Management & more: The Firm reimagines The Deal
Jeff Kwatinetz wants to fix the music business. To do this, the high-profile manager and chief exec of the Firm has structured a spate of deals that strive for a more equitable split between label and artist.“What I’m proud of at the Firm is we’ve shifted the balance of power both creatively and financially more to the artist’s side,” he says. Recent deals include partnering the rock band Korn with music conglom EMI to share in the band’s revenues, as well as a similar arrangement between Korn and concert promoter Live Nation. And while these types of agreements may not be unique, the Firm is at least giving its clients options in the traditional record label-artist-manager relationship. “These deals work best with acts whose record sales are on a decline but are still viable live acts with ancillary revenues,” says one EMI exec about the Korn/EMI pact. “And it typically gives management commissions on the advance payments.” In July, the Firm bowed a label that will split revenues equally with its artists (after expenses) that is funded by EMI. First signings in the still-unnamed company include Mandy Moore and Army of Anyone. Revenue-sharing with artists is a model that’s been previously tried without success, but this latest incarnation nonetheless has kept the Firm in the headlines for its deals, instead of its high-profile client defections and key staff exits. And while many music management honchos such as Irving Azoff prefer to keep their number of clients to a manageable few, the Firm boasts a robust list of potent artists, such as Kelly Clarkson, Jennifer Lopez, Ice Cube and Taylor Hicks. “The music business is being driven by record companies (that) used to be more able to invest money in acts because the economic realities were different,” Kwatinetz says. “They also were able to take a more long-term view of careers. We have tried to fill that gap by creating a company that is not exactly a management company; it’s more of a music company. The difference in my model is, instead of the label giving artists Cadillacs, you actually give them the money.”
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