Music Business Worldwide Yearbook 2022/2023

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Contents

Jay Marciano 12

Julie Greenwald 20

Lex Borrero 26

Starrah 32

Denis Ladegaillerie 36 Swizz Beatz 42

Scott Pascucci & Bob Valentine 48

Martha Earls 52

SK Sharma 58

Larr y Mestel 64

Dominique Casimir 68

Lucas Keller 74

Emmanuel Zunz 78

Martin Kierszenbaum 82

Sherr y Tan 86

SERVICE FAIRNESS TRANSPARENCY.

SINCE BEFORE IT WAS FASHIONABLE.

Editor’s Letter: A new dawn

You know why I like this column? It provides a rare chance for a bit of reflection, and to look back on the music biz’s defining themes of the previous 12 months.

One of those themes in 2022: simply a return to full normality. As you’ll read in MBW’s in-depth interview with AEG Presents boss, Jay Marciano, the live music business is booming once again, with festivals selling out within hours, live music promoters posting record years – and Taylor Swift’s popularity literally breaking Ticketmaster. Like all sectors of the business, though, live companies (and touring stars) also face major economic challenges ahead, particularly tied to rising prices (travel, accommodation, staff etc.) and a surplus of artists launching tours following the barren Covid lockdown years.

including Universal Music Group’s ≈$300 million acquisition of Sting’s song portfolio, and Concord’s ≈$300 million acquisition of a catalog that spans Genesis, Phil Collins’ solo output and more. Both of these acquisitions get their dues in this Yearbook – via MBW’s discussions with Martin Kierszenbaum (Sting’s manager & Cherrytree’s founder) and with Concord’s Scott Pascucci and Bob Valentine (the company’s CEO and President, respectively).

MUSIC BIZ IS BALANCING THE ROUGH WITH THE SMOOTH.”

Other segments of the business are similarly balancing the rough with the smooth right now. Last year’s MBW Yearbook was stuffed with executives and entrepreneurs who were splashing huge sums of cash – not always their own cash! – on artist and songwriter catalogs. In an era of spiraling interest rates, there can be no doubt that the nine-figure acquisition sprees we saw in 2020 and 2021 have this year slowed to a trickle. That being said, influential voices in the market tell me that acquisitions in the seven and eight-figure range (anything up to $100 million, basically) are still getting done at a rapid rate. That’s a message driven home by Primary Wave’s Larry Mestel in this Yearbook – who says that, with $1.7 billion of Brookfield’s capital sitting in his company’s coffers, deal opportunities are still plentiful. It should be noted that a handful of nine-figure catalog acquisitions have closed this year,

Other trends defining today’s global music business? How about the rise and rise of Latin Music, which is set for its first $1 billion year in terms of recorded music sales in the US in 2022. Spearheading that success is the incredible Bad Bunny (and his team at Rimas Entertainment), alongside a wave of entrepreneurship that’s showcased in this issue by Lex Borrero. He’s the manager/business partner of Bad Bunny producer Tainy, and the co-founder of NEON16, a company that Borrero argues is becoming Latin Music’s answer to Roc Nation.

Finally, we’ve seen a continuation of the trend for a smaller percentage of total streams going to the Top 10 biggest hits –with market share shifting further towards a subset of ‘middle class’ artists who make a decent living, but have little ambition to break into the Billboard Hot 100.

That’s a phenomenon discussed by the likes of Denis Ladegaillerie (CEO of Believe) and Dominique Casimir (CCO of BMG) in this Yearbook. Bringing things full circle, it’s also impacting on the live industry: Jay Marciano says AEG’s “clubs and theaters” business is booming like never before. That’s thanks to streaming continuing to democratize fandom – widening the power base of the modern music business.

Tim Ingham, Publisher & Founder, MBW

“TODAY’S

Credit: Lester Cohen

Jay Marciano on streaming, Coachella, macro-economics – and why ‘everyone’s a genius in a bull market’

Jay Marciano doesn’t do many interviews.

In typical times, there’s little need: Up until March 2020, AEG Presents – which Marciano heads up as CEO & Chairman – was a steadily growing global company in a steadily growing global segment of the music biz.

Since then, of course, we’ve been far from typical times. As a result, MBW has a heck of a lot to ask Marciano about, including: (i) Live music’s strong comeback post-Covid; (ii) The impact of streaming on the next generation of live talent; (iii) Whether the concerts business will be recession-proof; (iv) The future impact of inflation on the business; and (v) AEG’s increasing investment in international expansion.

Happily, Marciano, one of the modern music industry’s most modest and straight-talking – not to mention successful – Chief Executives granted us an audience to do just that.

The world’s largest private live music promoter – and second only to Live Nation overall – AEG Presents is the owner of huge festivals like Coachella (attendance: 125,000 per day, over two weekends), the New Orleans Jazz & Heritage Festival, and the UK’s British Summer Time (BST), which this year hosted the likes of Adele, Elton John, Pearl Jam, and the Rolling Stones.

In addition to its festival business, AEG is also the owner of multiple global venues including the Crypto.com arena in Los Angeles, The O2 Arena in London, and the Mercedes-Benz Arena in Berlin, amongst many others. And

as a concert promoter, right now, the firm is working tours for superstars ranging from BLACKPINK to Bryan Adams, Elton John, Luke Combs, and Stromae.

The topline signs for the live industry in 2022 are good: AEG rival Live Nation (a publicly-traded company) recently stated that 44 million tickets were sold to its shows in Q3 2022, more than any other quarter in its history. Over in the UK, the 2023 Glastonbury Festival – yet to name a single

the equivalent of “a stadium show every single night for the next 2.5 years.” (The below interview with Jay Marciano took place before Taylor Swift’s much-discussed dates were announced – and before those much-discussed tickets went on sale).

Unlike publicly-traded Live Nation, AEG Presents (part of Philip Anschutz’s AEG group) doesn’t publicly publish its financials. But if we briefly bounce back to pre-Covid times, its scale becomes clear:

According to Pollstar data, AEG Presents’ worldwide shows grossed $1.4 billion from ticket sales in 2019. The firm’s shows sold 14.8 million tickets that year – up by more than 3 million on its tally in the prior 12 months.

So how will AEG – and the wider concert business – fare when 2022 shakes out?

Jay Marciano had an answer for that – and plenty more – when we sat down together…

headliner – recently sold out in less than an hour.

Speaking of good signs for the business, it’s worth mentioning that AEG is promoting that Taylor Swift tour (though not handling its much-discussed ticketing sales, which go through Ticketmaster). The scale of AEG and Swift’s success there – and the signal that gives us about live music demand even during a tumultuous economic period –shouldn’t be underestimated.

Swift sold 2.4 million tickets. According to Ticketmaster, the volume of traffic to her on-sale suggested enough demand for Swift to play 900 stadium shows:

The live industry in 2022 is a complicated picture: Some projects, including your sold-out Coachella and British Summer Time shows, seem to be doing exceedingly well. Other shows are being canceled by artists for various reasons that may or may not be a cover for soft demand. What’s going on?

Anyone that tells you they know what’s going on is probably using the benefit of their experience in the last 24 hours. Ask them that question in seven days, they might answer differently!

Our experience tells us it’s hard to ignore consumer sentiment,

“ANYONE WHO TELLS YOU THEY KNOW WHAT’S GOING ON IS PROBABLY USING THE BENEFIT OF THEIR EXPERIENCE IN THE PAST 24 HOURS.”

period. And consumer sentiment right now is like a yo-yo.

I’ve always felt that concert ticket sales are very much the canary in the coal mine: We know, probably before many people, how consumers are feeling. When we’re selling really well, it means consumers feel really good about going out. When people begin to pull back, maybe it’s because they’re feeling a little less secure about their own financial situation.

Events that went on sale in that initial period post-Covid had all the benefits of the euphoria of opening up the market. Everything was selling: You and I could sell a concert out!

As we started to move into summer 2022, we had to look at the supply side: There were too many shows, and too many choices. Combine that with a little bit of that pullback on

consumer sentiment, and it’s not a surprise to me that only the really hot artists and shows are guaranteed to sell – anything else closer to the margins is going to find things more difficult.

How do you see these next 12 months playing out for AEG’s concert promotion business?

It’s important for me to start by laying out my long-term view of macro dynamics that are working very favorably for the live business. The accelerated adoption of international music plus the benefits of streaming mean that audiences have more access to more artists and genres of music today than ever. And that’s great.

It’s great for our clubs and theater business, it’s great for our festival business, and it creates all kinds of opportunities.

But in the near term, it’s difficult to ignore the economic

signs – and in this business, you ignore those signs at your peril. There’s an old saying that everyone’s a genius in a bull market. We came out of the pandemic into a bull market, and everyone looked smart. Now it takes a really strong operator to navigate what we’re probably going to experience over the next 12 months.

That’s why, given where the economy is going into 2023, I’m not judging our company’s performance on quantity. I want us to be a little bit more selective.

What’s the biggest benefit that music streaming has brought to live music?

It’s made music discovery borderless. Maybe for the first time in the history of pop music, it doesn’t matter which language you’re singing in.

Five years ago, the idea that BTS

BLACKPINK’s latest tour dates are being promoted by AEG

and Bad Bunny were going to be the two biggest stadium shows in North America would have been an absurd thought. But now, through discovery, fans are willing to take on music from around the world.

Coachella, because it’s always been the most adventurous festival when it comes to booking and always wants to get there first, has always been at the forefront of giving a big platform to the next wave of artists from around the globe. So at a festival of 125,000 people, at least 50,000 people will go watch them and be open to something new.

That goes both ways, too: Justin Bieber sold out five stadiums in Japan, that would not have happened five years ago. And I think we’ll see more and more of that.

I’m glad you mentioned the

correlation between streaming and your ‘clubs and theater’ business – i.e. smaller venues than arenas. The logic is that there are now many more artists booking and filling these venues, and that correlates with what’s happening on streaming platforms: the Top 10 superstars are seeing their share of total listening decrease, but thousands of artists underneath

them are growing their audiences. Is that a trend that has continued post-Covid?

Yes, and our clubs and theater business is very healthy. A club that did 100 shows a year in 2012 is now doing 180 shows a year. That’s a direct result of there being more talent available. It’s a great byproduct of streaming. Our clubs and theaters business is a steady, relatively low-risk and dependable side of what we do. It’s also beneficial for spotting new talent that we think could take the next step and play on the B stage of one of our festivals… that kind of thing.

Interestingly, clubs and theaters used to be a break-even business. Now it’s become profitable because our venues have become better and we’ve made investments to improve both the artist and audience experience.

What’s also new is the frequency

“CONCERT TICKETS ARE LIKE THE CANARY IN THE COAL MINE... WE KNOW BEFORE MANY PEOPLE HOW CONSUMERS ARE FEELING.”

with which fans are going to shows: The quoted stat, years ago, was that the average concert-goer goes to 1-point-something shows a year. In our experience, at the clubs and theaters level [today], where the audience is primarily 22 to 32-year-olds, it’s more like eight times a year.

Is it inevitable that ticket prices will have to go up in the current inflationary environment, especially at those smaller shows?

A young artist that’s on the road today is seeing all of their costs going up – their tour bus, staff,

When you work at a label, that ‘genius of discovery’ is part of [your] reason for being there: ‘I signed this artist, I discovered this artist, I made this artist.’ And of course the people who are successful at doing that are rewarded the most.

There’s a little bit of that in the concert business, but less so. When I sit there at a show after doing this for all these years, can I make a pretty quick decision about how far a [young] artist is going to go in their career? Not always. But I can make a pretty informed guess, just based on having seen thousands and

after a label’s frontline marketing of their music wanes.

sound engineer, lighting engineer, hotels... and as a result some artists can’t even afford to go on tour.

That in itself would necessarily dictate that ticket prices have to go up. What used to be a $20 ticket is probably going to be a $25 ticket, because everyone’s costs have increased.

Something I’ve been thinking about: The live music business has long treasured so-called ‘heritage’ artists who can sell out stadiums on the strength of their catalog, while the record industry has arguably been more obsessed with the ‘new’. In a world where those established artists are selling their catalogs for hundreds of millions of dollars, that seems to have changed a bit.

I’d agree with that. Traditionally, there wasn’t a lot of glory on the label side of the business in working on an artist who had already released their five biggest albums.

thousands of shows. I can sense pretty quickly if an artist is connecting with the audience.

What’s the difference in the reasons for a company like AEG to back new talent vs. the reasons the labels might back talent? We’ve all seen hyped artists with over a billion streams who can’t sell tickets at this point.

We experience artists where the fans are. This isn’t a knock on the labels, but we have access to different data points [than they do], and our data is a bit more active. We always ask ourselves: are fans in love with the song, or are they in love with the artist? You can have a great song that people love, but that doesn’t necessarily mean they’re willing to go out and spend 100 pounds or 100 dollars to see the artist perform live.

The longevity of a live fan base is what we’re interested in. That’s what helps so many artists continue to pay their bills long

The record business and the concerts business are definitely closer than they once were – you only have to see the number of record industry folk who come to Coachella and British Summer Time to know that! But there still seems to be a distance between the two parts of the business. We both need each other for the ecosystem of this industry to function at its best: we need strong labels, and we need strong promoters. Frankly, I wish we were a little closer to the labels on the live side of the business. It would be to everyone’s benefit. When we’re at Coachella, I talk to a lot of label people over the course of those two weekends. And they all say, ‘Next time, our marketing plan should be more integrated with the Coachella performance.’ And I start to think, ‘Well, when you’re having those marketing meetings, you never call us and say: ‘We have something we’d like to do with this artist.’” I’ve never gotten that call!

The music industry has seen a number of companies go public in these past few years: Universal Music Group, Warner Music Group, Believe, Hipgnosis etc. AEG Presents seems happy staying privately owned. Why? Our company reflects who our owner is. He’s an owner that expects our company to be the gold standard. He is patient when he makes an investment. You have to be patient and visionary to make a bet on something that wasn’t so obvious at the time –the O2 Arena is a perfect example – that ends up looking very obvious today.

When we were nosing the London area looking for an arena site, we said, ‘what about out there at the Millennium Dome?’ Everybody laughed at us. They all

“A CLUB THAT DID 100 SHOWS A YEAR IN 2012 IS NOW DOING 180 SHOWS A YEAR. THAT’S BEEN A GREAT BYPRODUCT OF STREAMING.”

said, ‘Nobody goes to East London. It’s a white elephant!’ It was the same thing in Berlin. Everybody thought we were crazy to build where we did. Same thing in Los Angeles; we went downtown at a time when nobody wanted to go downtown.

My point is you can only take those bets when you have an owner that’s focused – someone who doesn’t need to make a dollar today, but instead wants to create value in the long term. That’s who Phil Anschutz is.

What’s your view on the labels taking money from live via ‘360’ deals with artists?

It’s had no impact on us as concert promoters, because that money isn’t money from our table – it’s the artist’s. I think over time wisdom has prevailed: the labels don’t have the ability to execute

the rights that they’ve acquired in a 360 deal. And many of them have sort of moved on from it. The really experienced lawyers that are negotiating record deals these days are successful in eliminating them.

I understand where that thinking started from the labels’ perspective, especially given the financial straits the labels were in at that time: ‘We’re spending all this money and all this time to build an artist’s brand.’ And then they looked at what was happening on the live side thinking, we’re not participating - how do we get more of that?

But that was before the big streaming checks started to roll in. And the money coming in from streaming is so big that the money that they’re going to make off of selling a T-shirt looks de minimis

The big difference between the two businesses: streaming is a high-margin business to the labels, and we’re a big gross, low-margin industry, because – as it should be – the artists are making 90% of the revenue. So when I hear labels complaining that they’re only getting 70% of the revenue from the streaming companies… well, you can guess what I think about that!

There’s been a lot of debate around secondary ticketing and ‘dynamic ticketing’ this year – with ‘dynamically priced’ tickets for some concerts, based on demand, spiraling up to multiple hundreds of dollars, and more. What’s your view?

The US market accepted secondary ticketing much more readily than other places, like the UK and Europe. That’s because it

AEG-promoted Elton John recently played his US farewell shows at L.A’s Dodger Stadium

Courtesy: Ben Gibson & Rocket

was originally driven by sports: Season ticketholders couldn’t make it to every home game in the NBA or NFL each season, so they needed a marketplace. Sometimes those tickets sold for under face value, sometimes they sold for face value, and sometimes they sold for more than face value.

Then, by the time the music business woke up to the fact that there was a robust secondary market for its tickets, it was too late. Artists were afraid of being called out, or for seeming “offbrand”, for charging what their tickets were really worth in an open marketplace. So they’d put a third-row ticket on sale for $100 that would then sell for $500 on the secondary market.

We as concert promoters didn’t love the secondary market, and our artists’ didn’t want to be involved. So we stayed away from it. Instead, hundreds of millions of dollars were invested by the banking industry to create a secondary [music ticketing] market. All of that money spent in the secondary market didn’t make it to any of the rightsholders; including the promoter and the venue, but most importantly, the artist.

Now artists [increasingly] understand that they were letting all these third-parties profit off their shows, so they’re working with the ticketing companies and promoters to unlock a concert’s gross with ‘dynamic pricing’. The fact is, we just moved that 30%-plus increase in a box office you would see on a secondary ticketing site back into the hands of the ‘rightsholders’.

Yes, we can argue about who among those ‘rightsholders’ gets what. But we’ve got to move that money away from the secondaries and back onto the table to enable us to do that.

What’s the direction of travel for AEG Presents over the next few

years - what are your priorities for expansion?

The biggest segment of growth will be international. You’re going to see us become more aggressive in Asia and South America, and potentially a few more offices will be opening in Europe as well.

I would point to our relationship with Frontier Touring in Australia as a recent example of that. In 2019 we announced a JV in which we acquired 50% of the company. Then, following the unfortunate passing of Michael [Gudinski, founder of Frontier and Australian music business icon who died in 2021], we purchased another 30%, with Matt Gudinski owning the remainder. We believe in Matt, we believe in the entire team that came together to run the business after Michael’s passing, and we believe in both the history and the future of Frontier.

We’ve also really made our own global touring deals a priority. Our Global Touring team is

spearheading that and I expect we will have more artists partnering with us through that sector of the company.

The other area of focus is ticketing our own shows. Historically, we’ve made the bet on an artist, done all the marketing for the shows, agreed on a contract with a venue… and then turned our ticketing – our point of contact with the consumer – over to a third party. We are acutely aware that the whole relationship with the consumer orbits around the sale of the ticket, and we are going to make that relationship even more of a priority.

So, global expansion and ticketing – you’ll see some real evidence of that over the next 12 to 24 months. More than anything, after the past two years, I’m just excited to be talking about the future of the business again.

This interview originally appeared on Music Business Worldwide in December 2022.

Coachella welcomes around 125,000 ticketholders each day

Julie Greenwald is certainly no lover of media attention. Yet, she admits, she would love this article to be way longer.

Specifically, she wishes –amongst many others – it would more extensively mention her love for Gnarls Barkley’s Crazy, Lil Uzi Vert’s XO Tour Llif3, Cardi B’s Bodak Yellow, Coldplay’s Magic,

and Lizzo’s Good As Hell (“I knew it would be a smash – it only took four years!”).

But rules is rules. We asked the Atlantic Music Group CEO & Chairman to choose up to seven tracks that have defined her life to date, and no more. She very nearly stuck to the limit.

Greenwald’s choices span a

childhood in upstate New York, through teenage student life in New Orleans, through her formative music biz years at Def Jam, through to the past 18 years of her life, running Atlantic Records alongside Craig Kallman.

The most recent destination on that journey represents a position and a professional home she

Julie Greenwald: ‘I never want music to be just my “job”. What a waste that would be.’

wouldn’t change for the world.

“People ask me, ‘You’re the Chairman of the company, why are you so in the weeds with the artists?’ But I love it,” she says. “I love the fact I can still contribute a nugget or an idea to an artist, and that can be the idea that makes a difference.”

Greenwald’s work ethic and competitive spirit, she says, is derived partly from her parents and partly from being “the third child – the classic over-achiever”.

That’s the third child of four sisters, something we learn by joining Julie in the front seat of her parent’s car – as she justifies her first choice on her lifetime playlist, back where it all began…

1) Barry Manilow, Mandy (1974) / Fats Domino, Ain’t That A Shame? (1955)

I have fond memories of my childhood. My parents had two different tastes; my mom was Simon and Garfunkel and Barry Manilow. My dad was completely into jazz, gospel, he loved Black music. So, whoever was driving the car, it was a very different experience!

My mom passed away 18 years ago, and every time I hear Barry Manilow, I get such visceral memories.

Back then, we were allowed to sit in the front seat as kids. I have three sisters, and there was always a fight; two of us went in the front, and two of us went in the back. We’d sit next to my mom, none of us wearing seatbelts, and we would just be singing at the top of our lungs, “Ohhhh, Mandy!”’

The other side of my childhood memories would be my father playing Fats Domino, who he completely loved. Blueberry Hill and Ain’t That a Shame were particular favorites.

We had these giant brunches at our house every Sunday; Fats Domino would always be playing. He soundtracked this feel-good

vibe in our house with this incredible soulful music. And his lyrics were great: “Ain’t That A Shame…” My father would sing that one to us kids when something wouldn’t go our way [laughs].

2) Peter Gabriel, In Your Eyes (1986)

Towards the end of high school, I was trying to figure out where to go to college. It felt like this giant, heavy decision: Do I stay in the northeast and keep my parents happy? Do I go to Cornell? Or do I go to be in warm weather and explore a new city far away, which was Tulane [in New Orleans]?

I had a driver’s license, and I was able to go visit colleges, taking these long road trips. And on those road trips, I would play my cassette of Peter Gabriel’s So over and over. I didn’t just love that album, I actually murdered that album. I couldn’t get enough of it.

While visiting Cornell University, we took a road trip to Rochester to see Peter Gabriel in concert. At some point, when he did Lay Your Hands On Me, he laid down and let the audience pass him around. And it was the greatest concert experience I’d ever seen; he was so magnificent.

It really just showed me what could be possible when a giant audience in a room is in sync, all witnessing greatness together.

Even today, when I go see an artist and I see an audience all moving together, that’s when you know you have something for the long-term – when everybody commits and everybody’s fully ‘in’.

3) Van Morrison, Sweet Thing (1968)

I was the third child out of four; the classic over-achiever. I wanted to get out of my small upstate town so badly.

I chose Tulane to go to college because it was a world away from the Catskills. I had a lot of fun in

New Orleans, an incredible city with amazing nightlife. It’s where I got a lot of my cultural education.

I was surrounded by live music in that town; The Meters, The Radiators, Aaron Neville. You’d see all of that stuff on your average Wednesday. I was part of the Concert Committee [at university] and I brought Echo and The Bunnymen, Simply Red, and many others, to our auditorium on campus.

My friends and I loved sharing and swapping music. We’d all make tapes for each other.

Through that, I discovered Van Morrison and Astral Weeks. I didn’t even know who the guy was before college; I was a product of radio and MTV, and they didn’t play him on the Top 40 stations. My God – the voice, the musicianship, the lyrics – it felt like discovering Pluto.

There still isn’t a week that goes by that I don’t listen to Van Morrison. He’s either a part of my yoga in the morning or walking my dogs at the weekend. He’s one of those magic artists who takes me away from my own head, allows me to clear my mind, and creates those moments in which I’m not thinking about my job or what I have to get done that day. He’s my escape.

Every week, he makes me grateful to be in the music business, because he reminds me what music can mean. I never ever want music to be ‘just my job’. What a waste that would be.

4) Jay Z, Hard Knock Life (1998) / Can I Get A… (ft. Jah Rule & Amil) (1998)

I’ve always been passionate about social issues. At college, I wanted to become a lobbyist. I interned for Senator John Breaux, I volunteered at the soup kitchen. Once I left college, I signed up for ‘Teach for America’, after which I was planning to study law.

But then, in the summer of ’92, I got an internship working at Def Jam. Instead of law school, I ended up going to the Lyor Cohen school of hard knocks. Lyor was a super tough and super inspirational mentor. He still is.

Out of all of my memories at that company, I have to pick something from Jay Z. It wasn’t just the music that made me go ‘all in’ on him – it was the person. He became such a great friend,

and we’ve grown up together in this business.

That year [1998], we had Hard Knock Life and Can I Get A… out – two monstrous records going at the same time. That album [Vol. 2... Hard Knock Life] debuted at No.1 and just stayed there and went on to sell over 5 million copies [in the US alone]. It was an enormous album for Jay, and Roc-A-Fella, and an enormous album for us at Def Jam, breaking him to superstar status.

With Jay Z, the possibilities were endless. He was the most magnificent artist to work with, such a smart businessman, so cool, and so nice and down to earth. And he made music in the most honest way; even though his records were crossing over and becoming huge, he retained every bit of his credibility. Because he was Jay Z.

The thing that I learned from him more than any other was he didn’t take every opportunity, even early on. He knew the difference between water and champagne. He was so clever with his brand, not allowing it to become anything but exactly what he wanted it to be.

He taught me how important vision and ambition is when you want to be a superstar.

5) DMX, Ruff Ryders’ Anthem (1998)

Def Jam was a small independent label. We couldn’t outspend Columbia, we couldn’t out-clout Atlantic. But we could out-taste and out-hustle everybody.

We always felt like it was us against the world. We knew we had amazing artists and we had youth culture on our side.

All of that fueled this feeling that we had the battery on our back, ready to make it happen for our artists. This is where I became tough. Where I learned to be a fighter. To do whatever it takes for the talent I believe in.

DMX was like no other artist. He

was raw and dark but so necessary to upend the state of hip-hop at that time.

His lyrical sensibility, authenticity, and pure emotion changed the landscape and changed how we thought about marketing artists. With X, we just needed to put him front and center. The strength of his connection with the audience made it impossible to doubt.

He brought his whole being to everything he did. He performed, he cried, and prayed on stage. He was one of the greatest to ever do it.

6) Oasis, Champagne Supernova (1996) / Fleetwood Mac, Silver Springs (Recorded live, 1997)

My husband [Lewis Largent] worked for MTV at its peak. He loved Oasis and thought they were the greatest thing in the world. Our courtship was him introducing me to this incredible British rock band who were totally outside of my wheelhouse. We saw them so many times in multiple cities, and multiple venues.

We had this great weekend when Oasis was doing the MTV Unplugged show in London [August 1996], while I was in town for Foxy Brown. Obviously, Liam didn’t show up to that show. [The Oasis lead singer infamously pulled out of the MTV performance, leaving brother

Noel to lead vocals for the evening.] Lewis didn’t get the show he wanted, but he definitely got the girl.

I’m also squeezing Silver Springs in here, which is one of my favorite songs ever. My husband and I have seen Fleetwood Mac play live a couple of times, but there’s one moment that stands out even more for me:

the recording of The Dance [a 1997 live album recorded at Warner Brothers Studios, Burbank]. I was glued to MTV [which aired it]. You’re watching Stevie Nicks sing every word of this song to Lindsey [Buckingham]; I had goosebumps on my arms. It felt like you were part of the relationship; you could feel the hurt, the pain, the love.

“WITH JAY Z, THE POSSIBILITIES WERE ENDLESS. HE WAS THE MOST MAGNIFICENT ARTIST TO WORK WITH, SO COOL AND DOWN TO EARTH. ”

Sharing a cuddle with Ed Sheeran

We know music has power, but when artists are such insane performers and they leave it all on the stage, it’s so cathartic for the audience – being allowed in on the artist’s pain and their journey. That’s what separates the greatest from the great

7) Bruno Mars, Just The Way You Are (2010) / Ed Sheeran, The A Team (2011)

Bruno and Ed really signaled the beginning of an incredible new chapter for this label.

In 2010, Bruno performed with B.o.B at a UJA luncheon where Craig and I were being honored, and Bruno changed the lyrics to their song [Nothin’ On You] to “nothin’ on you, Julie”. That mattered to me, but what really mattered was that he slayed the entire room.

Everyone walked out of that room, all the tastemakers from the industry, thinking: ‘That guy is

going to be a fucking star.’ And from that moment on, he’s delivered.

As soon as I heard Just The Way You Are for the first time, I ran across the street to [then-Warner exec] Lyor’s office and played the song. We danced and we hugged, because we knew Bruno was going to take over the world.

I vividly remember Ed Sheeran’s New York debut at Mercury

Lounge in 2012. It was magical. He stood on a chair in the middle of the crowd. Eighteen months later, he sold out Madison Square Garden three times over.

We worked his first single, The A Team, for over a year, knowing how important he would be if we delivered. Fan by fan, city by city, together we knocked down the US. His work ethic and talent is second to none.

Both Bruno and Ed are now firmly planted in history as two of the all-time great songwriters and performers.

There are artists who can redefine a genre, and then there are artists that just defy all categories; I call them ‘genre defiant‘. Genuine originals. It’s those unique talents we live for at Atlantic Records.

This interview originally appeared on Music Business Worldwide in October 2022.

“BOTH BRUNO AND ED ARE NOW FIRMLY PLANTED IN HISTORY AS TWO OF THE ALL-TIME GREAT SONGWRITERS AND PERFORMERS.”

With Jay Z in New York, 2005

NEON16 wants to become the Roc

Nation of Latin Music. Lex Borrero has a master plan to achieve it.

Lex Borrero wouldn’t presume to call himself a protégé of either Sean Combs or Jay-Z, two of the greatest artists-turned-execs of any era or genre. But he did spend some of his formative years in their company (at their companies) – and it shows.

Borrero is his own man, with his own strategy, but it’s definitely there in the attitude and ambition.

He says: “Something I learned from Puff first, and then saw reiterated at Roc Nation with Jay, is that they’re a flag for the culture.

“A lot of times, most artists, most entrepreneurs, most labels, they focus on just their job: I’m a music guy, I’m going to manage my artist, I’m going to do touring, I’m going to do publishing, I’m going to do the label deal.

“Very few people have the approach of Puff and Jay, which is to say, ‘We have an impact on culture, we understand what our consumers like. So, I’m going to start setting this flag in consumer goods; I’m gonna set this flag in fashion; I’m gonna set this flag in liquor; I’m gonna set this flag in sport.’”

This blueprint was a clear inspiration for NEON16, the increasingly multi-faceted company Borrero established in 2019 with super-producer Tainy, (whom Borrero manages).

In 2022, NEON16 (whose other management clients include the likes of Yandel and Dylan Fuentes) expanded on its music and media mini-empire with the launch of 22 Publishing in partnership with Sony Music Publishing.

That news arrived just as Bad Bunny’s smash album Un Verano Sin Ti – on which Tainy produces/ co-produced no less than nine tracks – was exploding globally.

And we mean exploding: According to Bloomberg, in the two months to July 18, Bad Bunny tracks appeared in Spotify’s Top 100 chart over 150 times – more than any record label’s entire artist roster.

For Borrero, this is all further proof of Latin music’s

“So I figured, if we can become the Roc Nation or the Bad Boy of Latin music, I’m going to be able to ride that wave all the way to a billion-dollar business. And that’s essentially what we’re doing.”

Lex Borrero’s initial break into the music business came after leaving school, when he interned at a studio and made a record with a local rapper. That led to a distribution deal with Universal.

“My mom had to negotiate that deal for me,” he recalls. “She used an immigration attorney because that was all we knew.”

From there Borrero made his way to New York to attend a Dynamic Producers convention, which, crucially, included a ‘Beats Battle’.

The prize for the winner of said battle: the chance to work in the studio with an artist Russell Simmonds had just signed.

Only problem was, Borrero’s beats hadn’t been deemed good enough to gain him entry to the competition.

mushrooming mainstream moment, something that NEON16 has been designed to make the most of ever since it launched.

“I basically saw no-one doing [what Jay-Z and Sean Combs did for hip-hop culture] for Latin culture at the time when Latin music was starting to become global and starting to break streaming records,” says Borrero.

“Like any cultural movement, like with hip-hop, it’s led by the music – then it goes into consumer goods, it goes to Hollywood, and all of a sudden it’s mainstream pop culture.

“I started annoying the lady organizing it so much that in the end she said, ‘Kid if you don’t get out of here, you’re never going to come to this conference again. Just accept the fact that you didn’t make it to the battle.’”

He... didn’t accept it.

“Sunday comes around and she starts naming these producers [in the final], and there’s one person that doesn’t show up. I run to where it’s taking place and she’s like, ‘Okay kid, you’re so freaking annoying – you’re in.’

And, of course, Borrero wins.

“I go to the studio that night and there’s a guy called Gregory

“IT’S LED BY THE MUSIC, THEN IT GOES TO CONSUMER GOODS, IT GOES TO HOLLYWOOD, AND ALL OF A SUDDEN, IT’S MAINSTREAM CULTURE.”

‘Beef’ Jones, who was President of Russell Simmons Music Group.

“I said to him, ‘Listen, I don’t know anything about how this business works, but I want to learn, and I think I could be your best employee. Give me a job.’”

Jones didn’t give Borrero a job, but he offered him the next best thing – an internship based in NYC.

Says Borrero: “I came back to Miami, took out a student credit card from Bank of America for $5,000, and I left for New York.”

So far, so Hollywood biopic. But the reality of Borrero’s first internship was anything but glamorous.

“The money ran out and I was broke. I ended up homeless. I was sleeping from couch to couch; I actually slept one time in a crack house, although I didn’t know it

was crack house.

“I slept on the 6-train for months. I went through everything you could think about.

“I was still interning, hustling my beats, just trying to be in the mix. And little by little I was starting to meet people. But I was at a point where emotionally and financially I just couldn’t stay in New York anymore. I was tired of being homeless.”

Eventually, knocked down by the economic realities of fighting to make it in music, Borrero called his mom, defeated.

“I asked her to book me a trip home. That was Sunday; she booked me a trip for Thursday. Two days later, on Tuesday, I get a call from this A&R at Bad Boy. He was looking for records for Puff and he asked me to come by.

“I show up; I have 23 beats on

my CD. And the 23rd beat, Puff ended up recording. That was my first check in the music business. They bought it for $1,000.”

Borrero stayed in New York, making beats but also learning the business side of things, most notably with Blue Williams and his highly successful producer management business, Family Tree.

Next, a role at Roc Nation, where Borrero would go on to head up the Latin division, took him back to Miami.

When he got there, Borrero discovered that a talented producer, Tainy, had landed a gig as a consultant, but wasn’t really being utilized. In fact, his career was going through something of a downturn.

So much so that, having moved into the same building as Borrero,

Tainy

Tainy asked his new neighbor if he might be able to help.

Since then, Tainy has become one of the world’s biggest producers of the past decade (via his work with Bad Bunny and J Balvin, but also Cardi B, Selena Gomez, Dua Lipa, Travis Scott and more).

Borrero, meanwhile, is proving himself to be equally influential as an executive, changing the commercial landscape of Latin music while planning and building what he is confident will be a billion-dollar business within five years…

humble, very Zen.

But he was at a pretty horrible stage of his career. Financially he was in a really bad situation, he was part of tons of bad deals, and one day his girlfriend came and asked me if I could help.

At the time I wasn’t looking to manage. I was an executive at Roc and I was really trying to focus on [that]. So I just started to help him as a friend, stepby-step. When I went to L.A., I would bring him with me, so he could meet some [people in] the American market.

were in Tokyo and I decided to build this company [NEON16], to put producers around him.

I told Tainy, ‘We have something that no one else has, which is my years of experience making Anglo-pop music and urban music, plus my relationships in that market. We also have your understanding of heritage and culture, from being involved in so many Latin hits.’

So we embarked on this journey. And, just so you know, he’s now much bigger than that artist [laughs].

Before we get into your career, we have to ask about that period when you were homeless in New York. Why didn’t you quit as soon as you found yourself without a roof over your head?

The perseverance that I’ve had has really been the key to my success. There were multiple times when I wanted to quit.

There were days when I would wake up on the train and my whole back would be wet. I thought it was because I was sweating, but it was just because some guy had pissed on me.

Like, there were many times when I saw people get into fights, get stabbed. And there were times when I almost died from heat exhaustion.

On top of that, I wasn’t eating right; I was eating off the McDonald’s one-dollar menu every single day.

But I’m showing up for work like it’s nothing, no matter how tired or how sick I was.

Tell us about meeting Tainy, and becoming his manager?

He lived in my building in Miami when I was at Roc [Nation], and I just kept running into him.

One day I asked him to come over, he was super impressed by my sneaker collection! Back then he was super-quiet, super-

Out of that, things started happening with Balvin and with Bunny. The transition point was when I was with him and an artist called. [Tainy and said artist] were arguing over something, and the artist said, ‘Hey, Tainy, no one gives an F about producers; it’s always about the artist.’ I saw his face just collapse, because Tainy’s such a nice, humble guy, and this

Can you give us some idea of just how big Tainy has become in your time together?

He became the No.1 Latin producer in Billboard’s chart for 27 weeks in a single year. He spent 196 weeks at No.1 and [is] one of the Top 10 producers of the Century according to Billboard figures.

“I SLEPT ON THE 6-TRAIN FOR MONTHS. I WAS TIRED OF BEING HOMELESS. EMOTIONALLY AND FINANCIALLY, I JUST COULDN’T STAY IN NEW YORK ANYMORE.”

really hit him.

He hung up the phone and I told him, ‘You know what, enough is enough. We’re going to work together, we’re going to work out a plan to make you bigger than any artist.’ And that was the day everything changed.

That’s the day that I decided, okay, there’s this misunderstanding of how producers should get treated in the Latin business, and there’s this idea of how producers should be billed and presented and there are limits that get put on their power and creativity, and we are going to change that.

Six months after that, pretty much exactly three years ago, we

He is playing a run of festivals this year as a live performer, and commanding the same fees as major artists. There is a multitude of hits and awards, and most importantly there is the cultural impact.

If you look at the Latin music business, you have Bad Bunny, you have J Balvin, you have Rauw Alejandro, you have Tainy, you have Karol G and you have Rosalía. They are the basis of [modern] Latin music. Tainy’s become as big as any artist, as valuable brand-wise and financially as any of those artists.

Do you think he gets the credit he deserves, not in the Latin

industry and community, but around the world – in the mainstream music business?

I think he’s there, because now he’s looked at as this overall creative – the same way Pharrell has been looked at throughout his career.

Producers like Pharrell and Tainy, they are really good at making rhythmic records, and those are the hardest records to make.

To be really creative, musically, on a record that has a lot of movement, it’s extremely hard. And that’s why most producers are not rhythmic producers, they’re very standard pop producers or urban producers.

That’s why Pharrell is where he is. And with Tainy, even though his exposure to the wider world has only been in the past few years, that’s why he sits in that Top 10, above producers that have way more history than him; he’s really changed the sound of music.

What sort of metrics and milestones can you share to give us an idea of the growth of NEON16 in your first three years?

I can tell you that when we started, we were a two-man team and we are now at 22 people across the business.

We started with just a production house; now we’re a label, an extremely successful publishing business, we have a brand agency and we have launched a TV and film division.

What you are going to see us do over the next two years is create a Latin media powerhouse that touches everything from music, film and television to consumer goods.

We’ll build that to a billiondollar business. And then we will choose to go for an IPO or go for a merger or sale to a bigger company within five years.

Have you already had majors

looking to either acquire or invest into NEON16?

Yeah, we have. And at first we weren’t interested, primarily because we liked our creative freedom and being able to build it our way.

But we also understand that we now have the foundation of the business. When you have an explosion of success like we have, in the first two or three years, you’re just structuring things, you’re figuring out your main goals, where your revenue is truly coming from, and how to maximize that revenue.

Now we’re ready to look at opportunities to see how we structure our business for far bigger growth, because we know our potential.

That’s what we’re doing today; at some [point] in the next six months we are going to look for a large injection of cash to help make this the billion-dollar business that we want to build.

Would that be through investment from within the music industry, or might it be VC money from outside the music business?

Either/or. It will come down to partnership value.

I have the blessing of a partner who I also consider a kind of father, in Tommy Mottola. So we can count on his guidance.

It comes down to who’s going to understand the vision, who

sees the end goal and who will allow us to build without restriction. Sometimes money from the majors comes with a lot of restrictions because of their business model.

How important a mentor has Tommy Mottola been to you?

He’s been very important. I feel extremely lucky, because it’s hard to find a mentor, let alone someone who genuinely cares for your well-being as a person.

When I say he’s become a father to me, I don’t say that lightly. He’s someone who is my family and is involved in every aspect of my life.

[Laughs] I joke around that sometimes I get screamed at like a son, and it doesn’t even have to be about business. If I make a decision in my personal life that he disagrees with, he’ll make it known!

What I’ve been really impressed by, and taken the most from, is that Tommy will trust my gut and follow my lead. He gives great advice, but he also trusts and encourages me.

That’s something he’s really great at, because I have sat in so many meetings [alongside Mottola], with powerful people, who have worked for him, and they all say the same thing: ‘Tommy, thank you. You believed in me and because of you I’m sitting here; because of you I’ve changed the music business; because of you I’ve had this or that run of incredible success.’

That’s because he understood what he was and he understood what he wasn’t. He never tried to be the boss who knew it all. He brought an all-star team to Sony and he let them go be sharks.

And at the same time, he trusted the artists. Every artist that has talked about Tommy will tell you: he put them first.

This interview originally appeared on Music Business Worldwide in July 2022.

“WE’LL BUILD THIS INTO A BILLIONDOLLAR BUSINESS. AND THEN WE’LL GO FOR AN IPO, OR A MERGER [WITH] A BIGGER COMPANY WITHIN 5 YEARS.”

FOR MUSIC

Our 160,000 songwriter, composer and music publisher members are the beating heart of the music industry.

If you write songs, produce or create beats, joining PRS for Music means you can collect royalties globally when your music is streamed, broadcast, downloaded or performed in public. Find out more at prsformusic.com/join prsformusic.com

Bob Vylan performing at PRS PresentsFebruary 2022

Starrah: ‘Make music you want to listen to. Don’t chase trends.’

Starrah is one of the most innovative, interesting and in-demand songwriters to emerge over the last 10 years.

She is a young, Black, LGBTQ woman who writes modern hip-hop classics and mainstream pop chart smashers – and doesn’t really want the world to know who she is. Or at least doesn’t want the world to know who she really is.

There’s a biopic disguised as a paragraph right there.

She grew up in a small Delaware beach town, the youngest of nine, and became the first in her family to graduate college. By then she had already started writing songs and sharing them online, building up a network of friends and collaborators that proved invaluable when she moved to LA to pursue a career in music.

An early big break came when she was signed by her manager, Nick Jarjour, who has previously said of discovering Starrah, “I didn’t know if she was a girl or a boy, 11 years old or 27 years old; she was the most ambiguous person I’d ever heard.”

From there, success came relatively quickly – and then unequivocally spectacularly. Her first cut was Kid Ink’s 2015 single, Be Real, and over the next couple of years she co-wrote songs for, amongst others, Rihanna, Travis Scott, Drake, The Weeknd, Nicki Minaj, Calvin Harris and Katy Perry.

In 2017 she wrote two No.1 records – Havana by Camila Cabello and Girls Like You by Maroon 5 both early proof, if needed, that Starrah can write in any genre.

Her third No.1 was Savage Remix by Megan Thee Stallion feat. Beyonce [2020]. The track

won the Grammy for Best Rap Song, although Starrah’s aversion to awards shows/the spotlight meant that she wasn’t at the ceremony. Instead, she stayed at home and “ran round the house screaming”, which seems like a solid choice.

In 2019 she sold her catalog to Merck Mercuriadis’ Hipgnosis Songs Fund. As a result, both she and Jarjour became members of that company’s advisory board and are now part of its Richter scale-registering revolution, with the value of songs and remuneration for writers at the epicenter of the blast.

More recently she launched her

What music did you listen to as a kid and who were the artists that first inspired you?

The music that I listened to on my own as a child was Lil’ Bow Wow, B2K, Lil’ Romeo, Lil’ Sammie – all of the Lil’s.

My siblings were seven and eight years older than me though, so when I would ride in the car with them I was listening to Eve, Ruff Ryders, Hot Boys etc.

How did you break into the business?

Hard work – networking through Twitter and Instagram, and being at every studio session, just trying to perform better than I did the day before.

Why did you gravitate towards songwriting rather than being an artist?

I was rapping at first but it wasn’t fulfilling for me. I liked experimenting with genres and wanted to learn a new skill.

own publishing company, 3:02 (it’s the area code for Delaware), as a JV with Pulse Music Group, which signed her as a client in 2015. It is a vehicle she hopes will not only sign great writers and deliver big hits, but also stay unswervingly true to the ‘creatives-first’ mission on which it is founded.

Social anxiety means that Starrah rarely gives (and almost certainly never enjoys) interviews (or photoshoots – she always finds a way of at least partially covering her face), so MBW is partially surprised and completely thrilled when word comes back to say she will talk to us about her life, work, ethos and ambitions as a songwriter…

I have a friend named Shinique, who co-wrote Medusa for Chris Brown, and at the time she told me that she believed I could write songs. I took her advice and pursued it.

Which tracks or sessions changed the game for you and moved you into the big leagues?

Be Real, by Kid Ink ft Dej Loaf was my first song to get a proper release [in 2015]. And then Girls Like You by Maroon 5 [2017] was a song I wrote in 20 minutes that went to No.1. For me it meant everything and it changed the way that I approached music.

I built lifelong friendships from those sessions, with Cirkut, Jason Evigan and Gian Stone – which, to be honest, is more important to me than ‘the big leagues’.

“WHEN GIRLS LIKE YOU WENT TO NUMBER ONE, IT CHANGED THE WAY I APPROACH MUSIC.”

Picture: Mekael Dawson

With Pulse Music Group launching Starrah’s own pubco, 3:02

Can you tell us about your part in writing a couple of specific tracks - Havana and Savage Remix?

With Havana, [producer] Frank Dukes came to the studio and asked me to write a post hook. I did it in 15 minutes. It was my first No.1 record. When I wrote my part of the Savage Remix it actually took three submissions.

I didn’t really hear much feedback on the first two, so I knew the answer was no. After that I tried one last time and that final revision is what made the cut.

How did you come to work with Madonna on Madame X [2019] and what was that like?

Madonna called me on the phone over the holidays. I was with my family. I stepped outside to take the call and she said she wanted me to come vibe with her.

We worked in London and it was an amazing experience. She has such a beautiful soul and I’m thankful for the time that we spent creating with one another.

You worked in quite small groups on that record, is that something you enjoy? Yes, I love working mostly by myself, to be honest.

Smaller groups and smaller cozy studios are ideal environments for me. I like to build true bonds with the people I create with.

Songwriting in general has become much more social than solitary and seems to involve a lot of networking, how do you feel about that aspect of the job?

I have my music family and that came about by being social and sharing our visions with one another. So I think that it’s necessary, otherwise it does start to feel like a job. Building genuine creative connections is the key to a healthy work environment.

What are the most important

skills and attributes you bring to a writing room?

I never do what people expect and I’m efficient. I write full songs fairly fast.

In 2017, Justin Tranter said the music industry was “shockingly homophobic, misogynistic and racist”. That was when you were really breaking through. was that your experience and has that situation improved?

That was my experience for sure. I’ve been in situations where people think I’m supposed to just accept whatever they bring me, that I’m not allowed to have an opinion or choice about what I’d like to work on – so they call me complicated or a diva.

A man with that same vision for themselves would be looked at as a boss. Or some people just plain leave me out of rooms or attempt to put me in a box.

Those reasons seemed racially motivated, especially when they would call me an ‘urban’ writer when I have multiple No. 1 pop songs.

I’ve now created an environment for myself and my team that is inclusive for everyone from all walks of life; that’s my favorite thing about what we’re building at 3:02.

Can you tell us about the formation of 3:02 and about your plans and hopes for that company?

3:02 was formed by me just

wanting to provide opportunities for my friends and create a healthy work environment.

I want creatives to have a safe space and room to be the best version of themselves. My hope is for the company to be the catalyst for positive change in the industry.

I approach everything from the perspective of a creative and I put my team’s mental, physical and spiritual health first.

Who have been your mentors in your career to date?

My mentors to date have been my manager Nick Jarjour, and my partner [in 3.02, songwriter and Pulse Music Group co-founder] Scott Cutler.

Who are your favorite songwriters at the moment?

My favorite songwriters never really change: The-Dream, James Fauntleroy and Max Martin.

What do you enjoy most about your job?

I’m literally living out my dream every single day. It’s not a job to me, it’s something that I truly enjoy doing and that’s the most important thing for me.

If you had a magic wand, what single thing would you change about the industry?

The hustle mentality. I hate the way people push the idea that the hustle mentality is the best way to fuel creativity; it takes away the passion and soul from the music.

What piece of advice would you give to a young songwriter starting out?

Have fun and make music that you want to listen to. Don’t chase trends. Create your own style and stand on it.

This interview originally appeared on Music Business Worldwide in September 2022.

“MADONNA CALLED ME ON THE PHONE OVER THE HOLIDAYS. I WAS WITH MY FAMILY. SHE SAID SHE WANTED ME TO COME VIBE WITH HER.”

“WE ARE VERY EFFICIENT AT GAINING MARKET SHARE – AND WE ARE GOING TO KEEP ON GROWING.”

From Paris, With Love (And Some Astute Market Criticisms)

The music business has been forever changed these past few years by the stock exchange.

Following the likes of Spotify and Hipgnosis’ flotations, in June 2020 Warner Music Group returned to the public markets via an IPO on the NASDAQ. And, famously, in 2021 Universal Music Group floated in Amsterdam at a whopping USD $54 billion day-one valuation.

In some ways, though, the flotation on the Paris stock exchange of Believe has been the most interesting music IPO of all. That’s because the majority of Believe’s business comes from servicing independent artist and label clients around the globe (including the servicing of DIY artists via TuneCore). As such, investors in Believe aren’t directly betting on the future growth of catalog copyrights (a la Hipgnosis or, to a degree, WMG/ UMG); they’re betting that the future of the ‘frontline’ music business will encompass a much more valuable independent sector than it does today. And that Believe will be at the centre of it, globally.

Believe’s thesis focuses on funding and servicing active artists (at all stages of their careers) in their local markets. It doesn’t – unlike the major record companies – pin its hopes on a certain percentage of these artists ‘going global’, although it’s happy when they do. Believe’s founder, Denis Ladegaillerie, forecasts that the next 10 years of the music business will become more ‘local’ than it’s been in a long time – and that’s partly why he’s predicting that Asia (inclusive of China and India) will become the global recorded music industry’s No.1 region by 2028.

Believe saw its annual global revenues grow by over 30% in 2021, and has seen serious artist success in recent times with the likes of Naps (No.1 in France), Lauren Spencer-Smith (No.4 in the UK), and Pamungkas (No.1 in Indonesia). Plus, largely thanks to TuneCore, Believe says it serviced over a million artists in 2021, versus 850,000 of them in 2020.

Here, we grill Ladegaillerie on Believe’s global gameplan as a public company, his fresh enthusiasm for the UK market –and what he thinks the music business’s biggest problems are as we stand today…

Goldman Sachs just released a report that predicts a single digit rise (+7.7%) in global recorded music industry revenues in 2022. How does that compare with Believe’s view of the market?

It seems very conservative. Obviously there’s a lot of uncertainty about what’s going to happen in the second half of [2022] in terms of macroeconomic factors, but looking at the numbers, we’re not seeing a significant slowdown in paid subscription growth in the UK or elsewhere. We do anticipate a slowdown in the second half of the year globally. But our view is we’re still anticipating doubledigit [global industry] growth annually.

There’s a lot of talk about macro-economic impact on streaming’s global growth this year. What’s your view?

What we hear from a number of conversations – and from my own intuition – is that paid music streaming subscription is more resilient to an economic

downturn than video streaming subscription. In video, people tend to subscribe to several services; in music, they only need one. We feel pretty good about the [record industry’s prospects in 2022, despite inflation]. Where we see more question marks is around ad-supported revenues, through YouTube, TikTok and Instagram. We know historically in economic downturns advertising spend is one of the things that gets cut. So depending on what happens in H2 2022, we [anticipate] slower growth there. We’re [mindful] that this is still very early-stage [in the macroeconomic story]; when people like [JPMorgan Chase CEO] Jamie Dimon are talking about an upcoming ‘economic hurricane’, it’s wise to listen.

Goldman Sachs has you as ‘neutral’ stock, but Universal Music Group as a ‘buy’. What’s your take on that?

I think Goldman’s analysis has very specific guidelines around ‘buy’ built in. When Lisa [Yang at Goldman Sachs] initiated a report [on Believe], I think her target price was around €19 [per share], and the Believe stock was trading at just 20% lower than this. I really respect the work of Lisa and her team on their market projections. From a more general view, it seems the current market values profitable companies, rather than longer-term growth, and Believe is still in a phase where we’re still investing heavily.

But what we’ve been telling investors is, we are very efficient at gaining market share, we are going to keep growing and investing in teams, investing in technology, to continue differentiating ourselves. That

means not aiming for positive free cash flow in the very short term.

You recently predicted that Asia would be the world’s No.1 recorded music territory in a few years’ time. How does that fit with the long-term strategy for Believe?

The long-term strategy for us –and this applies to the UK as well [see boxout] – is developing local artists. We believe that over the course of the coming two decades, local artists will progressively gain a bigger share of their own markets, around the world.

In Asia right now, in most of the market, that’s already the case: In Japan, 80% or 90% of the music consumption is of local artists; in China, it’s 85%; in India, it’s above 70%. So, for our strategy, these are great markets.

If you then take India, China, Japan, and add Indonesia and the Philippines, you are going to have the largest music market in the world by 2028. These are regions where local artists are going to be dominating, but where [volume of the population] is also going to drive global results.

Go and look today on any of the Top 100 most-viewed videos on YouTube, and you’ll see that close to 90% of them are Indian, Indonesian, or Filipino artists, three or four of them are from LatAm, and then the rest are from the US.

The [Asian markets mentioned] have not yet reached the same level of monetization [as the UK and US] through paid subscription, but it’s going to come.

I don’t think this is something that most investors [in music] have even realized yet. People are still thinking music is an AngloAmerican world, globally, and it’s going to remain that way. I don’t think that’s the right assumption.

In terms of catalog acquisition, as I understand it, Believe is interested in participating with certain criteria, but you’re not going to use capital from your own balance sheet to achieve that...

Correct. When we have conversations with artists who are considering selling, they tell us two things. One, obviously they’d like a big check – whether that’s for tax reasons, or they’re getting older, or just want to maximize the value of their assets.

And two: they want someone who cares about their catalog and actually understands how to monetize it. If you look at most of the catalogs right now, 90% of the monetization is coming from Spotify, YouTube, and other digital sources, and the rest is coming from branding or sync.

Our view is, we have the ability to actually monetize these catalogs to a great extent, because digital is what we do best. And many artists have been approaching us [with a view to a catalog sale]. And that’s great… except for the price of the assets!

Since the Believe IPO we have raised €300 million of investment capability. But, relative to the majors, Believe is still a small company, and our view is that paying really high multiples for catalogs – 15 times or 20 times –[isn’t] for us. There are other ways of allocating capital that are much more efficient. So we’ve had a number of conversations with private equity, with us telling them, ‘Hey guys, you are looking for investment returns with a cost of capital that allows you to pay 12 times, 15 times, even 20 times for assets – but we can do a great job exploiting these assets and helping you source these deals. Let’s partner.’

I’m not copyrighting any ideas here: I think Willard [Ahdritz] at Kobalt wrote the blueprint for this, and then Merck [Mercuriadis] and Hipgnosis took it to another

level. I tip my hat to both of them.

I have to ask you about Kate Bush. Warner Music doesn’t own her catalog – she does. Are you excited by this kind of development in the marketplace?

What it demonstrates is that a lot of the big catalogs aren’t actually owned by the major record labels. Some of the transactions we’ve seen in the past year have demonstrated that, like Bob Dylan; Sony wasn’t the owner of that catalog, it was Bob Dylan’s and Bob Dylan sold it [publishing sold to Universal and recording rights sold to Sony].

Perhaps the biggest one of all is Queen, who own their catalog [outside North America]. Queen then contract, every three to five years, a partner for the exploitation of various rights. And I think that’s as it should be.

These artists need a partner to maximize these revenues through sync, or across all digital services. And obviously, when you’re working with an [artist-owned] catalog like Kate Bush’s, generating millions or tens of millions of dollars [annually], you don’t do that on a 50/50 revenue share basis.

What revenue share basis do you work under on a deal like that – as a distribution partner to an artist-owned evergreen recording catalog making millions of dollars per year?

People aren’t going to like me saying this, but you do it on a 90/10 or even a 95/5 basis [in favour of the artist]. That’s the reality. If you have a catalog that generates millions or tens of millions of dollars, you can operate that catalog very profitably on lower levels of margin – bringing high value to the artist while also being a very profitable business.

Major record companies are

well positioned to keep some of these deals. But they’re not going to be able to keep them at high margins, because the nature of the service doesn’t warrant taking 50/50 or even 70/30 on these catalog distribution deals. Artists are going to start realizing that.

And am I right in thinking that Believe worked with Queen at one point?

We worked with Queen on their music video rights – we exploited all the YouTube channels a couple of years back. And then, ahead of the [Universal] IPO, Lucian [Grainge] decided to write a big check that we felt we couldn’t match! So Queen took the rights to Universal. But I hope there will be opportunities for more conversations in the future.

Let’s talk about TuneCore: You recently announced a change in pricing that enables DIY artists to upload as many tracks as they like for $14.99 a year. Can that help you scale to catch

DistroKid’s

market position?

Yes, I think so. Our target is to aim for market leadership. Believe has always thought that the music market starts with developing artists, all the way up to the top artists. We’ve seen that on TuneCore with Lauren SpencerSmith and others. For us, working with DIY artists is very important, and it’s a segment we believe is very valuable and will keep growing. [The DIY sector] is capturing 15% to 20% of the value of [all] streams today in many markets around the world; it’s the fastest-growing segment in the music industry. That’s why we have been investing in TuneCore and we will keep investing in TuneCore.

What do you make of the argument that DIY artistuploaded songs should get a lower royalty rate on services like Spotify than major label-signed superstars, because the superstars are the ones attracting subscribers to the platforms?

I heard the expression that Rob Stringer used [to describe lesser-

quality DIY-uploaded music] the other week, ‘flotsam and jetsam’. I had to look up the meaning [laughs]! It was interesting to see that comment, and then at the same time see Universal announcing that it was reducing Spinnup. [DIY artists can no longer upload their tracks to DSPs via Spinnup; they have to be accepted / invited by the service first.]

In my view, there is a lesson here: Lauren Spencer-Smith signed to TuneCore, went to No.4 in the UK charts and was No.1 in four countries; LANDY in France was a TuneCore artist a year-anda-half ago and was No.1 Billboard charted six months ago. There are many more examples.

My view is these emerging artists should get exactly the same [royalty] rate as any other artist on streaming platforms. If you’re a big artist, the argument is: ‘I am contributing subscribers and users to the services.’ Absolutely right. But as an artist you are already extracting value out of that relationship, because

Lauren Spencer-Smith (L) and Naps (R)

often [when the] DSPs are using your image and popularity, they are buying billboards, buying digital marketing campaigns, significantly contributing to your own marketing as an artist. That lowers your own marketing costs and, at the end of the day, increases your royalties. So if you’re an artist at the top of the industry, you are already getting more value out of the services than if you’re an emerging artist with fewer followers and streams.

When I talk to a lot of the DSPs, I ask them, ‘Do we have more fake streams through TuneCore on your platform than the major record labels?’ I get a no. ‘Do we have copyright infringement at higher rates than the major labels?’ Also a no. So are there operational costs [to the services] that justify a different royalty treatment for [DIY] artists? No.

I know major record labels are pushing for lower rates for [DIY] artists, and I just don’t think it’s right; I think it’s wrong. The reason major record labels are pushing for this is that they’ve been consistently losing market share for the past five years [due to the volume of releases coming out via DIY platforms]. They’re trying to find ways of regaining that lost market share through higher value, but I don’t think it’s the right way to do it.

You’ve been a supporter of Spotify’s Discovery Mode, which lowers royalty rates in exchange for organic-type promotion of artists who apply for it. What’s your latest view on it, and of the criticism it gets from the independent community in particular?

What I’ve been recommending to Daniel [Ek] and Spotify is for them to automate all of their media-buying tools, wherever it’s Marquee, whether it’s Ad Studio, whether it’s Spotify Discovery, and create APIs for them, so that we can use them at large scale. I

would love nothing more than to be able to invest much more money into Spotify than we do today. All of our experience shows us that the return on that investment for developing artists when using these tools is great.

When you look at the P&L of any of the major record labels, the ‘marketing and promo’ line is still one of the most significant areas of investment. And when your audiences become digital, the best way to spend money is where the audience is already listening to music. So, yes, we’ve been a big supporter of Spotify Discovery, because Spotify Discovery is pushing discovery of our artists to users that would not otherwise have listened to them as it supports revenue growth.

Is Spotify doing enough to keep a clear line between Discovery Mode and what was once called payola?

It’s a really good question. And I think the way they’re framing it right now is correct: this is not guaranteeing airplay. In our experience, Spotify Discovery puts the user at the center of the experience: [Speaking as Spotify] ‘I’m not able to guarantee anything [to the Discovery Mode artist] because I first want the user to be satisfied. If the user starts skipping a track [the platform recognizes] I shouldn’t be marketing that track.’ And then it’s about being very clear to the user that [the Discovery track] is a sponsored track. But I think the

way it is being done now aligns with how you would do traditional marketing, rather than payola.

A few people have raised concerns the flat fees being paid to rightsholders from the likes of TikTok every few years. The worry is, that lump sum, eventually, won’t recognise how much business music has created for these platforms. What’s your view?

I’m smiling at this question a little, because we started our renegotiation with one of these platforms – a large short-form video platform – about three or four months ago, and we asked what you describe: ‘You are great, but you’ve been paying us a flat fee for our music, which is fine in the beta phase. But now we want a rev share agreement [and associated reporting tools] like YouTube does for Content ID.’ We started that negotiation.

And then [this video platform] began another negotiation, with another company, a larger music company than Believe. And I’m told that company said to them: ‘We don’t want a rev share. We want a check – today.’ Then [the video platform] came back to Believe and said, ‘We’re going to pay you a check too.’ So the short answer to your question is, yes, I would like that, but unfortunately we are following rather than leading on that discussion.

What happens when I compare what some of these platforms are paying us versus what we should be getting? When we compare the volume of music usage to the size of checks? Even considering the size of the checks we get, I don’t think they are at the right level. And we’re going to fight tooth and nail to get them to the right level.

This interview originally appeared on Music Business Worldwide in July 2022.

“I KNOW THE MAJOR RECORD LABELS ARE PUSHING FOR LOWER RATES FOR [DIY] ARTISTS. I THINK IT’S WRONG. ”

Over the last few years, Swizz Beatz has, he tells us, been preparing for his career 2.0. The first twenty years, during which time he’s produced for the likes of Jay-Z, Eve, DMX and Beyoncé, were just a “warm-up”.

“I haven’t even started yet,” he says. “You start when you understand what you have and what your power is. Now it’s a fair race because I own my power.”

That power has been realized as a result of gaining a greater understanding of business by spending three years at Harvard University Business School, which Beatz says will be leading to him launching new platforms and ventures.

One of those has already arrived — pandemic hit Verzuz, which Beatz started as an online live music battle series on Instagram in his garage with Timbaland.

After evolving into a livestream platform of its own, Verzuz was acquired by TrillerNet in 2021 and is on track to go public as TrillerVerz via a reverse merger between holding company SeaChange and Triller.

He’s also recently executively produced the soundtracks to TV series Godfather of Harlem and Queens and is now back in the studio working on new music, which he says he’ll be using to collaborate with artists soon.

Beatz explains: “What I like to do is make like one hundred new beats and then I sit down with the artist. I want to make sure I have what I need first to present — I want to call the artist because I’m excited.”

Growing up in the Bronx, Beatz was surrounded by music from an

early age and he first started out as a DJ.

“The DJ is what caught my attention because the DJ was really controlling the crowd, for the audience and the rappers,” he remembers. “I was like, that guy has a lot of power and that’s a cool job, you’re able to play all the hits.”

While making his mixtapes for DJ sets in his mid-teens, Beatz started making his own intro beats, which caught the attention

Busta Rhymes and Jadakiss before a summer trip to New York resulted in the hit that changed everything.

Beatz was invited to spend time at Ruff Ryders, which is when he met DMX. The two struck up a friendship and the first track they worked on together was DMX’s Ruff Ryders’ Anthem

He says: “That was the gamechanging song. I remember sitting on a fire hydrant, listening to every car passing by on 125th street playing the song and that’s when I felt like I finally did something big.”

Here, we chat to Beatz about growing up in the South Bronx, his approach to production, working with artists and much more besides.

of other DJs who started asking him to do theirs.

His uncle, who co-founded US label Ruff Ryders, suggested that Beatz start taking production seriously and the idea was planted.

He says: “I was like, ‘What’s producing?’ because there weren’t a lot of producers at the time that I was looking up to. The producer was like the engineer — way, way, way behind the scenes. But that’s how it started — as a DJ and then I got into producing by default.”

Beatz learned his production skills by spending time with the equipment while in his room (“a lot of time on punishment”). His early career involved producing for artists including Noreaga,

I read that you had a difficult time at school. Can you expand on that?

I didn’t have a difficult time in school academically, I had a difficult time at school because of the environment that I was in. I got into a little bit of trouble here and there, which comes with the area that I lived in and the person that I am. I wasn’t going to let [people] run all over me and have their way because then it would lead to a bigger problem.

What was it about the school environment that was difficult for you?

It was the South Bronx and a very low-income area. When I would defend myself, I would have to go to another school so I was moving further and further away from my comfort zone. That made it even

“THERE WEREN’T A LOT OF PRODUCERS AT THE TIME THAT I WAS LOOKING UP TO.”

Swizz Beatz: ‘Music has always been my safe haven, it kept me off the streets and it kept me dreaming big.’

Credit: Nigel Parry

harder because those people that I was going to these new schools with, I didn’t have a connection with. If I’m pushed to three other schools way out, I probably know like 2% percent of those people, they’re all familiar with each other and I’m the outcast and then I’ve got to defend myself from being the outcast. It’s just a revolving door that you can get caught up in growing up in those particular areas. But thank God that music led the way and that I knew how to carry myself and survive in the jungle. Music has always been my safe haven, it kept me off the streets, it kept me occupied and it kept me dreaming big.

How do you approach production? Do you have a specific process?

The process is just being free in the studio. I don’t have any pressure on me going in — I’m not like, ‘I’m going to make a hit’ because if you say that, eight, nine times out of ten you’re definitely not going to make a hit. If you just let it flow, you know what people want and you can feel the elements, it will naturally happen.

Where do you draw inspiration from?

I draw inspiration from everything. I listen to all types of music from around the world and I don’t listen to too much rap because it helps me when I produce rap. Trying to be like everyone else on the radio and trying to give people the same thing, which a lot of people actually want, I can’t help with that. When I did Stop Drop [DMX’ Ruff Ryders Anthem], everybody wanted Stop Drop and I was like, ‘That’s done already, I can’t give you that’. That was one of the things I learnt early — not to have the pressure of your last hit because it might be your last. You’ve got to move forward.

Is there anything you’ve learned about how to get the best

creatively out of the people you’re working with in the studio?

Honesty. I tell artists, no matter how big they are, ‘I don’t think that verse is special’ and I’ll tell them why as well. I have great communication with the artists, not necessarily telling them what to do, but explaining the creative process of art. It’s like, ‘When you did this cadence, it sounded better like this, but when you did this, it took me away from the song’. My thing is, ‘You can try it and if it doesn’t work, it doesn’t work and if you don’t want to try it, you don’t have to try it either’. I always leave it in the artist’s hands to do what they feel is best but I’m going to say what I need to say because that’s why I have my job.

A lot of people will just say anything to be on the song but I’ll decline being on the song if I don’t feel that it’s right. I remember hearing Jay-Z’s 4:44 album and he was like, ‘Do you have anything for it?’ but I thought the record was so perfect there was nothing for me to do. Most people would jump on the record and ignore that it’s already a perfect project. You have to know when to get in and know when to step out — that’s part of being a real producer. Most people just want to do anything and that’s not what’s going to help you in the long run, you have to do magical things.

What’s the best piece of advice you’ve been given in your career? Maintain, stay humble. A lot of people start believing what people are telling them they are instead of actually knowing who they really are. A person could tell me whatever, I know who I am so I’m good.

Do you have a most memorable studio session or artist that you’ve worked with?

I would definitely say every session with DMX is memorable,

crazy and fun. We’ll listen to a bunch of old school music, he’ll sing a bunch of old school songs and that’s how we got into our vibes. We’ll create the zone and then he’ll be ready to go.

With producing, you can’t just throw artists in cold. You’ve got to warm up the studio session, you’ve got to warm up the energy and I know how to do that with him, with Jay, with Buster, with everybody. It’s about creating a friendly environment and then taking it to the next level.

Do you have a toughest

DMX

production job? If so, is there anything you learned from that experience?

Doing things that your gut instinct is telling you not to do — sometimes that’s a tough thing. You sign up for something which you know you didn’t really want to do but you’re being nice and that whole session and energy is just dreadful. I don’t do those any more. You have to listen to your gut because it’s not worth it, not even the money. It’s like, okay, the money is cool, but how do you feel? You feel silly. Some hits came out [of those kind of sessions] but I know the

backstory on a lot of them and I’m like, it could have been better. But I’m a Virgo so that’s just me naturally.

Your career came of age during a historically legendary time for hip hop in the US. What do you make of the modern hip hop music scene?

It’s amazing. Everything is going to take its turn, if everybody was doing today what we did yesterday, that means there’s no progress. I love today, it’s a whole new sound, a whole new look, a whole new energy. It’s up to us to keep up with that progress.

Verzuz has been a huge success story during the pandemic — what’s the future for the series and how are you navigating the challenge to keep it relevant now the world is opening up again?

That’s not a challenge for us — the world’s been open and Verzuz is not a thing of the past. We already proved that it’s not just a pandemic moment. It’s gotten so big that we’re in the middle of setting up our structure and hiring amazing people, like Steve Pamon [as President].

We have so many verticals and mega-big Verzuz that we’re about

Credit: Gennadiy Kravchenko / Alamy

to announce. It’s the biggest online platform for performances, period, and we have to staff up quick and take time out to really respect and represent that because it’s not just a show that’s on Instagram anymore.

Here’s a big picture question that we ask everyone: what would you change about the music industry and why?

The only thing that I would change about the music industry is the [royalty] splits with streaming. I feel that we should sit down, as an industry, and have a conversation about certain ways things are paid.

We know that labels put a lot of money into artists, so they definitely have to recoup, but what’s the plan after that? Perhaps we could come up with different strategies that mean when you perform on a certain level, it unlocks different things.

you’re disgruntled and it’s become uncomfortable to do music. Don’t wait until it gets to that point. Have some representatives sit down and make sure they explain it to you so you have an understanding and there’s no surprises.

Did you have a handle on the business side of things in your early career? Or was that something you had to learn the hard way?

None of us have a handle on business in our early career because we never even knew we were going to have a career. I’m telling you to prepare because I wasn’t able to prepare for it, I was just having fun.

Most people coming in, they are having fun and they sign away thirteen albums and on the fourth album, it’s like, ‘I’ve got the No.1 record in the world and I don’t have any money’. That’s

Kanye, Dr. Dre — all of us have individual sounds. So for all of the producers, create your own energy that the world will know you by and if it’s done, it’s done already.

Doing things that have been done already can get you in the door real quick but the journey is going to be real quick as well. Take the risk. I took the risk and stopped sampling and started messing with synthesizers and that’s what made my sound different.

You’ve achieved a lot in your career but do you have any other ambitions you’d like to tick off?

I haven’t even started yet, that was just a warm-up. The reason that was a warm-up was because I was so young I didn’t understand but now I’ve invested in myself by going back to school. I was at the Harvard [Business School] program for three years and I know how to strategize. So now, it’s a different story. I’m like, ‘How can I have started then when I didn’t understand what I was doing?’ You start when you understand what you have and what your power is. Now it’s a fair race because I own my power.

I’d change the old program and bring some new energy to it.

Are you hopeful that will change in future?

Yeah, I just hope that the conversation with the creatives and the business counterparts gets closer because right now, there’s a lot of people in the middle so the artists don’t get to know 100% [what’s going on]. But artists have also got to be willing to learn and understand the music business. I know you want to do music all day but this is business, so I encourage all artists to learn the business, not only thinking about it when it’s too late, when you’ve signed something you don’t like and

when everything hits you. I went to the Michael Jackson play with my kids the other day and the one thing that keeps coming up when we see [the stories of] all of these greats is financial problems. When I look at that, I’m like, man, we all fell short with the educational part.

Aside from learning about the business side of things, is there any other advice you’d give to someone starting out as a producer today?

The reason why I’m here is because I was being as original as possible. If somebody had anything close to what I was doing, I would erase it. The same goes with Timbaland, Pharrell,

What can we expect as a result of that?

Amazing platforms like Verzuz and many more things. Verzuz started in the garage and we’re talking about an IPO. That wasn’t a freestyle, you have to know how to do that.

That’s why I always say education is important because without education, Verzuz would have been gone, it would have been something just for the pandemic but the reason why it’s not only for the pandemic and we survived a year strong after the pandemic and moving forward is because of education.

This interview originally appeared on Music Business Worldwide in May 2022.

“I WAS AT THE HARVARD [BUSINESS SCHOOL] PROGRAM FOR THREE YEARS, AND NOW I KNOW HOW TO STRATEGIZE.”

Scott Pascucci and Bob Valentine

Concord turned down a

where it’s going next.

You can usually tell when a music company is up to Big Stuff –because their name will keep appearing in music business media headlines. At least, that’s the traditional logic.

Because there’s actually a counter-intuitive way to tell when a music company is up to Really Big Stuff: when they go quiet to a suspicious degree.

That’s precisely what happened

at Concord following its $400 million acquisition of Downtown Music Holdings’ copyright portfolio in May 2021.

For the next 12 months, MBW barely received a business announcement from Concord’s communications dept. Yet behind the scenes, in hushed boardrooms away from the ear of the wider business, Really Big Stuff was indeed going down.

During that year-long period, Concord (and its majority owner, the State of Michigan Retirement System) welcomed in – and chewed over – multiple offers for the sale of its company. The firm was reportedly only ever interested in considering an “extraordinary” offer with a firm threshold: more than $6 billion.

Considering Concord’s postDowntown annual revenue sits at

roughly $600 million – with EBITDA expected to land in excess of $200 million in 2022 – a $6 billion acquisition offer really would have been “extraordinary”. (We’ll save you the math: It’s somewhere near to a 30-times multiple of profit.)

The offers got close, however. According to Bloomberg, Concord was ultimately offered somewhere north of $5 billion, said no, and packed away discussions. Which begs the question: Where does Concord go from here?

“We’re now working on a new five-year plan to grow the company dramatically and aggressively,” Concord CEO, Scott Pascucci, tells MBW in an exclusive interview.

Elements of that plan are already coming together quickly:

• During 2022, Concord announced its eight-figure acquisition of Aussie music publisher, Native Tongue;

• News also slipped out that it had acquired the catalog of Los Angeles-based, L.A Reid co-founded pop factory, HitCo;

• In addition, Concord spent somewhere around $300 million buying the publishing and recorded music catalogs of Tony Banks, Phil Collins and Mike Rutherford, as well as the publishing and recorded music catalog from their years in the band Genesis;

• And MBW understands that Concord was – and may still be – in the running for one of the biggest single-catalog deals in history, from Pink Floyd.

Concord, then, is very much back in M&A mode. Which perhaps shouldn’t be a surprise for a company that spent an estimated $1 billion on acquisitions during its first 14 years in business, before spending two nine-figure sums acquiring a majority stake in Pulse Music Group (2020), and

then the Imagine Dragons publishing catalog, before acquiring that Downtown’s copyright portfolio (2021).

MBW sat down with Concord CEO, Scott Pascucci, and President, Bob Valentine, to get the inside track on the company’s discussions over selling – and its ultra-aggressive return to music’s M&A marketplace...

point where they said: ‘You know what, we have a fiduciary duty to all of our pensioners to explore this. We have an obligation to find out what Concord is really worth.’

So Michigan said to us ‘let’s test the market’. Through the process, we had a bunch of companies that were really interested in putting proposals on the table. All of those proposals were well north of $4 billion.

Lay it out for us: Why did you decide to explore a sale, why didn’t you sell, and what does that mean now?

Scott Pascucci: The State of Michigan Retirement System started investing in [us] as Bicycle Music some 14 years ago, and their investment has continued to grow. They’ve always been an incredibly steady source of capital, and very supportive. Their equity interest in Concord has increased over the years and is now over 90%.

Never once in that long run did Michigan ever say, ‘We want to

But we had started the whole process skeptical that we would do anything, and so it proved.

You wanted $6 billion minimum, right? That was your “extraordinary” number?

Pascucci: There’s always a number at which you have to sell anything. You might own a lovely house with your family; that house is not for sale. But if someone offers you $10 million for it, you might become a seller!

We got great offers, we didn’t counter anybody. And we said, ‘Okay, that was very informative. We’ve learned a lot

sell Concord.’

They fund pensions, which carry 20/30/40 year time horizons. There was no reason for them to think about selling. They always loved our business; they always told us they were in this somewhere between the long haul and forever.

But in late 2019 they started getting a lot of phone calls from people [who were] saying they wanted to buy Concord. These are people operating outside the music industry, historically speaking.

Finally Michigan got to the

about the company. We now have a very good sense of what it’s worth as a floor – and that’s a very high number.’ That was the end of the story.

We’re now working on a new five-year plan to grow this company dramatically and aggressively.

Where is the funding coming from for that aggressive five-year plan?

Pascucci: Michigan has never backed off on their support of us financially. The growth capital [Concord uses] going forward will

“WE GOT GREAT OFFERS... [BUT] WE’RE NOW WORKING ON A NEW FIVE-YEAR PLAN TO GROW THIS COMPANY DRAMATICALLY AND AGGRESSIVELY.”

be a combination of Michigan and maybe some debt financing.

Maybe we will take in some outside minority investors too –that’s to be determined. And we’re getting big enough now that a lot of deals we can just do under cash flow.

Bob Valentine: Plus we have access to a revolver [fund] with 13 banks involved.

There’s plenty of capital [Concord] can access from Michigan, but there’s been a couple of large deals recently come up that could [potentially require additional capital].

Tempo Music is a private equityowned music company looking for an exit after less than five years. Does that make you thankful for having a longerterm class of investor?

Valentine: Absolutely. Having a shareholder like Michigan investing in these assets is the best possible scenario for a company like ours. Because the time horizon that they think about things is just so much greater than anyone else in the marketplace.

We’re in an environment right now where interest rates are going up, and we all see what’s happening with inflation. The big question in the music market: Is this going to put a damper on valuations in music?

My answer: If you’re running a financial model that had an exit planned sometime within three to five years, probably yes.

But I don’t think it has the same effect if you are looking at things from a 15 or 20-plus-year time horizon.

How does Concord continue to win deals in such a competitive M&A space?

Pascucci: Everybody likes catalog assets for publishing, us included. But recorded music assets are more complicated to on-board

and to manage. So we tend to have an edge there.

And then if there are goforward relationships with writers or artists [involved in deals], because we’re a real music company – we’re not just a financial investment vehicle – that also tends to give us an edge.

There seems to be more master rights deals starting to become available – and not just Pink Floyd! Artists from various eras seem to be recapturing ownership of their records. Kate Bush, for example. I remember when Concord did a deal to distribute the ‘Warner Bros’ R.E.M catalog. That was one of the first big ones in the trend.

Valentine: Masters have traditionally not traded [in the M&A marketplace] because the majors owned most of the good

back the first part of your catalog 15 or 20 years from now, if you’ll do another three records for us.’

Those rights, in a different era – the streaming era, not the CD era – are now returning to those artists. We believe that there’s generally still more upside in buying masters and exploiting masters [than publishing catalogs].

Concord was buying masters well before many other companies started buying masters, and we’ve built up a real record company.

Pascucci: The newer entrants into the music business won’t be able to pursue these [premium recorded music] assets because they’re not set up [to service and distribute] them. Plus it’s still harder to sub-contract out the management of masters than it is in publishing.

What would you like people to understand about Concord?

Pascucci: People don’t quite know how to view us, and that’s often because they want to pigeonhole us into somebody else’s category. We have worked very hard to build something that does not fit somebody else’s category!

stuff. But we’re now getting into a world, a window, where contractual reversions are [kicking in].

Whether it was 15 years ago or 20 years ago, a lot of these significant acts got their masters back, because they were in scenarios like this [during the CD era]: They’re on their third contract with a major, and the major says, ‘Fine, we’ll give you

We’re not a major. We’re not trying to be a major. We’re not a small indie. We’re much bigger than that. We’re neither just a record company nor just a publisher; we’re much more diverse than that. We are not an asset acquisition machine. We have bought a lot of assets, but it was for a purpose – because we wanted to build a music company, and really viable successful music companies have a strong catalog foundation.

We’ve built something that we believe is unique.

This interview originally appeared on Music Business Worldwide in September 2022.

“CONCORD WAS BUYING MASTERS WELL BEFORE MANY OTHER COMPANIES STARTED BUYING MASTERS, AND WE’VE BUILT UP A REAL RECORD COMPANY.”

Phil Collins, Tony Banks, and Mike Rutherford

Credit: Patrick Balls & Martin Griffin

Martha Earls has defied the odds with Kane Brown — a tattooed biracial country act who first found fame via social media.

He’s not the kind of artist who fits in with the traditional Nashville community, and, as Earls tells us, that resulted in doors at key gatekeepers

remaining closed until his success couldn’t be ignored.

“When we released his first single to radio, which was already a gold record just based on Kane’s popularity on social media, I remember sitting in the office with a colleague of mine and we were like, ‘This is going to be the

fastest hit that’s ever happened on radio,’” Earls remembers.

“And then it wasn’t. That was a pretty abrupt wake-up call. But it was a good thing because you can’t ever have too many expectations or assumptions about what’s going to happen.”

In the meantime, Earls focused

efforts elsewhere, which was mainly through social media in the early days of Brown’s career.

Eventually, radio came around and Brown now has eight No.1 hits at country radio. His success also spans three Top 5 albums on the Billboard 200 and country chart, three AMA Awards, and over 4 million ticket sales.

Earls adds: “Kane went out there and demonstrated his fan connection.

“[Radio programmers] met him, he broke down their preconceived notions of what a country artist looks like, and I think that really opened up the door for a lot of people.”

Earls met Brown early on in her management career, which started eleven years ago by helping to look after artist, Greg Bates.

That followed a decade in music publishing, during which time Earls held roles at Warner Chappell Music and BMG, before starting her own ventures.

With the first company, Earls’ writers had cuts with Blake Shelton, Rodney Atkins and Rascal Flatts with Natasha Bedingfield before the company was sold back to its investor.

Her second, which was sold to Big Machine (where she spent some time during the transition process), kickstarted Earls’ foray into management, and working with Bates made her realize that’s where she was happiest.

She explains: “It’s really hard to start a publishing company from ground zero and build it — you’re really just sitting around and waiting for your songwriters to write a hit and nurture them in that process.

“For me, I’m so results-oriented and action-oriented and I’m an opportunist in the best sense of the word. So it wasn’t the pace that I like to operate at.”

Today, Earls heads up music company, Neon Coast, which has a management division,

production company and a joint label venture with Sony Music Nashville and Sony Music Publishing.

Alongside Brown, management clients include country acts Restless Road and Dylan Schneider, and pop band Nightly.

Earls tells us that she’s looking to grow the roster with a female artist and is focusing on company expansion.

Here, we chat to her about her approach to management, lessons learned across her career, and how being a parent influences what she does.

How has your background in publishing shaped your approach to management?

Being respectful to the creative process and understanding the value of the artist as a person and the songs as art. Sometimes, when you’re a few steps down the chain, people tend to see the artist as a commodity and don’t understand that there’s a person behind what they are selling. Also, you can have all the other elements that you think will work, but without great music, you’re wasting your time.

To have that foundation on the creative side is the most beneficial thing to me. I have no regrets for how much time I spent in music publishing because it was such a tremendous education for respect for the process and

respect for the creatives. Some people don’t have that experience.

You were at Big Machine when Taylor Swift was releasing Red. What did you learn about artist development during that time?

Scott Borchetta didn’t put any boundaries on what he was doing. That became ingrained in me. Taylor Swift, to me, is the ultimate example of an artist who can start as one thing and blossom into the full representation of themselves as an artist, without any boundary, and continue to persist while there’s naysayers. Anytime you’re that artist who’s a bit disruptive, it makes people uncomfortable, and they start dissenting.

Seeing Big Machine stay so mission-focused while releasing that project, knowing innately how successful it was going to be and not allowing themselves to be deterred by people that couldn’t keep up pace or were uncomfortable because they were doing something different, was so inspiring to me.

What are the other attributes that make a good manager?

The personal attribute that I can speak of is to be big-picture thinking, while also understanding the steps that need to be taken to get to the end goal. You can be at 30,000 feet and have this big end goal, but if you can’t jump from step one to step 10, you have to take all the steps in between. So it’s about being thoughtful about a plan and then every time we have success, seeing that as an opportunity to build, rather than a destination.

I always love an actionable step. If I get off a call or come out of a meeting and there’s no actionable step to take, I feel like it was a waste of time. It’s the same helping artists with their careers — if we have something

“SCOTT BORCHETTA DIDN’T PUT ANY BOUNDARIES ON WHAT HE WAS DOING AT BIG MACHINE. THAT BECAME INGRAINED IN ME.”

Kane Brown

great that happens, let’s take action and do something more.

Do you have any examples of how you’ve done that?

Yes, Kane had a big hit with Marshmallow on a song called One Thing Right and instead of letting that be its own isolated moment, it was, ‘How do we grow his fan base outside the traditional country fan base?’ We started with Marshmello, so what’s the next opportunity to reach more people? With Kane, if we put him in front of people, they love him. So we just need to expose him as widely as possible. Then it was about finding the next Top 40 record, which in that case was Be Like That [with Swae Lee and Khalid].

Another example is that Kane has a strong presence in the sports world. The first thing we did was a commercial with the NFL and New Era. We built on that by him performing at the halftime of the Dallas Cowboys and now we have a strong relationship with the NFL.

One more example: right before the pandemic back in January of 2020, he played the Staples Centre, which is now the Crypto. com arena, in Los Angeles. He sold it out, it was tremendous. I was sitting with his promoter the night before the show and he said to me, ‘We should do more of these’, almost kind of joking. I was like, ‘No, we should do all of these’. And that was where the idea for the NBA arena tour came from. Kane is the first country artist to tour all 29 NBA arenas in a single tour, which he did last year. It was a massive success.

I read that you know you don’t have to do things in the traditional way. What does that mean in practice?

This has all been altered slightly with social media and the record label’s dependency on TikTok, which is a whole other

conversation, but when Kane first started, there was this template for how you have a successful career. You have a hit on the radio and then you released your album. And maybe, on the highest of hopes, you have a song that’s a big enough record to be played on pop radio.

But with Kane, he didn’t have immediate success at radio, because country radio programmers, five, six years ago, made preconceived notions about him based on his race. So we had to adapt. We put his first album out and he had a No.47 song, falling off the chart. But we figured out non-traditional ways to reach fans.

Fast forward to today, no artist

don’t do things the traditional way the industry tends to give you some backlash. Kane’s never been nominated for a CMA award for his own music. It’s crazy. He’s one of the biggest stars in the format and has never been nominated because he makes people uncomfortable, I guess.

That said, the way you do it is with great music and authenticity. With Kane, whether he’s doing a pop song, or a country song, he’s only doing music that is authentic to himself. And he knows himself probably better than any other artist I’ve ever met. There’s no wishy-washy, ‘Oh, maybe I could do this, maybe not’. He knows definitively who he is. I think that’s an important element.

And at the end of the day, he is a country singer, but he’s a cultural crossover. So it’s just reaching those people that he crosses over to. With him in the early days, it was through social media. He’s the first Nashville artist to really break through on social media and speak directly to his fans.

has done what he’s done. He’s had four hits on pop radio that were never played on country radio, he’s had eight No.1s on country, and they are completely different songs. No other artist that I know of has been able to navigate both of those worlds and have these almost dual careers. But I think it’s simply because everyone says you can’t do it. Hopefully we’re an example of how you can.

How did you reach those people without the traditional routes to market?

Yeah, and also with the backlash, because that’s part of it too. If you

Like you alluded to, the route to breaking an artist has shifted now from radio to record labels spending marketing dollars on platforms like TikTok to create ‘viral’ tracks. What do you make of that approach?

It’s complicated. Social media, regardless of the platform, is incredible because it’s an equalizer and it allows the consumer, the fan, to choose what they like, rather than a record label saying, ‘Hey, this is the song we think that people need to hear and we’re going to release it to radio and determine whether you can hear something or not’. So it’s definitely democratized the process for reaching fans and also gives artists a direct connection to fans.

What happens, though, is whenever something starts

“NO ARTIST HAS DONE WHAT HE’S DONE. HE’S HAD FOUR HITS ON POP RADIO THAT WERE NEVER PLAYED ON COUNTRY RADIO. HE’S HAD EIGHT NO.1S ON COUNTRY.”

working, and I hate to sound like I’m dogging the labels, but unfortunately it’s part of their business model to try and figure out how to manipulate it to their benefit. That’s where I think it starts to get a little foggy. Because all of a sudden, you have 20 people weighing in on what the artist should be saying on their social media to their fans. Doesn’t that defeat the whole point of what we’re trying to do?

Also, people are signing moments – 15 seconds of a song being popular — without a plan to develop a long-term career for the artist they’re signing. That’s

for better or for worse, and for me it’s definitely for better, whether it’s marriages, jobs, friendships or just your worldview.

FUNNY HOW SOCIETALLY, THEY’VE TRIED TO TURN MOTHERHOOD INTO A WEAKNESS. DEEP DOWN, IT’S A VERY POWERFUL THING. ”

troublesome to me because that implies these artists are disposable people. ‘Oh, you had a hit, we’ll sign you. You don’t have another one? Whatever, we’ve moved on.’ Are you really giving them everything they need to have the most successful career possible? I do have some concerns with that.

As you mentioned, you’ve been a parent the whole time you’ve been in management. How does that influence your work? My two daughters make me better at my job because I am more compassionate and more patient with people. As soon as I had Avery, my eldest daughter, I started having to manage my time better and prioritize things better. I never realized how much time I wasted before or conversations that I had or things I put emotional energy into. I didn’t have time for that after I had my daughter and it made me much higher functioning. It’s fascinating how kids affect things,

It is. You hear a lot about the downsides of parenting before you become a parent but there’s also the positive side of it; how it offers so much opportunity for personal growth and prioritizing what’s really important. Yes, and as clichéd as it sounds, you’ll figure out what really matters. When people say that to you, it tends to be in a patronizing way like, ‘You’ll figure out that what matters to me will now matter to you’. But that’s not the case. All of a sudden, you gain a wild sense of self. There’s a power that comes from within you that you have this child and there’s a bond there that no one else on the planet, not even the father of the child, can understand. It’s very empowering. It’s funny in a way how societally, they’ve tried to turn motherhood into a weakness. And I think that’s because deep down, it’s a very powerful thing. Maybe the patriarchy is afraid of that.

What’s the best thing about working as

a manager?

The best thing about being a manager for new artists is their success is truly your success. Watching, with new artists especially, a lifelong dream come true and being a part of that is so satisfying. Seeing someone you truly care about deeply, that you’re financially and emotionally invested with, having success and having their dreams come true, is amazing.

Once the career gets rolling, it’s being able to influence culture. And then it’s also all these amazing experiences that I get to do. I was talking to someone about how in this week-long stretch we went to the Grammys and the Super Bowl and we just started laughing. We were like, ‘This is crazy. The stuff that we get to do is like, it’s like a dream.’ I also got to go to Australia for two weeks and it was a dream.

And the most challenging thing? When you work with someone and you know how talented they are and yet, for whatever reason, they’re not breaking through. Setbacks are really hard. I take it as a tremendous personal responsibility and I beat myself up, probably a little bit too much, when I can’t make something happen for somebody who I know deserves it. That’s tremendously frustrating.

Is there any other advice you’d give to someone early on in their career? Anything you wish you’d known before you started out? Just showing up is critical, and being enthusiastic and respectful. It’s an interesting balance of walking the line of offering your opinion on something but not overstepping. Early in my career, I was pretty aggressive in my opinions. In retrospect, maybe I should have offered those opinions but perhaps said, ‘Hey, would you like my opinion?’ versus just going in there, guns blazing. But I definitely think that having an opinion, speaking up, and being passionate about the work and the place where you’re working will get you far. Those are the types of people I like to hire; people who are passionate and who I can tell truly care about what we’re doing.

This interview originally appeared on Music Business Worldwide in October 2022.

“IT’S

THE MOST EFFECTIVE MUSIC INDUSTRY JOBS BOARD IN THE WORLD

Meet The AI expert patenting technology for Ingrooves Music Group

We’ve called SK Sharma an ‘AI expert’ in the headline above, but it hardly does him justice.

We could have just as easily called him an expert on theoretical chemical physics, marketing analytics, computational biophysics, or antimicrobial therapeutics Granted, ‘AI expert’ was snappier.

In his twenties, Sharma –who grew up in Watts, L.A, and attended the same school as NWA’s Eazy-E – graduated with a Ph.D in Chemical Physics and Biophysical Chemistry from Caltech.

He went on to create medical pharmaceuticals, before turning his hand to analyzing markets for the likes of Goldman Sachs and Lehman Brothers.

Along the way, he began managing investments, using data science to help guide his clients’ money. Amongst his early bets? Tesla, owned by that shrinking violet, Elon Musk.

From there, Sharma (pictured) went on an impressive run as an entrepreneur: To date, he has either been a co-founder or a Partner / equity owner in four startups, in multiple fields, that have each exited for over $100 million.

And then, in 2016, he took a sharp turn into the music business – joining Ingrooves Music Group, the global distribution and services provider for indie artists and labels.

Sharma was hired by thenIngrooves CEO, Bob Roback, to lead Ingrooves’ development of patented technology.

The aim of this patented tech was not only to help independent artists perform better on streaming platforms, but also to give Ingrooves itself a

crucial USP against its rivals in the competitive world of distribution and services for indie artists and labels. So far, that mission is going rather well: Ingrooves first successfully patented tech underpinning its ‘Smart Audience’ platform in 2020.

In April 2022, it announced that it had won its second US patent for further developments on this tech. The company claims that Smart Audience now drives a volume of streams for artists amounting to more than double the plays they would have received via traditional digital marketing methods. [Since this interview, a third patent has arrived – this time for tech that can analyze trends on short-form

Could you briefly explain what Ingrooves’ patented technology actually does?

In a nutshell, the way we think about our second patent –which encompasses a Smart Audience platform – [is] really about analyzing the way that a particular piece of content is being consumed with respect to something like source of play. So you can think about active [listening] versus passive [listening] in that regard.

This analysis effectively informs targeting that reaches both a currently engaged audience of a track – and obviously nurtures that engagement further. But [it] also starts to identify audiences who have not yet been strongly

video services like TikTok.]

It’s an interesting time at Ingrooves right now: the company, which has rapidly expanded globally since being acquired by Universal Music Group in 2019, recently became part of Virgin Music Group –Universal’s flagship global services division – following the departure of Roback.

Here, SK Sharma discusses Ingrooves’ strategy, the music business’s relationship with technology – and why, in his view, the “defining characteristic of success” for any new-fangled inventions in music (see: metaverse, NFTs etc.) is “going to be separating the bullshit from the facts”...

exposed to that track, but are nevertheless highly likely to engage with that promoted track, given their current consumption patterns. So, in a nutshell, [it’s] a lot like Netflix.

That’s not ambitious at all! Why was Ingrooves so determined to develop patented pieces of technology? And why was it important for that to be developed internally as opposed to externally?

A big part of that for us early on – and this obviously predates the UMG acquisition in 2019 – was to really think about an opportunity where we had to be smarter than everyone else. We had to use what was, at the time, a set

“WE’RE A BUNCH OF SCIENTISTS, ENGINEERS, AND MATHEMATICIANS – AND WE’VE BUILT SOMETHING INCREDIBLY VALUABLE.”

of creative skills to think about how we wanted to enable our artists and our labels to ‘win’ in an [industry] that was changing very quickly [with] all sorts of retailers coming online.

There were a lot of conversations about how to get your music heard, or how to grow your audience, but there was very little actually being done, frankly, outside of say, Spotify, to demonstrate to artists and labels that there was real value in going down this path. We took it as a challenge.

We’re music lovers. I came from outside the music industry, my entire team came from outside the music industry, we’ve come to be extraordinarily thankful for the opportunity to work in the music industry.

But after a while, we realized: we’re a bunch of scientists and engineers and mathematicians, and we’ve [built] something that’s incredibly valuable. It makes sense to own that. And it makes sense to iterate and make that better and smarter over time, as opposed to simply relying on someone else who frankly, may or may not really love the music the same way we do.

How has Universal’s acquisition of Ingrooves – and subsequent investment in Ingrooves – allowed you to play on a different level?

We’re very thankful to the leadership team at Universal Music Group: Bob [Roback] has been very clear about thanking [UMG Chairman/CEO] Sir Lucian Grainge, and [UMG CFO] Boyd Muir, in particular, for their continued support of our business.

[The UMG deal] has really catalyzed our growth in the sense that it’s expanded our access to information. And it’s expanded our action space as well.

Previously, our algorithms, while extraordinarily robust and

scalable, were based on the data that we had adding groups. Now we have access to the richest set of music data in the entire world, courtesy of our parent company. It’s made us smarter, and more prescriptive.

We’re able to interrogate hypotheses in a much more expansive way, and partner very collaboratively with [our] colleagues that UMG. The whole thing just gets better, smarter, quicker, faster.

Could you just give us a flavor of your background before you came to the music business? Absolutely. I have a PhD in Chemical Physics and Biophysical Chemistry from Caltech. I’m actually a physicist by training; I’m a drug design scientist. So I’ve got 14 or 15 peer reviewed publications, in fields that have become much more relevant to people these days – given the pandemic, obviously.

But I’ve worked on small molecule antagonist design and designing peptide therapeutics, and had a successful therapeutic drug in clinical trials.

I [then] broke away from that, I worked at Goldman Sachs and worked at Lehman Brothers. I was a quant, I was a bit of a bond trader for a while, I worked in Switzerland, and was the Chief Investment Officer for a venture capital fund. And at some point I

worked as a strategy consultant.

So I’ve done a couple interesting things that really just sort of driven by my desire to solve problems, and work with people I really like working with.

So I’m extraordinarily fortunate that there’s no shortage of problems to solve in this business! And I’m incredibly thankful for people I get to work with at Ingrooves.

When you came into the music industry, what were the things that bemused you? what took you aback in the way that the music industry worked, particularly as it pertains to its relationship with technology? I’ve been incredibly humbled by listening to folks and learning from people. But, as you say, there’s certainly things where you scratch your head and go, ‘Did that really happen? Did someone just say that?’

I think initially, that was [because of a] lack of contextualization.

Now everyone’s talking about machine learning and AI – like everyone’s an expert – but I can tell you back in 2016, it wasn’t a thing. Very few people were talking about this stuff in the music industry outside of Spotify.

People were like: ‘Where’s this gonna go? Why would we do any of this stuff? What is this really gonna mean?’

That was a bit unusual for me, because I was used to being in roles where innovation and R&D drove success and growth.

Being a scientist, you’re used to failure; it’s okay to test a theory. It’s the right thing to interrogate a hypothesis and go: ‘Hey, mea culpa, it didn’t work out. Let’s move on to something else.’

Early on in the music industry, I was sort of taken aback sometimes by people going: ‘I don’t fail; I just don’t fail. You don’t ever want to fail!’

Embracing failure as a natural

“NOW EVERYONE’S TALKING ABOUT MACHINE LEARNING AND AI. BUT I CAN TELL YOU, BACK IN 2016, VERY FEW PEOPLE WERE OUTSIDE OF SPOTIFY.”

part of growth, and accepting how you can learn from that and do better, is something I’ve always embraced. I was surprised that was not necessarily an attitude that was embraced by some of the folks I met in the music industry early on.

As we move into the next phase of music – a world of AI music, the metaverse, all of these things that are emerging – what to you is perhaps standing out as something that will have a really big impact on the music industry and the artists operating within it?

You’ve highlighted a lot of the emerging aspects of technology, things that fall under the Web3 umbrella. It’s really hard to pinpoint one thing because there’s multiple things that move in lockstep.

This is probably going to sound a little trite, but I mean it with sincerity: I think the most important and the most impactful thing is actually going to be positive and accurate education [for artists and labels].

Whether it’s around royalties,

whether it’s around increased opportunities for monetization – particularly the conversation around NFTs and the metaverse –I think the defining characteristic of success here is going to be separating the bullshit from the facts.

It’s experimenting and [finding] things that work, things that we can get behind, stake our professional reputation [on], and go: ‘This looks like it’s going to help [artists] get to where they want to go.’

A lot of things that you mentioned, I think we’re all very excited about, but we want to insure that we de-risk that as much as possible with accurate information and proper education. So that we’re actually partnering with artists and labels as strong marketers and as true marketers, not just like: ‘You got to get behind this next big thing, which may or may not make you any money, or increase the awareness of your music.’

Where do you see Ingrooves headed over the next five to ten

years?

I’m so thankful to work with the kinds of people that we do – not just on my team, but across the board at the company. [So] it’s ultimately our people, right?

This is a people business, no matter what anyone says. We’re never talking about using algorithms to replace people; that bullshit, right? We don’t want to use algorithms to replace people. We want to supplement intelligence.

So given that it’s a people business, frankly, it’s our people that are responsible for driving the success that you talked about – the notable accomplishments over the past few years.

What I can tell you with complete honesty is that I am incredibly excited to build upon that solid foundation, that infrastructure, as we continue to move forward with our absolutely obsessive goal to be the most impactful strategic marketing partner for artists and labels.

This interview originally appeared on Music Business Worldwide in April 2022.

The 1975, signed to Dirty Hit, distribute their music via Ingrooves

With an impressive mission and an enviable track record, one of the music industry’s key financial services partners is now building its business in North America.

With over 800 of the world’s top touring artists on its books, UK-born Centtrip has been at the heart of managing money for global artists for almost a decade.

Those clients include 50 Grammy Award winners and nine out of ten of the UK’s top global stars.

Bill Tannenbaum, Managing Director, Gelfand, Rennert & Feldman, said: “Gelfand, Rennert & Feldman supports the world’s most celebrated artists and musicians. The Centtrip card provides us with complete and instant financial clarity for artists’ tour accounting while Centtrip’s foreign exchange expertise helps us maximize international cashflows for our clients.

“Like GR&F, Centtrip prides itself on integrity and deep, long-term, business relationships making it our go-to partner for every aspect of artists’ payments and FX needs.”

Centtrip, which runs offices in the UK, Europe and the USA, is fast approaching its 10th anniversary in 2023.

Here, Centtrip’s Director of Music, Film and Entertainment Freddy Greenish discusses the firm’s future plans – and explains why Centtrip prides itself on service excellence and on the long-standing relationships it has built with artist managers, business managers, accountants, record labels and publishers across the music industry…

Can you explain what Centtrip does and how it helps artists and their management?

Things move fast in the music

business, especially during touring, and getting things done is often about getting things paid quickly and seamlessly. That’s where we help.

The Centtrip platform is highly secure and gives clients real-time visibility and control over their money, wherever they are. Clients can access multiple independent or related accounts where they can deposit funds, exchange, send or spend. That means that a business manager can have separate accounts for each of their clients.

Our cards are used a lot by touring artists because it empowers those on the road to deal with any problems or opportunities they face while the management team retains real-time visibility and control over everything. Funds can be transferred to and from cards instantly. Cards can also be

‘Centtrip is a leader in the music industry. Our plans reflect that.’

Team Centtrip and guests arrive at MBW’s 2022 A&R Awards in London, November 2022

locked or unlocked instantly.

Clients control their cards from the platform, setting individual card limits and alerts and controlling features such as access to ATM withdrawals.

The Centtrip app includes expense management and cash management functionality that allows cardholders to tag transactions, capture receipt images and allocate expenses to account codes that are pre-set by the client. That way nothing gets lost or forgotten about.

Clients can also exchange between currencies and send single or batch payments, domestically or internationally. Our record label clients often use this for their regular royalty payments.

Why have you expanded Centtrip into North America?

It’s demand-driven. We have a proven track record in the UK and Europe. As touring is coming back to pre-pandemic levels, it is the perfect time for us to take our experience and success into the world’s largest music and entertainment market.

Besides, we already have longstanding relationships with many big US artists, often supporting their world tours and they’ve been asking for the same service in the US.

We established Centtrip Inc., the US business, in 2021 and we are working with leading American banking and financial services partners. A USincorporated artist can be serviced by Centtrip Inc. and if they have a UK or European entity, we can service them through their UK/European entity.

Whatever our clients prefer, they can access their US and European accounts from the same, single login. It means we can offer greater choice and flexibility to all our clients.

What does Centtrip offer US

artists that they don’t get from their existing banks?

We’re a partner to established banking relationships, but we provide greater visibility and control combined with informed service excellence.

So, if a client has a problem or just a simple question, they won’t be funneled into a generic, “business support” team. They have access to a dedicated account management team who understands the music industry and the unique challenges they face. And, our services are tailored to those unique requirements. For example, our cards offer the

Yes, very much so. We’ve been able to build on established relationships with UK clients and we’re already working with several major US artists, artist managers and leading business management firms.

Does Centtrip operate in other sectors as well?

Yes, our mission is to seamlessly connect the world’s most glamorous money for the most dynamic businesses. We’re focused on providing multicurrency treasury and expense solutions to organizations that move around the world. So,

highest transaction and monthly spending limits in the business.

We can issue as many cards as required for a tour – 200 or 300 cards is not unusual if they’re also used for per diems – and if cards get lost or personnel change, we can quickly send replacements to wherever they are required.

Our currency dealing service works in the same way. We can help clients minimize risk and maximize their returns with an effective foreign exchange strategy. That’s useful at the budgeting stage of an international tour, making payments throughout, or at the end, repatriating tour receipts without losing large sums in exchange fees.

Centtrip is well-established in Europe – 10 years and over 800 artists – but it’s a newcomer in the US market. Is the US business growing as you expected?

outside of music we support Actors, Film and TV studios/ productions companies, sports teams, super yachts management firms, family offices and more.

Centtrip now has offices in the UK, Europe and in the United States. What are your plans for the rest of the world?

Music and entertainment is a global business and we plan to be wherever our clients need us. Our first US office is in Florida and we’ll be opening offices in New York and LA in the new year. I’ll soon be relocating to New York where I’ll divide my time between there, London and LA.

We’ll probably start with three US offices and grow from there. After that, we see a big opportunity in Canada and then the rest of the world.

Centtrip is a leader in the music and entertainment industry and our expansion plans reflect that. Watch this space.

“IT IS THE PERFECT TIME FOR US TO TAKE OUR EXPERIENCE AND SUCCESS INTO THE WORLD’S LARGEST MUSIC MARKET.”

Freddy Greenish, Centtrip

Credit: Frederike van der Stræten

Dominique Casimir: ‘We don’t just promote records anymore – we promote artist brands.’

Did you happen to find yourself in a provincial German discotheque in the early 2000s, somewhere betwixt Berlin and Dresden, watching Rednex – and we say this with a modicum of charity –‘perform’ Cotton Eye Joe to a wide-eyed dancefloor?

While you were there, did you notice a 19-year-old woman, stood to the side of the throng, with a handbag suspiciously stuffed with tens of thousands of Euros?

If so, we do hope you were polite to her. Because she went on to become one of the most influential international executives in the global music industry.

Today, Dominique Casimir is Chief Content Officer at BMG, and sits on the board of the Bertelsmann-owned music company. Most importantly, she oversees BMG’s ‘repertoire’ (that’s publishing and records) operation in 17 separate territories, including Central Europe, Latam, and the UK. Or to put it in a more succinct way: Casimir runs BMG’s entire music operation everywhere outside North America.

Twenty years ago, such professional heights must have seemed a long way off for Casimir, who had moved to Berlin as a teenager with the initial intention of becoming a doctor. Within a few months, she’d pressed pause on these medical ambitions, and found herself studying an aimless mix of subjects at university, while waitressing in her spare time to pay the rent. One day, a realisation hit her: “This leads to nothing.”

Following her innate passion for music, she signed up as an intern for a German talent agency that specialized in booking shows for

Swedish pop acts. It was an eye-opening introduction to the music business.

She spent most of her time in a van, “picking up acts like Rednex and [nu-disco trio] Alcazar, and taking them to shady discotheques for playback performances – multiple venues in one night. When we got to each show, I’d been told to [accost] the venue owner: ‘No one goes on stage until the money is in my handbag!’”

This precarious lifestyle was a thrill for Casimir until one December night, still in her teens, she found herself arranging an emergency helicopter to the local

branching out into management of young German rock bands. She made enough waves over the next half-decade to impress Fremantle, a Bertlesmann-owned TV content company, who hired her to handle sync licensing and music publishing agreements in 2007.

A year later, her work caught the eye of Hartwig Masuch, who had just become CEO of the ‘new’ BMG, a startup music company backed by Bertelsmann capital. (The ‘old’ BMG was no more, after Universal Music Group acquired its publishing assets in a USD $2.19 billion deal in 2007.)

Today, outside of the major music companies, BMG is

hospital. The lead singer of Rednex had succumbed to a life-threatening fever… in a minibus driven by Casimir… which was stuck on the Autobahn… because of an avalanche. Casimir was out of money, out of phone battery – and very nearly out of a lead singer of Rednex.

Somehow, Casimir made it back to her parents’ house in Hamburg that Christmas. And far from being scared off the music industry, she decided to double down.

Returning to Berlin that New Year, Casimir launched her own successful independent booking and management company –keeping her contacts from Swedish pop-land, while also

arguably the largest music publishing and recorded music entity globally.

In the first half of 2022, BMG turned over EUR €371 million, up 25% year-on-year, with 40% of that revenue figure coming from recorded music and the remaining 60% from publishing. Its repertoire across publishing and records includes all-time classics from Pink Floyd, the Rolling Stones and Tina Turner, through to modern releases by the likes of George Ezra, Kylie Minogue, Jason Aldean, Slowthai, Lewis Capaldi, Mabel and Louis Tomlinson.

Remarkably, Hartwig Masuch says that BMG had achieved its 25% YoY revenue uplift in H1 2022

“I’D BEEN TOLD TO ACCOST THE VENUE OWNER: ‘NO ONE GOES ON STAGE UNTIL THE MONEY’S IN MY HANDBAG!’”

“with virtually no hits” – his point being that BMG’s primary focus is not on achieving global charttoppers, but instead on amplifying the prospects of all its repertoire, regardless of audience size.

As head of BMG’s repertoire outside the US, Dominique Casimir oversees music that is responsible for around 50% of her employer’s worldwide turnover.

Many of her most notable moves to date have come in her home nation of Germany. In August, for example, BMG swooped for Telamo, Germany’s largest independent record label and a specialist in Schlager music (often described as Germany’s equivalent of country music in the US). As a result of that deal, BMG now stands as one of the largest label groups in the

the Vegas/Broadway-style ‘residency’ successes of artists in the US such as Bruce Springsteen, Adele, and Celine Dion.

Here, Casimir explains what her early experiences in music taught her about treating artists and why she believes BMG has cracked the right way to do deal-making with artists – as she reveals an interesting theory for why the music industry continues to obsess over weekly charts…

You started life in the music industry as a teenager, sitting in splitter vans with Swedish pop acts and German rock bands. Is there anything you learned during that time that still resonates with your professional life today?

Definitely. As a manager [in the early noughties] I saw a totally

was actually when the trouble would really start!

What do you mean, trouble?

I believe that the most important thing you can have when you’re starting a [commercial] discussion with an artist is clarity. Clarity on what it is we can achieve together, but also clarity on agreeing on a realistic picture – sometimes, a reality check! – on what the best case scenario looks like at the end of a project.

That means not promising the sky and everything in it just to get an artist to sign to you. Because what happens in that scenario is you enter into an ‘us and them’ relationship. Record companies might think [when the artist signs with them] that they have ‘won’ a deal, but if you haven’t invited clarity and honest discussion into the room, you will be left with a huge amount of pressure. And, soon, you will be left with the blame game. The moment you create a relationship with an artist where there is ‘you’ and not ‘us’, it just won’t work.

German market.

Casimir has also personally been at the forefront of BMG’s investment in three significant areas of live music. During the pandemic, she led the majorityacquisition of German live music promoter Undercover. She also led BMG’s backing of the stage musical Ku’Damm 56, which has sold over 200,000 tickets to date, and was recently extended to the end of February 2023.

Most recently, Casimir took the wraps off BMG’s latest foray into live entertainment: The firm has booked out Berlin’s most renowned theater, the 1,600-seat Theater des Westens (TdW), every night until the end of 2024.

BMG, in conjunction with Bertelsmann, will pack that theatre with live content each week, with a view to emulating

unbalanced, unfair and superweird situation: The artist would be putting their entire life into this, and you had the industry – whether that was live or record companies – making all the money and calling all the shots.

That triggered something in me from minute one. There was this tone from the music industry during that era: We have the power; you, artist, are small. Now shut up while we overrule you, because we know better.

I met lots of anxious artists who were so busy trying to make their A&R at the record company happy. They were delighted when one of these ‘super repertoire’ people from the label visited the show. To the artists, it felt like these label people really could open the gate of magic at a major music company. But that

Artists are not always superpredictable – that’s part of the reason we all love them so much. But when they know who they are, you can all agree together what the goals are and what the goals aren’t. When they’re willing to get into the ‘boat’ with their [record company partner], when you’re in it together, there is no blame game. You have a recipe for success.

Isn’t the ‘promising the moon’ element of record company deals with artists very often because the artist involved has a likelihood of releasing a chart hit – or already has one on the way? Yes. I know you noticed Hartwig’s comment about BMG not requiring a hit to grow 25% in the first half of this year. That is the new music industry.

Of course it’s nice for every artist to have a hit, and we’ve had our

“TRADITIONAL LABEL A&R IS LIKE COOKING SPAGHETTI: THROW 10 PIECES AT THE WALL AND HOPE ONE STICKS.”

fair share. But hits come and go, and for some of them [the record labels] massively overpays. Some artists have just one hit in their career, and it’s not even a superhit.

You can’t live off that forever, but it might cost you everything because of the way your deal is structured; if that deal, for example, is completely predicated on you having a second hit, with massive expenditure [baked in] at radio. If you don’t get that second hit, you’re toast.

Think of it from the artist’s perspective: The industry often doesn’t talk nice about artists who don’t get that follow-up hit, especially if a lot of money has been spent trying to get it, and artists know that. A huge part of this industry still spends all its time and attention – and a lot of its money – playing that hits game, and it leads to bad incentives.

Traditional record label A&R is like cooking spaghetti: throw 10 pieces at the wall and hope one sticks. Those pieces of spaghetti are artists! It needs to change. There are so many ways of making a living for an artist today. Even though it remains really hard to do so, focusing on just the hits and the recorded music charts – in an age when 600,000 new songs a week are going on to streaming services – isn’t a sensible strategy.

What is a sensible strategy?

Our perspective is to look at artists and ask: Is there an interesting brand here, an interesting story we can use our expertise to grow around the world?

As an artist, you need as diversified an income as possible – Covid proved to all of us that just relying on live income can quickly be disrupted. It’s not about just living off your vinyl sales or D2C, or Spotify, or ticketing; you need to understand

which income streams work best for you, and turn up the volume on all of them. We don’t just promote records anymore – we promote artist brands.

Why do you think so much of the music industry continues to focus on charts and hits? Surely that doesn’t make sense under your argument; there must be a sound economic reason for it?

One of the reasons I’m so thankful I started out in live is that I got to witness that ‘live moment’ – when eveything you’ve worked on together as a team is realized. You hear the audience; it’s such a direct and satisfying reaction.

That’s something you don’t get when you work in a record company. That’s one reason I think the charts remain so important to friends and colleagues in the record industry – charts are a mirror that tell a team: ‘You’ve done something

successful.’ But the truth is the charts only reflect a small proportion of the music industry, and even if you do have chart success, it should only be one part of a much bigger story.

That was made clear to me from the first minute of being interviewed to join BMG. Hartwig was very strong and opinionated: we need to apply expertise and systems to what music IP is, and what an artist identity is. That’s the goal. And we need to do it while being honorable, transparent and offering the best level of service – not overruling or overpowering because ‘we know best’.

What were your first impressions when you met Hartwig? He was busy choosing the new BMG logo at the time!

I remember him turning around and saying, ‘Why do you want to join this new music

Tina Turner

company.’ And I said: ‘Actually, I’m not really sure why the world needs another major music company.’ That got him going! He looked and me and said: ‘I will tell you why…’ And that was followed by Hartwig in full inspiration mode: What he wanted, why he thought artists and songwriters deserve it, and the type of people he wanted around him to make it happen.

Since May 2022, you’ve been Chief Content Officer of BMG, overseeing all repertoire operations outside North America. Which markets around the world are you most excited by from a business perspective? Mexico, and Latam more generally, stand out. We announced we would launch BMG Mexico earlier [in 2022], we’re in the process of getting it up-and-running and it is already so much fun. There’s

tremendous growth, of course, in LatAm [territories] with many of them growing by more than 30% per year for three years in a row at this point. Streaming and digitalization of the LatAm markets is generally very advanced. But on the other hand, other parts of the industry - the live business, brands, merch, the sync business – all have room to become much more relevant, and I think we as BMG will really make a difference to that.

You mention live: BMG has made significant strides into live in its home market in these past few years, especially with your majority acquisition of Undercover, and more recently with your two-year residency of the Berlin theatre where you’ve seen success with the Ku’Damm 56 musical.

Germany is a good country for us

to test things. It’s the fourth biggest music market in the world, and in some years it’s the third [overtaking the UK].

What we’re trying here with Bertelsmann, is to ask: Can we extend what we do in rights management in music to the live business? Because from a marketing and promotion and storytelling perspective that idea makes a lot of sense. We’re very good at that in [music rights]. And then another thing we’re very good at is financial transparency, and I think there’s a need for that in the live world. And we found a company [in Undercover] just like us. The first meeting I had with [Undercover founder Michael Schacke], he said: ‘We are about fairness and 100% transparency. Our artists can come and audit us anytime.’

One big annoying needle in every artist’s foot in live is the

Slowthai

Mabel

consumer data. There’s a huge amount of valuable fan data created in the process of selling tickets, but it’s often difficult for artists and managers to access that information. We are trying to crack that open with some artists, and get the fullest picture possible of their fanbase, so we can really optimize their income streams.

Our involvement in live concert promotion is the opposite of a ‘360’ deal structure: We offer live promotion and agency services on an opt-in basis to our [recorded music and publishing] artists. We hope those artists do opt-in, because we think we’re offering a lot of added value. But it’s their choice and if it doesn’t suit them that’s fine.

One of the biggest stories in the music industry in 2022 has been the revival of Kate Bush’s

Running Up That Hill via a Stranger Things sync over the summer. What was your take on that, and how even though it’s a ‘catalog’ record, it exploded like a new streaming hit amongst millions of teenagers who were hearing it for the first time?

It’s a beautiful dynamic, and it’s not about ‘catalogue’ or ‘frontline’. Kate Bush is an icon and an iconic brand. The question for this new generation of consumers, and those in the music business working to maximize this

moment’s potential is: What’s the core of the brand? Why why did she have such a cultural impact? What’s the essence of this artist’s appeal? I translate that to what we’re doing with Tina Turner [whose music interests BMG acquired in 2021]. What is the essence of why people feel so strongly and so connected to Tina Turner? We’re talking about a premium brand here, and a brand that comes with very strong emotional attributes attached to it. Obviously, it’s about the music, but it’s about more than the music.

So, again, that’s the question: Why was an artist so culturally impactful in the first place? Once you can answer that, you go from there.

This interview originally appeared on Music Business Worldwide in October 2022.

“THE TRUTH IS, THE CHARTS ONLY REFLECT A SMALL PROPORTION OF THE MUSIC INDUSTRY.”

George Ezra

Lucas Keller: Why I’m doubling our investment in the UK music industry, just when people say it’s losing global power

You’ve all heard the arguments. The UK remains the world’s third biggest music market, but its homegrown artists are finding it increasingly difficult to make it huge on the global stage. That’s all because of streaming, and a superstar artist community getting ever-more international.

Despite the likes of Harry Styles, Ed Sheeran and Adele topping worldwide charts of late, the numbers don’t lie: According to Billboard/Luminate stats analysed by the BPI, UK artists claimed just 7.6% of all streams in the US in 2021 (by the top 3,000 artists in the market). Back in 2016, that number stood at 8.4%. And don’t forget – 2021 was an ‘Adele’ year, with the trend-curbing megastar’s long-awaited album release, 30.

There are, though, some positive signs for British stars: UK artists claimed 12.1% of all global streams in 2021 (of the top 1,000 artists worldwide), according to Billboard/Luminate. That put the UK in a solid No.2 spot behind the US (with 59% of all streams) and comfortably ahead of Canada (5.4%). What’s more, PRS For Music – which represents British songwriters globally – saw a 22.4% rise in collected revenues in 2021 (on a constant currency basis), suggesting that British creativity remains a lucrative force in a changing world.

Lucas Keller is founder of Milk & Honey, one of the USA’s biggest songwriter and producer management companies, which has also expanded into artist management, sports, Web3 and more in recent years. Additionally, Keller’s company (co-partnered

by L.A-based executive Nic Warner) brags that it’s struck music publishing catalog sale deals cumulatively worth over $150 million in the past two calendar years. Headquartered in L.A, the firm also runs offices in Nashville, New York, Dallas, London, and Sydney.

Milk & Honey set up its UK office in 2020, run by Brit exec Ant Hippsley. It’s enjoyed a spate of successes with UK talent since, including involvement on No.1

has an unshakeable belief in the continued global power of British creatives. Take it away, Lucas...

The last thing we wanted when we set up Milk & Honey in London two years ago was to have Ant Hippsley be told, ‘Oh, you’re that guy that runs that little office for that big L.A company.’ That didn’t work for me.

It needed to be the case that our British business, with its UK bank account, was successful independent of our L.A business. The road to achieving that has really opened my eyes to the uniqueness of British talent, and the amazing impact it continues to have around the world.

albums and/or Top 5 singles from the likes of Ed Sheeran (via David Hodges), Dua Lipa and George Ezra (via Stuart Price), Sam Fender (via Rich Costey), Celeste (via Jamie Hartman), Meduza/ Dermot Kennedy (via Gez O’Connell), Billen Ted/The Wellerman, and James Arthur (via Andrew Jackson).

Globally, Milk & Honey’s clients have written and/or produced hits for superstars including Demi Lovato, Selena Gomez, Doja Cat, Ed Sheeran, Justin Bieber, the Jonas Brothers, Calvin Harris and The Chainsmokers, amongst many others.

Here, Lucas Keller explains why he’s doubling investment in his UK business in 2022, and why he

Some people these days are down on the UK, especially UK A&R, because of the declining streaming market share of British artists globally. And I get it: If I was a major record company Chairman, I would also be pondering what percentage of my global A&R budget the UK should be getting versus, for example, LatAm, South Korea, or Sub-Saharan Africa.

UK executives might be sick of hearing the (rapidly-becoming) old adage that, these days, global hit songs and viral moments can come from anywhere. But from Milk & Honey’s perspective, that’s just as true of the UK as it is anywhere else in the world. It’s not a threat to British talent – it’s an opportunity!

Investing to create a transatlantic system to nurture and break that talent is now a crucially important strategy for my company. But history suggests it’s a sensible bet. Look at what’s

“GLOBAL HITS CAN COME FROM ANYWHERE. THAT’S NOT A THREAT TO BRITISH ARTISTS – IT’S AN OPPORTUNITY!”

Picture: Blake Young

weighing in the UK’s favor: An amazing pedigree and track record of British songwriter, producer and artist talent, decade after decade.

From Milk & Honey’s perspective, where the runway for modern British talent falls down is when artists, songwriters and producers don’t get a fair opportunity to shine in the US –the world’s biggest music market by some distance.

In almost every case of us signing British songwriters, they want to know if we can provide them with resources and opportunities in Los Angeles or Nashville, because they recognize

that, like it or... well, don’t like it, the US market has become the center of the global music streaming business in 2022.

We make sure we provide that two-way street. And guess what? Once that channel is opened up, British talent absolutely kills it. Opening our London office also afforded an amazing opportunity for our US talent: direct access into the British music market. Simply, our UK office has become air traffic control for US clients who want hits with British artists.

When you zoom out and look at it properly, an inordinate number of the world’s best writers, and its most successful copyrights, are

British. Those songs don’t have to be as big as Dua Lipa’s Levitating (the most streamed song in the US in 2021). I’m talking about records that are evergreens, huge crossovers, that didn’t necessarily make a giant splash in the States when they were first released.

New songs go up, then they come back down – but in the streaming age it’s where they flatten out for the long-tail that really matters. The evidence shows that a bizarrely large proportion of the greatest, most timeless copyrights in the world, still being streamed millions of times a week, come from the UK. (Kate Bush, anyone?)

Milk & Honey’s Stuart Price has worked on recent global smashes for Dua Lipa, including Levitating

Look at James Arthur’s Say You Won’t Let Go (2016), which was co-written by Milk & Honey friends and clients, Neil Ormandy and Steven Solomon. That song peaked outside the Top 10 of the US charts, but it still makes a ton of money, and is a genuine crossover, because it was built to last.

Allow me one more plug: Jamie Hartman. Here’s a British guy who upped sticks to Nashville to hone his craft and further become one of the most successful songwriters in the world, before moving back to Los Angeles and London. He’s been behind an insane volume of international hits these past few years, for everyone from Celeste (A Little Love, Stop This Flame) to Lewis Capaldi (Hold Me While You Wait), Calvin Harris & Rag N Bone Man (Giant) and countless others. He deservedly won Songwriter Of The Year at the Ivor Novellos in 2021.

These artists all want to work with Jamie because they know he’s going to bring an immense amount of talent and know-how to their work – but he’ll also bring a different perspective, and a different cultural background, from the American writers they might have picked otherwise.

I don’t want to make trite suggestions that writing enduring hit songs is ‘in the blood’ of British writers. I don’t believe that. But I do agree that mainstream British culture is tuned in to (and reverential of) music – from a genuinely diverse set of musicians – to an uncommon degree. And that appreciation of music in all its forms is being pumped into Brits’ eyes and ears from an early age. It shows.

So, Milk & Honey’s British office is doing great, it’s nicely profitable, and we’re working with some ludicrously talented people. We’re making sure those people then get in front of the right people in L.A and Nashville.

Plus, we’re making sure that US writers – David Hodges being a perfect example – can travel and work in the other direction, and get proper service from us in London, because the UK industry is an important place for clients to craft global hits. For the same reason that so many of our writers have chosen to spend time in Nashville (working with Milk & Honey South) to tap into the local culture and songwriting community, many of our clients want to experience a similar energy by spending time in London.

just a bandwidth issue; based on how the money flows, a pubco’s L.A office is often not incentivized to help out UK-signed writers, and vice-versa. As a company with 30 employees globally, we believe we are the largest staffper-writer producer management company, but we are also nimble enough to deliver on what we promise. Additionally, the revenue on a hit that comes from anywhere for Milk & Honey matters. And it matters for the whole company, not just one local office.

As for UK artists going global?

“MORE UK ARTISTS WITH THE GLOBAL LEVEL OF SUCCESS OF ADELE AND ED SHEERAN WILL COME SOON ENOUGH.”

This article came about because Tim at Music Business Worldwide keeps telling me British execs are concerned about the numbers; that the market share of global streams from British artists has been dwindling of late versus the ‘glory years’ of British music.

I’m here to tell you, that’s just not the pattern I see in our world. British songwriters and producers in particular keep laying down hit after hit, in multiple markets, and we’re hugely appreciative to work with them. We’re doubling investment in the UK because we want to work with even more of them.

As a management company, when you service brilliant British talent properly, when you make the calls – and call in the favors – in L.A and other US markets to get UK writers and producers their shot, more often than not you find success.

One of the big issues for songwriters today is the quantity of employees at the major music publishers, and their expectations of their point person there. It’s not

Be patient. It seems obvious to me that there will be more artists with the level of worldwide success of Adele, Sam Smith, Harry Styles and Ed Sheeran coming soon enough.

The UK has brilliantly exported great artists like this decade after decade. (I’m not distracted by the glut of dance hits and electronic music focus coming from the UK right now – because we love those artists and records too! I told you: ‘Hits come from anywhere’ in 2022!) It seems inevitable to me that British artists will be a huge part of the streaming superstar story in the years ahead.

We want to be a lynchpin in telling British songwriters’ stories and putting them on the global stage. The UK industry might have lost a bit of confidence in the past few years. But I’ll guarantee you this: its brightest talent has never lost the ability to create a global smash.

This interview originally appeared on Music Business Worldwide in July 2022.

“WHEN YOU BUY THE RIGHT MUSIC ASSETS AND YOU ADD VALUE TO THOSE ASSETS, YOU KEEP YOUR PARTNERS HAPPY.”

Larry Mestel, CEO, Primary Wave

Music catalog acquisitions

The music industry moves fast. The real world (especially these days) moves even faster.

So you could easily be forgiven for missing the monumental importance – in music biz-relative terms, anyway – of Primary Wave’s big announcement in October 2022. If you’re not fussed about detail, this headline is all you need to know: Financial giant Brookfield has struck a $2 billion deal with Primary Wave, the acquisitive home to catalogs from legends like Bob Marley, Ray Charles, Whitney Houston, Stevie Nicks, Prince, Burt Bacharach and many more.

If you are fussed about detail, then: (a) You’re MBW’s kinda person and (b) We’re gonna have a go at breaking it down for you.

Before Brookfield came along, Primary Wave was an investment manager that looked after three song-owning funds with various financial backers:

• Fund 1 was born in 2016 with approximately $300 million behind it (and investors including BlackRock);

• Fund 2 was born in 2019 with $500 million behind it;

• And Fund 3 was born in 2021. MBW’s sources suggest it was backed with $800 million in capital. (The launch of Fund 3 .coincided with a $375 million investment into Primary Wave by Oaktree Capital.)

Now, Brookfield has committed $1.7 billion into a new “permanent capital vehicle” – essentially a fourth fund – in which Primary

Wave itself is a minority owner.

That vehicle has already spent an initial $700 million acquiring some rights from Fund 1 and Fund 2, with some of those funds’ investors cashing out.

This has left somewhere north of $1 billion in unspent Brookfield cash sitting in the new “permanent capital vehicle”, ready to be deployed.

That’s just as well: Primary Wave says it has $600 million in agreedbut-not-yet-closed deals that it expects to complete by the end of 2022. (The firm says it’s already done $300 million-worth.)

Now, the last piece of the puzzle: Brookfield has additionally acquired a minority stake in Primary Wave (as in, the investment manager that looks after the four ‘funds’).

Brookfield appears to have spent somewhere around $300 million on this minority interest, which is why, when you add this figure to the aforementioned $1.7 billion capital commitment, Brookfield has struck a “$2 billion deal” with Primary Wave.

Oh, final, final thing: Global talent agency Creative Artists Agency (CAA) has also acquired a minority interest in Primary Wave – as in, the investment manager – for an undisclosed fee.

[Side-note: Eye-popping dollar signs aside, this CAA involvement might actually prove to be the most interesting thing about this whole deal announcement.

Primary Wave prides itself on being able to amplify an artist/ songwriter’s brand far beyond syncs and traditional marketing,

cooling down? Not at Primary Wave: ‘We’ve never been busier.’

which is why it is a long-running pioneer of buying ‘name & likeness’ rights from talent. Witness the upcoming Whitney Houston biopic, I Wanna Dance With Somebody, for evidence. Primary Wave says it believes CAA’s new involvement in its company will deliver “contentcreation clout unheard of in the music publishing space”.]

Okay! End of lecture. Any other questions? Well, yes, we had a few. So hours after the deal was announced we called up Larry Mestel, founder and CEO of Primary Wave Music, to get the bigger picture.

Here’s what we learned.

1) Permanent means permanent For those of us still getting to grips with lingo from the financial world, the phrase “permanent capital vehicle” might seem a little perplexing; after all, aren’t “permanent” capital vehicles just... companies?

In essence, yes. Explains Mestel: “It’s designed to be a permanent capital vehicle – to never be sold. It’s more like a regular corporation in that sense.”

In an interview with the Wall Street Journal announcing the Brookfield deal last week, Mestel was quoted as saying: “[This deal] means there isn’t any good acquisition that we couldn’t do in the music business. We’re not limited by size or opportunity.”

But – thought experiment – what if an amazing multi-billion dollar music deal came along? Surely with its current $1 billionish pile of Brookfield cash, Primary Wave would be counted out? Don’t be so sure.

“We have an unlimited supply of capital to the extent that we find good deals,” says Mestel. “So if there are deals that make sense, and we stick to our vision, we will not run out of capital.”

2) There’s a reason, says Mestel, that Primary Wave is changing the narrative around music M&A If you’re a watcher of music’s once-frenzied acquisitions marketplace, you’ll know things have gotten a bit... gloomy of late.

Macroeconomic factors – not least endlessly rising interest rates – are putting pressure on acquirers with debt, and naturally driving down the multiples they’re willing to pay.

Rumors abound of smaller players in the M&A marketplace suddenly seeking buyers, while ruing the high multiples they paid for assets that, in hindsight, aren’t quite as premium as they first thought.

Meanwhile, the financial media is asking tough questions of bigger players. And every other music biz lunch you attend, someone wants to proclaim that the “era of cheap money is over!”

And then Primary Wave comes along with a $2 billion deal and a mountain of new cash. So how’d it manage that?

“When you buy the right music assets and you truly add value to those assets, you keep your partners happy,” smiles Mestel. “There is typically a good outcome that comes from that strategy.”

Mestel alleges that some of his competitors simply haven’t followed a similar path: “They’ve over-leveraged themselves

“WE HAVE AN UNLIMITED SUPPLY OF CAPITAL... IF THERE ARE DEALS THAT MAKE SENSE AND WE STICK TO OUR VISION, WE WON’T RUN OUT OF CAPITAL.”

Whitney Houston biopic, I Wanna Dance with Somebody (pictured), has been co-produced by Larry Mestel

without having a strategy to grow their income stream”.

Continues Mestel: “We’ve had a successful growth strategy in place for 16 years now –enhancing value not only for us but for our artistic partners as well [Primary Wave often strikes deals where the songwriter/artist/estate involved keeps a minority interest]. Primary Wave has a history of being friendly to artists, plus artists know we close deals – we don’t walk away from signed letters of intent.”

He adds: “When you look at the enhancement of streaming for iconic artists [Primary Wave has achieved], when you look at the marketing and then the podcasts, documentaries, brand opportunities that we’ve implemented, you understand why our revenue has grown dramatically.”

Mestel is clear that Primary Wave does not want the until-

recently-energized music M&A market to “fall apart”. But if some financialized music portfolios do end up hitting the auction block, he says, don’t assume it’s only the three major music companies who’ll be capable of “scooping up all the pieces”.

Adds Mestel: “If this market does go into recession, we are going to have an enormous amount of capital and we will be very discerning about what we buy.”

3) There are plenty of deals left One of the most striking things from Primary Wave’s announcement was that it has $600 million of acquisition deals currently in play that it expects to close by the end of 2022. This rather flies in the face of the idea that there is a drastic cool-down in catalog acquisition activity in the music business. “We’ve actually never been busier,” says Mestel of Primary Wave’s current

M&A activity. “We have an enormous amount of deal flow in the pipeline.”

Part of the reason for Primary Wave’s deal-making frequency, argues Mestel, is his company’s reputation amongst the creative community – partly based on its prowess for storytelling and understanding artist brands.

That’s something he believes will be crystallized by the new Whitney Houston movie, on which Mestel is a co-producer alongside the likes of Clive Davis.

“It’s going to be incredible,” says Mestel of the film.

“I think as a result you’re going to see a very significant jump in Whitney’s brand, in streams of her catalog in general – and in people’s introduction and reintroduction to a legend.”

This interview originally appeared on Music Business Worldwide in October 2022.

Primary Wave acquired a catalog by Huey Lewis & The News this year

Credit: Jan Sandvik Editorial / Alamy

ONErpm has conquered Brazil’s streaming market. Now it’s taking on the world.

Which record company had the most positions on the weekly Spotify Top 200 in Brazil in the first half of 2022: Universal Music, Sony Music, or Warner Music?

Trick question. Sony technically had the most, when you include Brazilian label Som Livre, which the major acquired for $255 million in 2021.

But if you counted Sony Music (and The Orchard) and Som Livre separately, the No.1 company on this particular list isn’t a major music company at all: it’s ONErpm.

Nashville-headquartered ONErpm was founded 12 years ago this month by entrepreneur (and the company’s CEO) Emmanuel Zunz. The business targeted Brazil as its priority market from the very start.

“Brazil was the very first office we opened, in July 2010,” recalls Zunz, who studied in the LatAm country.

“We were probably the first business to go into Brazil and provide a music DIY platform that was both open to anybody and transparent. And at the time we were extra rare because we actually paid people!”

Today, ONErpm has far outgrown its DIY distribution beginnings. The firm still does run a DIY tier, but – somewhat akin to Believe’s model – it also invests more heavily in a smaller pool of artists, like a label would.

Some artists (those within what ONErpm calls its ‘Taking Off’ tier) are paid advances and given inhouse marketing/PR/playlisting support to accelerate their careers; others (‘Next Level’) might even share copyright ownership with ONErpm, and receive a more blockbuster level of investment.

Today, with a global staff of over 450 people – and a dedicated A&R staff of over 60 people – the company says it aggressively sources new business from all corners of the music market.

In addition, over the past few

years, ONErpm has been quietly acquiring copyright catalogs from artists and labels, with Zunz estimating that ‘owned’ or ‘part-owned’ copyrights now account for a significant singledigit percentage of ONErpm’s repertoire.

By building this model over the past dozen years, and expanding into territories such as the US, Chile, Colombia, Jamaica, Argentina, Spain, the UK, Australia, and Nigeria, ONErpm – according to MBW’s sources – is a profitable

and fully independent business (i.e. no VC capital). It currently operates in no less than 30 global territories.

MBW’s sources also tell us that on a gross revenue basis, ONErpm turns over a nine-figure sum annually – although obviously the majority of this is paid out as royalties to artists and labels.

Zunz won’t be drawn on details of his firm’s finances, but does confirm that his company’s revenues grew by 70% in 2021, and he’s expecting further 30%-

“WE’RE BIG BELIEVERS THAT THE ‘CREATOR ECONOMY’ WILL CHANGE THE GLOBAL MUSIC BUSINESS FOR THE BETTER.”

Three ONErpm artists including Bobby Pulido (pictured) won Latin Grammys in 2022

plus annual growth in 2022.

The scale of the business is obviously impressive – and not just in LatAm. Zunz says that ONErpm artists/tracks currently attract approximately 12 billion plays a month on YouTube, tens of billions of plays a month on TikTok, and over 3 billion streams per month across Spotify and Apple Music combined.

You probably don’t need MBW to tell you how smart ONErpm’s early focus on Brazil was. Zunz says it gave his business a “firstmover advantage” on other companies servicing indie artists.

According to IFPI statistics, Brazil was the world’s 10th largest recorded music market in 2021. And according to local trade body ProMusica, Brazil’s annual subscription streaming revenue shot up by 28% YoY in 2021, to BRL 1.084 billion (around $219m).

ONErpm’s success in Brazil certainly isn’t limited to Spotify: On YouTube, for example, it beat the likes of Universal Music and Warner Music in the first half of

2022 in terms of the number of distributed artists taking places on the platform’s weekly Top 100.

In turn, ONErpm’s success in LatAm isn’t limited to Brazil: The company has seen similar levels of major-beating/major-baiting success in the likes of Chile, Peru, and Colombia. (Based on the IFPI statistics for 2021, Zunz believes that ONErpm took a 20% market share in the latter territory by revenue in 2021.)

Says Zunz: “We have built very clever technology that helps us manage all of our marketing campaigns in each territory. Because of that, we have economies of scale, which a lot of our competitors don’t –including the majors. It means we’re able to render high-quality services for artists at much more affordable rates.

“We’re no longer just a distribution company; we’re a full-service music company for artists that also happens to offer a distribution solution.”

He adds: “We are big believers that the ‘creator economy’ and direct-to-fan platforms, including YouTube, will continue to change the global music business for the better. We have built significant infrastructure to support those creators.”

For the rest of 2022, Zunz and his team are laser-focused on globally expanding the ONErpm model.

This plan sprung into life last month with the announcement

“THERE WAS A RUN TO ACQUIRE US LAST YEAR BY THE MAJORS, AND THEN A RUN TO ACQUIRE US THIS YEAR BY PRIVATE EQUITY. NONE OF THAT IS INTERESTING TO ME.”

Source: YouTube / OneRPM analysis. (Data covers 25 weekly YouTube charts from Dec 31, 2021 through to June 23, 2022

Spotify’s weekly Top 200 in Brazil: How many chart placings did each of these record companies / distributors score in H1 2022?

OneRPM

Som Livre Sony Music Universal Music Group Warner Music Group

that ONErpm was adding five new offices to its setup in Africa: in Accra, Ghana; in Abidjan, Côte d’Ivoire; in Nairobi, Kenya; in Dar es Salaam, Tanzania; and in Johannesburg, South Africa.

These new launches joined ONErpm’s office in Lagos, Nigeria, which the company opened in 2020.

More expansion is on the horizon for ONErpm, too.

“We’re in the process of opening up properly in Asia, hiring our first people in China, in Malaysia,” explains Zunz, who says that he’s aiming to double the size of ONErpm’s business in the next three or four years.

The gateway to that growth, he explains, will be based on two things:

• (i) Technology that allows ONErpm to efficiently scale its artist/social marketing, while also providing other premier services to artists around the globe; and

• (ii) The company’s DIY tier,

which operates as its entry point to tens of thousands of indie artists in any territory in which it operates.

Case in point: Zunz says that across Africa, following the recent expansion, ONErpm already has over 30,000 different artist accounts distributed via its system. The next step will be highlighting those ‘Taking off’ and ‘Next Level’ artists – i.e. the acts whose early success indicates that ONErpm should start investing more into their careers.

Zunz says that ONErpm currently works with around a million different artists and labels globally, and that it provides “bespoke services” (i.e. additional investment and sync/ marketing/PR/playlisting support) to somewhere between 2% and 5% of them.

“We are a full-service music company that really knows how to market your music,” says Zunz.

“For our artists and creators, we can be everything from your

distributor all the way to being your record label, and anything in-between. We’re one of the last truly independent music companies of this size that are out there. So many other companies of our size have been bought, and that’s kind of scary.”

“We fully intend to stay independent,” he adds. “There was a run [to acquire] us last year by the majors, and there’s been a run [to acquire] us this year by private equity firms. None of that is interesting to me.

“What is interesting to me is doubling the size of ONErpm and expanding into all of these different markets – we will have 33 offices open worldwide by the end of [2022].

“That way, we can move into a position where we can be as big as we can be – while maintaining the flexibility to continue running this business the way we want.”

This interview originally appeared on Music Business Worldwide in July 2022.

Source: Pro-Música / MBW calculations

Brazil’s recorded music industry revenue (BRL in million)

Martin Kierszenbaum on working with Sting, streaming’s impact on A&R, and why he’s a music biz optimist

What’s your dream job in the music industry? The producer of a global smash hit album, perhaps? Martin Kierszenbaum’s done that.

What about being a major label exec that discovers and/or develops a multitude of stars? Kierszenbaum’s done that too –from Lady Gaga to LMFAO, T.A.T.U, Feist, and Enrique Iglesias, all of whom he worked with during a 17-year tenure at Interscope Records (initially in international marketing and then later in A&R).

Here’s another doozy of a career path: Launching and growing your own independent music powerhouse. Yep, Kierszenbaum’s done that too: 100% independent, Kierszenbaum’s The Cherrytree Music Company today houses a record label, a music publishing company, and the group’s central lynchpin – a highly successful artist management arm.

Okay, last dream job possibility: Managing a megastar with whom

you build a special and trusted rapport over multiple decades? Again, check: Kierszenbaum has managed Sting since 2016 (following the retirement of the artist’s long-time manager Kathy Schenker) but has worked with the legendary singer/songwriter in various capacities for 31 years.

“I’ve seen Sting in all sorts of contexts during our time working together,” says Kierszenbaum, who first began working with the artist as his international publicist

at A&M in 1991. “He’s a gracious, generous, hugely talented, and very disciplined individual.”

He’s also highly prolific: In the past 10 years, Sting has released five studio albums including The Last Ship (2013), 57th & 9th (2016), My Songs (2019), and The Bridge (2021), plus the Grammy-winning 44/876 (2018) with Shaggy.

Four of those records were produced or co-produced by Kierszenbaum, connecting the California-born entrepreneur with his very first love: Making music.

In addition to co-writing and/or co-producing a number of classic pop records across the last 30 years (including Lady Gaga’s The Fame album and t.A.T.u’s All The Things She Said), Kierszenbaum studied piano growing up and graduated from the University of Michigan with a B.A in music theory. (He also holds a Masters Degree from the University of Southern California’s Annenberg School for Communication and Journalism.) Kierszenbaum continues to create music in the studio, recently releasing a collaboration with rapper Piper, How To Walk Like A Man

These days, however, it’s fair to say Kierszenbaum’s most highprofile role at Cherrytree is that of artist manager, not only to Sting, but also artists such as Shaggy, Mike Einziger from Incubus and tex-mex rock/pop band The Last Bandoleros (who, a few weeks before we sat down for the following interview, performed live on Good Morning America).

Here, MBW asks Kierszenbaum about his approach to A&R, navigating the modern streaming world as a manager, and artists selling their songwriting catalogs, amongst other subjects…

You have a BA in music theory and continue to be a professional musician. Do you think a true understanding of music matters for executives in

artist development?

For me, it’s integral to be able to speak both languages: the language of music-making, and the language of music business. It allows you to convey your point of view with the right nomenclature to [an artist]. I can say: ‘I feel there might be an issue with this song,’ without then having to say ‘because it’s too prickly’ or ‘because it’s too blue’ or something like that. I can say, ‘In the pre-chorus, I think we could use a leading tone to the modulation,’ etc.

On the other side, you have to be able to translate an artist’s vision to be understood in a marketing meeting, where [otherwise] some people might be bewildered. That’s all interwoven with our philosophy at Cherrytree – we’re a very musician-led company. That has a lot to do with my background: my sister is a musician, and I learned piano from eight years old. My piano teacher in our neighborhood was fantastic; I’m very grateful to Mrs. Green.

You’ve been involved in the discovery and launch of a number of global superstars.

What do you make of the argument that streaming is killing off the opportunity to launch superstars today?

That’s a ‘chicken or egg’ question. Because you could definitely posit the argument you mention. But you could also say that it’s not down to streaming – it’s not the format. It’s the fact that people [working in music] are relying too much on readily available empirical information to make decisions about investment into artists.

Sure, you can put together a record on an iPad now and upload it, and it’ll probably sound pretty good. That accessibility of distribution [creates] a lot more competition. But at the same time, if you’re a super-talented person from almost any walk of life, you can get access to equipment, and distribution to allow yourself to be heard.

I don’t think there’s a scarcity of talent out there. It might be made a little bit more opaque because of the volume that comes out, but I still think the cream rises to the top. That case is supported by the fact that some big, really interesting global superstars have been created in

Sting

Credit: Eric Ryan Anderson

this era: Bad Bunny, Dua Lipa, Billie Eilish, Lil Nas X. They’re all important, culturechanging artists.

I’m more inclined to suggest that people in gatekeeping positions are maybe leaning on empirical data too often instead of using some instinct.

Are those gatekeepers sufficiently incentivized to take risks in A&R?

Good question: or are they actively disincentivized? If you take a chance without empirical support today, you are hanging your neck out there, man.

In the environments I was lucky enough to work in, there was ample room for instinct. But now I think everybody’s looking for exact empirical information that shows that [a track] is going to be a hit. That’s okay, except it changes the dynamics. There are huge bidding wars, the checks are massive, and that puts tons of pressure on the artists, not to mention the A&R people.

[As a result] maybe artists aren’t allowed to develop their musical instincts as much. I’m not even sure if that [data-led approach to signing] engenders any more success; you could argue it’s generally less successful than hiring people who have an A&R instinct, a compass or a barometer based on experience.

You worked under Jimmy Iovine at Interscope and had a close relationship. Does the record business miss that kind of talisman, or is the next generation keeping up?

Jimmy is extraordinary: that’s what the scoreboard says and that’s what I felt about him. It was a lot of fun to work with him, especially musically; he gave great advice, had great instincts, and supported me on a lot of real curveball initiatives that I brought in. I’m grateful to him for that.

Are there other Jimmys? No,

but there weren’t other Jimmys when Jimmy was at Interscope, either. Is there another Berry Gordy? No. Another Herb [Alpert] and Jerry [Moss]? No. But I’m positive there are new people coming through that are extraordinary in their own era. I’m not working with him, but my mind goes to Ron Perry or Tunji [Balogun], who I really admire. I’m sure there are others. Like Jimmy, these people are so passionate about working in music, they would have been willing to do it for free.

Who gave you the best ever advice about the music biz?

The day I started at Warner Brothers Records in 1989, in Burbank at that beautiful ski lodge building, a gentleman by the name of Lou Dennis came up to me – he was the head of sales. He was one of the people around Mo [Ostin], these Knights of the Round Table at arguably the best record label ever. Lou walked up to me, and he goes, ‘Welcome to the record business, kid; you missed the heyday.’ It was said in his sarcastic, very wise way, and it was funny. But I still think about it nearly every day, because I’ve since been able to have a long career, support my family, have hits, and I’ve still survived to work with some amazing artists today. My point is: the music business is constantly changing. So even

though some people might tell you ‘it used to be like this or that’, you just have to fight, carve out your own path, and make your own heyday.

Looking at the modern music business from a manager’s perspective, are you more excited or more skeptical about the future?

I believe in music, I believe in artists; I am optimistic. That’s something built into my personality that’s allowed me to persevere through some arduous times, and I’m grateful for it.

There are all sorts of innovations to be excited about today. Sting just did a song for a show called Arcane, a show on Netflix [spun out of the League Of Legends video game]; the animation is unbelievable. I don’t think I’ve ever worked with a company outside the music community that loves and prioritizes music as much as Riot Games [the maker of Arcane / League Of Legends]. I was super impressed. Season one was a huge hit and won an Emmy – and Sting sings the finale song. So there’s innovation happening in this business every day, especially when you’re lucky enough to be around an artist like Sting, who’s constantly challenging and curious.

Sting recently sold a bundle of rights to Universal for a ninefigure sum, continuing a trend that’s dominated music biz headlines for the past couple of years. Is the catalog sale boom a healthy thing for songwriters more generally?

It’s a very personal decision to sell your copyrights. These are things that you invented or even channeled from someplace, depending on how you see it. What might make sense for somebody at a certain juncture in their career may not make sense at all for somebody at a different juncture.

“I BELIEVE IN MUSIC, I BELIEVE IN ARTISTS; I AM OPTIMISTIC. THAT’S SOMETHING THAT’S ALLOWED ME TO PERSEVERE THROUGH SOME ARDUOUS TIMES.”

I know it may sound crazy, given the amounts that are flying around and all the stakes, but I really think it comes down to this: How will you feel tomorrow, when you don’t own your copyrights or your royalty streams or whatever it is? If the answer is ‘I’ll feel worse’, it’s a non-starter. I work to make sure my clients [in that situation] are considering whether the deal they’re considering makes sense for them and their family, and if they’re emotionally ready to do it.

I was recently speaking to a friend of mine, a successful songwriter with some big hits who’s not part of [Cherrytree] and he said: ‘I’m not going to sell. I have a house, my kids are okay, I don’t need to live beyond my means. And to be honest I just love getting a royalty statement every three months; it makes me feel like I’ve done something in my life.’

Why pick Universal as the buyer for Sting’s stellar song catalog?

That’s an easy answer: We know Universal very well, they’ve marketed and distributed Sting’s masters for some time, and they treat him with respect. Plus it’s a company whose core business is music.

Unsurprisingly, there were a lot of interested parties. I’m not saying every [price offered] was equal, but, for the most part, they all realized the value of a catalog that is an absolute gem. And what it actually came down to was knowing that music is the No.1 priority for [Universal], and knowing the history of how they’ve treated the artist. Lucian [Grainge] treated Sting with a lot of respect, as did Jody [Gerson]. Jody wrote the most beautiful, eloquent letter to Sting and me. It discussed the emotional side of having the great honor to work his extraordinary catalog.

Genuinely, that [letter] was just as important as any of the other stuff.

If you could change one thing about the music business right here and now, what would it be and why?

I’d want songwriters and artists to get paid more of the pie. That’s it. That has to be the No.1 priority. I wish they were getting a bigger percentage of streaming and digital consumption. It needs to be recalibrated.

Are you indicating that more should be paid out in the first place?

No. I’m saying a bigger percentage of proceeds from the actual consumption should go to the artist than it does today.

This interview originally appeared on Music Business Worldwide in November 2022.

Sting, Kierszenbaum, and Shaggy

China’s music market has been on a remarkable upward trajectory for a number of years.

Back in 2015, the country was ranked as the world’s 14th biggest music market according to IFPI data. It then climbed two places to reach 12th by 2016 and continued rising, taking the No.10 spot in 2020.

Now, according to IFPI’s most recent Global Music Report, in 2021, China is the world’s sixthlargest music market, after overtaking South Korea (now No.7), the home of K-pop.

Home to streaming giant Tencent Music Entertainment and its rival, NetEaseCloud Music, one driver behind China’s music market growth is the performance of its wider music streaming landscape.

Tencent Music Entertainment, owner of apps like QQ Music, Kugou Music and Kuwo Music, ended Q2 2022 with 82.7 million paying music users.

Rival NCM, saw its own monthly online music-paying users rise to 37.6 million at the end of June 2022. Combined, as of Q2 2022, TME and NCM had 120.3 million paying users in China alone. Spotify, the world’s largest subscription music streaming service, had 188 million subscribers worldwide at the end of Q2 2022.

Warner Music, which operates in China alongside rival major music companies Sony Music and Universal Music Group, as well as various prominent domestic players, tells MBW that its own

revenues in the market are now six times larger than in 2014.

Heading up Warner Music China is Managing Director Sherry Tan, who joined in June 2021 from Mengxing Media, a start-up company she co-founded and which worked with entertainment figures such as singer and actor Kris Wu and TV director Zhang Li.

Tan grew up in China but

At Fremantle, Tan worked at Creative Artists Agency China, working with actors, artists and celebrities including Danial Wu, Karen Mok, Kris Wu, Leehom Wang and Tang Wei.

In 2018, Tan co-founded Mengxing Media, which worked with singer and actor Kris Wu as well as TV director Zhang Li. The company licensed the rights of movies and entertainment shows for import and export to China, and co-produced TV shows including The Voice and Tmall Double Eleven Gala 2020.

moved to the US when she was a teenager. After graduating from NYU with a master’s degree in Music Business, she joined Sony Music in New York in 2005 as an International Marketing Department Coordinator.

The exec later relocated to Beijing and was promoted to Director of Sony’s office there in 2007, playing a key role in the Asia-focused campaigns for superstar artists like Alicia Keys, Avril Lavigne, Celine Dion and Leona Lewis.

In 2009, Tan moved to Fremantle Media and worked on some of China’s top TV shows like China’s Got Talent, Chinese Idol and X Factor.

Partnerships struck by WM China since Tan joined as MD, include a strategic deal with “League of Legends” to jointly create and promote new theme songs, and a local collaboration deal with ByteDance-owned Douyin, the Chinese version of TikTok, which the Business of Apps estimates has 700 million daily active users. WM China tells MBW its media content on Douyin has reached billions of views.

Tan says that Douyin has “become one of the most effective promotional channels in the country,” adding that WM China plans to “continue to explore more potential partnership opportunities with Douyin and other similar platforms”.

Commenting on the explosion of short-form video content on the likes of Douyin, Tan adds that “short-form video has changed the way music is now performed, shared, and enjoyed,” and adds

Sherry Tan: ‘Short-form video has changed the way music is performed, shared, and enjoyed. Competition for eyeballs is fierce.’

“DOUYIN HAS BECOME ONE OF THE MOST EFFECTIVE PROMOTIONAL CHANNELS IN CHINA.”

that “this allows for more people to discover our music”.

She notes, however, that “competition for eyeballs is fierce as people have only got limited time to spend every day”.

Here, Sherry Tan tells us about Warner Music’s objectives in China, challenges in the market, and opportunities in gaming, Web3 and short-form video...

What are your objectives for Warner Music in China in 2022/2023?

In addition to achieving our vision of becoming the most localized international label in China, we can’t wait to create more influential songs that people love, and enhance Warner Music’s reputation by providing our artists and the market with more value-added services. We also

plan to explore more high-impact win-win IP partnership opportunities, and think outside the box to search for more diversified business projects and innovative deals.

Warner Music China wants to be the partner of choice for domestic artists that want to build a global career and for international acts that want to break in the world’s sixth largest recorded music market. We also want to be at the forefront of developing our industry’s culture, making sure that everyone who works in music feels safe and valued.

What are the most significant developments in the market currently and how is Warner Music capitalizing on those developments?

The Covid pandemic has had a significant impact on the

planning and organizing of live performances and activities. Nonetheless, nothing will stop people’s enthusiasm for music, and fans are turning to online streams to get their dose of music and concerts, accelerating the digital revolution in music around the country.

To capitalize on the rapid changes in the way music is now performed, shared and enjoyed, we have helped put together many online concerts, as well as live-streaming events on different DSPs.

We have also produced a number of songs aimed at short-form video services designed to encourage fans to create and share content. These songs have proven to be a huge success.

What differentiates Warner

Warner Music China artist CoCo Lee

Music from other players in the market?

Warner Music is different to other local Chinese labels because of its global network and international insights. As our operations span the globe, we’re able to draw on the combined resources and experiences of our multiple affiliates across the region to offer an array of A&R, marketing and promotional services to help our roster grow their fan base across the East and into the West.

And compared to other international labels, we feel we’re the most localized international label in China. We’re very much committed to the Chinese market and are willing to invest in local artists and the wider ecosystem on a long-term basis.

This was recognized by Topklout.com, which named Warner Music one of China’s most active entertainment companies. We’re the only international company to have made it on the list, coming in at Number Two and beating other top domestic entertainment companies.

Warner Music’s strength also lies in our willingness to invest in artists who are at different stages of their careers and our commitment to build trusting long-term relationships.

How hard is it to break artists who are based in China, around the world?

Although there may be cultural differences between the East and the West, we believe that

music has no boundaries and it can always find a way to everyone’s heart.

We will continue to promote C-POP music to the rest of the world and look forward to introducing music from China to fans from around the globe.

What creative or business trends are you seeing in China that you can tell us about?

Short-form video platforms have changed the way fans enjoy and share music. More and more people are watching videos and spending money on China’s short video apps. That’s why we’ve partnered with various DSPs in the country to create and promote music that gets us one step closer to this trend and reaching massive audiences.

Another business trend that we are seeing in China are the

opportunities in soundtracks. Despite a drop in the box office due to the Covid pandemic, soundtracks have remained an effective way of promoting music. Warner Music China has tailormade a number of soundtracks for several blockbusters recently.

One recent example is the movie Moon Man, which soared as China’s latest box-office champion grossing over 3 billion RMB since its release. This film has introduced our artist CoCo Lee’s new song Finale and Jin Zhi Wen’s Leave the Moon Behind to a massive audience and in turn increased our digital streaming on DSPs.

Tell us about Warner’s strategic deal with League of Legends –Why was this an attractive partnership for Warner, and

Warner Music China artist G.E.M

“MORE AND MORE PEOPLE ARE WATCHING VIDEOS AND SPENDING MONEY ON SHORTFORM VIDEO APPS.”

what wider opportunities do you see for Warner Music in the video games space?

Games are now an essential part of the music market in China. Music in Games (MUGA) including theme songs, background music and game promotion music provide millions of gamers with a way to discover new songs. And because people are introduced to this music while playing a game they love, they develop a strong emotional attachment to it.

League of Legends is one of the most influential and popular video games in China. It has about 60 million registered players in the country, and has been credited for delivering massive and instantaneous exposure to audiences who then stream the tracks in full on DSPs.

There is a huge audience crossover straddling gaming and music, and we hope that through our partnership with the League of Legends, we can present our music to players in an innovative and creative way.

Warner also struck a deal locally with Douyin. What does this deal entail and what are your views on the impact that short-form video platforms like Douyin and TikTok are having on the music business?

Douyin is one of the most popular short-form video platforms in China and has therefore become one of the most effective promotional channels in the country. We’re working very closely with Douyin on various projects, including the creation of a number of short-form videooriented songs tailormade for it to encourage fan-created content.

This deal will enable our artists to benefit from exposure on Douyin’s platform, helping it attract and retain users by enhancing their experience and accelerating the amount of fan-created content.

In addition to being a great

marketing tool, Douyin is also an excellent channel for our A&R execs to use when searching for new talent. We’ll continue to explore more potential partnership opportunities with Douyin and other similar platforms.

What do you think are the biggest technological opportunities for the music industry in 2022/2023?

Web3 is poised to revolutionize and transform the music industry. We’re working with some of the country’s top tech firms to explore all new metaverse-related opportunities for our artists.

For example, Warner Music’s strategic investment approach to Web3 and its global infrastructure has enabled us to sign an exclusive deal with Chinese superstar G.E.M. to release her Metaverse-themed album.

What are your views on Tencent Music Entertainment being ordered to relinquish exclusive deals held with labels in China and what does this development mean for the wider market?

We embrace fair competition in free markets, and also respect the laws of all local jurisdictions. We believe that great music deserves to be heard by as many people as possible.

What are the biggest challenges for the music business in China?

Our industry has developed in a different way to that of Europe and North America. We can’t simply clone their approach as what works there, may well not work here.

To become a truly localized

international label in China, we need to create meaningful connections with fans by adapting our music products to their preferences, and continuously evolving to the country’s highly dynamic domestic market to create songs that resonate with Chinese audiences.

And globally?

Short-form video has changed the way music is performed, shared, and enjoyed. Although this allows for more people to discover our music, competition for eyeballs is fierce as people have only got limited time to spend every day.

With the development of this new consumption format, we’re not just competing with other music labels, but also with different types of entertainment companies from around the world.

If there was one thing you would change about the music business, what would it be, and why?

I sincerely hope that the Web3 technology will develop and mature soon, so that everyone can listen to, share and create music freely in the virtual world, while artists who create it benefit from its use.

I look forward to seeing a metaverse where we, or perhaps even our avatars, could perform; it’d be a place where there’s no negativity, no pessimism, only music and music lovers.

This interview originally appeared on Music Business Worldwide in October 2022.

“WEB3 IS POISED TO REVOLUTIONIZE THE MUSIC INDUSTRY. WE’RE EXPLORING METAVERSE-RELATED OPPORTUNITIES.”