Live Nation‘s head Michael Rapino has called the plans of ex-WME music chief Marc Geiger to acquire 51% stakes in struggling venues a “fire sale“.
The background
Geiger recently announced a $75m fund to create a “partnership plan” called SaveLive. It will see the fund buying up stakes of at least 51% and “backstop all these clubs”. This received very mixed reactions, partly due to the altruistic-sounding name, despite there obviously being more to it than that. The New York Times sees potential:
“As SaveLive partners, Geiger said, they would gain economies of scale as well as access to favourable deals for ticketing or sponsorship — suggesting that SaveLive would, to some degree, resemble a mom-and-pop version of Live Nation or AEG.”
Why the shade from Rapino?
For most of this year, I’ve been concerned about the ability of venues to maintain their independence beyond the pandemic. Then back in August, paired with their Q2 financial results, Live Nation announced their intention to expand:
“We believe that over the next 24 months there’ll be ongoing opportunities for us to expand our global footprints in foreign and international markets that we’ve have been looking to get into and build some businesses around.”
How they’ll get into those markets is unclear, but the company has a history of expansion through acquisitions. It also bears keeping in mind that the above statement came at the end of the same quarter that saw Saudi Arabia’s Public Investment Fund acquire a $500M stake in Live Nation.
The differentiator between Geiger’s SaveLive and Live Nation seems to be the geographical focus. Rapino opines that US independent venues won’t sell cheaply, because “there’s a lot of capital out there.“
What’s the take-away?
It’s a waste of time trying to figure out who’s right or wrong in these types of debates, because that’s not why the actors of the debates participate in them. What’s valuable about it is that you can spot intentions and see headlines that clearly point towards trends.
To me, the takeaway here is: independent music is at risk of becoming less independent. That’s always so, but more so now. Prominent music business veterans can raise funds of tens of millions of dollars and incumbents have all but announced their intention to spend cash to expand.
It may be worth checking in on your local music venue organisations and seeing what forms of support they can use. Each territory has their own unique challenges, economically and politically, so it’s a global plight with a local character.