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SFX Entertainment

SFX Entertainment
Public
Traded as NASDAQ: SFXE
Industry Concert promoter, music
Genre Electronic music
Predecessor Live Nation (de facto)
Founded June 2012 (2012-06)
Founder Robert F. X. Sillerman, CEO
Headquarters New York City, United States
Key people
Greg Consiglio, president and COO
Kevin Arrix, executive vice president, CRO
Chris Stephenson, CMO

SFX Entertainment is an American live events conglomerate founded by media entrepreneur Robert F. X. Sillerman. The company was formed in June 2012 as a new incarnation of Sillerman's previous live events company of the same name—the present Live Nation.

SFX focuses primarily on live events and other properties relating to electronic dance music (EDM) and its associated culture.

Its holdings include ownership of various major electronic music promoters and festival brands, such as Tomorrowland, Electric Zoo, Stereosonic, Voodoo Experience, and a 50% stake in Rock in Rio among others. The company also holds events at several nightclubs in the Miami area, the online music store Beatport, and several music-oriented web development firms. The company went public on the NASDAQ in October 2013.

Contents

  • History 1
    • Early history 1.1
    • 2012-2013 1.2
    • 2013-present 1.3
      • Decline 1.3.1
  • Assets 2
    • Festivals and promoters 2.1
    • Digital 2.2
  • References 3
  • External links 4

History

Early history

SFX Entertainment was formed by Robert F. X. Sillerman in the 1990s. Its business model surrounded the acquisition and consolidation of regional concert promoters into a single national entity. In 2000, Sillerman sold the company to the radio broadcasting company Clear Channel Communications for $4.4 billion USD.[1] Clear Channel Entertainment was spun off in 2005 to form Live Nation, and merged with Ticketmaster in 2009 to form Live Nation Entertainment. As of 2012, Live Nation is the largest concert promoter in the world.[2][3][4][5]

2012-2013

In June 2012, Sillerman publicized his intent to focus on the growing electronic dance music market by reviving the SFX brand to form a new conglomerate in the electronic music industry. Similarly to the past incarnation of SFX, the company's business model focuses on the consolidation and acquisition of independent EDM promoters, along with an additional focus on providing digital platforms for fans to connect. Sillerman expected to spend close to $1 billion on acquisitions within the first year of operations alone; at the time of the company's launch, SFX was in negotiations with around 50 different promoters for possible acquisitions.[6] SFX's first acquisitions included "Disco" Donnie Estopinal's Disco Productions, Miami nightclub owners Opium Group and Miami Marketing Group, and the tour Life in Color (then known as Dayglow).[7][8][9] However, the Opium Group deal fell through during the due diligence phase.[10]

By contrast to the previous SFX, Sillerman intended the new company to be more focused on building relationships and experiences for fans. In response to critics who believed that SFX may "commercialize" the largely underground electronic music industry, Sillerman stated that "if you buy great and successful businesses, you try to empower them to do what they do. And in this case, what they do is provide great entertainment. If you or anyone can ever find an example of someone from SFX telling them how much to charge for a bottle of Cristal at LIV, I'll give you my shares of SFX."[11] Sillerman has emphasized his belief that the live events industry can not be operated in a centralized manner, noting that SFX is "decentralized with full power invested in the entrepreneurs who have made these businesses."[9]

In January 2013, SFX named Chris Stephenson as its Sensation tour at Barclays Center in Brooklyn.[9][12][13]

In February 2013, SFX acquired Tomorrowland known as TomorrowWorld in the Atlanta area in September 2013.[8] The company also received a $10 million investment from the communications services and marketing company WPP.[12][14]

2013-present

In June 2013, SFX announced an Stereosonic festival among others.[18][19]

In November 2013, SFX acquired Made Event, the organizers of Rock in Rio festival series, to acquire a 50% stake in a new entity that will own the rock music festival. Sillerman also disclosed plans to bring the festival to the United States for the first time ever.[22]

In December 2013, SFX acquired a 75% stake in Paylogic, a European online ticketing company. Paylogic's services are prominently used by ID&T, and will be phased in across SFX's other event brands over time as deals with other providers (such as Eventbrite and Disco Donnie) expire. Sillerman singled out Paylogic for its ability to handle large "surges" of ticket sales, as had been demonstrated at TomorrowWorld, the first U.S. event to use the system.[23]

On January 6, 2014, iHeartMedia, Inc. (formerly Clear Channel Media and Entertainment; the company which, coincidentally, Sillerman sold the original SFX to in 2000) announced a marketing partnership with SFX, which will see the two firms collaborate on EDM-related content for its digital and terrestrial radio outlets, including a Beatport top 20 countdown show (which will air on some of Clear Channel's major-market contemporary hit radio stations), a national talent search, and an "original live music series" in the style of its Jingle Ball concerts. The partnership expanded upon iHeartMedia's existing EDM-oriented outlets, such as Evolution, which encompasses a digital radio station on iHeartRadio, and terrestrial outlets in Boston and Miami. iHeartMedia staff, including John Sykes, believed that the deal (particularly the Beatport countdown show) would help provide a higher level of national exposure to current and upcoming EDM artists—its syndication division also produces the American Top 40.[5][24][25]

In February 2014, SFX acquired React Presents—organizers of Chicago's Spring Awakening, along with Clubtix and West Loop Management.[26] In April 2014, SFX announced a partnership with Simon Cowell's Syco Entertainment and T-Mobile to produce a new EDM-focused television reality series, Ultimate DJ.[27]

In September 2014, SFX acquired

  • Official website

External links

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  5. ^ a b "Clear Channel and SFX Strike Electronic Dance Music Marketing Deal" The Wall Street Journal (January 6, 2014)
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References

Digital

Festivals and promoters

Assets

By August 2015, the value of SFX stock had decreased considerably, going as low as 91 cents per-share.[35] On August 14, 2015, the company failed a takeover bid, initiated by Sillerman, valued at $5.75 a share.[36] According to the Los Angeles Times, SFX Entertainment is looking into "strategic alternatives" until October 2015 to determine the sale of the company.[37] The company extended its takeover bid deadline in October 2015.[38]

On February 25, 2015, Sillerman announced a proposal to buy out SFX's public stock at $4.75 per-share to take the company private, and support exploring a potential sale. He felt that the offer would offer "substantial value and flexibility to all shareholders", and was a "substantial premium" to its current value.[34]

Decline

On January 26, 2015, SFX announced restructuring at the executive level: Greg Consiglio was named president and chief operating officer of SFX Entertainment, while Kevin Arrix was named chief revenue officer and executive vice president. Both Consiglio and Arrix hold the same positions at Viggle. ID&T's Ritty van Straalen became CEO of live entertainment. Additionally, it was announced that SFX would, under a three-year pact, assume the operation of Viggle's sales staff, who will work for both SFX and Viggle; Sillerman explained that "the Viggle Revenue team brings an immediate new dimension, while combining the SFX inventory provides Viggle with more scale attractive to a broader base of advertisers."[32][33]

In November 2014, despite a total revenue of $143.5 million in the third quarter of 2014—a number boosted by the large number of SFX-managed festivals that occurred during the quarter, Sillerman reported that SFX was undergoing a significant restructuring and consolidation process that would involve "a not insignificant shift in assignments and reduction in workforce, all of which will go to improve efficiency and, of course, to improve our EBITDA."[30] Later in the month, SFX acquired a 50% stake in ALDA Events, a Dutch promoter who produces the concert tours of Armin van Buuren and Hardwell, along with the Amsterdam Music Festival. Alda will remain independently operated, but its founder Allan Hardenberg also joined SFX as the managing director of its Global Touring division.[31]

[29] to Beatport, and the service was phased out.reassigned-based startup that developed a mobile app which allowed users to browse their friends' music collections. Listn's employees were Montreal On October 10, 2014, SFX acquired Listn, a [28]

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