital has developed an Advisory capability alongside its investment capability, which enables the team to be involved in businesses at an earlier stage than they otherwise might: “The majority of our portfolio is at a later stage but the Advisory division can act as a feeder. People may come to us for advice who may not be ready for investment, but it’s a good way to develop a longstanding relationship and test if you will work well as a team or not. It builds trust and teams come to view you early-on as part of the family.”

Edition’s focus on the finance side of its portfolio is clearly understood by investee teams. This enables the founders to maintain focus on what originally brought them success, as Lisa feels losing sight of this is one of the biggest risks when scaling up: “With the creative people who started the business and had these amazing ideas, their focus should be on maintaining that creativity, so if we can help on the finance side, as well as growth and how to instil best practices, essentially ensuring everything is running smoothly in the background, they have the freedom to focus on the magic they can bring to the business.”

If you would like to be part of our Value Creation campaign, please contact hello@stoneandriver.com

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