The Joplin Globe, Joplin, MO

Business

May 18, 2012

Odd couple of music execs have a forward-thinking strategy

NORFOLK, Va. — Lucian Grainge and Scott Braun couldn’t be more different.

Grainge, the 51-year-old chairman of Universal Music Group, speaks with a genial English accent and was recently named a commander of the Most Excellent Order of the British Empire. Braun, the 30-year-old manager of Justin Bieber, calls himself Scooter and has an accent northeast of Queens, N.Y.

The two music men have forged an unlikely bond that becomes formal this week, when Universal plans to announce a global distribution deal for Braun’s Schoolboy Records, which represents Bieber, Carly Rae Jepsen and the Wanted. All three acts have singles in the top 10 of this week’s Billboard Hot 100 chart.

Grainge’s arrangement with Braun also kicks off Universal’s multimillion-dollar effort, dubbed the Global Creative Investment Program, to form ventures with promising tech-savvy entrepreneurs in the music business.

Universal, whose 30 percent of global music sales makes it the world’s largest record company, is looking to tap into hot young talent to remain relevant and connect to a new generation of consumers.

“There’s a new social contract emerging between music companies, artists and entrepreneurs,” Grainge said. “The challenge comes in creating a structure that is open to opportunity in the midst of a discombobulation of everything we’ve ever known.”

Seated side by side, Grainge and Braun seem an unlikely couple. Their first meeting took place three years ago in London, when Grainge was head of Universal’s international operations and Braun was a whippersnapper with an unsigned teenage client named Justin Bieber.

Grainge interrupted Braun mid-pitch to say he had to take a call. A minute later, Braun overheard Grainge bellow on the phone that he was not interested in meeting new people and was tired of hearing newfangled ideas.

Braun was rattled at first — Grainge was famously dubbed a “killer shark” by music veteran Doug Morris, now head of Sony Music — until he realized Grainge was bluffing.

“He was testing me,” Braun recalled. “After about 45 minutes, he started to get excited and asked a lot of questions. Ever since then, we’ve been close.”

How close? When Grainge decided in 2010 to move the company’s U.S. headquarters to Los Angeles from New York, Braun, who grew up in Greenwich, Conn., and cut his teeth in Atlanta and New York as an impresario of celebrity parties, followed him west.

The relationship evolved informally, with Grainge mentoring his protege and Braun sharing his insight into how his generation was using technology to listen to music and discover new bands.

The Bieber model was a good one.

The pop music sensation — who in 2011 was named America’s third-most influential celebrity by Forbes Magazine, after Lady Gaga and Oprah Winfrey — was already an economic powerhouse in music. (Forbes estimated he earned $53 million last year.) But his foray into perfumes, which Universal invested in, generates an additional $120 million a year in sales. Other revenue comes from Justin Bieber dolls, a documentary that pulled in $100 million at the box office last year and live shows that average $600,000 in gross ticket sales each night.

Bieber credits Braun with making his success possible. “Scooter’s creativity, intelligence and instincts have inspired me from the day we met,” the singer said. “I learn something new from him every day about how to keep growing personally and professionally.”

The brand-centered outlook is why Grainge and Braun moved to Los Angeles, away from New York and London, the twin music capitals of the world. The rationale: The business revolves around talent.

“I started in this business as a talent scout,” Grainge said. “I’d see five to six bands a night back then. And I’m a talent scout now. It’s just that the macro vision for what constitutes talent today is more multifaceted.”

As such, Universal’s Creative Investment Program, which has Braun as its first entrepreneur in residence, is Grainge’s vehicle for driving the record company into the 21st century.

What happens next with the program, however, probably is as unpredictable as where the next pop star will come from.

“It can be a venture. It can be a product. It’s about being alert,” Grainge said. “I’m on the hunt.”

 

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