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Showing posts with label Business. Show all posts
Showing posts with label Business. Show all posts

Down to Business: Expert Views on Business Plans

10:22 PM Secrets of the Music Industry , Posted in , , , , , , , , , , 0 Comments

Business Plan Expert #1: David Lee of SV Angel

Bio/Background

David Lee is considered an expert in business plan fundr
aising. In addition, he is a General Partner in SV Angel (venture capitalist firm) out of CA. SV Angel focuses on start up ventures that fuse technology development with entertainment. Mr. Lee’s background before joining SV Angel involves Google and StumbleUpon where he was involved with business development for both companies.

Image representing David Lee as depicted in Cr...Image via CrunchBase
What is important in a BP to investors?

David Lee believes in substance over show. The information must make an impactful statement followed by hard evidence to prove and justify that statement to investors. Substance over show is imperative because the investor must know there is a solid plan in place and not just a great idea without a path to get to the destination. Moreover, it is my opinion that the sentiment discussed above is why Mr. Lee is quoted as saying, "[t] here are a bunch of rich people and firms subsidizing tech entrepreneurs, but this time the entrepreneurs are better”, within an article by Mark Lacter for LA Observed. (Lacter, 2011)

Also, Mr. Lee feels it is important for the backstory to be told for an investor to see the heart and passion necessary for a successful venture to move forward. If, the investor doesn’t see the business owner as excited for themselves as they are for others to jump onboard, then David Lee feels you are fighting a losing battle. Furthermore in a recent article by Sarah Lacy for Tech Crunch, Lee states an opinion for younger founders doing better than older company founders based off of desire to put in the work necessary to build the business from the ground up. (Lacy, 2011)


Business Plan Expert #2: Guy Kawasaki of Apple

Bio/Background
Guy Kawasaki, American venture capitalist and ...Image via Wikipedia
Guy Kawasaki is known from Apple computers where he began work in the early 1980’s. From Apple, Mr. Kawasaki started a few businesses that developed software later to return to A
pple in 1995. Later still, he left Apple to start his own company called Garage (matchmaker for angel investors and entrepreneurs). Guy Kawasaki has a B.A. from Stanford University, M.B.A. from UCLA, and is an Honorary Doctorate from Babson College.

What is important in a BP to investors?

Mr. Kawasaki believes there are certain parts to the business plan that stand out: Executive Summary, Management Team, Business Model, and Product being his top four. Furthermore, he believes a business plan developer should spend 80% of their time on the executive summary because this piece is typically first viewed by an investor and if not impressed the investor will not read further.

Subsequently, the size of the business plan should not be more than 20-30 pages in Guy Kawasaki’s opinion. He feels the plan loses its bite and effectiveness if too much information is provided. Furthermore, each section should begin with just one page per section and only augmented if absolutely necessary. In a recent article found on Artist House Music by George Howard, Mr. Kawasaki describes the power slide pitch to investors as being “…no more than 20 minutes” with 10 or so slides to succinctly get the business model concepts across to investors. (Howard, 2007)

Sources:

Howard, G. (2007). How to create a business plan. Artisthousemusic.com.
Retrieved on Septemeber 6, 2011 from
http://www.artistshousemusic.org/articles/how+to+create+a+business+
plan                               

Lacter, M. (2011). Gold rush is back in silicon valley. LAObserved.com. Retrieved
on September 5, 2011 from

http://www.laobserved.com/biz/2011/04/gold_rush_is_back_in.php
Lacy, S. (2011). David lee and ron Conway bust entrepreneur myths on stage at
disrupt. TechCrunch.com. Retrieved on Septemeber 6, 2011 from
http://techcrunch.com/tag/david-lee/



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Milton Bradley: The Answer to Unemployment?

10:49 PM Secrets of the Music Industry , Posted in , , , , , , , , 0 Comments


Full Sail University's very own Ron Cook posted a recent blog entry that peaked my interest regarding entrepreneurship. Mr. Cook addressed the notion that in these tough economic times when unemployment is at record highs, you should employ yourself! Business program college graduates amass all this knowledge of how to run business the right way so that someone else can reap from their understanding.

It should be noted that part of Mr. Cook's job description is to consult with students regarding the plausibility of their business plans. Narrow focus that addresses a need that is not being met in the marketplace is key according to Professor Cook. Also, he says that seed investors should include family because if an angel investor has to ask you if any family gave to your idea and you say none have then why should a person that doesn't know you at all give one red cent? Moreover, Prof. Cook explains differentiation as something necessary and not cliché.

I agree with all points brought forth in this insightful article. I would even add a few things of my own. Today more than ever diverse revenue streams are needed to compete with the growing cost of basic necessities. Normal jobs by themselves will not fund retirement because social security may not even be there. Plus, to qualify for this government assistance you have to be worse off than any of us want to envision ourselves. Consequently, investing, learning the stock market, creating residual income, and understanding the world economy (not just domestically anymore) is a growing need.

Milton Bradley CompanyImage via Wikipedia
Schools do not teach things even as simplistic as Monopoly, why? Perhaps the AG student in the 1st grade would be better served playing a game from Milton Bradley than Activision or some other video game. These are the thoughts of an aspiring business owner. People around the globe 
love what the United States stands for with democracy and interestingly at its fundamental concept business wise the picture of what we as Americans represents can be seen in the simple form of a Flea Market. That is free enterprise at its finest.

References:

Cook, R. (2011). Cooking up an opportunity. FSO blogs EBMS. Retreived on
August 6, 2011 from
http://www.fsoblogs.com/ebms/2011/8/3/cooking-up-an-
opportunity.html
  

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Warner Music Group Buyout: The End or New Beginning

6:48 PM Secrets of the Music Industry , Posted in , , , , , , , , 0 Comments


Warner Music Group Corp. and Access Industries announced the execution of a merger where Access Industries will buy WMG in an all-cash transaction for $3.3 billion! The purchase includes WMG’s entire recorded music and music publishing companies.
The purchase price is said to give stockholders a 34.4% premium over the average share price of $6.14.
Under the terms of the merger WMG’s Board of Directors approved the transaction and recommended that WMG’s stockholders approve the transaction.  In addition to stockholder approval, the transaction is subject to customary closing and regulatory approvals.  It is anticipated that the transaction will be completed in the third calendar quarter of 2011. 
WMG’s Chairman and CEO, Edgar Bronfman, Jr., said, “We believe this transaction is an exceptional value-maximizing opportunity that serves the best interests of stockholders as well as the best interests of music fans, our recording artists and songwriters, and the wonderful people of this company.  We are delighted that Access will be the new steward of this outstanding business.  They are supportive of the company’s vision, growth strategy and artists, while bringing a fresh entrepreneurial perspective and expertise in technology and media.  Most importantly, Access supports Warner Music’s commitment to our recording artists and songwriters who are the foundation of our current and future success.”
Len Blavatnik, Chairman and founder of Access Industries, said, “I am excited to extend my longstanding involvement with Warner Music.  It is a great company with a strong heritage and home to many exceptional artists.  I look forward to working closely with the many talented people within the company.” 
Jorg Mohaupt, Head of Media at Access Industries, added, “The music industry is at an inflection point where digital adoption is rapidly gaining momentum.  Warner Music, as one of the most progressive forces in the music business, is well positioned to capture this opportunity for music creation and distribution.”
Warner Music GroupImage via Wikipedia
Scott Sperling, Presiding Director of WMG, said, “It has been our great pleasure working with the extraordinary team at Warner Music over these past seven years.  The company has managed to significantly increase market share and profitability during our ownership period and consistently outperformed even during a challenging period for the industry. Len Blavatnik and Access are likewise deeply committed to the music business and we know that we will be leaving the company in good hands.”
Warner Music Group became the only stand-alone music company to be publicly traded in the United States in May 2005.  With its broad roster of new stars and legendary artists, Warner Music Group is home to a collection of the best-known record labels in the music industry including Asylum, Atlantic, Cordless, East West, Elektra, Nonesuch, Reprise, Rhino, Roadrunner, Rykodisc, Sire, Warner Bros. and Word.  Warner Music International, a leading company in national and international repertoire, operates through numerous international affiliates and licensees in more than 50 countries.  Warner Music Group also includes Warner/Chappell Music, one of the world's leading music publishers, with a catalog of more than one million copyrights worldwide. 
Following the closing of the transaction, WMG will become a privately held company and its stock will no longer be traded on the New York Stock Exchange.  The company will retain the Warner Music Group name and will continue to operate out of its current facilities.  
Warner Bros. RecordsImage via Wikipedia
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Chrysalis Negotiations - The Hard Facts

8:08 PM Secrets of the Music Industry , Posted in , , , , , , , , 1 Comment


Russell Gaskins
Senior Director, Film, TV, Commercials
Chrysalis Music Group, L.A.

Interviewed by Bryan Bell

How do you pre-plan for a meeting where an artist on your radar is looking for a publishing deal?

First thing I do that may be different than most is I look up the history on the artist. Not what most describe as history, but how they got into music, what influenced them, why they do what they do. That way I may be able to see a correlation to our roster to people that artist already respects and use that in the negotiation.
 
Secondly, I look at the cold hard facts. People lie all the time, but numbers don’t. No advance is even discussed unless I can prove it  could be covered by past releases and record sales.

What numbers grab your attention from up and coming artists versus established artists?

In a newbie, I look for at least 10,000 sales in a time from of about 3 months from release date. If I see that then at least there is a chance in my opinion of re-couping money. In an established artist with marketing, you gotta at least give me 50,000. Otherwise, what is the point of continuing your career with the major label.

Inside the meeting, what do you see the problems are that need to be addressed?

Number one, do they have a gem! If I hear an album, I have to see marketing potential in at least 1 song, just 1 song people! Can I get a Verizon ad or film trailer or something! That is key for me in particular, but like I have told people for a long time publishing is where it’s at man…remember when we spoke about things years ago? I told you back then Bryan that things were shifting and they have continued to shift in my favor lol.

Another problem as I see is not what should be given out in advance money cause that’s all easily solved by looking at the numbers, but the underlying issue from our perspective is marketing the material. Does the artist have enough fan appeal to get the machine behind him or her. Once that machine revs up the rest is easy as pie.
Does a win-win situation seem like the focus or do you find that it turns into every man for himself in these negotiations?

To be honest early in my career I was cut throat as I could be and it served me well. However, the way things are now and the people I speak with its unnecessary. What I mean by that is that things have changed to such a degree that peole understand you have to prove what you get where as before it was based more on feel what was given and what was accepted. So, yeah I definitely search for win-win situations much more now and help out as much as I can.

Have you ever been mislead in a negotiation and lost?

Hell yeah! And didn’t even know I had lost! But the company made it clear to me how I lost, what I lost, and how to stop it from happening again. I had good mentorship and people around me that didn’t pull the plug on me at the first sign of a mistake.

How has this buyout of Chrysalis affected you?

To be honest it hasn’t. It will be over years that our name would even change. Plus, my department is more relevant than it has ever been, so as far as job security, I’m fine.

Thanks for your time.

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