Wednesday, June 27, 2012/
International DJ, record company impresario, and restaurateur are just a few of the hats Grant Smillie wears.
Smillie, who started his entrepreneurial career as a 16-year-old nightclub promoter, is continuing to build a music and entertainment empire on the back of an ear for a kicking tune.
You have a record label, Neon, a management group, 360 Agency, a restaurant, and a bar. How does it all work together?
I guess opportunist or entrepreneur is probably the best way to describe me. I started my record company Neon because I had a record that I’d written and I flew to Sydney and met with EMI, BMG, Sony, all the big labels, and thought as an aspiring upcoming young producer that this was the best thing I’d ever written, as it always is for every new artist.
I came back and had meetings and it was fairly negative, so I thought that was fairly disappointing, I thought this record was going to be big. My two options were, we either put it in the bin, or we start our own record label and put it out ourselves.
So I started up Neon, which I’m a 50% owner of, with Patrick Cleary and, luckily enough, that track, “Flaunt It”, won two ARIAs that year and we sold 300,000 of our debut single, which pretty much meant that record label had the best possible start.
I found out pretty quickly that my time’s not best spent trying to try figure out how to get it stocked in JB Hi-Fi or all those kinds of issues when you’re the artist. So I put this structure in place so I could be creative, directing but not actually working in it.
As with any business, to be out and around looking at opportunities, rather than head down in the actual mechanics of it, is where I want to be.
We’ve now translated that into a whole repertoire of artists and had tremendous success with the business, pretty much doubling revenue year by year for the last few years.
What was the revenue last year?
360 Agency’s revenue was $2.35 million in 2011 and is projected to be $3.8 million in 2012, while Neon’s revenue was $763,000 last year and is on track for $1.2 million in 2012.
What about your other businesses?
I figured out I was investing a lot of money in other artists on my record label and the thing about that is someone else takes a revenue from them as an agent. So we quickly realised that record sales were declining, but there are other opportunities inside the music media to make revenue.
We saw a decline in sales opportunity and increase in live revenue opportunity and decided to start 360 Agency, a booking agency which I am a 75% owner of. The plan was for 360 Agency to work with my record label so we could handle our artists’ music and also their live and merchandise activities inside that.
We’ve now got 30 artists on our books and some really good revenue. It gives you the ability to exert influence upon the music scene further and that’s by trying to utilise assets you’ve already developed to then further add income.
Then we created the Weekend as one of our current brands we own. The Weekend is national on the Nova radio network every Saturday and we program and host that. The Weekend is also about to go on Channel V on August 28 and we have a Weekend club night at Seven in Melbourne which we operate and is about to go national. So it’s about trying to create a brand iteration: The Weekend is on TV, radio, experiential and online.
It’s about having as many eyeballs as you can – our database of artists have Twitter, Youtube and Facebook followers as well, so having engaged with them to make that brand is that ongoing challenge to make a continued revenue.
Then that’s how we got the restaurants and cafe opportunities, because you’ve already got sunk costs into all of these; staff and facilities. One of those is Ponyfish Island, which is a unique bar in the middle of Melbourne’s Yarra River. It turned over $2.7 million last year.
I went down there, it was a cafe and it was running at a tremendous loss. We turned it into a brand new entity and gave it a name and took it to market, and it’s been a huge success. We’re planning more with the Ponyfish brand as well we went yesterday to a brewer in South Australia to negotiate doing our own Ponyfish range of drinks.
We work with every big festival in Australia already, providing the talent, so I can put on every drink rider around our venue saying, “All our artists drink our products.” Therefore we have a pretty good opportunity to have our own brand with our own assets inside it. So it’s always about saying, “What asset have you got and how do we continue to develop and grow that?”
I get the opportunity to go and meet people all the time. I connected with Salvatore Malatesta, the owner of St Ali, as he wanted to do a festival in his laneway. We decided to do a new venture together, My Mexican Cousin, which I own 50% of.
It’s not actually Mexican food, it’s Creole; even though Mexican is a big trend at the moment. Our philosophy has always been to look for the opportunity where it hasn’t been done on a mass scale before.
That’s how I like to position myself, because if you’re one of the leaders of the generation following everyone else’s lead that’s kind of boring and not exciting. I prefer to at least be at the forefront and lose because I’m too ahead of the curve than to try and jump on a trend that’s booming.
I went to Los Angeles last month and they have the worst coffee in the world. So I’m flying to LA in two weeks’ time, spending two weeks with agents looking for sites to see if we can’t find a site to do St Ali in LA.
It’s just about time, where do you best spend your time? Making sure the time is quality, being so distracted by new opportunities, filtering good ones from crap ones. You can waste as much time on a terrible proposition as a good one, and the good ones generally don’t take up much of your time at all once they’re up and going.
That’s why I employ two financial controllers that sit in our group and who analyse everything before we even step into a new venture to make sure it ticks certain boxes. Otherwise, I get accused of having ideas Tourette’s. I do get a lot of them and it happens multiple times a day.