Concord Execs Detail Maintaining 'One-Company Mentality' Through Label, Publishing Acquisitions at Canadian Music Week
"I think that we have a bit of a competitive advantage over some of the other players in the market," said CEO Scott Pascucci.
Billboard's West Coast editor Melinda Newman, led a discussion with Concord Music CEO Scott Pascucci and chief publishing executive Jake Wisely at Canadian Music Week on Saturday discussing the company's acquisition strategy and approach to reinventing the company in the 21st century.
The conversation confirmed a record celebrating the 75th anniversary of Oklahoma! is still in the works and that Wisely -- a self-declared metalhead -- would have loved to to have acquired the Ronnie James Dio catalog, which Round Hill bought earlier this year . As well, they touched on what sets their company apart in the music marketplace.
"I think that we have a bit of a competitive advantage over some of the other players in the market," said Pascucci, "because we're very fast and we're decisive. We're not afraid to walk away from something if we think it's a mistake, if there's things that worry us or the price gets out of control. And people know that we close deals -- if we say that we're going to do A, B, C, we do those things and people can rely on it."
Concord is the world's fifth largest integrated music company. It deals in the development, acquisition and management of recorded music, music publishing and theatrical performance rights with offices in Los Angeles, New York, Nashville, London, Berlin, and Cleveland.
The company's master recording portfolio contains more than 10,000 active albums, while its publishing catalog contains more than 380,000 copyrights. That follows a spree of acquisitions over the past few years, including the purchase of Imagem in 2017 for north of $500 million, which tripled its publishing portfolio with three distinct units: Rodgers & Hammerstein (theatrical -- including The Sound of Music and The King and I), Imagem Music (pop -- including Pink Floyd, Genesis, Phil Collins and Steve Miller) and Boosey & Hawkes (classical -- including Stravinsky, Strauss and Rachmaninoff).
In February, Concord acquired the Tams-Witmark Music Library, licensees of Broadway musical scores and scripts such as A Chorus Line, My Fair Lady, Cabaret, Hello, Dolly! and Bye Bye Birdie.
Newman asked Wisely, who ran The Bicycle Music Company for a decade before it merged with Concord in 2015, how he gauges the success of the Imagem deal so far.
"On a couple of levels -- one is just how the integration has gone and, operationally, we're doing very well," he said. "Undoubtedly there are growing pains, but because there was so little redundancy between the organizations, it was just fitting the pieces of the puzzle together rather than trying to replicate the institutional knowledge on either side of the equation."
He continued, "It happened to coincide with further acquisitions or layering on of additional catalogs, so it was a bit of a three-dimensional chess game to arrive where we are now. Undoubtedly a lot of moves have yet to occur, but arguably we are past the hardest part. I would say, probably, very successful in getting to a point where our A&R teams, our copyright, our licensing, business affairs, all of these teams coalesce and they're all working together."
Newman then asked how they are able to integrate the publishing and the recording side and reminded Wisely that, around the time of the deal, he had mentioned Rounder was talking about doing a Oklahoma! record to mark the famed musical's 75th anniversary.
"That project is on the tracks," said Wisely. "I asked this as recently as last week and they assured me it would come out this year, but we'll find out. But, yes, the 75th anniversary of Oklahoma! hitting the stage was a great opportunity for Rounder to ply its roots in its Americana roster to something akin to a cast recording that will be critically important to the relationship. Carousel just opened on Broadway as well and our catalog division Craft Recordings is releasing the original cast recording of that.
"There is incredible interaction between what is a 10-person A&R department now on the publishing side of things and six frontline record labels. All of the labels heads, all of the A&R people are collaborating in ways that we really only could have dreamed of initially, but our writer-producers are getting cuts and covers on Concord affiliated labels released. There are catalog songs being covered, wherever those opportunities exist and, in terms of plying both sides, the one-company mentality has been pervasive and that's part of the success where we've arrived at."
To Pascucci, Newman asked: What does that kind of deal do in terms of broadening Concord's footprint?
"In terms of our investors, we are a very inquisitive company," he said. "We do a lot and we do it fast and we built a pretty great platform.
"As we get bigger and are able to maintain the level of results that we had in our early days, which we'd been able to do -- in fact our results get better -- it makes us more attractive to potential outside investors. Now we don't actually need more outside investors. The investors we have are thrilled to be in with us and we have positive cash flow, we don't have capital constraints. We don't go to the market looking for money to do things, but I would say that we do get a lot more unsolicited inbounds from people saying they want to know more about your companies as a way for us to invest because they see the scope of what we're doing. So, visibility is good that way."
Newman also asked Pascucci to expand on what he had previously called a transformative deal for Concord on an international landscape.
"Before we did the Imagem label deal, we were a U.S. company with activities outside the U.S. but not a significant presence," Pascucci explained. "We were also imbalanced. Because of the growth and the acquisitions that we did in '15 and '16, we had a lot more recorded music than publishing, which is fine because the growth curve that was extremely positive but from a balance perspective we were very heavily skewed towards recorded music.
"So doing the Imagem deal got us almost into perfect balance in terms of revenues and then what it also did was it diversified the executive pool and then it give us offices in London and Berlin, and also got us more deeply entrenched in the theatrical rights business, which is an area we want to grow into."
Pascucci also outlined Concord's strategy to further develop the business across recorded music, publishing and the theatrical world. He said, "The mindset we have about developing our business is that we build a foundation that we think is stable and then from there we take risks. We do it in that order. You see it on our recorded music strategy. We built a catalog base significantly, and that has allowed us to take more risk with our front line labels and, bringing Tom Whalley in, building that business.
"Same thing in publishing. We were originally primarily a catalog company in publishing and now we are signing more and more writers, taking more risks. Theatrical rights, between Andrew Lloyd Webber deal and then the rights we got with R&H and then the Tams-Witmark acquisition, we've built a very significant stock in amateur business, which is fundamentally a catalog business. It's a low-risk business. You deploy a lot of people, you have great rights, you service clients well, you make money, and that's our foundation.
"So having built that foundation, the next step is to take more risk in first class [business]. That could mean a couple of different things. It could mean investing in other people's first class shows that have nothing to do with us. When we do that it will probably be manageable investments, small amounts, but enough to send the message to the theatrical world that we're a player in the first class business.
"The second thing is to take the first class right that we have and be more pro-active about finding teams that might want to build a financial structure around, take it to the West End or Broadway and be an investor in that. And then the third thing is to build new first class productions out of other rights. So Jagged Little Pill is category 1 and Stax is category 3, which is we have a great recorded music catalog, not actually implicated by a stage production, but we do own the trademark and more importantly when pitched on the idea we were willing to put a lot of money to work to develop the idea for the last four years. Now we just did a recent production and with a little bit more time or effort, we'll get to the West End or Broadway.
"It's kind of a three-part strategy built on the solid foundation of what is essentially a catalog business."