Broken Bow's Jon Loba Talks BMG Acquisition & Country's Global Growth: 'Streaming Has Made It a Different Game'
Founded in 1997 by Benny Brown, Broken Bow Records has grown from a fledgling Nashville imprint into one of the United States' largest independent country music companies, encompassing Stoney Creek Records, RED Bow Records, Wheelhouse and publishing arm Magic Mustang Music, alongside core label Broken Bow, which counts the RIAA's number one digital selling male country artist of all time Jason Aldean, chart-topper Dustin Lynch and American Idol's Kristy Lee Cook among its roster. Other artists belonging to the Nashville-based BBR Music Group, which has collectively racked up over 30 number one country singles, include Thompson Square, Randy Houser, Joe Nichols and Granger Smith.
After two decades of operating independently, BBR was acquired by BMG earlier this year in a deal worth around $100 million -- making it the Germany-based company's largest label purchase since forming in 2008. As part of the acquisition, founder Benny Brown stepped down as president/CEO, as did CFO Paul Brown (both retain consultant roles).
"This was never about money," BBR executive vice president Jon Loba tells Billboard in an exclusive interview. "It was about finding the right investors for the artists and the staff."
Multiple companies bid to buy BBR. Why did you go with BMG?
First and foremost, the company culture and prioritizing putting artists first. Number two, the staff that supports that culture. From the minute that I first spoke with Kos Weaver [evp BMG Chrysalis], Zach Katz [president, U.S. repertoire and marketing] and [BMG CEO] Hartwig Masuch, you could tell that they were more about the artists being the stars than the executives. Although we started entertaining offers and taking them seriously over the last year, it was still not a forgone conclusion that we were going to sell. We had certain boxes that needed to be ticked to protect the legacy of the company -- rather than just make a bunch a money and leave the artists in the dust. Benny Brown was already independently wealthy when he got into the business and he said, "I don't need to be a sell-out and I won't be a sell-out. I need to make sure that this company can move forward and grow. Not be taken apart and the cream skimmed off the top."
Was BMG's bid the highest?
No. This was never about money, driving up the price and having all comers [bidding], so we kept negotiations quiet. Once word broke in the press, there were offers that came out of the wood work and a few that were significantly more than BMG. But it wasn't about dollars at the end of the day. It was about finding the right investors for the artists and the staff. Once we sat with Zach and Hartwig we knew in our hearts that BMG was where we wanted to be.
How important was growing BBR's international presence in shopping for a deal?
Until a year and half ago we had zero international presence or distribution. [Benny Brown] was very focused on the domestic U.S. market, making sure that we conquered that first. In 2015, we convinced him to put a number of select titles in select territories up on TuneCore because we could see all the emails from all over the world wanting to purchase or stream music. As soon as we did that you could see very quickly that there was significant interest and the potential for significant income there -- and the majority of that income was streaming. So when Benny began entertaining the thought of selling the company one of my main objectives was to find a partner who really wanted to have an international presence. In that space I found that Hartwig and BMG absolutely separated themselves from the pack. It's an opportunity for all of us to really grow the format and touch the world with this music.
You recently attended London's Country 2 Country (C2C) festival for the first time. Are you encouraged by the fast growing international popularity of country music?
Absolutely. C2C has become so much more of a conversation within the Nashville and country community, so I had high expectations and they were exceeded. Five years ago when it first started, you had to sell C2C to artists. Now it has to turn away U.S acts. Everybody wants to come and play it. All it takes is for them to be on the ground once and they want to do it every year. When I first joined the CMA board a few years ago, a gentleman that worked for one of the other competing companies in town said, "Why do we keep having these international discussions? We go overseas and play to the same 300 people. We're throwing time and resources into something that's not going to grow.' At our last CMA board meeting he said, "Remember how I said what are we doing? Well, I throw all of that of the window." With streaming and the Nashville TV show, it's an entirely different game now. C2C is the perfect example of that. There's a real hunger for the music around the world.
What are BBR's plans for the year ahead?
We have some significant releases in the U.S. that we'll be focusing on with Dustin Lynch, Granger Smith, Trace Adkins and a new duo called Walker McGuire, who already have 14 million Spotify streams and haven't put out a single yet. There's also some acts internally that now -- with the aid of BMG resources -- we're going to be able to hopefully super charge. It's exciting that we now have different options. If there's an act in the States that doesn't fit as well domestically as it does internationally, in the past maybe we would have to move on from that act. Now we have the opportunity to look at other markets and develop them elsewhere. And that goes both ways. There's a couple of things in the U.K. that are real interesting that I would like to give exposure to in the U.S. and see what we can do there.