Duff McKagan at South by Southwest on Thursday (photo: Jeff Miller)
Even at SXSW, it was an unusual scene: a tattooed, shades-sporting, leather-clad former bassist for one of the world's biggest rock bands talking to a nearly-packed room about ... money markets? But Duff McKagan (who made his name -- and his money -- as the 4-string guy for Guns 'N Roses and Velvet Revolver) did just that in room 12ab of the Austin Convention Center today, in an engaged, engaging hour that owed its success both to his easy-going, plain-spoken approach (he even started with a room-comforting off-color joke) and a starstruck audience that asked questions not about groupies and drug experiences, but about topics ranging from the control of publishing rights (McKagan's advice, paraphrased: Keep them) to how he felt about "Glee" reaching out for licensing.
" 'Glee' can suck my ass," he said jokingly, referring to former bandmate Slash's publicized brush-up with the show. "Actually, I don't care -- my daughter watches 'Glee,' " he admitted.
McKagan's an unlikely candidate for money advice, which is exactly what makes him the right man for the job. To start off the panel, he spoke about his first years with Guns 'N Roses, as a formerly hard-up young man suddenly cashing royalty checks for hundreds of thousands of dollars without having any idea about how to manage his money. "I didn't even know what a stock was," he admitted. "I didn't know the difference between gross and f---ing net in my 20s." All that changed, he says, when he had what he described as a near-death experience and began going through the band's financial records. Convinced that he was losing money he could be making, he enrolled in business school and began dedicating his time to expanding his portfolio.
For musicians struggling with everything from how to hire a lawyer to whether to take an advance, that makes his advice worth, well, gold. And the audience didn't let him off the hook, leading McKagan through topics ranging from specifics on how to avoid Ponzi schemes to how the Presidents of the United States of America (remember them?) leveraged their hit song to make millions of dollars.
Most of his best advice came in the form of pull-quotes: "Your house is a home, not an ATM," McKagan said, referencing taking out new loans. "Usually publishing deals have an end. Perpetuity is forever," in response to a question about taking an easy paycheck. "I always plan for my career ending today," which's why he's already got his kids' college fund figured out.
Speaking of which, to a kid who said he'd just graduated college and didn't know whether he needed a money manager: "You don't need one if you just graduated college. You need a job."
His main point, however, was figuring out how best to leverage the money you're making with the money you could stand to make. "The Foo Fighters just did a video for $3000. [McKagan's current band] Loaded does a lot of webisodes. Content IS king. Does it kill the mystique? Yes -- but you can no longer be the band of 'I wonder what's going on with those guys,' " he said.
Later, he talked about accepting marketing money: "It's ok to have [product placement in a video], and then they give you money to help you tour. Fans don't see that as selling out anymore." He also discussed the fact that even the biggest bands in the world aren't far from feeling the pinch of today's economic reality; while keeping the band anonymous, he discussed hanging out with amphitheater headliners backstage, not talking about musical realities, but about whether they could afford the touring costs considering gas prices in Washington.
His expertise wasn't lost on the audience. Carlos Fisher, a songwriter who asked him a specific question about publishing futures, was glowing about McKagan after the panel. "It was his capability to say, 'It's about finding a balance,'" said Fisher, referring to McKagan's advice to not take an advance outright. "You won't get that advice from your lawyer or manager."