In his former guise of co-founder and CEO of MAMA Group, Dean James ran the London-based live music, artist management and consumer services company from its inception in 2005 until his eventual exit in January this year to "focus on outside interests."
During his nine years at the helm of MAMA, the company built up an extensive portfolio of U.K. music venues, including London’s Hammersmith Apollo (now the Eventim Apollo), The Forum and G-A-Y., as well as U.K. festivals Lovebox and The Great Escape, and management division Supervision, which represented Franz Ferdinand, Kaiser Chiefs and The Vaccines, among others. Having been acquired by HMV in 2010, James led a management buyout two years later before exiting the company early 2014.
Last week, James unveiled his new business play: Sixth PLC, a live-focused music company, which, like MAMA Group, will pursue interests in artist management and venue and festival ownership. Joining James at the company, which has offices in London, Melbourne, Mumbai and Delhi, is former head of business affairs for Shazam Matt McCann, who takes up the role of Sixth COO.
Dan Fraser, co-founder of Nettwerk Music Group, becomes a non-executive director, while funding for the start-up comes from Indian conglomerate Apeejay Surrendra, which counts Typhoo Tea among its extensive business properties. Sethu Vaidynathan, a senior director and family member of Apeejay, joins James and McCann on the Sixth board as chairman and co-founder.
Billboard caught up with James to discuss his new company’s goals and ambitions. “If we’re sitting down with an artist, we’re going to be talking live, brand partnerships and digital,” says James. “You’re not going to build your profit and loss accounts by relying on recorded music sales.”
Why have you called your new business venture Sixth?
It comes from sixth sense actually. The more I thought about it the more I thought [Sixth] fitted because this company is a little bit more about thinking than it is about the other senses, which I think are probably overused in the music industry sometimes. Often there is maybe not enough thought given to what we do.
What are the core components of Sixth’s business model?
You could label it a live company. You could label it an artist management company. For us, it’s working with artists in the areas of the music in that are growing, which are live, digital and artist partnerships. Rather than focusing on a decline product, which is recorded sales. How many more signals do we need that that’s not really an area where a band or a company should be focusing? If we’re sitting with an artist we’re going to be talking live, brand partnerships and digital. The recorded product part takes care of itself.
Isn't that a rather short-sighted view of the industry, given that recorded music fuels the live business, brand partnerships and the digital market?
You still need recorded music, don’t get me wrong. People consume music by listening to recorded product. But they don’t necessarily buy recorded products, and there is a big difference in that understanding. You’re not going to build your profit and loss accounts by relying on recorded sales. 90 percent of what we focus on and discuss as an industry is recorded product and I think that balance is wrong, when 60 percent of the revenues come from live and another big chunk comes from brand partnerships. With the best will in the world, if you are sitting at a record label you must think the live industry is the moon because it’s such a complicated industry to understand. The live industry doesn’t run in a linear fashion. With all due respect, why haven’t labels gone into the live music industry yet? Because they don’t know where to start. To them, it’s like a foreign world that they don’t understand. We do. We’ve been in it for 15 years.
Key to Sixth’s overall business model is signing emerging artists to all rights partnerships, and maximising returns on those rights through your other assets. What makes you convinced that’s an effective model for today’s music business?
We have known the way forward for many years. I think MAMA would have become this company, had we not been acquired by HMV [in 2010]. We knew then that we needed to make direct investments in artist’s careers. Once you have made that investment you can bring everything under one roof. When we started thinking about this [model] in 2008 artists were not wanting to enter these all rights partnerships because they still wanted to get signed to a label. It’s moved our way now because the record labels have, by and large, moved out of funding those deals. Even the biggest selling artists are no longer going through a major label model.
Presumably you’re not looking to partner with majors for artists represented by Sixth, then?
You can’t rule them out. There are things that they are very useful for, like distribution. And some of the models that they are trying to develop are working really well, like Caroline at Universal. [Major] labels now are offering a lot more a la carte services, so you can go and pick out the particular capabilities they have got, which is that global distribution spread that we can’t do ourselves. So we’ll do the front end, make the product and own the rights. But we’ll buy distribution services from major labels, indie labels or people like Kobalt.
You’ve said that advanced data analytics will be at the heart of how Sixth operates. How do you intend to use that data in practical terms?
We will use for it every decision that we make. Whether it’s a decision about buying a venue, setting up a festival, or working with an artist, we will look at the data first. We have got deals with the biggest tech players -- like Facebook, for example -- that are exclusive to us. However, systems are only systems and what matters is the experience of the people piloting those systems.
Have you already signed anyone to the artist management side of the business?
We have about 25 artists currently under management. We haven’t announced [names yet] because we are waiting to announce them all in one go rather than piecemeal. For us it’s not really about genres. It’s about quality. Does the artist have it, or can we add it to the artist? But we have to make sure that the artist can play live. Because if they can’t, there is no way that we can recoup that investment.
Are any of those 25 acts established artists?
Yes. They are artists that we have been working with, or the companies that we are acquiring have been working with for some time. There will be artists [among the 25] that you will have heard of. We had a pretty successful summer with artists appearing at major festivals, getting nominated for awards and achieving chart success.
What’s the strategy in regards to acquiring venues? Are you actively looking to build a roster of U.K. venues?
We'll acquire venues and festivals where it helps develop the artist piece of what we are trying to do. Would it be something that they would find valuable? If the answer is no then we probably won’t be buying that venue. So it’s very selective -- key venues in cities where there are populations that we want to showcase artists in front of.
And in regards to festivals?
Again, festivals where bands would be pleased to be showcased. The festivals that we get into will be a lot about new music. We have agreed to take a stake in one, which is very nearly completed. And there are a couple of others which are slightly earlier in the discussion stage.
At launch, Sixth operates offices in London, Melbourne, Mumbai and Delhi. Why those locations?
Each one is at the centre of its particular geography and market. If you think about the model that we’re adopting geographically it is a crescent shape that takes us from the U.K. out to India and then on to Asia Pacific. That’s our focus.
What are your plans for the U.S. market?
It's a huge market, so you can’t ignore it. We’re looking at opening an artist management office in L.A. and having an artist management presence there. What we won’t be doing is buying venues and festivals in the U.S., because it’s not our market and it’s well served by the local incumbents, so we’ll just keep a watching brief on that. Probably the ultimate play five years down the line is that if we make a good job in Europe and Asia then we’ll partner with a company that is doing a good job in the U.S.
What are your short-term and long-term ambitions for Sixth?
This year, the goal is to establish the company, put the business model in place and then we’ll see how we go from there. If you look at the history of MAMA, we floated in 2005. We spent most of 2006 looking at things. Then in 2007 we acquired [London music venues] Hammersmith Apollo, G-A-Y and the Mean Fiddler network. And that all happened within nine months. I think we will adopt a similar philosophy here.
Finally, what’s your view on the health of today’s music business?
Recorded product has problems that don’t seem to be getting fixed and I don’t think steaming is necessarily the answer. I think there’s further decline and pain in that market to come. On the other hand, I don’t think there’s ever been a more exciting time to be in other parts of the business, like live, digital and brand partnerships. There’s some really interesting business models coming out. If you look at Madison Square Gardens and what Irving Azoff [is doing there] I think that’s fascinating. Google going into Lyor Cohen’s 300 is fascinating. Because these are new entrants and new players coming into a business that I have been in for 15 years and [throughout that time] has pretty much stayed with the same players. There are new business models coming through which will be driven more by technology. Our aim is to join the dots up.