2019 American Music Awards

Off The Road Column: Show Me the Money

In the touring industry, as in life, the ability to tap into deep financial resources can come in handy.

This truism was proved yet again with the story of how the Rolling Stones came to work with AEG Live in promoting the upcoming North American dates on the band's 50 and Counting tour. As the team that put up an estimated $25 million for the five shows marking the band's 50th anniversary last December, Australian promoter Paul Dainty and Virgin Music had the inside track to do the 2013 North American dates--provided they could come up with the money, believed to be about $76 million in guarantees. As Billboard reported last week, and before, Dainty put together a satisfactory deal--on paper. In fact, it was probably all but done after Dainty's team successfully pulled off the anniversary shows.

And though AEG bid hard on the Stones for both December's shows and this year's (as did Live Nation, in partnership with promoter Michael Cohl), AEG had all but conceded victory to Dainty by March. But Dainty, who couldn't be reached for comment, still had to produce the money, partly in cash and partly in the form of a letter of credit. According to sources, Virgin declined to reach into its pockets, and Dainty went to a variety of U.S. independent promoters and even the arenas for backing. Ultimately, he apparently couldn't secure it.

Raising money for a Stones tour is hardly unprecedented. When Cohl began promoting the Stones on a global basis in 1989, he solidly beat incumbent promoter Bill Graham's offer with a unique global touring model and a deft ability to secure funding. And even though the Stones' tours became sort of self-sustaining financially after the Steel Wheels run in '89, until Cohl sold his company to SFX (now Live Nation) a decade later, he still had to raise money for tours like "Voodoo Lounge" (1994-95) and "Bridges to Babylon" (1997-98). After that, for each subsequent tour with the Stones, Cohl used what's now Live Nation for financing and to partner in executing those tours on the ground. The relationship between Cohl and the Stones was massively productive, culminating with the 2005-07 "A Bigger Bang" tour that grossed $558 million, according to Billboard Boxscore.

Dainty's recent situation wasn't so much that he was outbid--according to insiders, it was more about his ability to get the necessary finances together. When it turned out he couldn't, industry insiders were shocked it had gotten as far as it did, with the tour set to begin in May. Historically, in the Stones' world it was never enough to just guarantee the millions--one had to prove it and secure it, and the financials for the deals with Cohl were in order as much as a year in advance. Beyond the short setup time necessary to tap into the 50th-anniversary milestone (though surely everyone knew that was coming), it could well be that the retirement of legendary Stones financial adviser Rupert Loewenstein in 2009 factored into the uncertainty surrounding the promotional rights for 50 and Counting. Whatever the case, when the Stones' camp turned to AEG, billionaire owner Philip Anschutz was able to OK the necessary cash and letter of credit in less than an hour, according to a source familiar with the deal.

All of this underscores the increasing role big money plays in launching events and mega-tours. Secure financing was part of the reason Cohl sold to SFX in the first place, and why independent promoters like Lollapalooza producer C3 Presents turned to the investment community to help fund expansion. Whatever their skill as promoters may be, those who must seek funding every time they want to launch a multimillion-dollar project are behind the eight ball.


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