This week In the Hot Seat with Larry LeBlanc: Danny Hayes, CEO, Danny Wimmer Presents.
How close are Danny Wimmer and Danny Hayes of Danny Wimmer Presents?
The Dannys.
The two live a mile apart in the Cheviot Hills’ neighborhood of West Los Angeles. Their kids go to the same school. They have dinner together several nights a week, and they spend weekends together. They even go on family vacations together.
Close.
As in being like brothers.
While the two have an identical business vision, Wimmer is the creative maverick, CEO Hayes the shrewd businessman.
Wimmer, while passionate about music and his company’s activities, is mostly reserved, and avoids media interviews and public speaking at all costs.
Hayes, overseeing the business side including all legal work, has a portfolio of colorful stories, and can deftly stickhandle through city and state presentations, media interviews, as well as directly connecting via social media with music fans.
Since 1993, Wimmer has been producing festivals, both large and small. In 2011, he formed Danny Wimmer Presents (DWP) which, with 14 annual festivals in 13 cities, is now America’s largest independent festival producer
DWP’s portfolio includes the Aftershock Festival, Bourbon & Beyond, Chicago Open Air, Epicenter Festival, Hometown Rising, Louder Than Life, Sonic Temple Art + Music Festival, and Welcome To Rockville.
Don’t talk to either Danny about 2018, however.
DWP lost 4 out of 5 festival days in Louisville due to rain; got nerve-rackingly close to losing some of Aftershock presentations in Sacramento; and ejected themselves out of Rockingham in Richmond County, North Carolina after Epicenter’s inaugural event there ran into slow ticket sales, massive traffic jams, and wild weather.
And still, there’s DWP’s split with AEG which grew heated after DWP launched its inaugural Columbus, Ohio festival, Sonic Temple, last year which replaced Rock on the Range, and the inaugural North Carolina festival Epicenter which replaced Carolina Rebellion.
Rock on the Range and Carolina Rebellion were co-owned and co-promoted by DWP and AEG.
AEG filed court documents in Los Angeles Superior Court last November alleging that that DWP had “relied upon deceit and fraud to steal these two festivals.”
According to Billboard, DWP’s divorcing AEG was inevitable. “Industry sources tell Billboard that tensions between the two companies had been brewing for years and that while the two had a co-promotion agreement for both events, their deal also included language that allowed either side to walk away from the agreement and create a competing event. Creative differences between the two sides began to boil over in 2015, sources say, but neither side could come to an agreement to buy or sell their stake in the festival. Sources also say that AEG had tried to create a competing festival down the street from the MAPRE Stadium at Ohio Stadium on the same weekend as Epicenter Festival, but ultimately didn’t proceed with the event.”
Undeterred by its bumpy 2018 ride, DWP held three major festivals in Louisville, Kentucky over three consecutive weekends this past September. The run kicked off with the premiere of Hometown Rising, a country music festival (Sept. 14-15); followed by the return of Bourbon & Beyond, a mix of rock, folk, and Americana acts (Sept. 20-22); and the 5th year of Louder than Life (“The World’s Largest Rock ’N’ Roll Whiskey Festival”), featuring hard rock acts (Sept. 27-29).
How did it feel successfully experiencing the trifecta of live music with three consecutive festival weekends in Louisville, Kentucky in September?
Well, we had such a rough 2018…
You had rainouts and cancellations.
Yeah. We lost 4 out of the 5 event days in Louisville last year, and what people don’t know is that we got very close to losing some of Aftershock (in Sacramento) through the winds last year. So the combination left us a little frayed, to say the least. Then in the Spring, we had a bunch of issues as well. Weather issues. To finally get 8 full days of good weather (in Louisville) really felt rewarding. Danny and I kept saying, “The ball has to bounce our way at some point.” It was rewarding for everybody. Everybody kind of breathed a sigh of relief to finally show the vision we had. I think that was the hardest thing about last year. To do all that work, build everything to be just right, and then you don’t get to show it to anybody.
(Last year the Dannys were excited about moving DWP to Louisville. They rented apartments next to each other in the Whiskey Row Lofts on Main Street. They were determined to buy houses within walking distance to each other. They began shopping for office space. And then the disastrous weather happened.
On the Saturday of Bourbon & Beyond, heavy rains inundated Champions Park located on a floodplain above a landfill making it dangerous. The next day as water pumps ran full tilt, it became clear they had to shut down the second day. Later on, they also canceled Louder Than Life. Not only did DWP submit a $12-million insurance claim, but they decided to shift to a new Louisville site for 2019. To a 400-acre state-owned site at the Kentucky Exposition Center, near the I-65 and I-264 interchange, which the portion that they would use was renamed as the Highland Festival Grounds.)
So you have an issue of flooding for a day of Bourbon & Beyond, and all of Louder Than Life days at the leafy city-owned Champions Park. Lighten up here.
I know. We take it too seriously.
Meanwhile, you and Danny had a full year to dine out in Louisville at Anthony Lamas’ Seviche, and drink bourbon at the Evin Williams Experience.
Yeah, exactly.
As successful as the three events in Louisville were this year, there were still issues. For Bourbon & Beyond, attended by 91,000 people, there 21 complaints. The music could be heard two miles away, including in neighborhoods such as Meriwether, Schnitzelburg and Belknap, in addition to closer neighborhoods like Audubon Park and Camp Taylor.
One viewer sent WHAS11 TV a text message saying, “I live 6 blocks away. Try sitting in your living room, and having to turn the TV volume way up and feel your windows rattling… three weekends in a row.”
For Louder Than Life, your sound engineers utilized additional noise steering and management technology to reduce the exposure to the areas most affected during Bourbon & Beyond. So there’s still fine-tuning?
Yeah, there are always real-time adjustments that you are trying to make as you get feedback. In this case, it was a new site for us. So you don’t know what you don’t know going into a new site. There are a lot of things that we will change for next year. I’m sure that when we change those things, we’ll learn more new things. But by year 3 or 4 we should have it dialed down pretty good.
Are the reasons you and Danny fell head over heels in love with the Louisville market similar to the business conditions and the template first developed for Rock on the Range in Columbus, Ohio? Louisville nor Columbus are not festival markets one would naturally think of.
It’s a combination of things. Louisville has a unique resource which is bourbon. Consider that 95% of the world’s bourbon comes from Kentucky. We felt that was an interesting angle to build off of. The mayor (Greg Fischer) has started what he calls “bourbonism” which is the growth of the bourbon culture. We really connected with him.
(Members of the Kentucky Distillers Association have spent close to $100 million since 2012 on distilleries, warehouses, bottling lines, and visitor centers in Kentucky. The growth of distilleries throughout the state provides economic benefits from employment, taxes, and tourism — a combination Louisville Mayor Greg Fischer and others call “bourbonism.”)
Well, at the very first meeting you and Danny had with the Mayor’s office, you ordered a Ketel One and soda with a lime. An L.A. drink. Not only to the dismay of the city officials on hand, but even Danny was taken back.
(Laughing) I didn’t say we connected day one. But Louisville is a very pro-business city. They have a unified system of government where there is not a lot of city versus country or mayor versus city council politics that get in the way of business growth. They all sort of work together. And we really mapped out a long-term plan that they supported, and bought into. It is a plan that we would have liked to have done in Columbus, but there were limitations with the venue as you already intimated, and we had the AEG partnership that kind of got in the way of growth because we had different viewpoints on how to grow that festival to where the festival should sit in your portfolio which ultimately led to the split with AEG. There were a lot of those differences with us.
In Louisville, your new venue space for the three festivals, Highland Festival Grounds, is at the Kentucky Fair & Expo Center.
That’s a state property. It is owned by the state of Kentucky.
(Overseen by Kentucky Venues which is governed by the Kentucky State Fair Board.)
Easier for an outsider to deal with when the venue is under one jurisdiction?
It all depends on the government. In this case, the state of Kentucky has turned out to be as pro-business as the city of Louisville. We have made deep connections in the governor’s cabinet, and as a result, haven’t missed a beat in our growth plan. Champions Park was a city-owned property, and while we were a little nervous going from city to state property—would we have a learning curve?—the state has just picked up from where the city left off. The city has stayed involved, and everybody is working together on a vision. That doesn’t happen often.
Bourbon and music are a natural fit. They share such elements as craftsmanship and dedication.
Without a doubt. The history of rock and roll and the history of bourbon and whiskey certainly go together. Some of the most iconic rock photos in our time. There are so many of those moments. It really works together in creating something unique in the same way that BottleRock (an annual music festival held at the Napa Valley Expo in Napa, California) has created something really unique around wine, and we are creating something really unique around bourbon.
You had a selection of distillers and a collaboration with Kroger as part of Bourbon & Beyond, and then at Hometown Rising.
Kroger has been a phenomenal partner. That was the first time that we really had a really big retail footprint, and that felt good. To walk into a Kroger store, and see our displays. As Danny says, that’s a moment where he calls his mom and says, “Look, mom, I’ve made it. I’m in a Kroger.”
(Hometown Rising’s centerpiece Kroger’s Big Bourbon Bar featured more than two dozen hand-selected bourbons from top distilleries, and a unique opportunity to enjoy bourbons, and specialty cocktails from 1792, Angel’s Envy, Barrell Bourbon, Coopers’ Craft, Elijah Craig, Four Roses, Jefferson’s, Jeptha Creed Four Grain Bourbon, Kentucky Peerless, Michter’s, Rebel Yell, Old Forester, Stonehammer and Wild Turkey.)
When you and Danny first went to Louisville 8 or 9 years ago, you weren’t a bourbon drinker. Was it at the Evan Williams Experience that you became a bourbon drinker?
Yes. That is very true. Whiskey Jean was the person serving us, and that was the first bourbon I started to like.
I’m mostly a Single Malt Scotch Whisky drinker, but I’ve tried Maker’s Mark which is produced in Loretto, Kentucky by Beam Suntory, one of Hometown Rising’s partners.
I love Maker’s Mark. I particularly like the cask strength.
Too sweet for me.
Yes, bourbon is much sweeter than scotch. It’s all about finding your palette, and that’s where (renowned bourbon caterer) Fred Minnick helps out. If you come to Bourbon & Beyond I will have Fred do his palette test where he figures out your palette, and he says, “Here’s the right bourbon for you.” There are some bourbons that are on the peatier side. You just have to know which ones are, and that sort of opens you up, and then you start to get into others.
(Fred Minnick has worked with Danny Wimmer Presents as the bourbon headliner for the Bourbon & Beyond since its debut in 2017, and now Hometown Rising. For both festivals, Minnick—who has written 7 books– curates over 30 workshops including tastings, and discussions; moderates panels with industry icons, and celebrity chefs; and develops the bourbon and culinary programming, including sipping bourbon with celebrity musical artists.)
We have become very close to Fred. He is the world’s leading bourbon authority. He has been instrumental in building Bourbon & Beyond and indeed the whole festival scene for us there. That guy has really helped. You sort of joked about it earlier right, when we showed up there was a lot of resistance. Like, “Why do these two schmos from L.A. want to do a bourbon festival? You guys are from L.A., and one of you drinks vodka.” So Fred came in and helped us. He really got what we wanted to do, and helped legitimize us, and help keep it authentic. So it stays true to what bourbon is.
In an interview with journalist Jon Calderas in Cincy Music (Aug. 21, 2019) you indicated the three Louisville festivals are part of a long-term plan DWP has worked out with Louisville, as well as with the state of Kentucky. You said, “The goal is that we’re going to create a SXSW model around these three festivals. So, each festival is sort of the pillar and then we’ll start programming the weekdays with more and more things to do, giving people more and more reasons to stay in Louisville an extra day or two to take part in official events and activities and explore the city.”
In what way would you use the South By Southwest Music Festival model? As in creating a separate conference?
We will definitely add a spirit conference. All of the distilleries are there. Most of the bourbons are owned by major conglomerates who also have vodka, wines, and tequilas. So we went to add a spirits conference element. But the bigger piece is the way that South By Southwest touches the city of Austin, and what makes it unique is that it programs throughout the city of Austin. And that’s what we hope to do.
You should discover the annual Festival International de Jazz de Montréal, the world’s largest jazz festival, that hosts 800 concerts, two-thirds of them free, and attracts 2.5 million visitors each year to the heart of the primarily French-speaking city, providing local businesses with millions in tourism revenue.
I will check that out. We definitely want to be in more restaurant, bars, and local venues. I think that is what makes South By Southwest so special, and Louisville has this bourbon culture to build around something like that.
Bourbon tastings at such Louisville-based distilleries as Angel’s Envy or Kentucky Peerless Distilling or even the Woodford Reserve Distillery in nearby Versailles while your festivals are on would be very cool. Even going out to Bardstown, where some of the older distilleries like Willett Distillery, Barton 1792 Distillery or Preservation Distillery have been in operation forever, would be eventful. Treat the period like the festival and music events in the Napa Valley which do wine tastings.
The bourbon tastings are awesome, and it is a lot like the Napa Valley experience. They have spent hundreds of millions of dollars building these beautiful distilleries, both downtown and the original distilleries outside of downtown. It is equally as fun as a wine tour. It really is and it is becoming a big part of Bourbon & Beyond partnering with companies like Mint Julep Tours to create those kinds of packages and opportunities.
So bourbon tours through Louisville and Bardstown would fit alongside the festivals?
Yes. So what’s really exciting is that the KDA, the Kentucky Distiller’s Association which is the association and main lobby group, produces an event called the Kentucky Bourbon Affair. It’s more like an intimate 5-star Affair, probably 100 or 200 different events, intimate experiences. They are moving it to be the week before Bourbon & Beyond so they can now incorporate into what we are doing. We will be able to offer very detailed packages where you can say, “I want to come to Bourbon & Beyond, and before that I want to do these three distilleries and have dinner with master distiller.” It is really going to make a huge step forward in our long term vision there.
You came into DWP first as an investor. You were impressed by what Danny was doing with such festivals as Carolina Rebellion and Rock On The Range. What was your thinking in becoming involved because you didn’t know anything about producing festivals or concerts?
Danny and I had become very close, I was watching his success, and while I didn’t know anything about the festival space, more than what any other average lawyer would know, I could spot a good business.
Plus, Danny being in A&R for labels in Los Angeles including Atlantic Records, Epic Records, and Fred Durst’s Flawless Records was working with bands you represented as an attorney such as Staind, and Limp Bizkit.
Yeah, and I was his lawyer. I had done all of his deals for Rock On The Range and Carolina Rebellion. I could see that it was a good business. That he just needed some funding. So my brother Mark Horowitz and I started getting involved as investors, at a show level, and then that grew into the idea of the entire company.
As a music lawyer, you may have known about live music contracts but you didn’t know about festival sites or production.
I still don’t.
Wimmer is the creative guy, you are the business guy. You handle legal, budget and political issues, and Danny the creative aspects of running a festival business?
Exactly. I give Danny a lot of credit. He recognized his strengths and weakness, and I think he was cognizant of my strengths and weaknesses. It’s funny. We have this CEO coach, and we took this personality test, and the coach was like, “You two guys, your personalities match up perfectly as partners.” Danny said that is why he asked me to join him because, “I needed his side of the table.”
You left the legal world to work in live music as music sales began to tank. Today, income from touring is the primary focus for all artists. Bands paid $70,000 to perform only a few years ago are now demanding $350,000. A three-day festival spend of $6 million for artist budget isn’t unusual.
Yep.
When you two started, the biggest talent budget for a festival might have been $1 million for a weekend. Now it could be $1 a million for a single act.
You are not wrong. There are festivals that we produced in the early days in which the entire bill cost less than our headlines today. That’s a fact.
Has there been a time in which a contract comes across your desk with a fee that surprises you?
I don’t do that part of the business. The way that we run our business is that I run the business, and Danny runs the creative. We joke that every day we fight that line between art and commerce. So Danny and Gary Spivack (executive VP & talent buyer) do all of the bookings, I set the overall budget for the show, and then they can allocate it how they want. They may consult me. Ask me, “What do you think of this?” As long as they are sticking within the budget that I set for the show then I am pretty hands-off on that part of the business.
But you concede that there have been a few artist fees that raised your heartbeat.
Oh, God. More than a few. More than a few. Artists think that their fees should go up every year and I’m not exactly sure why.
Because their agent or manager tells them to do that.
Yes. They aren’t selling more tickets every year.
Promoter demands will also drive up a fee.
I get that we are buying a large radius that we have to pay a premium for that.
What radius do you seek?
We do 300 miles. We absolutely pay a premium for that. To me, that is money well spent.
How cool it is for you to continue working with some of the clients you previously represented as a lawyer like Staind, and Linkin Park.
There are some special moments for me because a lot of these bands I stayed friendly with and really close to. It’s ironic that once upon a time they were paying me, and now I’m writing them checks. I kind of enjoy that. It’s fun. Some of these bands helped me to get to where I am, and to now have them playing our stage is fun.
You and Danny live a mile apart in the Cheviot Hills neighborhood of West Los Angeles? Your kids go the same school? You often have dinner together or spend weekends together? You go on family vacations together? All true?
It’s all true. We come home from three weeks in Louisville and then we go to dinner at our country club together. We joke all the time that one of the things that we have to do now is separate more because we have to divide and conquer. But we like traveling together. We like taking meetings together. We go into a pitch, a presentation together, he’s the passion and I’m the business.
You love to talk about Danny Wimmer.
I do. He’s literally my brother. The only reason the company is named after him is that I made it a consideration of my joining the company. So even though we are partners in the business…
DWP has been going since 2011.
We had been building it for a couple of years, and I was already involved, but I hadn’t left my law practice yet. So I was acting as a CEO for about 18 months before I left my law practice. We had hoped and planned to grow into a full business. I had made it clear from day one that if I was going to get involved; if I was to invest, and eventually be a partner; the company had to be named after him because he’s the one with the creative vision, and everybody knew him as an A&R guy. I wanted them to see him for who he was in the festival space. I told him, “You are as creative there as you are as an A&R guy.”
He was an A&R guy who couldn’t get Staind a festival booking and then decided to launch Rock On the Range in 2007.
That’s exactly right. Then he picked Columbus. And I was like, “Columbus, Ohio, who wants to go to Columbus?”
Of course, Columbus offered a template that you’ve utilized again and again. Strong market economics, and a sizeable hard rock fan base within a 6-hour drive. Also, Danny always picks line-ups that are distinctive.
You are 100% right, and for all of the reasons you just said we went there, and obviously, it blew up. I agree with everything you just said. It was all Danny’s initial business plan, and to tell you how important that 6-hour drive is, 70% of our audiences come from outside the host cities. Without fail. And 50% are typically from outside the state.
When you and Danny went to lobby the city council in Danny’s hometown of Jacksonville, Florida for Rockville, the legend is that you were about to speak but Danny abruptly jumped in. His concert promoting career started in Jacksonville in the mid-1990s at the Milk Bar, where he worked with and learned from bar owner Ed Wilson, and where he discovered Limp Bizkit. Danny also produced shows at local venues such as Club 5 (now the Sun-Ray Cinema).
The city council guy was like, “Is that the guy who owned the Milk Bar?” I said, “Yeah he did.” Then he said, “Oh shoot, he might have pictures of me. I’d better support him.” It was really funny.
Danny wasn’t going to speak?
No, no, no. Danny and I spent the entire airplane ride with Danny telling me that he wasn’t going to talk, and I’d better be ready, and I’d better know what I was going to say. And we went over what we were going to say. What I was going to say, and what I was going to present. Then we got there.
Danny pushed you aside to speak?
It was actually (production manager) Les Targonski, but I’ve changed the story because it’s funnier that way to me. Les Targonski was speaking, but I was next, and Danny ran down, and he was told, “You can’t talk out of turn.” and he goes, “No, they work for me. I’m going to talk.” It was really funny.,
I’ll tell you another funny story. We were in Louisville, and I had two presentations. I was supposed to present to the board directors of the State Fair, and then an hour later I was presenting to the KDA (the Kentucky Distiller’s Assn.). My KDA presentation wasn’t done so I was like, “Danny, I’m sorry but you have to go to the State Fair board meeting, and do it (the presentation) for me.” He’s like, “I knew this was going to happen. I knew it.” He was so mad because he does not like to public speak. But he delivered such a passionate speech that he got two standing ovations from the State Fair board. Literally, the Secretary of Tourism was saying to him, “You’re the future of Kentucky. You’re the future of Kentucky.” That would not have happened if i had done the presentation.
You always don’t get that kind of enthusiastic reception when you approach officials about wanting to bring a hard rock festival to a city. Their reaction is often, “Do you mean with all of the noise and the potential for violence?” You can at least tell them that DWP hasn’t had troubles at its festivals.
No, and thank God for that. There’s is such a misperception as you know about the hard rock audience.
But you have had that dismissive reception?
Everywhere we go, but luckily we have enough history now that all we have to say to a new city, is “Hey, call the mayor’s office in Sacramento. Call the mayor’s office in Louisville.” We have enough references now that one or two phone calls clears that up pretty quickly. But it was hard. Fitting in Louisville with Louder Than Life wasn’t easy because that was their perception of us, and what ended up saving us there was from the CVB’s (the convention and visitors bureau head’s) son going to Rock On the Range (in Columbus) every year. So it was, “Hey mum this festival is amazing.” So she went to the mayor and she said, “I think you guys need to take a look at this. These guys are legit. This is not what you think.” She really opened the door for us there because of what we had done in Columbus.
Not every festival, of course, works out. You will not be returning to Rockingham Dragway with the 2020 Epicenter. All told, DWP lost $3 million last year on Epicenter’s inaugural event at the Rockingham Dragway, part of newly created 550-acre Rockingham Festival Grounds in Richmond County, North Carolina. Correct?
Correct. We moved to Charlotte
(The 2020 Epicenter festival will be held at the Charlotte Motor Speedway’s Rock City Campgrounds which includes nearby lodgings, increased camping, and convenient travel.)
At Rockingham, you ran into slow ticket sales, massive traffic jams, and wild weather. So not everything works out. On the other hand for its 8th year, some 90,000 people attended the Aftershock Music Festival at Discovery Park in Sacramento with 50 bands on three stages including Slipknot, Blink-182, Marilyn Manson, Stone Temple Pilots, and Korn. You had a great year there.
Yeah, and that is still going toward why the split with AEG happened. It is all about building a portfolio because as you know if you are a stock investor none of the stocks are up 100% of the time across the board, right? Some are down, some are up and you hope that the portfolio balances in your favor. And that is what we tried to build with our festival portfolio. It was hard when we didn’t have a partner who isn’t part of our overall portfolio making decisions or wanting to vote in ways that maybe affect the overall balance of our portfolio.
DWP had more than a decade relationship with Joe Litvag, the former senior AEG VP. He abruptly left AEG last year after 15 years and is now at Blackbird Presents as partner and the president of live entertainment.
Love Joe.
What soured the relationship with AEG?
It’s pretty public. They filed their papers. We filed papers. It’s fairly public. It was just a different business philosophy and different booking decisions. As you can see, we believe in getting more and more aggressive with our talent, and stepping up the game every year, and AEG didn’t always agree with our booking decisions. But one of our business strengths was that we could buy weekends to weekends together. But if AEG doesn’t want to buy the same headliner that we wanted to buy, then we can’t get the headliner for (Welcome to) Rockville. So decisions that were being made at Rock On The Range were affecting our business elsewhere, and that started to create some real problems for us. Understandably, they don’t give a crap about….they don’t care about Rockville, but we do. We are trying to grow it. There were just a lot of situations where we just didn’t have the same business or creative vision.
Independents in most businesses can make decisions, and turn around events faster than a major player that may be their partner. One of you can walk into the office, and say, “Let’s do a festival” in this or that town. When? “Next year.” And you can do it.
That’s exactly how we do it.
A bigger partner might say we have to look at this more, and then talk among themselves
You are exactly right. The issues that were developing were developing over the course of several years. It wasn’t any one thing.
AEG is suing DWP on 25 civil counts, alleging breach of fiduciary duty, fraudulent misrepresentation, breach of contract, unfair competition and trademark infringement. You and attorney Matthew Oster did dispute AEG’s charges as well as the characterization that DWP “schemed in secret” to essentially steal and rename the original festivals in dispute.
They have a very creative mind.
As a lawyer what did you think when you read that?
Luckily, I have a paper trail that shows otherwise because I had been telling them for years that this (separating) was the only conclusion. That if we couldn’t figure out a better way of doing business, the only conclusion was what I called “the nuclear option” per out of the contract. That was the only right that we had. We had the right under the contract to end the festival and start a new one. That was the only right that I had. I kept saying, If you can’t come up with a better solution then I have to do what I have to do for our business.” There are all kinds of emails talking about “the nuclear option.” I don’t know how they think that I was conspiring secretly.
The litigation is still ongoing?
Yeah. And I’m sure some of the people involved with Jason (regional AEG Presents VP Jason Rogalewski) now didn’t. Maybe it seemed like news to them, but it’s not up to me to internally who knows what. I dealt with Joe.
Does DWP undertake economic impact studies following festivals?
Oh yeah, we do economic impact reports every couple of years for the cities. There’s a mathematical formula so you can pretty easily update them. We got about $100 million in Louisville between the three shows.
What’s somewhat overlooked is the impact of festivals on hospitality and accommodation spends elsewhere in the region. So much focus is spent on the festival gate receipts that what happens regionally is understated or not reported. Bring in 250,000 to 280,000 people into a region for three weekends, and local hotel rack rates will spike for miles around. Local hotels and merchants just won a jackpot thanks to you.
It’s already happening. I am already hearing from fans that’s the case. It happens in every market. It also happened in Columbus.
Earlier, you mentioned Linkin Park. You know Jim Digby who has served as director of touring and production for Linkin Park since 2002. He is also founder and chairman of Event Safety Alliance which, since 2014, has been centered on identifying, and distilling the standards and codes that apply to the live event industry; as well as teaching operational practices, and decision-making criteria that would allow those working in the industry to work safely.
I really respect what Jim Digby and Steve Adelman (an attorney at Adelman Law Group in Scottsdale, Arizona, and VP of ESA), are doing. It’s a really important part of the business to come up with best practices and to be constantly re-examining. Unfortunately, if something happens, you have to re-examine how you are doing things to try and adjust. The scariest part of producing outdoor events is the number of points that are vulnerable.
Insurance will protect you and your staff to some degree, but also each of you has a legal duty of care for all of those things that are under your direct sphere of influence at a festival site. You could be legally held responsible personally in case of a mishap or injury. Staff wouldn’t be indemnified through a work contract.
Yeah. I’m so glad that you are reminding me of that. There’s one part of our business where Danny has absolute spending authority, even if it is outside the budget, and that is when it comes to safety. One of the rules that we have is that if he has to make an onsite decision or week of festival decision that has to do with safety, then he has the automatic ability to make that spend, even if it exceeds the budget. At that point, we don’t believe that there’s any time for a budget process and you have to do what you have to do to make the event safe.
(In tort law, a duty of care is a legal obligation imposed on an individual requiring adherence to a standard of reasonable care while performing any acts that could foreseeably harm others. It is the first element that must be established to proceed with an action in negligence. Breaching a duty may subject an individual to liability. With each of the 50 U.S. states being a separate sovereign free to develop its own tort law under the Tenth Amendment, there are several tests for finding a duty of care in United States’ tort law.)
At what level of safety do costs rise so high that it might be unrealistic to continue a festival?
The biggest challenge is the point of which where do tort and security make the event unproducable. As a lawyer, I think the thing I think about most is at what point does a lawsuit change a law to a point where you can no longer produce a live event? At what point is an event unaffordable to do everything you would have to do to be “reasonably safe?” To have done safety measures up to a reasonable standard? There is a point. There is a point at which you will say, “I can’t pass this cost to anybody anymore” and, in effect, festivals become unaffordable.
Festivals have transitioned so far from the ‘60s. No longer are they bands in a field with a handful of local merchants selling jewelry and clothing or a few tents with suppliers selling liquor. Meanwhile, American promoters remain wary of targeted Wi-Fi, network monitoring and analytics, cashless payment systems, and even RFID wristbands.
I can speak for everybody but I can speak for us is number one it’s a fear of bandwidth that if that Wi-Fi….we are in places that don’t have hard-wired Wi-Fi. We have yet to find a Wi-Fi solution that doesn’t crash when everyone is sending their video to Facebook at the same time.
You can do the math on what a half-hour outage would cost the festival bar sales.
Right. So you are worrying about taxing Wi-Fi. You worry about it going down and then everything has a cost as you said. So we are going to RFID this year but it added a cost that now the consumer has to bear. In our genre for sure, there’s extreme price sensitivity. Extreme. And every 5 and 10 bucks does matter.
For Epicenter, DWP sold discounted tickets, a $1 bring-a-friend type deal to try and make up for slow sales
Just to reduce our loss.
But you ran the risk of ticking off fans who paid the full ticket price earlier.
Yeah, and that’s why ultimately I got on social media because I felt that the fans deserved an answer, and I wanted to explain in very clear terms why things happen. Like, maybe, as a fan you don’t like, and you might think that this is a slap in the face, but you don‘t understand the alternative which is I could have lost $5 million on the show, and there’d be no more Epicenter. I love to have a dialogue. “Would you guys rather that I not discount, and just have Epicenter just go away? That’s the choice that we had to make in that moment.” It was, “Let’s lose $5 million and shut the sucker down or…
Lose $3 million…
And try it again?” You have to sometimes do things that are unpopular. But the thing is that it deserves an answer. That is what I learned from social media and I learned they can handle an answer because they understood it. And I really respect that.
The live music industry doesn’t do a great job of communication. Promoters usually only become visible in order to defend themselves over such issues as high ticket prices or tickets not being available or secondary ticketing complaints. They should do more direct to consumer things that you did over the Epicenter ticket pricing.
I agree with you 100%, and there aren’t any state secrets. Everybody in the business knows the business, and we all know what everybody else is doing. It’s pretty obvious. I think that you are right. To clue the fans in enough so they can understand the reasoning behind things is important.
Someone in live music recently told me, “I see no reason why ticket prices for a show can’t be $800 per show.” I replied that firstly few bands are worth an $800 ticket, and as Garth Brooks famously said, “Just because you can charge a high ticket price doesn’t mean that you should.” Still I recognize that when secondary ticketers drive up the price of a ticket there’s now a higher value in play. But also isn’t there a limit of what can be charged for a ticket?
Without a doubt. Our fans are extremely price-sensitive and that is the biggest challenge. Artist prices are going up at a percentage that is faster than ticket prices can go up. That’s my festival economics.
You do have VIP programs
Yeah, we have a VIP program. In some markets we have an uber VIP program. Those are higher tickets. But even those have a finite ceiling. If you price them too high they don’t sell.
Veteran Canadian promoter Michael Cohl once told me, “How do you tell a ticket price is too buy? People don’t buy it.”
That’s exactly right.
Many artists see a $200 ticket advertised by secondary ticket reseller for $400 or more and they ask, “Why am I not getting a piece of that?” As do many promoters. I understand that.
I do too. I don’t know why we just don’t do the lottery system. Or a bidding system where you can bid, and be transparent about it. The tickets go to the highest bidder. I think there’s something to be said for bidding and being transparent saying, “If you want the front row for Bruce Springsteen. You do the option, and the ticket is going to the highest bidder.
What really ticks off people are concert tickets selling out within minutes via the ticket agencies.
That’s a tough one. If there’s a finite capacity, there’s a finite capacity. One thing that we did change this year though was fans were really saying, “We don’t like it when you put up that first tier up, and it’s gone in a second.” So what we’ve done is rescaled our tickets this year so there are fewer tiers, and there are a lot more (ticket) allotments in each tier. At least they then have a shot. We put a lot more into the three tiers. But for them (shows) I guess you have to have a lottery or a raffle. It’s simple supply and demand, and sometimes these bands are that hot, and they are playing an underplay, and the show is just going to blow out.
Is secondary ticketing an issue for festivals?
It doesn’t affect us as much because we are predominately a GA (general admission) sell. It is much more rampant in the world of premier seating. If the front row sells out that’s what you find on secondary. For us, it is only a real factor if the shows sells out. so I’m hoping it becomes more and more of a factor. If shows sell out sooner then you might see more on the secondary market but it just doesn’t affect us the way that it does an arena or an amphitheater.
You have 5 Metallica shows on tap in 2020, let’s see if they will be affected by secondary ticketing. Making the performances so attractive is that these dates are the only chance to see Metallica at U.S. festivals in 2020, and the band is formulating 10 different setlists so that no two nights will be the same.
I want to sell them out first, and then I will analyze that (secondary ticketing). Right now I’m just focused on selling Metallica tickets.
(Metallica will play two separate headlining sets at each event. The festivals include Epicenter (May 1st-3rd) in Charlotte, North Carolina; Welcome to Rockville (May 8th-10th) in Daytona Beach, Florida; Sonic Temple Art + Music Festival (May 15th-17th) in Columbus, Ohio; Louder Than Life (September 18th-20th) in Louisville, Kentucky; and Aftershock (October 9th-11th) in Sacramento, California.)
I’d be more focused on winning the Willie Wonka-styled Golden Ticket Contest wherein the winner will receive an all-expenses-paid trip to their choice of festival to watch both nights of Metallica from the “Snake Pit,” plus accommodations, meet and greets, exclusive festival access, memorabilia and so on.
I want to win that.
Who came up with that?
Our head of marketing Brian Harrah (VP of marketing). He came up with it in conjunction with the Metallica team.
How did the company end up with five Metallica shows? A relationship that Danny developed?
Yes. We had Metallica at Rock On The Range, and they sold out in a month. That year we took a beating everywhere else by not having Metallica. Carolina Rebellion was really pissed that they didn’t get Metallica. Rockville was pissed that they didn’t get Metallica. Danny started talking then with Lars Ulrich and to Q Prime (Artist Management) about a bigger concept with them and a year and a half later here we are.
With Q Prime’s Peter Mensch and Cliff Burnstein, you know everything will be done right.
Team Metallica is unbelievable. Across the board unbelievable, and just tremendous partners.
You have a Bachelor of Business degree from the University of Miami? Are you from Florida?
I was originally from Fort Lauderdale and went to Miami for undergrad. I studied business there.
Then you jumped to the University of Southern California Law School for a law degree.
I was a Trojan (student). I’m a crazy Trojan football fan.
(The USC Trojans participate in the NCAA Division I Football Bowl Subdivision (FBS) as a member of the Pac-12 Conference and have won 123 total team national championships, 97 for men and 26 for women, including non-NCAA championships.)
Where did you first practice?
I started off In 1992 at a real small firm Guggenheim Felker & Levine, and then I was at Manatt, Phelps & Phillips for 5 years (1996-2002), and next, I joined Davis Shapiro Lewit & Hayes and was there for three years (2013-2015).
Mainly practicing music law?
I did nothing but music the entire time. In the ‘80s, Manhatt was a power player in the music business. When I got there they were still good but they weren’t what they were and I was helping to rebuild it. They still have some great music guys there now.
Manatt, Phelps & Phillips’ Lee Phillips has been the leader in the music industry for over four decades. His clients have included Brian Wilson, Burt Bacharach, the Eagles, Kenny Loggins, Steve Perry, Tracy Chapman, Barbra Streisand, Prince, Michael Jackson, and so many others.
I worked with Lee Phillips who is just the smartest lawyer on the planet. I knew I just had to get people in front of Lee, and if I got them in front of Lee, we would get the client.
Who was your first entertainment client ever?
I started off doing copyright and music business law for songwriter estates, representing the Bernie Wayne Estate. He was best known for “Blue Velvet,” and “There She Is,” the song long associated with the Miss America pageant. I had a handful of estates. That’s sort of how I started, and I had tour assisted for Yanni when I got out of law school. After I passed the bar, a buddy of mine was his tour manager, and he said he needed an assistant. He convinced me that I would never understand the music business if I didn’t tour. That ended up being the Live at the Acropolis tour (in 1993). Yanni and I became really close. Yanni played a big part in getting me to Manhatt, and when I went there Yanni went over there with me, and that really started switching me to be an artist lawyer. Then I picked up Everclear which is probably my first platinum rock band.
Davis Shapiro Lewit & Hayes is certainly a music industry powerhouse as well.
Yeah and that was straight music talent as well. I am really proud of what we built there. It was a really good firm but definitely I saw things changing and what Danny was doing sounded pretty interesting.
Do you miss the legal world at all?
I still do all of our high-level legal work here. All of our outside attorneys are all reporting to me, so I still get more than enough legal work. I have outside attorneys for everything. But it all runs through me. I am actively involved in any litigation. I am actively involved in all of our negotiations. So I am still getting enough legal work to the extent that if I had any hunger for it I am getting more than enough.
As the summer festival season fades away what business activities take up your time?
There’s always so much that goes into building and leading into the festivals. Planning other events, looking at new business opportunities. Danny and I spend a lot of time looking at new opportunities. That is also when we have the time to travel, and go look at other cities, and other sites.
Returning to Louisville to no doubt drink bourbon.
We have to go back there a couple of times, and there are enough meetings to do around bourbon. We are in enough places. There’s always travel and meetings, and things that you still have to do face to face.
Larry LeBlanc is widely recognized as one of the leading music industry journalists in the world. Before joining CelebrityAccess in 2008 as senior editor, he was the Canadian bureau chief of Billboard from 1991-2007 and Canadian editor of Record World from 1970-80. He was also a co-founder of the late Canadian music trade, The Record.
He has been quoted on music industry issues in hundreds of publications including Time, Forbes, and the London Times. He is a co-author of the book “Music From Far And Wide,” and a Lifetime Member of the Songwriters Hall of Fame.
He is the recipient of the 2013 Walt Grealis Special Achievement Award, recognizing individuals who have made an impact on the Canadian music industry.
