How Wilco’s Jeff Tweedy Learned To Grow Up And Start Firing His Friends

[uncool2pillow]

Article from the Chicago Grid - A very good piece

 

http://www.chicagogrid.com/features/wilcos-jeff-tweedy-learned-grow-start-firing-friends/

 

My favorite Tweedy quote:

 

"I think about telling my dad, who worked for 46 years on the railroad, ‘Somebody offered me $100,000 to put my song in a movie, and I said no because it’s a stupid movie.’ He would want to kill me... The idea of selling out is only understandable to people of privilege.”

[bleedorange]

Thanks for the link. Very interesting article.

[Albert Tatlock]

Article from the Chicago Grid - A very good piece

 

Nice one - Ta.

 

Quoted here to save it for posterity (or the next board crash) in case that link ever becomes invalid.

 

In a business that hates hierarchy, Tweedy learned that someone has to be boss.

BY KEITH GRIFFITH

 

It’d be hard to imagine a place that captured the rock ’n’ roll ethos better

than the Wilco loft. The massive open space spreads across the entire third

floor of a nondescript brick building in Irving Park, but guitars, amps, and

recording equipment overwhelm the space. Across from a cluster of bunk beds,

Jeff Tweedy, Wilco’s frontman and arguably Chicago’s most iconic indie rocker,

is sitting at a glass table, doing something that’s not very rock ’n’ roll at

all: talking business.

There’s a widely held belief among musicians, and maybe artists in general,

that there’s some zero-sum game being played, that it’s a compromise to even

think about business as being a part of what you do, Tweedy says. I think our

approach is that there’s another way to be creative. How we run our business is

another thing to think about creatively.

 

The Wilco loft headquarters a band that’s earned a reputation as one of the most

independent acts in rock ’n’ roll. But it’s also where Tweedy, 45, has

established himself as one of the music business’s most innovative

entrepreneurs.

Revenue and profit numbers are hard to come by, but it’s clear that Tweedy has

built Wilco into a thriving enterprise even as the music business has seen

traditional revenue streams evaporate. Industrywide, record sales have fallen 58

percent in the past 20 years, as digital formats like Apple’s iTunes store and

music streaming services like Spotify steadily replace higher-profit sales of

physical albums.

But Tweedy has beaten a path toward financial autonomy, establishing himself as

the band’s boss, removing middlemen and asserting full rights over the band’s

music, merchandise and tour sales.

Wilco grossed $9 million in concert ticket sales in 2012, says Gary Bongiovanni,

the editor-in-chief of industry tracker Pollstar. Wilco’s online store, where

fans can buy a book of Tweedy’s poetry, a dog collar that matches his guitar

strap and Wilco onesies, grosses well into the six figures annually, say

insiders. And when Tweedy licenses new Wilco tracks for movies and commercials,

he doesn’t have to split the proceeds with a label he fired Wilco’s in 2011.

 

It wasn’t always this way. It’s taken more than 20 years for Tweedy to build the

needed industry expertise and a devoted fan base. Forging independence has meant

learning to fire friends, eschew hefty advances, and build out infrastructures

for touring, marketing and merchandising.

Tweedy never set his feet in concrete with his music, but wanted to keep

changing, keep evolving, says rock critic Greg Kot, author of the 2004 Tweedy

biography, Wilco: Learning How to Die. I don’t think business has been any

different.

 

 

In an industry where authenticity and commercial viability are supposedly at

odds, Tweedy accepts the mutually dependent relationship between the set list

and the balance sheet. But at times he’s invoked the ire of purists, who accuse

him of compromising his art. When he licensed four Wilco songs for a Volkswagen

TV campaign, the Tribune ran an opinion piece headlined, Does VW deal make

Wilco a sellout?

Tweedy is unapologetic. I think about telling my dad, who worked for 46 years

on the railroad, ‘Somebody offered me $100,000 to put my song in a movie, and I

said no because it’s a stupid movie.’ He would want to kill me, Tweedy says.

The idea of selling out is only understandable to people of privilege.

Like many entrepreneurs in the arts, Tweedy had to learn the hard way to take

business seriously. Before founding Wilco in 1994, Tweedy played in alt-country

group Uncle Tupelo, where he says profits were anathema. You kept everyone

who’s making money, the idea of making money, at arm’s length, Tweedy says.

But when Uncle Tupelo ended, it became very obvious that we were in a business,

because we owed people money.

 

It was a lesson he didn’t need to learn twice. After putting together a final

Uncle Tupelo tour to pay off the band’s debt, Tweedy resolved to stay out of the

red. Bills get paid first, we get paid last, and we live within our means that was the basic idea, he says.

 

When Tweedy signed Wilco’s first record deal in 1995, with Warner Bros.

subsidiary Reprise Records, he refused big cash advances for tour support and

recording, preferring to keep the band’s debt obligation low. It went against

the prevailing wisdom of the day, when many bands took as much cash as their

labels would shell out, gambling that labels would do heavy album promotion to

recoup the advances.

In the old days there was this fictional bubble that artists lived in, like we

weren’t affected by the laws of commerce, says Damian Kulash, the OK Go

frontman who left EMI in 2010 to form his own independent label. You were

protected from those realities by supposedly benevolent labels. We all know the

terms of those agreements were pretty one-sided, but you paid that price so you

could live in the bubble.

 

Tweedy’s rejection of big advances would play a key role in Wilco’s drive toward

independence. In 2001, the band produced a record that the brass at Reprise

considered commercially unviable and declined to release. Tweedy held his

ground, refusing to change the songs. Reprise canceled the band’s contract.

They allowed us to walk away with the record, and that would have been much

more difficult if they’d had a million dollars or multiple millions invested in

the band, Tweedy says. We would have been forced one of two ways: to change

the record to their liking, or to wait indefinitely until a point where our

contract would allow us to leave.

 

The record that Reprise turned down, Yankee Hotel Foxtrot, later went gold,

selling more than 674,000 copies after its 2002 release under a new contract

with Nonesuch Records, also a Warner Bros. subsidiary.

 

After signing with Nonesuch, Tweedy’s operation took on more and more of the

duties traditionally handled by a record label. His team, led by Wilco’s

longtime manager Tony Margherita of Tony Margherita Management in Easthampton,

Mass., began handling the band’s marketing and publicity. They used the Wilco

loft to record songs and warehouse merchandise. All they really needed from

Nonesuch was distribution. That degree of self-sufficiency and Wilco’s

established, loyal fan base meant that when Tweedy’s contract with Nonesuch

expired in 2011, he was in a strong position to renegotiate its key terms.

Once [the Nonesuch contract] ran out, being free agents, it would’ve been nuts

for them to go back to a traditional deal given the cache they have, Kot says.

 

Tweedy made Nonesuch an offer that was anything but traditional take the 20

percent cut on album retail that Wilco had been getting, and Wilco would take

the label’s old 80 percent cut. They didn’t really want to entertain that,

Tweedy says. But it didn’t seem unrealistic to us, and it wasn’t unrealistic,

ultimately.

 

After parting amicably with Nonesuch, Tweedy struck out on his own, founding

dBpm Records as the label’s sole investor. His new distribution deal with

independent label ANTI- gets Wilco roughly the 80 percent split they’d sought.

After 15 years on major labels, Wilco finally released an album on their own,

2011’s The Whole Love.

Ken Waagner, a digital strategy consultant who worked with Tweedy from 1999 to

2011, sees the major labels’ inherent advantages fading, as bands find new ways

to connect directly with fans. What technology does is take away the

gatekeeper, Waagner says. Now, it comes down to being a smart label, and you

don’t have to be a major to be smart.

 

According to Margherita, Wilco’s manager, the finances bear that out. Although

overhead is higher, Wilco makes more per unit on album sales, and can keep every

dime on film and commercial licensing agreements, instead of sharing the 50

percent cut that Tweedy says labels take. So why doesn’t every band start their

own label?

 

Imagine you have a chance to work a steady job, with a salary, health insurance

and some semblance of security, or to risk starting your own business and be an

entrepreneur, Margherita says. All of the same risks and rewards apply.

 

There are also significant barriers to entry. Tweedy has spent years stocking

the Wilco loft with studio equipment and building relationships with recording

engineers and sound mixers. The band has a cash reserve large enough to cover

startup costs for tours.

 

And they have a fan base that they can rely on. In 2012, they played to average

audiences of 3,100, with tickets around $50. Touring expenses, which for Wilco’s

domestic gigs include two buses and a crew of about 20, typically run about 60

percent of gross, according to Pollstar’s Bongiovanni. They have real expenses,

but they have a significant following that can support that, he says.

 

Both the early call to turn down big advances from Reprise and the decision to

break from Nonesuch were ultimately up to Tweedy, since the record contracts

were with him alone.

But initially, Tweedy was a reluctant boss. A 1995 band agreement, which later

surfaced in court records, shows that he originally tried to structure Wilco as

a collective enterprise. The four original full-time members owned equal shares

in Wilco World Tours Inc., the band’s first business entity. The agreement gave

Tweedy no special authority, other than control of the Wilco trademark.

I didn’t want to be the boss. I didn’t want to be the guy who was looked at as

‘other,’ Tweedy says of Wilco’s early years. I did a lot of things to try to

institutionalize a band concept and a band idea that were counterintuitive,

business-wise. This was probably a period before I fully embraced the idea of

growing up.

Personnel issues plagued Wilco early on, with half the roster turning over

before 1999’s Summerteeth, but Tweedy was reluctant to actively manage the

turmoil. In early 2001, when he decided to replace drummer Ken Coomer, a charter

member who came over from Uncle Tupelo, Tweedy had Margherita make the phone

call.

A letter followed from the band’s attorney, instructing Coomer to sell back his

shares in the band’s business entity at par value.

 

I’ve regretted that, Tweedy says. I assumed that I would be able to call him

afterwards and talk to him, but of course that didn’t happen.

From that point on, he took his responsibilities more seriously. I made the

realization that, whether I take charge or not, I’m in charge, he says. After

friction with multi-instrumentalist Jay Bennett during the recording of Yankee

Hotel Foxtrot, Tweedy decided to let Bennett go in the summer of 2001. He met

Bennett in the loft and broke the news personally.

 

If you wanted to pinpoint a moment where I was doing something boss like and

mature, that would have been it, he says, then looks away. Though Tweedy does

not mention it, Bennett died in 2009. ‘Boss like’ sounds terrible, but you know

what I mean.

 

Since then, Tweedy has embraced full leadership of Wilco. Shortly after firing

Bennett, as Wilco was entering the new contract with Nonesuch, Tweedy

incorporated two new companies to run the band’s business. He owns them

outright, and employs the other band members through negotiated work agreements.

After a decade of high turnover under the former shareholder setup, Wilco’s

lineup hasn’t changed since 2004.

 

There’s a chemistry that works itself out in collaborations, so it’s not like

I’m sitting there as a gatekeeper, saying, ‘OK, that’s a good idea, that goes

through.’ Tweedy says. But the buck has to stop somewhere, creatively and

otherwise.

 

[Rusty Shackleford]

Thanks for posting.  I find the whole music business fascinating, but details like these are hard to come by.

[tinnitus photography]

yeah that was a good read.

 

interesting to hear of the band agreement and then how it fell apart. i guess Stirratt had to get bought of that original contract too?

[mariana neri]

I love articles about bands as brands!

[choo-choo-charlie]

Fascinating look at Wilco (the business). Thanks for sharing!

[worldrecordplayer]

Very interesting read. Surprising to me that John has no ownership interest in the band or its business interests. He's been there from the beginning.

[froggie]

great read!. thanks for posting

[lost highway]

These dudes are wealthy.  Good for them, there's a shortage of well paid musicians in the world, and many of them are awful.  Good to see some people with artistic merit profit off of their creativity.

[Guest Jules]

Very interesting read. Surprising to me that John has no ownership interest in the band or its business interests. He's been there from the beginning.

 

Well he didn't write any of the songs.  Except for that one.

 

These dudes are wealthy.  Good for them, there's a shortage of well paid musicians in the world, and many of them are awful.  Good to see some people with artistic merit profit off of their creativity.

 

I doubt they are that wealthy. The number shown ($9M?) is a gross number.  It also doesn't say what the band members get paid.  And it appears Wilco/Jeff reinvests a lot back into the band (equipment, etc).

[jff]

 

I doubt they are that wealthy. The number shown ($9M?) is a gross number.  It also doesn't say what the band members get paid.  And it appears Wilco/Jeff reinvests a lot back into the band (equipment, etc).

 

The $9m figure was gross for ticket sales only.  They also earn income from record sales/downloads, merch, and song licensing.  I don't know if they're wealthy (although it's safe to say Tweedy is pretty well off), but the $9m is only one of the piles of money they're working with.

[calvino]

Hopefully Tweedy is providing the rest a decent health insurance plan - between Glen and Nels, sometimes it looks like a blood bath up there on stage, not to mention John's jumping off the damn amps...

 

I imagine none of them are hurting for money - but wealth is all relative, anyways.

[lost highway]

I doubt they are that wealthy.

 

As more divisive threads have proven, you and I define wealthy differently.

 

More to my point, Wilco has used dignity, ethics, business-sense and most importantly artistic depth to make a living that surpasses the greater majority of most musicians.  That's damn respectable.

[nalafej]

Why did Wilco participate in this article? They want us to understand how smart they are? How rich they are? Forget how lackluster WTA was?

[Atticus]

Why did Wilco participate in this article? They want us to understand how smart they are? How rich they are? Forget how lackluster WTA was?

 

probably a combination of all three.

[choo-choo-charlie]

I listened to W(TA) the other day on headphones and heard some stuff that didn't stand out to me before. The songs are not as strong as other albums, but the guitar interplay is first-rate. Fun to pick out details and who's playing what part.

[jff]

Why did Wilco participate in this article? They want us to understand how smart they are? How rich they are? Forget how lackluster WTA was?

 

Is there a reason why they shouldn't have participated?

 

Maybe they feel like they've finally arrived at their ideal business model and sharing information about it might help other bands in some way.

[bleedorange]

Why did Wilco participate in this article? They want us to understand how smart they are? How rich they are? Forget how lackluster WTA was their last three albums were?

[nalafej]

Is there a reason why they shouldn't have participated?

 

Maybe they feel like they've finally arrived at their ideal business model and sharing information about it might help other bands in some way.

 

Reason: Lose artistic credibility. Comes off as arrogant. Opens up a range of questions about the reason behind there actions: artist decision? business decision etc.

[jff]

Reason: Lose artistic credibility. Comes off as arrogant. Opens up a range of questions about the reason behind there actions: artist decision? business decision etc.

 

Prior to this article, were they giving you the impression they're trying to dodge those types of questions?

[tinnitus photography]

how could they possibly lose artistic credibility with that article? if anything, they would gain it by taking control of their business and not being beholden to others.

[nalafej]

Prior to this article, were they giving you the impression they're trying to dodge those types of questions?

 

No, Wilco doesn't dodge questions. They are very open. I just don't know why they would participate in an article about Wilco Inc.

[bleedorange]

No, Wilco doesn't dodge questions. They are very open. I just don't know why they would participate in an article about Wilco Inc.

 

Maybe as a model for other bands that want to take control over their careers?

[calvino]

No, Wilco doesn't dodge questions. They are very open. I just don't know why they would participate in an article about Wilco Inc.

 

That would be a great title for the upcoming Wilco/Tweedy realty show ---- heaven forbid!