Magazine article Variety

Corralling Coin

Magazine article Variety

Corralling Coin

Article excerpt

With revenue sources fragmented and scattered, biz managers are more critical than ever ByTodd Longwell

The torrent of technological and economic changes that have reshaped the industry over the past decade means that showbiz pros and stars are earning fewer dollars and more dimes - and the dimes are flowing in from an ever-increasing array of sources that span international borders and a multitude of distribution platforms.

This puts ever more pressure on business managers - the custodians of these individuals' private wealth and personal affairs - to make sure the coin is accounted for and maximized.

This is especially true in the music business, where radio is being usurped by such streaming services as Pandora and Spotify, and where online downloads of digital singles from iThnes have vastly diminished purchases of CD albums from brick-and-mortar retailers.

"There's so much money coming from so many different places, and if you don't have an expertise in each area, you won't be able to count money and you won't be able to maximize the clients' profits," says David Bolno, a partner at Nigro Karlin Segal & Feldstein.

The pros at NKS&F saw the writing on the wall a number of years ago and decided to create several departments to service their music-industry clients. One, the royalty division, is a six-person unit of the firm's 70-person audit group.

Plus, with sales of recordings declining, musicians are becoming more entrepreneurial and creating their own revenue streams, necessitating additional fiscal oversight.

The firm WG&S, whose clients include Metallica, maintains a satellite office in San Rafael, Calif., where members of the band reside, to provide support for their multitude of business interests, which include a record label, a magazine, a fan club and direct-to-consumer marketing of recordings and merchandise.

In situations like these, "our role is really as the outsourced CFO and back-office financial operations," says Eric Wasserman, WG&S managing partner. "We support all of the collections, the paying of the bills, the royalty or profit reporting on the businesses, the financial reporting to the client and then support all the tax compliance."

Andrew Meyer, a partner at Freemark Financial, dealt with a similar dynamic when helping facilitate a YouTube deal for a high-profile director that gave him capital and creative freedom, but no studio-like infrastructure. …

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