Slowly but surely, Dushow continues its march forward, welcoming into the group Fa Musique, Frédéric André’s little gem of a company in Rhône.
Just three years after a story on the birth of Dushow group, we went back to take stock of this flagship of French service together with the president, Eric Alvergnat.
It’s always interesting to spend time with a man who prefers to hang PA over having to deal with words.
Fa Musique joins Dushow, along with its employees
SLU : So, a new star has been added to the Dushow constellation: Fa Musique.
Eric Alvergnat : Yes, following our “soft integration” model. We spoke for years with Frédéric André about its entry into the group. The day we pressed a little more on the throttle, now two years ago, the first thing we did, even before talking about money, was to get together in Valence with the employees of Fa Musique and its subsidiary S-Audio – managed by Jean-Paul Tridon – to discuss their opinions and how we would work together.
Frédéric André
Frédéric “Kerde” Kerdekachian was, of course, on hand since it is he who will take over the presidency at Fa on the 1st of January 2016, while Fred will stay with us for the next two years. We won the support of a large number of employees and, therefore, we got under way.
Otherwise, I don’t think that we would have completed the transaction. This is a “very old style” method, which may seem unusual or even caricatured, but that’s how we want it. This approach will not last as long as taxes (laughs).
SLU : What happens then with the companies that are joining your group ?
Eric Alvergnat : From the outset, we standardize the accounting structures. This is imperative for two reasons: first, it allows us to read the activity and performance of all companies in the group in the same way.
The second reason is for the consolidation of figures. Companies must be treated identically, account by account, so that the consolidated results are consistent. For the rest, the companies continue to work according to their initial methods and, gradually, team spirit is created. It’s quite soft and smooth.
It has been constructed with Philippe Borentin, our long-time accounting and finance expert. We started out together more than 30 years ago and have created or acquired more than 40 companies together. He’s the legal “Lucky Luke”; before we have time to finish explaining the proposal, he has already laid out the statutes!
End of 2014, the team of Fa Musique send this greeting card …
SLU : Dushow remains a completely private group, but with its increasing size, have you not considered putting it on the public market? Have you received outside capital or was it basically your own funds?
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Eric Alvergnat : We don’t meet the criteria that would permit us to be traded on the stock market. We’ve managed it ourselves, so far. We have been maintaining a very high level of investment, at the same rate for 10 or 15 years, despite the increase in the size of the companies and the fixed costs.
We maintain this course because we love new and beautiful products and, especially, because we realized that our customers are happy when we provide them with what they want or what is the most recent. And it keeps going faster and faster. The life cycles of the equipment are shortening; the manufacturers are innovating and accelerating the pace. We follow them.
SLU : How many people are employed by the group now, with the integration of FA? Do you have an idea ?
Eric Alvergnat : These numbers change from day to day, but we are around 300 permanent employees, plus about a hundred full-time equivalent employees including intermittent collaborators. In order to understand, you have to take the tour of the whole group. The holding company at the top is called Groupe Dushow SA. It has no direct commercial activity. Its role is to unite, aid, and offer reflection and counceling to all 12 commercial companies of which it is directly or indirectly the majority shareholder. It also serves as an internal bank.
I am the full-time President since the first of last July. Up until then, I had stayed on, dedicating half of my time as president of Dushow SAS (SAS: simplified joint-stock company – ed. note), the largest of our subsidiaries. In light of the increased workload and the necessity to advance our young managers, that same July 1st we appointed François Soutenet to the presidency of the Dushow SAS.
François Soutenet, the new President of Dushow SAS, in very good company
Francois Soutenet
SLU : The one that combined Dispatch, Arpège and Chameleon ?
Eric Alvergnat : Exactly. It is the product of the merger of these three companies that occurred three years ago. Dushow SAS is still special because, around its young president François Soutenet, we have a panel of six deputy general managers: Fabrice Allex-Billaud in Marseille, Christian Lorenzi and Philippe Barguirdjian in Nice and Xavier Demay, Anthony Robert, and Gérard Trévignon in Paris.
SLU : François is the youngest of them all ?
Eric Alvergnat : Yes, and I’m really happy with this change. This has been in preparation for several years and has been validated by all our shareholders and all our officers. That’s the story.
We have a 38-year-old at the presidency of Dushow SAS. He is assisted by six more-or-less young gunners, who are all very experienced. This is a strong team that surrounds him, which is formed – it is important to say – of agents with civil and criminal legal responsibility.
Christian Lorenzi
SLU : Does Christian play a large role ?
Eric Alvergnat : Of course. He is, along with Philippe, a founder of Arpège who achieved significant growth in the 2000s. He is a historic pillar of the team. He is very strong with relationships and national business. He is especially present in the southeastern region, which he knows like the back of his hand.
He is also president of our company in Monaco, Accord, and very involved with Patrick Marenco, who is the founding director of Mash, our southeastern subsidiary dedicated to structures, hoists and automation.
Eric Alvergnat, President of Dushow SA Holding
SLU : And you… what do you do, then ?
Eric Alvergnat : Well, in the morning I swim in the pool and after lunch I work on my sculpting! And then I have to go to our small subsidiary in Rio to see Dominique Chalhoub! In between, I am now able to look after the group full time, in particular its growth and its future in general.
In addition the arrival of Fa Musique and S-Audio, in the course of this year we also welcomed a Marseille’s company called Vidéo Events. We’ve partnered with Lionel Carmes, its founder.
At the same time, the video company Alabama, chaired by Dominique Lassarat, took in the company Harkan and its founder Olivier “Jekel” Bussy. They specialize in media servers and dedicated computer equipment.
SLU : Dushow continues on its merry way !
Eric Alvergnat : We’re not going too fast, but we are growing significantly.
SLU : And what is the ratio between permanent employees and intermittent collaborators, it is rare for the permanent contracts to predominate. Instead we see the opposite.
Eric Alvergnat : Increasing the size of businesses inevitably leads to an increase in the permanent workforce with respect to the intermittent workforce.
Regarding the activities of sound, light and video, however, the Synpase and, especially, the Commission Nationale du Label rightly ensure that the payroll for non-permanent employees is not greater than that of the permanent workforce in that sector.
A picture taken at the party held in the brand new Dushow facilities, on November 26, 2012. It shows a portion of the future management of Dushow SAS. From left to right: Fabrice Allex-Billaud, Christian Lorenzi, Eric Alvergnat, Xavier Demay, François Soutenet and Gérard Trévignon. Since then, François has taken the reins and Antony Robert and Philippe Barguirdjian have joined the committee
SLU : Then your job is to grow the group, the holding company. What is the strategy of the group? We got the feeling that, at one time, Dushow was preparing to change hands and consolidating in order to prevent being sold off in pieces.
Eric Alvergnat : Our strategy is still simple, if you can even say there is one, but that doesn’t keep us from thinking!!! (he smiles). First of all, we never wanted to establish ourselves in this business, location or country in order to satisfy appetites for power or money. We have responded positively to some opportunities and not to others. We have studied many projects that have not been followed up.
The one genuine strategy has been to develop an independent company on a base, for this first generation, for the division of the shareholding. We have 26 shareholders in the holding company and other thirty shareholders or partners in the subsidiaries. There are no corporate bodies in any of the group companies.
Xavier Demay
SLU : Who leaves the group, looses his shares ?
Eric Alvergnat : No, we are not a cooperative or participatory company. The shareholders of the commercial companies are or were founders and employees. The holding of shares is not linked to the employment contract.
SLU : So, no major risk of fragmentation ?
Eric Alvergnat : It’s already all fragmented! And this is the great story of the founders, but that will not happen to a second generation. The company is not for sale, but we now have some retired shareholders who would like to be liquidated. We are attentive to them and searching for solutions for their total or partial exit.
SLU : How does Dushow plan to continue its growth? Internally, externally ?
Eric Alvergnat : Both, my good man. We continue to grow internally because more and more people are requesting our services. Our turnover is growing on a constant basis. Obviously, the total consolidated revenue of the Group is increasing, since the peripheral revenue is. The business is there, and there are many shows, events and television programs to do. Lots of business, including the Voyageurs.
SLU : It’s true that your magnificent mobile studios had gathered a little dust lately.
Eric Alvergnat : Right now they are all on the road: the U2 European Tour, the MTV Awards, not to mention Taratata. It’s even more incredible in an époque when you can record 96 tracks with a computer lying on the quilt in your bedroom. In another area, our rehearsal studio is complete.
We are even asking ourselves whether we should build more, since we are forced to juggle so much. There are shows that come out at 10:00 pm, we have the night to clean it up and another production arrives at 6:00 am, like at the Zenith! It’s great because the artists come to us.
One of the finest recording studios in France with its 5.1 monitoring and SSL digital console. It’s called Voyageur 1…
Previously, producers and artistic teams did not come to vendors. They thought we were in some far away garage. They discover that we offer optimum working conditions with the rehearsal stage, pre- and post-production studio, warehouses, workshops, dressing rooms, production offices, restaurant and barbeque in the same complex. For sporting types, the adjoining golf course, 4-star hotel and fitness center is under construction.
Philippe Barguirdjian
SLU : What are the major business sectors of Dushow and how are they positioned in terms of percentages for the company ?
Eric Alvergnat : The ratios are slightly different depending on which company within the group. Overall, we are the leader in the field of live performance while maintaining almost half of our business in events. And television continues to grow. Dushow Barcelona, Bordeaux and Toulouse do little music, while Dushow SAS thrives on concerts and festivals.
As its founding director, Benoît Quero, would say, at Spectaculaires in Rennes, Brittany, one of the principal activities with “The Image Illuminators” is creating monumental images that are broadcast around the world. And then we have the sectors of…
SLU : Sales, imports, installation …
Eric Alvergnat : Oui monsieur. The imports, sales and installation sectors account for 10-15% of our turnover. We are not dealers, in the sense that we have no external sales force. We are, first, service vendors but we do offer, to those who wish, the possibility to purchase from us audiovisual and stage systems, such as those that we design for use in shows, in television or in events.
SLU : We are familiar with the quality of your services, so we imagine that the installations you do are not cobbled together and jury rigged! (laughs)
Eric Alvergnat : Especially if we fit out a venue and, three weeks after the inauguration, we return with a tour… we’d be better off if it works! We are doing many installations right now.
Fabrice Allex Billaud
SLU : Which company was doing the acquisitions, prior to the Dushow holding company ?
Eric Alvergnat : In the ’90s, it was Dispatch, specialized in audio, which performed the function of holding company. We didn’t have the legitimacy to defend the group companies that did lighting. We created a holding company to cover all the activities.
Dubo, Dubon, Dubonnet, Duson, Duboi already existed, so we created Dushow. It was not supposed to do communication or commerce. And then we got used to this name and when we merged Dispatch, Arpège and Chameleon in 2012, it was necessary to find one name to replace all the earlier brands, so we ended up keeping it by creating Dushow SAS. As a result, the holding company was named Groupe Dushow SA. As for me, I proposed “LSBL”, that is “Lovely Sound and Beautiful Light” group. I got myself ostracized by all my friends (laughs!) – I nevertheless filed the trademark !
SLU : As well as being at the head of the holding company, are you still present within the SAS ?
Eric Alvergnat : Sure. I must devote my time to all the group companies, proportionally to their relative size, and Dushow SAS represents about half of the whole. It is a soft change. François has replaced me, but I am still representative of the shareholders that hold 100%, comprising all my longstanding shareholder associates. However, things are moving fast and we already feel the new wind blowing in with this young president and his new team of highly complementary executives with several thousand flight hours behind them.
SLU : You don’t see roses in your garden and pruning shears pushed into your hands, yet ?
Eric Alvergnat : There are roses and pruning shears in the garden, but that’s not my thing. I have no intention of stopping. The work is exciting and the teams are formidable. Most of the companies are in good health and the challenge is still alluring. I will take my bag and go do other things when the shareholders will make me understand that I must step aside. I will not be angry; there is a time for everything. The music will always be there and I will be there to listen to and “watch” it with the same attention and the same pleasure as always.
Gérard Trévignon surprised by an indiscreet lens during a concert in June, 2008
SLU : The SAS is the heart of the group; are the other companies wholly owned by the holding company ?
Eric Alvergnat : No, they are not all 100%. We are the majority shareholder in each but there are those that are 100% owned, others 80%, and still others 60%. The company histories and personalities are different, and the unifying role of the holding company is important. The paths cross.
For example, at Spectaculaires, we have a very important unit for image production. When I leave at the end of this interview, in fact, I’m going to the premiere of Francis Cabrel.
All the visual content on his tour – light, set and video – was created by Spectaculaires. They got into live music touring productions by way of a pretty nice route – specifically, through the artist himself.
SLU : And the sound ?
Eric Alvergnat : Francis Cabrel lives in the southwest of France and, somewhere out there, is a company that I don’t know much about called Audio Concept. They do a good job and the artist is loyal. We would never require producers or artists who trust us and are loyal not to work with colleagues or competitors.
SLU : Let’s go back briefly to your external growth. A number of well-known French companies join other groups. The birth of these new players is stimulating for the competition they create.
Eric Alvergnat : And why not? We are not the Synpase and don’t wish to be, either; we cannot propose to all the companies in the industry to join us. The birth of new groups doesn’t necessarily create new competition, since their operators take majority stakes in existing companies.
A photo of the Dushow headquarters on the night of its inauguration. The colors give the full scale of the size of the building
The stimulation is real, however, because once companies have been acquired or recovered, they will often change their ways of working. Both because the new owners or managers apply new business methods and techniques, and because the procedures for the acquisition create senior debt, which induces different economic ratios.
This is new for France but widely practiced for a long time by our American colleagues who are able to raise debts amounting to their annual turnover.
Apart from the many new businesses in the sector, which is evidenced by the large amount of requests for accreditation by the Commission Nationale du Label, you will find that many current vendors were founded 30 years ago by people who were 30 years old. These founders are now 60 and looking to enhance their heritage. This is natural, but there must be a correct balance between the funds guaranteed to outgoing retirees and the resources that are still needed to ensure that companies continue to invest.
It’s time for the next generation and we must thank the new entrepreneurs who concentrate on our sector.
The breathtaking view of the Dushow “anthill” from the meeting room where the interview was held. At the bottom of the image, on the floor on the right, you can see a large number of white pallets loaded with Meyer speakers for an amusement park
We have the habit of investing in companies with money we have already earned and not with what we were going to earn. It’s a bit old-school, but it allows us to maintain strong technical investment policies. In our case, although we come from the same period, we are not vulnerable to the departure of a single founding shareholder because there are many of us.
including those who have retired, are ready to liquidate and we are studying solutions to satisfy them. We are not for sale, but we are ready to welcome new shareholders.
SLU : Perhaps no one has been able to make an offer that you can’t refuse.
Eric Alvergnat : That is not false… but also not true. This is not grandstanding – of course everything is for sale – but, for thirty years, we have developed a policy of sharing profits with a number of salaried employees who have become shareholders or partners, and not everything can suddenly be swept away by writing a check. Again, we are probably still quite atypical, but a total change of property and a big check for the founders are not enough to resolve the issues of the future of our 300 employees, whose lives and employer would change.
SLU : That is an interesting position to take; it helps to clarify things.
Eric Alvergnat : This is why we think, instead, to welcome new shareholders progressively.
Eric Alvergnat accompanied by Melina Avenati in St Denis for the Mylène Farmer show in 2009
SLU : Is the group in good financial health ?
Eric Alvergnat : Yes. We have always been and we are still rated with a note of excellence at the Bank of France. We have very little short- and medium-term debt, no long-term debt, and no senior debt. At most, we have some supplier credit, some loans and some leasing.
SLU : In the history of the group and even before Dispatch, did you receive capital contributions ?
Eric Alvergnat : We never received external capital. We had financial shareholders who have never exceeded 10%. First the big English venture capital group, 3i, and a private equity fund of Crédit Agricole. They had no buyers when they wanted to exit and we ourselves bought them out.
SLU : You told us that there is business, but do the margins remain good ?
Eric Alvergnat : We have to hang on because our contacts, producers, contractors, broadcasters also have their worries. They would always like to pay less, and they are not necessarily interested in our poor 40,000 m² of generally new buildings.
When our teams are approaching the conclusion of their deals, we encourage them to organize meetings with us so our customers can visit our facilities. It is then easier to go on with the discussion. It is important that they understand that we are well-established businesses with costly technical and human resources.
The renewal of the equipment stock
Francois Maze
SLU : At Dushow do you have a strategy for the resale of used equipment ?
Eric Alvergnat : Yes we have a scientific and innovative strategy: it’s called finding buyers (laughs). We have just stepped it up a notch. For the SAS in Paris, Francois Maze was in charge of sales of used material for a long time. He has just been joined by Bernard Vainer, who came on to enlarge the team, so much that he took over management of this department.
Sale of used equipment is necessary to free up space and because the onset of obsolescence is becoming much more rapid. We usually have decent purchase prices, so our resale prices are not insignificant in comparison to replacement values.
I think all rental companies and services have the same dynamic. We have to renew the stock. 20 years ago we bought mixing consoles in order to use them for ten years. Today, you know that in five years they will be outdated, just like computers and digital equipment are.
Bernard Vainer
SLU : How do you decide the best time to sell off equipment ?
Eric Alvergnat : We look at its rotation, observe its reliability, how often it is specified. We add a pinch of experience and methodology and then we decide to launch its replacement. This topic is the subject of meetings.
Bernard Vainer, in particular, who has one nose in our warehouse and another on the world market (yes, it takes a spy for this business), makes suggestions. We may also replace equipment that is in high demand, just to renew the stock.
Still a fan of Meyer Sound
SLU : It was Meyer that made the heyday of sound, is it still a promising brand? I see it’s less specified these days, less used in France; is it still interesting for Best to distribute it ?
Eric Alvergnat : I understand what you are thinking. It is probably justified by the weak communication on our part. We are not good communicators. What is an interesting point, however, is that our life with Meyer is exactly the opposite of what you perceive. We have distributed the brand for 25 years.
We have mad, passionate researchers that are still also fans of speakers, like Marc de Fouquières. The fidelity criterion is largely fulfilled, and we love that. I was at Meyer one month ago and it’s a great company. There are 300 people working with fantastic dynamics in research and development. Just last night, we received an emergency air-shipment of 40 pallets!!!
One reason for the technical outreach and excellence Dushow: Marc de Fouquières. Here he is on the Meyer booth at last year’s edition of Prolight+Sound, in the company of Big Mick
SLU : For use or for sale ?
Eric Alvergnat : For sale, this time. The English are very strong in this aspect. When they sell a 6-channel analog console in a pub on the outskirts of Glasgow, they send out a press release worldwide. As for us, we deliver a million and a half euros worth of speakers to equip an amusement park, and we don’t even talk about it. Or maybe so… we will try to invite you to the inauguration (laughs!!).
Fortunately, we have some voluntary communicators. This is the case of Xavier Demay, Christian Lorenzi, Riad El Abed in Barcelona, Thierry Perceval in Bordeaux and Christophe Digne in Toulouse and many other young employees of the group. Be it because of our story, our culture, our size, our DNA… I am neither a merchant nor a communicator. It should be time for me to create a Facebook account (laughs), but I’m still thinking it over!
Getting back to Meyer Sound, there is a great team at Best Audio, led by Sébastien Nicolas. We are proud to distribute their equipment, which is currently riding a wave of tremendous success with the new range.
SLU : How is it that d&b and Adamson were able to take shares of the French market… is it that, in France, we don’t want big enclosures with amps built into them? Is it a passing fad ?
Eric Alvergnat : I believe that it takes all tastes, and these two manufacturers are making quality equipment. As far as performance goes, it is impossible to follow all the brands simultaneously. However, there is a huge number of shows and events being done with Meyer Sound. As sound services, we follow three main brands right now. Meyer Sound and the excellent L-Acoustics by most companies in the group, and d&b with Fa Musique and S-Audio.
SLU : Hence my question, because when you talk to me about Meyer stock, if you count the M3D coming out of the warehouse maybe once a year, that is not being honest (laughs)
Eric Alvergnat : Indeed, we use these older systems when the job is not “speaker brand sensitive”. However, the new Leo, Lyon and especially Leopard series are in demand because of their innovation and the results they provide.
Just think that, 25 years ago, for the sound at the Olympia, we put in some SCV Audio Compact 246s, weighing 180 kg each. We were able to replace them with Meyer Sound UPAs with their subs. And I mean replace. It was a big turning point, replacing omnidirectional mastodons with small enclosures that could send sound wherever we wanted and, again, it was only the beginning. We were still far from the current systems, but we achieved a bit better dispersion.
An article from a financial magazine, circa 1993, in which Eric talks about having used and imported Meyer for four years, but also Martin, SCV and probably a little of what was still called at the time Christian Heil. Even then, the same credo: “… we provide the equipment requested by our customers and we purchase more, if necessary, to satisfy them”
SLU : Is it that L-Acoustics has taken up all the space in your hearts and that it is the most requested in France and, now, in the world ?
Eric Alvergnat : No, we are proud to work with Meyer Sound, and very pleased with all the success that has been achieved with our substantial fleet of L-Acoustics speakers. I remember that I used the V-Dosc on the tour of Jean Michel Jarre in 1993, alongside the MSL3. This was an incredible success and the longevity of the V-Dosc was enormous. Since then, the service life of systems has become shorter for all the manufacturers.
SLU : So, with Meyer everything is going quite well.
Eric Alvergnat : We do very good turnover with Meyer. It’s a wonderful experience, with people we like who are very reliable. Their delivery capabilities are amazing. Besides, it is important to stand together because the dollar exchange rate does not help these days.
SLU : This is not the case with all manufacturers…
Eric Alvergnat : Yes, the Euro is cheaper! L-Acoustics takes longer with deliveries; doubtlessly the price of their success. But we all play the game.
SLU : You don’t sell L-Acoustics
Eric Alvergnat : Of course, and in significant proposals, particularly in the south of France, because of tenders that we won where L-Acoustics is specified.
SLU : Can you quote some figures ?
Eric Alvergnat : The group turnover is approximately €75 million
SLU : And in terms of sales ?
Eric Alvergnat : It’s quite variable. We have a small team, which is nonetheless present in Paris, Nice, Marseille, Bordeaux, Toulouse, Rennes and Lyon. Sales represent about 10 to 15% of the group turnover.
SLU : Do you have a message to convey… a word from the President? (laughs !!)
Eric Alvergnat : Simply that we have been lucky so far, and today we have a good setup. The teams are versatile and enthusiastic, the group is profitable and we have loyal customers. Just like everyone else, we wonder about our future, but we are not preparing for anything drastic.
We certainly welcome new shareholders, but it would be with a collegial approach, as has always been the case. I am particularly pleased to see young people taking things in hand. But I can tell you that I’m not about to leave the ship, because there’s a party every morning and, in the evening, the show must go on!
Well, almost 🙂
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