I think the most valuable thing we do is we do a lot of exclusives with artist integration. We unlock certain parts of our business plans to people via our social network to let them discover and drive what it is that we do.
So if we do an event on New Year’s Eve, or if we’re about to release a lineup, we’ll let people engage with us to get to a certain ‘Like’ count to unveil what it’s going to be. We find by engaging with our consumers, they dictate the terms, and then after the fact we produce or spend a lot of money filming or documenting the event from start to finish, and then doing up a post-video.
We release that, and we do a pre-video for the event the following year, which recaps the previous and forward sells the next. By doing a video we show the process, we find we sell out within a day of release and it costs nothing from in-house. But marketing wise, because it is organic and it’s real, it’s powerful. So we find that’s our best thing.
A few years ago we went to a big conference and, as we’re distributed by Warner, we met with Atlantic in America and Warner in the UK. We said, ‘We’re all doing everything individually; we all have the same kind of records; we all have our own artists; or we’re all doing videos for the same person three times’.
So we sat down and went for a big dinner and said, ‘Why don’t we create a global alliance where we will sign artists collectively, or if you’ve got someone you’ve signed for your territory we’ll give you first option, most of the time for free; we’ll sign you for the world if we can’.
What that meant for us has been the ability to call on an Atlantic artist as a feature on Australian artist records. It’s meant that we can share costs for video and has meant a huge cross pollination of American influence in Australian records and vice versa.
It gives us both opportunities to sell, and it means we can line up for a worldwide release on one day, where we used to have to piggyback or wait for America to go first and follow.
While it’s not a contract per se, and it’s a handshake deal, it’s been tremendously successful, and we’ve learned knowledge that every market is collectively pulled. That global alliance has been the strongest thing. We’ve been able to take our revenue and our artist base and double it.
I think this year it could triple our revenue again because we could send Aussie artists to America, get them collaborating with American artists, bring them back home. Then, all of a sudden, they’re on main stage festivals. So it cascades; one feeds the other organically. The cash surplus at the end of that fuels brand extension into Ponyfish or whatever else, and then you sleep like once a week for two hours.
Of course I’ve made mistakes. I did a business venture called One Life; it was a fruit company. We did sliced apples in a bag which we saw had been successful in America.
We raised about $1.25 million to start the business. We decided to go route trade to start with. We had cars, we had branded everything, we had a great team, but we figured out very quickly that route trade was going to be too difficult to return on investment, we should’ve been going for large format suppliers.
By the time we knew that, cash was running thin, but we went and got contracts with Qantas, Virgin, Hawaii Airlines, McDonald’s and 7-11. In month 14, I think, we turned a profit for the first time.
Then we had a problem with our apple suppliers and so we started not delivering on time to Qantas, who don’t take kindly to not getting their deliveries on time. Things became strained there, and we decided to do a big promotion at 7-11 – buy Mount Franklin water with a bag of apples.
But then we found that they could only deliver us about 300,000 bags of apples that month because of an issue with supply of apples that particular time of year. That was the critical point and we thought if we put boards out the front of 7-11s in Australia saying ‘Buy one get one free’, and after week one there’s none left, they’ll sue you for a lot more money than we had in the bank.
The worst thing we could possibly have done was that we didn’t have backup plan for how we would package that product, so we pulled the whole thing. We dusted $1 million on that one.
But you win some, you lose some and nothing ventured, nothing gained. It could’ve equally been the hugest thing we’d done.
When I was about 16 and still at school I worked as a promoter at the Metro night club. I was probably one of their highest-paid people because back then. I was paid a dollar per person that got through the door. I was getting $300 a week on a Saturday night, and $400 another night so $700 a week as a kid. I think that showed that I always had a kind of entrepreneurial streak.
Then I started DJing and when you stand in front of a crowd as a DJ you better have some presence; because if you look vulnerable, you’re weak and easily knocked off. So that’s always been a forte, to be able to stand in front of a crowd and talk and not worry about what they think about you.
Most of the artists you come into contact with attach an ego to what you do. There’s no room for ego in this business because you’re only as good as your next record, so if you don’t do a good job with the last one, don’t expect the next to be any good.
I think that’s why in business I’ve been quite good. I’m very, very aggressive to set up multiple revenue streams and maximise the most of any opportunity to create, because you don’t know when that may stop. So while that window’s there, you’ve got to go really hard at it, and that generally opens more. I don’t think any business will fail if you throw enough energy at it, but what’s the opportunity cost?
I think with music, for me as a humble DJ to sit there and now have the biggest music agency, we’ve grown far. Not that you worry about your competitors. You shouldn’t worry about what they do; it’s what you’ve got.
Now I’m actually more enjoying watching the new artists come in, giving them a hand and exploiting them. I love the word “exploit”, I think exploiting is good – it’s how you exploit that is the key. If you exploit it in a positive way, to exploit someone’s full potential, that’s good. If you exploit them to rinse them for short-term cash, that’s not cool.
We’ve got the tools; we give them easy contacts, business acumen. Anyone with short-term views, I don’t want to work with them, because there’s nothing to be gained.
Continued brand extension. We’re going to increase our hospitality portfolio significantly. We’ve got four concepts that are really quite strong and they entail a lot of what we’ve talked about. There will be the overhead product, and inside that we want to own every brand and every piece of cutlery will be branded.
Every bit of every source, every feature in the restaurant will be purchased and sold through third parties. They’ll be own brands inside that.
Melbourne’s got four sites which are under offer, so it’s just a question of which one we activate first. And we’re looking at LA, and I’ve also got an opportunity in Spain. It’s just a question of time and staff and getting the right team. If you’ve got the right team it’s fine.
We’ll be hosting festivals for our Weekend brand. We will be doing our own venues, our own clubs. We’ll also be doing our own publishing company for music. Artist management is next, which is not only just music; it’ll be sport and entertainment as well. We’ve just acquired a social media agency which we’re going to be monetising and hopefully selling that in a couple of years. We’re very excited about the growth opportunities of that.
Cara Waters is a former SmartCompany editor. Previously, Cara was a senior reporter for the Financial Times’ website and worked for The Sunday Times in London.
