Nitro Fidelity has partnered with racing powerhouse Speedway Motorsports Inc. (SMI) to launch a national series of branded “top tier” immersive music festivals, beginning with the NiFi Festival at Kentucky Speedway August 28-30, to be headlined by Green Day, Miranda Lambert and Kings Of Leon.
NiFi will produce the events in the first branded music festival series of its kind in the U.S., at venues owned and operated by SMI. The Kentucky fest will be followed by festivals for Dallas/Ft. Worth at Texas Motor Speedway, and Charlotte (N.C.) Motor Speedway in 2016. The long term plans call for up to five fests at SMI speedways, including Sonoma (Calif.) Raceway and Atlanta Speedway, over the course of a 10-year exclusive agreement between Nitro Fidelity and SMI, a leading marketer, promoter and sponsor of motor sports events owning eight major racing facilities across the country.
With backgrounds in hospitality and finance, entrepreneurs Sean Knight, CEO, and Howard Mergelkamp, chief strategy officer, are the power duo behind NiFi. Mergelkamp says the SMI partnership is a critical component of the venture, providing, “a national platform with incredible infrastructure built to provide incredible experiences for 100,000 people per day, and teams that are experts in doing that,” he says. “The [venues] are all located in accessible areas, and they all have camping at every level, from tents to high-end RVs, and we include free camping.”
The NiFi team of entertainment and hospitality professionals is “built of best-of-breed folks who know their segments of what they do very well,” says Mergelkamp. NiFi has partnered with Huka Entertainment founder A.J. Nyland (Huka, Hangout, Tortuga, Pemberton) for talent booking; also on board are festival veterans Chris Sorlie, production manager, and Chung Kuo (Lollapalooza, ACL Fest); CMO Stephanie Edens (Wolfgang Puck Catering); and CFO Michelle Fullbrook.
The lineup that Nyland put together for the Kentucky festival is nothing if not eclectic, with contemporary rock and country stars booked to play the fest’s three stages alongside popular live performers like Gov’t Mule, Hank Williams, Jr., and a mix of veteran and developing artists from different genres, including several regional and local acts. In addition to the headliners, NiFi will host Brantley Gilbert, Jake Owen, Weezer, Spoon, Flogging Molly, Bleachers, Trace Adkins, Joe Nichols, Sara Evans, Josh Turner, the New Pornographers, Benjamin Booker, Built To Spill, the Joy Formidable, the Black Lips, Jana Kramer, Moon Taxi, Preservation Jazz Hall Band, Bully, Cloud Nothings, The Orwells, Jon Pardi, Drake White and the Big Fire, Charlie Worsham, Nikki Lane, Rayland Baxter, Native Run, David Fanning, Brooke Eden, Dean Alexander, the Marcus King Band, Mamadear, Jacob Davis, Tucker Beathard, Firekid and Walker County.
Tickets go on sale at 10 a.m. EST on May 28.
The NiFi team seeks to differentiate its brand and experience from an increasingly saturated North American festival marketplace. “We’ve looked at the market, and there are like 1,000 festivals in the U.S.,” says Knight, “but if you talk about the Tier 1 [fests], there’s like 10 that have the wherewithal to put on a show at that highest level. We knew out of the gate we didn’t want to be a mediocre festival, or a small one. We came from the approach that not only do we not want to be a failure, it has to be a success at a high level to penetrate the market, get notoriety, for people to come, experience, and say, ‘wow, I want to go back next year.’”
The national branding platform, with the SMI partnership offering scale and continuity of venues, makes NiFi unique among North American festival concepts. “The actual food and beverage, hospitality, and music will be regionalized, but by the same token there will be a number of themes and experiences that go across all the festivals,” says Mergelkamp, who envisions “a whole bunch of things you can do to leverage that national platform.”
Marcus Smith, resident/CEO and director, Speedway Motorsports Inc., points out that his company is adept at hosting more than 100,000 people for events. “We’re doing horsepower festivals most of the time,” Smith tells Billboard, making the point that, with their wide array of activities and destination status, NASCAR events are, in effect, huge “festivals,” with motorsports as the main attraction. “Our business is sports entertainment, and entertainment is the chief component of that,” Smith says, “whether it’s NASCAR races, car shows, music events, or piling all that into one weekend together.”
And SMI is not completely new to the music festival business. “We started doing music events a few years ago, we’ve had some success and learned from failures, and we like the successes better, that’s for sure,” Smith says. SMI’s Las Vegas Motor Speedway hosts the Insomniac/Live Nation produced Electric Daisy Carnival, which draws some 400,000 fans. “EDC has been a great business relationship for us,” says Smith. “It showed us there’s an opportunity to do one of these festivals, and we’ve looked at it for a number of years. It’s a neat thing to be a part of, and I think we have the right facilities and the right markets to be a successful venue for the biggest music festivals around.”
Smith says that if SMI is going to enter the festival marketplace, it only made sense to go big. “In our experience, we’ve found we’re great at big events, but we’re not so great at small events,” Smith says. “So to make a big impact and have a lot of fun and a lot of business success, for us it’s got to be big. That’s where we have a competitive advantage over everything else out there in terms of venues. You can be out in the middle of a field somewhere, but that gets to be really expensive, with a lot of the rental equipment. But you come to a speedway, we specialize in big events like that; 50,000 people on a Saturday afternoon is kind of a warm-up for us, and is something we’re very good at and very experienced at.”
For the Kentucky event, attendance is projected in the 30,000 range. Front Gate (Coachella, Lollapalooza) is overseeing the ticketing for NiFi, and the festival will make use of a full suite of state-of-the-art festival technologies, including RFID, cashless, and beacon tech, all integrated with a heavy emphasis on social media. General admission early bird tickets are in the $245 range, with day-of-show tickets at about $325. The Ignite Pass, NiFi’s version of VIP, is priced at about $795 and includes food and beverage in VIP areas like the Ignite Lounge. Other enhanced experiences include tour bus accommodations and various tent to RV “glamping” options. Car camping is included in all tickets.
Though a talent budget of about $6.5 million and an overall “soup to nuts” budget in the $15-$17 million range puts NiFi in the big leagues of music festivals, producers say 40,000 attendance would be needed for a financial break-even. The traditional rule of thumb for major festivals holds that it takes three years to finish in the black, and Knight admits, “we’re budgeted for loss.” That said, he says NiFi’s financial backers, which he describes as “institutional” sources in Texas along with “some high net worth folks,” indeed have the stomach to stay the course. “Our investors are well aware that this needs some runway and that it will take some time to really makes this successful and build a brand.”
In partnering with SMI, “we’re saving a ton of costs from an infrastructure standpoint,” says Knight. “Our view has always been part of the partnership is on the marketing side, but the biggest part of partnering with SMI and multiple venues is we can save all these costs and take all that money and put it on the front end fan experience. So the less we pay for the brick and mortar, radios, bike fence, information booths, stuff all these festivals have, the more we can pay for top tier talent, food, experiences. That’s our point; we’re not trying to put [money] in our pockets, we just want to spend the money on a better experience, and that’s why the national partnership.”
Mergelkamp says the producers understand that talent drives first-year attendance but the experience drives repeat business. “We came in with eyes wide open, we understand the economics of a first year, second year, third year, when you do make money, and how you make it,” he says, “and we planned for it. We’re hoping that we bring something special to the market and to the regions that we’re going into. We’re trying to learn from the best, and we’re not bashful at looking at what everyone else is doing and saying, ‘we like that and we don’t like this, and we think we can do this unique thing.’ We like the industry, we think there’s a lot going on, and a lot more to come.”