As we head into the peak summer season, millions of us will be going to concerts.
For many, that means attending a Grateful Dead show.
It turns out that there are some notable business connections, some fascinating and some more obscure, with the Dead.
The current incarnation of the Grateful Dead today is Dead & Co, as several of its original members have either passed away or are no longer playing with the band. Replacing the late Jerry Garcia, who passed away in 1995, is guitar virtuoso and heartthrob John Mayer. (Note to Deadheads: I’m not an expert here, though I’m a huge fan and saw them in Baltimore, March 1973.)
The Grateful Dead, in all its iterations, have become big business over the years.
The original Dead sold $393 million in tickets alone between 1965 and 1995, according to the Grateful Seconds blog (published by my friend and banker, Dave Davis). In 2020, Variety reported, “The band has grossed $250 million in the past five years, averaging $2.3 million per concert at the box office…”
With 20 shows this summer, Dead & Co. will likely make tens of millions this year, too. And this doesn’t include merchandising and music sales that bring in many hundreds of millions more.
“The Grateful Dead is so much more than buying a ticket or buying a T-shirt,” says Joe Jupille, a professor of political science at the University of Colorado and an amateur Grateful Dead historian. “They built community.”
Although the Dead were known as the ultimate counterculture gang, their ties to Silicon Valley run deep.
Founded in Palo Alto in 1965, the Dead’s first shows were in Menlo Park and San Jose. In February 1966, Stewart Brand, who became a highly influential technological visionary, co-produced a show. The Dead, then, is a local cultural piece that sits at the intersection of art and science that Steve Jobs famously articulated.
Flash-forward 30 years to Garcia’s death. “Losing Jerry Garcia was more than losing a singer and a guitarist,” says Joel Selvin, author of “Fare Thee Well: The Final Chapter of the Grateful Dead’s Long, Strange Trip.”
“Garcia was the brains, the heart and the public face of the band,” says Selvin. “He was the center of all the other musicians.”
“When Jerry died, the economic engine of the tour shut down, leaving 60 people with no touring income. They needed a new plan,” says high-profile tech investor and Deadhead Roger McNamee, who advised the band during those years.
The Dead sought financial advice and had discussions with a number of bankers and advisers, including, at one point, Houlihan Lokey. An informed source says that even then-banker Steve Bannon made a pitch. (Another informed source does not remember Bannon.)
In a series of discussions, $65 million was discussed as the amount of money the band needed to raise to develop the digitization and sales efforts of their so-called Vault, the tape collection of their shows, plus the construction of a Terrapin station. . According to the business plan, this would be a “65 to 70,000 square foot facility located in the heart of San Francisco…projected to attract nearly a million visitors a year. In addition to entertainment, it will have a museum, library, merchandising store, restaurant, record store and research center.
Another document mentions talks with Silicon Valley venture capital firms such as Accel, Sequoia and Kleiner Perkins. There was also a proposal to create a company called Deadweb that would go public with a valuation of $480 million. The exact sequence and details of some events are unclear, but the bottom line is that along the way, the gang specifically turned to McNamee for help.
“Roger McNamee, who, at the height of his internet success, volunteered one day a week,” says Selvin. “We can’t measure the value of volunteering to go into the Grateful Dead office and try to clean up the mess that was his web strategy. He put together a possibility both from software and from deals with other bands like U2, Dylan and Dave Matthews, that if The Dead had passed, that would have been iTunes.”
In late 1999, MTV News reported that “numerous high-tech companies, including Microsoft, have approached the band with unsolicited offers of capital for the project, but until recently all suitors were avoided by the remaining members.” MTV quoted the band’s spokesman, Dennis McNally, as saying, “The board feels these venture capitalists are sympathetic to the ideals of the Grateful Dead. They trust them.”
However, not all members of the band. In late 1999, Dead bassist Phil Lesh issued a statement: “The Grateful Dead have never accepted corporate sponsorship or venture capital money, and I am unalterably opposed to any deal that rents, licenses, or collateralizes the music on The Grateful Dead.” Vault.”
Other band members responded, “There never has been, nor will there ever be, any discussion about selling our Vault, our music, our name, our legacy. Not to Microsoft. Not to anyone.”
As expected, the whole deal came to nothing. In a deal pushed by Lesh in 2006, Vault was licensed to Rhino Records, a division of Warner Music. And after a series of musical ups and downs, including the band’s 50th anniversary Fare Thee Well concerts in 2015, the last time all surviving members of the Grateful Dead played together, the remaining members formed Dead & Co. and left for the club. racing again.
“Fare Thee Well was a beautiful thing, an encore for Phil and the start of something new for the rest of the band. It all worked out for everyone in the end,” says McNamee.
As for Jerry Garcia, he has become and remains a legend.
In early 2010, when I was an editor at Fortune magazine, Steve Jobs visited me to demo the iPad.
One of the features he showed us was that the device played music. Jobs pressed an icon and “Friend of the Devil” began to play.
“I love the Dead,” I blurted out to Jobs.
“Me too,” Jobs agreed.
On this weekend when we celebrate America, we could do a lot worse than remember Steve Jobs and the Grateful Dead.
This article appeared in a Saturday edition of the Morning Brief on May 14, 2022. Get the Morning Brief delivered directly to your inbox every Monday through Friday at 6:30am ET. Subscribe
Follow Andy Serwer, editor-in-chief of Yahoo Finance, on Twitter: @serwer
An earlier version of this story referred to Phil Lesh as the shortest of the Grateful Dead. he is from the band bass guitarist. Yahoo Finances does not know who is the shortest of the band.
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