David Goldberg - Advisor at TPG Global

LP:                             Rather than try to explain who David is and what he does, I’m going to let you tell us what you do.

David:                        I’ll tell you what I’m allowed to tell you at the moment.

LP:                             I like that even better.

David:                        These days I more or less work with a few different private equity firms. Until I got into this, I didn’t know the difference between venture capital, private equity, mutual fund, you name it. You can think of private equity, for those of you who aren’t as familiar with, the biggest firm I work with is a company called TPG. It used to be called Texas Pacific Group, although San Francisco is really their home now. They go around to pension funds, to high net worth individuals, billionaires around the country, sovereign funds and they get them to give them capital that they then go an invest on their behalf to get better returns than, hopefully, you can get by investing in a mutual fund or stock.

TPG has a history of investing in entertainment. TPG owns CAA. TPG owns Cirque du Soleil. With them, I have invested in a ticketing and live entertainment business in India, a ticketing company in China, a record label business in China. I would like to find something in the United States of America to invest in. That would be nice, less time on planes. One of the distinguishing factors between private equity and venture capital is typically private equity writes much larger checks and oftentimes looks for much bigger positions in companies than early stage venture investors, which is frustrating for me because I like finding early opportunities.

But so, in that advisory work with TPG and a couple other of these private equity films, I get to work with portfolio companies, so companies they’ve already invested in, help them find new investment opportunities, and maybe steer those through to an actually completed investment, and it’s all in and around live entertainment, ticketing, and sports betting, which are really the only three things I think I’ve ever done. So it’s all I know about. I can’t do healthcare. I can’t do clean energy. I can lie about those, but I don’t know anything about those. But, because of that, I’ve spent sort of a better part of a 30-year career developing lots of great relationships, cultivating relationships with folks like Lawrence, who once upon a time was Larry.

LP:                             I’ve grown up.

David:                        Yeah, you did, you did. It happens. But because of that, I get to meet interesting sorts of folks. It’s wonderful when you have a long-standing relationship with someone and you get to experience something new through their eyes. But it’s also great, I’d never been to India before we made this investment in the company. And it’s been a fascinating market to learn, fascinating people to work with. And sort of, I’ve gotten to this point, I guess, in my career progression where the people thing comes first and I evaluate an opportunity first and foremost based upon do I like the people, do they seem like good people. Then I look at what the opportunity is. And then, is there something that I could do to meaningfully impact that opportunity. If it doesn’t pass the first test on the people, then it’s just not worth the time. Because you’ve got to go through the trenches ultimately sometimes with these people and if you don’t like them, or worse you don’t trust them, it’s really not worthwhile.

                                   How was that? Is that what I do now?

LP:                             I’m pretty sure.

David:                        Okay.

LP:                             Of the three things, what was it? Live entertainment, ticketing, and sports betting.

David:                        Sports betting, yeah.

LP:                             Which was the first thing you got involved with professionally.

David:                        Live entertainment. So as a college freshmen, I had no clue what I was going to do. I didn’t know what I was going to major in. I didn’t like anything other than drinking beer at college. And I sort of stumbled into working on the activities board at my college. There’s no good reason why they actually chose me to be on there. I had no background music. I grew up in Saint Louis Missouri, which is one of the worst music markets in the world possibly. We were fed a steady diet of classic rock and hair metal. And so, luckily, I had an older brother who loved the blues. So I got a good schooling in the blues. But, for some reason, they picked me to be on the committee. The person that hired me was a guy named Don Sullivan, who is now Mike [Luvus’s 00:05:49] partner.

And I just loved promoting concerts on campus. And we got to bring Bing in Chicago. I went to school in Chicago. We got to do so many great blues shows. We could do, you know, Koko Taylor, And Buddy Guy, and Otis Rush. And these guys all lived there so they could just drive up, play a show, and go home. It was fantastic. And then we got to do bigger shows like Elvis Costello, Echo and the Bunnymen.

LP:                             Great blues men.

David:                        Great blues men. Ian McCulloch, one of the underrated blues men of all time. And I found something that I loved, which was I was never—I’m a frustrated drummer. I hope most everyone in here is a quality musician, but at least some type of musician. But I love the behind the scenes aspect of doing a show. And really, that sort of rush when the artist hits the stage, and the crowd screams, and knowing you had some small part in making that happen. That was pretty cool. Right after college I migrated to becoming a professional concert promoter working for Jam Productions in Chicago, still one of the largest independent companies. They never sold to Age, Live Nation. And what I learned there was, you know, doing this on a much even bigger scale, I got to work a lot of cool bands early on in rough markets.

So I was not allowed to promote in Chicago or Minneapolis, which are two big markets. I got Priory Illinois, Dumont Iowa, Duluth Minnesota, Appleton Wisconsin. But I also got the chance to work with a lot of great booking agents early on. Guys like Marc Geiger and Don Muller. And they would trust me with bands like Jane’s Addiction, or Nirvana, or Pearl Jam in some of these B and C markets. And learning how to research in the days before the internet, how bands like that would perform when there was no radio in those markets that was playing those bands. Maybe you had a college radio station, but lots of times you didn’t. I would literally call record stores, and talk to the manager of the record store, and find out what was selling, and what wasn’t. Those guys became sort of a lifeline for us. But that’s true research.

But that gave way, that career gave way, I guess the epiphany for me in that role was I realized the company I was working for was essentially a mom and pop company. It was two founders that owned it all, ran it. And I also knew I was not related to mom or pop. So I didn’t have a big future there. And that’s when I made the jump into the ticketing world. I went to work for Ticketmaster in Chicago. At the time, we were owned by the Pritzker family in Chicago, big wealthy family. They owned Hyatt hotels, a bunch of other industrial conglomerates. This was ninety-three. And it was right when the whole Pearl Jam mess was breaking. Two weeks before I was booking Pearl Jam concerts, two weeks later I was Perl Jam’s enemy. But it was interesting because I was still talking back and forth to those guys while they were going after Ticketmaster for antitrust. But that’s when I learned ticketing for the first time.

LP:                             What was the state of ticketing in 1993, 94?

David:                        Ticketing, I realize a lot of you won’t necessarily understand this.

LP:                             They don’t know what 1993 is. It’s a rumor.

David:                        Tickets were primarily sold through what we called outlets. They were record stores, grocery stores, department stores that had physical computers in them, and ticket printers. And you would line up and buy tickets. We also sold them via the phone. You could call a number and buy them on the phones. But there was no internet, there was no way to purchase, at that time, online. There was no online. The most interesting thing, and I guess if you want to talk about something that’s probably impacted my career arc from that time period, was during that time a service started and got big called America Online.

And AOL was not the internet. AOL was a proprietary dialup network. You got your little disc in the mail, you popped it in your computer, and it gave you a local phone line to call. And that gave you access to whatever content they had in this proprietary network. We had an enterprising operations team in the Chicago office at Ticketmaster. And they—we worked with the Chicago Cubs, who were a Ticketmaster client at the time in Chicago. And they were owned by the Tribune Corporation, the Chicago Tribune, WGN TV. They had made a significant investment in America Online. And they said to us, can you put the Cubs schedule, and the phone numbers, and the list of outlets into America Online so that when people are looking up Chicago within America Online they can see how to buy tickets, they can see where to call, and what the schedule is.

And our operations guy said, yeah, but I think we could actually rig up a system to try to sell tickets. Because it’s not this Wild West internet that people are reading about, it’s a safe environment. People have already put their credit card in because they were paying by the minute for access to the service. So we built the first online ticketing gateway. It was not internet, but it was an online ticketing gateway for the Chicago Cubs. And there was one computer in the office that actually had direct connect into the AOL gateway.

So we could see when a customer had entered Chicago online, our area of America Online, and when they were looking at tickets or information. And it was so novel that it was like someone was ringing a bell when that happened and we’d all flood back to the ops area. And we just stared. It was like looking at the matrix. You’re just looking at a screen of data. There’s nothing really there. And the ultimate epiphany came when we finally sold a ticket to somebody. And we did what we now know is taboo. But there were no rules then. We didn’t understand anything then.

The guy bought the ticket, the first thing we did was pick up the phone and call the guy. And our customer service person said, you could have bought this ticket at the Cubs box office. We see you don’t live too far from Wrigley Field, privacy issues. You could have called an operator on the phone. You could have gone to a Rose Record store, or Dominic’s grocery store. Why did you choose to buy the ticket this way? And he said, because I don’t like dealing with people. And hung up the phone. It was literally one of those, this is going to be big. There’s a lot more of those people out there. It was the first ticket that Ticketmaster ever sold online. It might be the first ticket sold online because I don’t think anyone was doing it on the internet at that point. But that was sort of, all right, anything I do from here on forward is involving this type of technology. And it was sort of just as much as I loved music and loved the music industry, the idea of marrying this technology into an industry I loved was it.

LP:                             One of the funnest things about these conversations that I’ve been having with people is how many people were the first ones to sell tickets online. I can’t wait to have the next conversation with the first person that sold tickets.

David:                        I will take down [Dreskin 00:14:14] in a heartbeat. In a heartbeat.

LP:                             That’s amazing. At that point, how many versions of the Ticketmaster system existed? Meaning there was basically that regional rollup model. I remember a time where you couldn’t really—you could, from a human point of view do a national campaign with Ticketmaster, but the humans were each operating different platforms. What was the landscape of that all about?

David:                        If I remember the numbers right, we had probably 13 hosts systems in North America. And this goes back to mainframe computer days. That’s why they refer to this way. Each host system, for instance, Illinois had its own host so tickets sold in the state of Illinois went through one central computer and reservation system. Indiana, Ohio, Kentucky, and West Virginia had their own host system for that region. New York probably had two hosts, one for New York City, one for the broader region. And you couldn’t—if you called a phone operator who only had access to the New York City host, they couldn’t sell you tickets for Chicago. They didn’t have access to that host system.

So there was no way to do a national on sale and coordinate. We did ultimately arrange some phone centers so that operators had codes that allowed them to log into these different systems. But these were distinct, unique ticket selling systems that didn’t really talk to each other. And we had to take them down for two, three, four hours every night to back up, to replicate to an offline backup system. So between call it one a.m. and five a.m. you couldn’t even buy tickets. There was nothing available to you.

LP:                             Was that a function of the Ticketmaster architecture or the business of buying up regional ticket companies?

David:                        Yes.

LP:                             Yes. So one complicated the other.

David:                        More to do with the way that Ticketmaster system was architected. It was a few students at Arizona State University in 1974 who came up with the original code, which is still buried in there somewhere. We used to say that in seventy-four this programmer Pete Gadwa came up with what, at the time, was probably the best set of code for selling tickets online, it wasn’t’ only then, but on computers, and since then Ticketmaster has executed about five million exceptions to that code. And that’s part of the challenge that that company has. And I love it dearly, and know them well, and some of my best friends, and I still do work with them from time to time, but it’s that legacy of having to make so many changes to an original code base that makes it difficult. It makes it very difficult.

LP:                             I’ve always thought of it as trying to refurbish the train car while the train was barreling down the tracks and you just don’t have the option to stop the train for any length of time.

David:                        No. And now it’s more like the plane is in midair and you’re trying to retool it. It’s tough. They’ve done a great job of abstracting some of the older lines of code and some of the more inflexible portions of the system so that they can iterate and develop much more quickly now. But it took a lot of time just even to get to that stage.

LP:                             I remember a story. I don’t know if it’s apocryphal or not, but I want to believe it’s true, around when they were talking about relaunching the Ticketmaster platform and sort of modernizing the platform. And they had one of the big five consulting firms in and do a review. The recommendation that they came back with was you should go to one of the major computer science universities and fund a cobalt program so that you can make sure that cobalt programmers are still be minted every year. That was the strategy to deal with their legacy platform.

David:                        And I think, actually, they’re enacting the strategy. Look, it’s still is the most powerful system for selling the most tickets in the shortest period of time that you can. And some of it’s just brute force, but a lot of it is, at the heart, some pristine code that, unfortunately, has been accepted a bit.

LP:                             Yeah. So you’re in Chicago. What are you doing for Ticketmaster in Chicago?

David:                        I am a general manager. So we had three general managers in Chicago, one who worked for sports teams, one who worked for arts organizations, and I did music. And that meant that my job was signing up clients to use Ticketmaster. So my old company, Jam Productions, was a big clients, promoters all around the Midwest, small clubs. And then after a few years of doing that, what my predecessor in the job had told me to do was to learn how to do contracts. He said the less you have to rely on the L.A. office to do your contracts, one, the faster you’ll get your work done, but two, you’ll really understand the nuts and bolts of the organization, which was great advice. I got to know our contract so well that actually when the Pearl Jam antitrust lawsuit came up and we hired these ungodly expensive consultants to work with us, they would start addressing things to me, to David Goldberg, esquire, which I thought was the best thing ever.

                                   But at that point, I wanted to work in the online business at Ticketmaster that was now nascent but growing in Los Angeles. I was given the option that if I wanted to do that, I had to move to L.A. but if I wanted to stay in Chicago, I was basically going to keep doing what I was doing. Interestingly, over the time I was there the Pritzker family sold Ticketmaster to Paul Allen, which a lot of people forget that there’s a nanosecond there where Paul Allen owned Ticketmaster before Barry Diller came in and acquired it from Paul Allen.

LP:                             Paul Allen being?

David:                        Microsoft cofounder and a guy that knew a thing or two about technology. I didn’t want to leave Chicago and decided to leave Ticketmaster at that point and went to sort of back with my old company Jam Productions, but we did my first ever startup. Back in the early digital music days we created a company, at first, that was called Jam TV, which was about taking Jam’s concerts that we were promoting and producing and putting them live in the internet, either via real audio. There was no video streaming at the time. Audio, we used to describe it, streaming audio, at the time, sounded like a.m. radio in a tunnel. Maybe there were three people at a time kind of listening to what we were doing.

LP:                             It’s as exciting as hell though.

David:                        Oh yeah.

LP:                             It was really fun.

David:                        But we bought a company in Berkley called Tunes.com. If it only had been Itunes.com. We ran one of the first destination music sites. And then we did a deal with Jann Wenner and Rolling Stone. And we ran RollingStone.com as well. So we had our broadcast music site, we had a destination music site, Tunes, which had deep artist information and ability to buy music, and then we had RollingStone.com, which, over time, we slowly but surely digitized their archives, but also got their writers more comfortable with releasing other material and content maybe that didn’t go into the magazine, and then, ultimately, the magazine content online too.

                                   We sold that business in ninety-nine. And then I helped start up a company called Sport Vision. And Sport Vision, this is the first time like my mom ever sort of understood visibly what it was I was doing. We invented the yellow first and ten line on NFL football broadcasts, or college football broadcasts. So greatest thing ever. Goodnight, it was good to see you. For all of its technological advancement, it’s just really a fancy green screen is all it is. You understand what colors you’re allowed to paint, and what colors you’re not. So don’t paint the players uniform color but paint the green of the grass. The problem is if the player slid in the grass and the uniform became green like the grass, you’d end up painting the leg anyway. But it was a really cool business. We created the virtual strike zone in baseball that you now see that’s pretty pervasive. Virtual advertising insertion that goes in baseball behind home plate. If you watch Mexican soccer, you’ll see it on the field. They put virtual ads while you’re watching TV.

LP:                             I always wondered about the ads behind home plate. So that was you guys huh. That’s interesting. It took me so long to realize they weren’t there.

David:                        They weren’t there. Yes. Well what happened originally it was expensive and usually only one camera angle was able to do the shot that had the virtual ads. So the straight on home plate from center field shot had the ad. But if you saw it from an off angle, it was just blank green. Then you were let into the secret at that point.

Female Voice:           Can I ask a quick question? Who was the first customer of that, the yellow line?

David:                        Fox.

Female Voice:           It was Fox. I had heard that ESPN started.

David:                        It was, there was a group of engineers at Fox sports that originally created the glowing hockey puck.

Male Voice:               That was awful.

David:                        It was awful for a few reasons, not the least of which the intelligence was actually built into the pucks. So this was now a thousand-dollar hockey puck. And if you’ve ever been to the upper deck at the old Boston Garden, at Chicago Stadium, if a drunk hockey fan has puck in their hand and you go try and take it from him, that’s the last thing you will ever do. So while it was interesting technology, that was a flaw in the implementation. That group of engineers, we pulled out of Fox.

LP:                             And shot them.

David:                        And they figured out how to create the intelligence server side, not in the actual item itself. And we had a few important characteristics for whether or not, what we call them a broadcast technology enhancement would be worthwhile. It had to be something that happened often during the game, it had to be something that hard for the naked eye to see, and it had to be something that was impactful or meaningful in the outcome of the game. And if you could meet those three characteristics, then it was probably a worthwhile thing to enhance for the audience at home. So think strike zone. It’s really hard to tell exactly if a pitch is a strike or not if you don’t have that frame of reference. Where is the first down line? You’ve got guys on either end of the field, but in the middle of the field, you can’t really tell exactly where it’s at.

In NASCAR, which was our most sophisticated product, being able to tell on the far end of the track while you’re watching on TV which racer is in which position is pretty much impossible. But if you can point down with a pointer and have their name up top, you can then see that. The interesting challenge in NASCAR was essentially what we were doing is we were putting a telemetry box on each car. Which had its own challenges because these guys are radical about what you can and can’t put on their cars. The next thing was we were using GPS technology. Well, the satellites are way up in the skies and these cars are moving at hundreds of miles an hour within centimeters of each other. And GPS doesn’t do that well for those kind of speeds and those distances.

So we had one of these brainstorming sessions with the engineers like how do we fix this. This is one of these great absent-minded professors. There’s papers all over the table, they look like Christopher Lloyd in Back to the Future. And this guy goes, we collapse the distance between the satellite and cars. And he’s like, I’ve got it. We’re like, okay, how do you do that?

LP:                             You race on mountain tops?

David:                        Exactly. Or in the sky. He said, no, no, no, we take a boom crane and we hang the crane over the track and we fake it out like that’s the satellite. And that way it’s only hundreds of feet away from the cars. And like, that’s what you meant. That would have been better. Like tell me that.

LP:                             I think it ceases to be a satellite at that point.

David:                        Exactly. But that was it. Then all of the sudden you could literally, these cars going 200 miles an hour, you could tell relative distances within a centimeter. It was fascinating data for the drivers, for the fans, for everybody. But the reason that business—and that business just sold three years for a fraction of what it should have. And this is another good lesson on startups, is it was a cost setter for the production. So Fox, ESPN, CBS had to pay us to supply that service. And what companies do is they try and minimize costs. We weren’t attached to any real revenue. And the reason we weren’t, and this is archaic rules of sports leagues. Take the NFL, for example, we were always like, why don’t you have the Home Depot out and paint the yellow line and sell it as a master sponsorship to Home Depot.

The league and the broadcasters have what are called frozen rights. Meaning it’s a right that the broadcaster doesn’t have and a right that the league doesn’t have. And the league argued that the yellow first and then line was an on-field sponsorship and therefore belonged to the league. The broadcaster said, show me in the stadium where that yellow is and then you can have that right. It’s not there, it’s only on the broadcast therefore I as the broadcaster should have the right. Literally, no one was willing to give on it.

LP:                             They both got 100 percent of zero.

David:                        That’s right. And to this day, it’s still not monetized. It’s an unbelievable enhancement for the viewing audience that has no revenue attached to it other than people demand it as part of the broadcast now. So lesson learned. Attach yourself to revenue when you can, not cost.

LP:                             So Sports Vision, you wind up back at Ticketmaster, was there an intern step between that?

David:                        No.

LP:                             And TM changed hands. You were out doing your thing and TM was out doing their thing and you wound up back together somehow.

David:                        This was still in Chicago. Sport Vision was in Chicago. In addition to the broadcast technology side of the business, we had a big interactive side. And we ran websites for about a third of the NFL teams. We actually ran four baseball team websites before MLBAM existed. We ran a bunch of hockey team websites. And even Fox Sports, when Rupert Murdoch tore down the original incarnation of news digital, he forced each of the divisions to run their own websites. And a guy named Ross Levinsohn was running FoxSports.com at the time. And we had they only private label, high end content publishing systems in sports. And what that means is in the world of sports there are data feeds coming out of every sporting event, pitch by pitch, play by play, second by second information accounts of what’s going on in every game. We had built a system that allowed for the ingestion of that content and the publishing of that content without human hands needing to be involved. And, therefore, you could publish real time sports content on the fly.

                                   Fox sports outsourced all of FoxSports.com to us. So we had this great interactive business. And, as you probably recall, in the early two thousands, any interactive business that was based upon advertising sales, just fell through the floor because the ad sales market disappeared overnight basically for online media companies. So we sold off that interactive division. I didn’t know anything about broadcast television. Everything I’ve told you now I learned after the fact.

So my old boss at Ticketmaster in Chicago had moved to Los Angeles and had become chairman of Ticketmaster. He said, if you want to be in the thick of things with technology, and ticketing, and ultimately all forms of live entertainment, sports, music, etc., this is where it’s happening. At the time, Barry Diller had then acquired Ticketmaster. He really sold me on the fact that there’s no idea you could ever have that’s too big for Barry Diller. There’s no amount of funding for that idea that Barry can’t secure or grant. And, if you want to be involved in this world of entertainment, L.A.’s a better place to be than Chicago. My wife had just had our second kid literally weeks before this. So it was an extreme moment of weakness and sleep deprivation where she agreed to move to Los Angeles.

LP:                             Was if February by any chance in Chicago?

David:                        Timed well.

Female Voice:           Dave, can I ask another quick question?

David:                        Yeah.

Female Voice:           What was happening with Broadcast.com?

David:                        Sure, so Mark Cuban was a partner of ours. The predecessor to Broadcast.com was a company called Audio Net. And Audio Net was essentially a reseller of progressive networks, which became real networks. What he was doing was he was going to college basketball teams who didn’t have radio deals or coverage and he was broadcasting their games on the internet, streaming them on the internet. And he aggregated a bunch of them and, I think, smartly changed the name from Audio Net to Broadcast.com and eventually sold that to Yahoo for about five and a half billion dollars at the peak of madness in the dot com craziness.

LP:                             V1 madness.

David:                        V1 madness. So Mark was chasing us for our business, to stream our concerts. And as smart as Mark is, he was smarter because he had a partner named Todd Wagner who really was smart. And Todd was the guy who really put the business together. But that was—early internet days, Mark was hustling for business just like everybody else. But Broadcast.com did quite well. Or Mark did quite well. Yahoo did not do well in buying Broadcast.com.

                                   So Ticketmaster, the job was overseeing all mergers and acquisitions, strategy, business development, corporate development of which I knew virtually nothing about. I had never done M&A work. I certainly knew what strategy was, but not necessarily at the scale at the corporate level of Ticketmaster.

LP:                             Strategy is fun without accountability.

David:                        Yes. But I got, it was a baptism by fire. I just got sort of thrown into the deep end. In the first week I was there, ended up doing a presentation to Barry Diller. I think I probably threw up before I went into the room. I got all sorts of coaching. Barry is, he’s very interesting. He’s very different in a group environment than he is one-on-one. But he is incredibly bright. He gets to the heart of an issue in a moment. And he suffers no fools. So you have to build your argument with appropriate amount of data to support your argument, but not too much data that you boor him. He will figure out the problem faster than you will get to explaining what the problem is. And he will get to the solution to that problem faster than you can get to explaining your solution to that problem. And it was about sort of managing that dynamic.

But within a few months of being there, I was putting together a deck for him to go present to the Mays family who owned Clear Channel Entertainment, which was the predecessor to Live Nation about Ticketmaster buying Clear Channel Entertainment, which ultimately ended up the other way around. But I had no business being in that room, putting together that presentation, and telling this guy he should go spend billions of dollars to do this. But I just figured it out along the way and had a lot of smart people around me helping me. But what I ended up doing is that deal didn’t happen but ended up creating the music group at Ticketmaster. Hired David Marcus, our old friend Vito [Yayav 00:36:52], who’s still confused about what is and isn’t sushi. That’s for another time.

LP:                             There’s no poultry sushi I can assure you. Entire different part of the menu. It’s an entire different part of the menu.

David:                        Yes, yes. But it was, you know, historically Ticketmaster had shun working with artists directly at the expense of its brand and its reputation because we only worked directly with venues and promoters at that point. But we started reaching out directly to artists to try to figure out what was important for their goals and what they wanted to drive in their careers. Fortunately, there was some good people on the other side who recognized that Ticketmaster actually could help drive artist’s goals and drive meaningfully revenue lines and strategy for the artist. So that whole division was created sort of out of thin air to be an entity to develop relationships directly with artists. On the MNA side, I bought ticketing companies in Spain, Denmark, Finland, Turkey, New Zealand, Australia. I secured Ticketmaster the ticketing contract for the Beijing Olympics in 2008. All of which I had no business doing. But you just did it.

                                   At a point where I left, 40 percent of Ticketmaster’s [unintelligible 00:38:35] was coming from outside the U.S. And a lot of it was through the acquisitions that we had done. Now we had some play books we would look to see where promoters had rolled up. So it was easier to go in and make sure you could secure a lot of ticketing inventory in a given country if there was one promoter to do a deal with. But the rules were different in different countries. You had to pay a lot of attention to that.

                                   And the last thing I did on the sort of straight [biz daver 00:39:02] strategy site was work on some of our early distribution deals where we actually allowed partners to have ticket links on their site and link back to us to sell tickets, which before then really wasn’t done either.

LP:                             I remember once being at a conference in maybe ninety-six, ninety-seven, maybe ninety-eight at the latest, but I think it was earlier than that when Fred Rosen was the keynote. And somebody got up from the audience, and for those of you who were paying attention back then, Ticketmaster was suing Microsoft Sidewalk was it? Or City Search?

David:                        Sidewalk.

LP:                             So Sidewalk was during this era when the original internet portals had city based localized versions of their content. Microsoft Sidewalk had event listings on their site because, of course, if you have a local version of your website, you’re going to point to things to do in your locality. And they would link to the event pages to buy tickets. And Ticketmaster sued them to stop them from deep linking into the site.

David:                        They weren’t making any revenue off of it.

LP:                             Yeah, it was simply driving traffic to Ticketmaster. I don’t remember—the exact argument was you’re using our content? I forget what the argument was. It didn’t make sense at the time, but I want to be generous and think maybe there was something about it that made sense. But I don’t think it made sense.

David:                        The argument was that those links were Ticketmaster’s intellectual property and that Microsoft was trying to build traffic to a site based upon Ticketmaster’s intellectual property and therefore they needed to have a deal with Ticketmaster in order to be able to link to their site.

LP:                             Didn’t it have something to do with ad band revenue as well?

David:                        Well, I think that was the revenue generation part of what Sidewalk was doing, aggregating audiences so they could sell advertising to that audience. Unclear whether they were actually ever successful in generating any ad sales, but yes, that was the endgame for them. Fascinating.

LP:                             So what era did you, how late were you at Ticketmaster?

David:                        So our CEO left, a guy name John Pleasants, and Barry Diller did a very Barry Diller thing, which is he didn’t name a new CEO, he created the office of the CEO and he put myself and Shawn Lawryardy, who was our COO in to run the company as a bit of a two headed monster. Ultimately Barry decided to spin out five of the companies within IAC, Home Shopping Network, I guess it was Expedia,

Female Voice:           Ask.com?

David:                        Ask wasn’t spun. It wasn’t big enough to do it on its own. There was one called Interval International, which was a time share trading platform. And Ticketmaster was one of them. So to do a public company spin, you actually do need a CEO of the company. You can’t have an office of the CEO. So he made Shawn the CEO, which was very apparent that I wasn’t going to go any higher in the company. I left, and this was like 2008, late 2008.

LP:                             That recent, okay.

David:                        And then a good friend of mine back to the Pritzker family that used to own Ticketmaster, J.B. Pritzker who’s now the governor of the state of Illinois ironically, J.B. had an investment firm of his own and he’d invested in the largest legal sports wagering site in the U.S., which was based in Woodland Hills, California, in the valley. And a public company, horserace betting, again, I never ran a public company, I don’t bet, and I don’t know anything about horse racing. So he asked me if I’d run it. After learning a bit about it, you know, when someone like that asks you to something, you do it. It was a great experience. I got to take the public company CEO notch on my belt. If it never happens again, that will be a wonderful thing.

LP:                             At least you’re not in prison. I used to worry. Any time I was involved with a startup and it would be like the trajectory to going public, I’m like this is how I end up in a cell next to the guy from Enron, because this is not a good look.

David:                        So along that line, not long after I started, we got, to use a horse racing analogy, we hit the trifecta, which was we got a D listing notice from Nasdaq because our share price had fallen below their threshold, we got a notice from our main bank that we had busted through our debt covenants, and we got raided by homeland security because they thought we were an illegal offshore bookmaking operation. And they came in, guns drawn, everyone up against the wall, don’t touch your files, don’t touch your computers, put your phones down. I tried to reason with the guy that usually the illegal guys don’t list on the Nasdaq and subject themselves to Sarbanes-Oxley and other things. They didn’t really have a sense of humor. Once they sort of figured out the error of their ways, I did not go to jail, but it was close at that point.

LP:                             The guys with the guns aren’t there to interpret the law.

David:                        No. That’s a conversation for later. And don’t make jokes with them. Don’t try. We ended up selling that business to Churchill Downs, horse racing conglomerate, at this point. It was a great, again, another learning experience for me, not just running a public company, but figuring out how to sell a public company. And then, after that, I did a series of startups, a couple of which flamed out horrifically. I learned how to take a company chapter 11 bankruptcy, run it through chapter 11, and actually conduct a successful sale out of chapter 11. Again, never need to do that again. Great experience, don’t need to do it again.

But I also started this advisory work where I started working with companies like William Hill, who’s a big British bookmaking operation. They run retail storefronts but betting shops all through the U.K. But they also have a big online business for sports betting in the U.K. and Europe where all forms of wagering online are legal. And they were looking at market entry into the U.S. So I helped them as an advisor with that. AEG, at the time, had agreed to let Live Nation and Ticketmaster merge. When I say agreed, the justice department had AEG sign on to a consent decree, which just was in the news quite a bit lately.

And part of that was AEG had the ability to either take an instance of Ticketmaster’s technology and then use it on their own or get into the ticketing business for themselves. And Tim Lewicki, who was running AEG at the time, had me come on and help them create what is now Access. Everything from acquiring the URL, to doing market research on the name, to evaluating the available ticket platforms that were out there, and, ultimately, into hiring Bryan Perez to run the business, who’s still there now. Through this, met folks like TPG Capital, who I now have a strong relationship with, CVC Capital, another private equity firm who owns DTI Management. And I have to say, over the past few years, I probably have the least amount of stress I’ve had in my life.

LP:                             And make the most amount of money. Go ahead, say it. Go ahead, it’s all right.

David:                        No. I have a portfolio. I travel a lot. I do travel a lot. That is the downside. But as a husband and parent, I’m a lot more present when I am present. And I can control my travel around family events, important things in my kid’s lives, and whatever. I feel like I’ve got a lot of freedom that way. And when I work at home, I literally work in the attic of my house so there’s no commute time. That helps the stress part too.

LP:                             Yeah. So when you think about ticketing, in the United States, what are your prognostications, or what’s your philosophy or world view on the state of affairs and where things are going?

David:                        It’s been reasonably steady for a long time. I just think that the primary issuer of the ticket, and when I say primary issuer, I don’t mean the primary ticketing company. I mean whoever is at risk for an event, a promoter, a sports team, a Broadway theatre producer. That owner, that capital investor in that event is going to have complete control and say so how those tickets are sold initially, and whether or not they are resold, and how and under what terms they are resold or traded. And I think that is a very good thing for consumers. I think it’s a very good thing for artists in the case of music. Because I think what it can do, and sports and so forth, it allows the money to stay within the ecosystem for the people who are actually taking the risk to provide the entertainment for the consumer.

I don’t think that it means that the secondary market goes away. I think secondary market and good reparable brokers play valuable roles in that market, but I think their margins will likely shrink. I think some will go away. I think being a middle market broker is going to be difficult. But that’s the same in every industry on the planet. Middle markets in just about every industry end up getting squeezed out on the margin side. Small businesses can exist, big businesses can exist, but the ones in the middle have a hard time. And I think that’s the shake out you are seeing and will continue to see in the secondary market. But I think that control is enabled by technology. You look at what you guys are able to do by working with rights holders. You look at what Ticketmaster has in their arsenal.

We created, when I was at Ticketmaster, we created paperless ticketing, which is, I guess now a taboo term. But it was Tom Waits manager, who’s a good friend of mine, Stuart Ross, was doing all of his work. And Tom Waits used to require every fan go to the box office to pick up their tickets, to show their ID that they were the one who bought the tickets, pick up their two tickets at the box office, and then go right into the venue so that the tickets could not be resold in any way, shape, or form. His shows all started two hours late because filing people through two box office windows took that long. And he said, isn’t there a better way we can do this and accomplish the same goal.

LP:                             The only person that made any money on that was the union.

David:                        That’s right. Both the box office union and the stagehand union. The solution was simply to tie the purchase to the credit card that made the purchase. And we created a system, this was before Square existed. So you could swipe the credit card on a device on your hip and it would print out what we called seat locator receipts. Because, ultimately, you had to know where you were sitting in the venue.

LP:                             We call those tickets.

David:                        No, these were not tickets. And we got it so you could swipe and have them both printed out within one and a half seconds, which seemed like an acceptable time period. We could have dozens of people at the doors to do it. And we got the crowds in on time. And it accomplished what Tom Waits wanted, which was no resale of tickets. Literally the person who buys the tickets has to go. And if someone couldn’t go, we would refund them and resell them in the same manner. He was comfortable doing it because he said, look if I don’t sell those tickets, I’m comfortable taking the hit on it. But, again, that was the artist setting the rules for how they wanted their ticket sales and distribution to be handled. I just think that was the earliest stage of this control being in the hand of the ultimate provider of the entertainment.

LP:                             Yeah, it’s interesting your comment about the middle market going away. I was having a conversation with someone last night about how that applied in the world of synch rights for record labels. Indie record labels over the last, especially the last 20 years or so, have done a great business in commercial and film licensing. And it’s really allowed a lot of them to not necessarily mask a lot of the changes to their core business, but to survive through the transition as streaming has come to scale and all those people are getting squeezed out. So now every film with an end credit song, it’s going to be fine for Adelle. She’ll do okay with synch rights. But for some of the Indie labels out of the U.K. or alternative labels where they could get a hit on the back of a movie, that’s sort of gone away for them. And it’s sort of the have and the have nots in that business as well.

David:                        Yeah. I mean, ultimately, you can call capitalism a flawed system, but that is one of the flaws. It does squeeze out that middle market eventually.

LP:                             What else you working on? What’s interesting right now?

David:                        Lots going on in the world of sports betting.

LP:                             Actually, I wanted to come back to that for one second. I think when you first got into the sports betting world in the sort of end of the first decade of the two thousands, it seemed like there was so much momentum because of the financial crisis that I think everybody thought, oh the states are going to open this up because they need the revenue. Similar to the decriminalization with certain drugs. And it was a little bit too early. It didn’t quite happen. And it took the better part of another decade to get there. What happened? Why did it take that extra amount of time? It seemed like so inevitable in the moment that it was about to all break open. What changed?

David:                        Don’t underestimate the political power of fundamentalists who, whether for religious reasons or other reasons were against marijuana legalization. It’s going to lead to addiction and every bad problem you can possibly come up with. Same thing with gambling. It’s going to lead to problem gambling, expansion of gambling is a bad thing in any way, shape, or form. I think it just took time, same for marijuana, same for sports betting for people to wear down those arguments. And, ultimately for the state to be equally as desperate for revenue without raising taxes. And what I think was really most compelling, and true in sports, and certainly true in marijuana you weren’t sort of creating a new habit for people. You were simply taking an activity they were already partaking in illegally, that really wasn’t safe for them as consumers, and certainly wasn’t providing any protections or tax revenue, and you’re creating a legal avenue for that same activity to be done all the while protecting the consumer and creating tax revenue.

                                   And you’ve seen that in marijuana legalization, and you’ve certainly seen it in the states that have legalized sports betting. You’re not creating a new generation of people to bet on sports, you’re taking people that used to have an offshore bookie and you’re now giving them a legal avenue by which to do it. I think there’s anybody who is, given the choice, and economics are largely the same, is going to say, yeah, I’ll keep breaking the law. That’s fine, even though this is legal, I’m going to keep breaking the law. And it took a while to wear all that down.

LP:                             It’s a consumer protection play more than anything else.

David:                        It really is.

LP:                             It’s interesting the sort of shameless self-promotion part of it, that’s very much [Light’s 00:55:46] model. We’re taking an activity that we know certain people either get into speculatively or forced into because they can’t use their ticket, they have nothing else to do with it. They’re forced to go find a way to get out of the position and sell it somewhere. There’s a buyer for that who is assuming a lot of risk because it could be a printed-out PDF or what have you. So were taking all that activity that’s happening anyway and just putting it in an environment where everybody on both sides of the transaction knows it’s safe, knows it’s up and up. And, by the way, the rights holder gets their tax on it and gets a lot of insight into sort of what happens with their tickets once they’re released into the wild. I think it’s a very similar or a fair analogy.

David:                        My simplest equation in the world of live music is only two people matter, an artist and a fan. That’s it. Everyone else is a middleman. We’re all middlemen, middlewomen, middle people. And you either add value in that equation between the artist and the fan or you get the fuck out of the way, or you’ll be pushed out of the way. That’s it. You found a way to come in and add value to both sides of that equation. And that’s hugely valuable. Those that are in the middle taking pieces of it by not adding value to either side of the equation are the ones who ultimately get pushed out of the way.

LP:                             Thank you for that.

David:                        I wasn’t even paid for that.

LP:                             Well, I think, one of the—so earlier today we were talking about in our meetings on this sort of theme kept coming up about relationships in this business and how, you know, that’s the life blood of this business. And, I’m sure, in other businesses as well. But this is the one we all know. To me, every time I think about you, I realize we’ve never really done a ton of business together. We’ve just known each other forever. I have no therefore out of that statement, but it’s funny to me that it’s a relationship, not really a business relationship. I’m very grateful for that, but.

David:                        We did plenty of Stones fan club presales and so forth.

LP:                             That’s true.

David:                        But you probably associate more of that with Marcus than with me.

LP:                             Yeah.

David:                        Which is fair. I didn’t actually ever do anything. That’s why.

LP:                             I was trying to politely say while everybody else was working, you were just sitting around looking smart, which you’ve perfected.

David:                        It’s a skill.

LP:                             Before we release you back to the wilds of Manhattan and get you to Penn Station, I want to see if anybody had any questions, or if you had any questions, or if anybody had anything they wanted to add.

Male Voice:               So we’re looking at different territories to expand to potentially, obviously like Canada and the U.K. are the top of our list, Australia as well. Given your knowledge of Asia, wondering kind of what your thoughts are on Light and non-kind of outside of those obvious territories.

David:                        Don’t go to China. Wait a bit on that one.

LP:                             Why?

David:                        In China, ultimately, the government is your partner whether directly or indirectly. The decisions can be made unilaterally. For instance, I have one of the investments I’ve got is with a ticket marketplace. We would call it a resale marketplace. I’ll give you a little bit of information on how China works. In China, lots of times a promoter will buy a show and, in an effort to lay off risk, they will sell large blocks of tickets to people they call merchants. And those merchants will use a platform like a company that mine has to get those tickets out to the general public, which is a different platform than the primary ticketing system. So, in my mind, it’s a mix of pure resale and what I would call primary tickets just done in this sort of block format.

The beginning of the year last year the CEO said we’re going to have a couple of headwinds this year. Like, okay, what are they? Number one, this is the seventieth anniversary of the communist party in China. And the Chinese government views any potential mass gathering as an opportunity for a political protest to break out spontaneously. And because of that, they’re going to issue fewer mass gathering permits this year, which means fewer concerts and few sporting events are going to be allowed because they just don’t want to risk people protesting the government.

LP:                             Especially Western content I would think.

David:                        Yeah. Like what do you do with that? That is the ultimate, all right, I cannot do anything about this problem. The second was, and then this actually became a benefit for the company, but I think the CEO looked at it as a headwind first. The government decided unilaterally that any platforms that were going to resell tickets for a specific event had to get the approval of the event provider. At first, he was like, we’re going to have to get relationships with all these people and do all this stuff. I said, this is a great barrier to entry to the rest of the economy. You’re a legitimate provider. And there was a time where business dipped while we went out and made sure that everybody understood what we were doing, and how we were protecting consumers, and how we were actually selling some of their primary inventory anyway. And it has become a good thing for the business. But, again, it was a choice that was unilaterally made by the government where you just don’t have any input. There’s no one to lobby like you do here in the states or whatnot.

                                   So those are some of the reasons why I think China is difficult. I think you want to look at markets, obviously, that have either a strong history of resale or maybe have strong restrictions against resale. And they’re equally interesting for different reasons. But if there’s laws restricting resale, and you can come in and find a way to guide yourself rightfully, justly in those markets, you give yourself a terrific moat around your opportunity in those markets. Australia’s one of those markets. Canada. So I think there are certain ways you can look at expansion that sort of give you an interesting way to protect what you’re going in so there aren’t a lot of fast followers to what you do.

LP:                             In a world of limited resources, U.K. or Australia, where do you go first? This is the free consulting we’re going to get out of you in exchange for those cookies you’re going to have.

David:                        U.K. for population alone and volume alone. It’s also easier to just operationally. The time differences with Australia do get to be, until you’re ready to have a significant set of resources there, I think it’s a hard one to manage. But it’s literally only about those reasons. I think market wise Australia’s probably easier to crack into because of the regulations around resale. But I just think that longer term the U.K.’s a much bigger opportunity and the sooner you get cracking on it the better.

LP:                             What about sports for what we do?

David:                        Relevant. The concept of the season ticket is disintegrating in sports. But the concept of bundled tickets is not. Teams are going to be selling groups of tickets in smaller buckets, not 81 baseball tickets, but maybe ten packs and so forth. And those are going to need to be unbundled. And those are going to need to be resold. I think, depending on the sport, you do still find demand that exceeds capacity in venues. And I think those are interesting circumstances as well. And you find that what’s easier than music, which has a very complicated value chain and decision-making chain, sports is a lot cleaner. A team can usually make decisions for just about everything that happens. Sometimes leagues get involved, but usually that team can decide because they own the venue, they own the IP, they write the checks, they’re the ones with the ticketing contract, etc. So certainly think there’s opportunity there.

LP:                             What about the scenario where the team does own the venue and do you view primary ticketing as restrictive because of their sort of covenant with the primary ticketer.

David:                        It can be initially. I mean some of it depends on their relationship with their primary ticketing company. But I also think some of it depends on when that contract’s up for renewal. And they’re always up for renewal. So I think if you’re going to offer them something that’s value, again, same thing as in music. You’ve got the talent and the fan. If you can provide a reason why you’re valuable in the middle of that mix, they’re find a way or a reason to use you.

LP:                             Game on, yeah. Anybody?

Female Voice:           I was just wondering, what happened after that first ticket sale? Did it take off right away, the America Online, or did it stagnant after you were, yeah, and then it just dropped a little while until people caught on?

David:                        It was stagnant for a couple of reasons. One, it was a really clunky buying experience. I mean this guy had to crawl through hell to be able to buy that ticket.

LP:                             He really hated people.

David:                        Exactly, exactly. So there was a lot of work required, UI UX, to get it to a place where it was actually a reason to use that method versus the others. The second thing, candidly, is I think that Ticketmaster Corporate in L.A., at that point, wanted to take control over everything. We were a little rogue outpost in Chicago. And because of that, it slowed the process down. And Ticketmaster launched its first website without the capability of selling tickets. It seems crazy to say that now, but they went with such caution that it just took more than a minute for it to become an area where they were investing in from an e-commerce perspective and then ultimately getting the UI UX rights so that, from a consumer perspective. You also needed bandwidth increases. I mean we were talking twenty-eight eight or fifty-six K dialup modems at the time.

LP:                             At best.

David:                        So waiting for a venue map to load on a twenty-eight eight modem, not a great experience. Nothing to do with us. That was bandwidth.

Female Voice:           Did I have anything to do with—people used to be so afraid to buy things online in those early days. Was that a factor too do you think as far as even from the corporate perspective?

David:                        That’s why AOL was safe because it was a proprietary network. It wasn’t the commercial internet. But that was one of Ticketmaster’s concerns in launching a transactional website was how do we protect the credit cards, consumer data, all those things that you can easily get sued for even back then.

Female Voice:           Fascinating. Thank you.

David:                        Sure.

LP:                             So version one of Ticketmaster.com was basically event discover, a listing site.

David:                        Yes.

LP:                             And is that the genesis of why they had display ads because the site wasn’t commercially supported?

David:                        Oh, yeah. Originally it was a content site. And you monetize content with ads. Yes, they could refer you to buying on the phone or going to a record store whatever, but that was the—and we actually had writers writing original content for the website too.

LP:                             I remember that. That’s so funny.

Male Voice:               My question kind of evolves around international expansion. Just looking at that, you mentioned the U.K. One of the things that Europe or the U.K. does is a lot of the events don’t have one single primary ticketing outlet, they have multiple primaries handling one inventory with one set of tickets. How does that hurt partners that want to and partner say with an event when they have multiple outlets, or multiple primaries, selling one set of tickets.

David:                        It’s predominately the U.K. Most other markets in Europe still operate under the exclusive model that we have here. I’ve always found it to be bad consumer experience. Until such time as it’s literally the equivalent of a GDS system like you have in travel where the same inventory is being represented across every site as opposed to allocated inventory, which is different and unique across the different sites, until you get to that model, I think it’s going to continue to be a hard sell for anyone else trying to add value in there. I just think it’s a shitty system. Put it this way, we shouldn’t be that far off from the ability to have one system that’s the inventory management system for a venue and as many systems as the venue or event owner wants to be storefronts for that inventory. But not to have unique inventory by channel.

Travel works that way very well. There’re selling perishable inventory. They have to make sure two people aren’t sitting in the same airplane seat or buying the same hotel room. There solving for a lot of the same problems and it works really well. And they can change the rules. A ticket sold on Priceline and a pay what you bid model is very different than a ticket sold on Hotwire where you just don’t the name of the hotel, but you know a price or different from Expedia where you know every detail about what you’re buying. Those are all different models, but they’re all selling the exact same inventory from one inventory management system. Why we can’t get there in ticketing, some has to do with legacy technology, but that will get solved.

LP:                             I’d say the thing that’s interesting about it to me is I think of the competition for allocations in the U.K. venues as actually an opportunity for entry. Because if you can get in that first time, and to be honest, you can buy your way in if you have the right relationship. You can buy an allocation, or guarantee the risk. I’ve always believed, and I think I’ve seen it born out that the people that can sell the most tickets are given the most tickets to sell. So if you can get yourself in there as one of the five, or one of the X on an event, and show that you have marketing, you can get more tickets. And I don’t think it’s that closed of a club. I think there is an opportunity.

David:                        No, but a different answer. I think market entry is very easy. I think making a profitable business out of it is very hard.

LP:                             Well, I mean we’re a series A company, so. You’re answering the wrong question.

David:                        Profitability is overrated.

LP:                             The other thing is, with the model you described, whether it’s a, I mean travel’s the great analogy. But the west end works that way as well. There’s [Ingreso 01:11:15] I think is the company that sits behind all of that. And even to the point where you can set the business rule as the rights holder and say, you know what, give this outlet that inventory, or buy us this outlet for this pricing. It’s right there. It’s right there. So it’s an interesting market for that point of view. We talk about Australia, and I like Australia because our business is so focused on festivals right now that we get the two festivals seasons by going to Australia first. But that’s just us talking about current convenience. Anybody else?

Male Voice:               I’ve got one. So you’re talking a lot about the relationship of a fan and an artist or a fan and team. How do you see some emerging technologies like Blockchain and Cryptocurrency coming into this landscape?

David:                        In ticketing, I look at Blockchain as a solution in search of a problem. If the best use of Blockchain in ticketing is being able to secure the provenance of a ticket, which I think is how most people sell it, any good primary ticketing system can do that. It can guarantee the authenticity, and that this is a legitimate ticket issued by that legitimate original issuer, and it has these rules attached to it for resale just the way we were talking. So I don’t know that Blockchain comes in and changes anything meaningfully. I think some of the companies that are out there can offer beneficial services to ticketing companies that don’t have the resources to maybe do that on their own so they can be partners to ticketing companies. But I don’t think, in and of itself, the technology is a game changer for live event ticketing.

                                   Cryptocurrency, again, I was in Vegas for CES and you love walking by a bitcoin ATM. And I’m like, there’s a reason why no one’s in line at the bitcoin ATM.

LP:                             When you withdraw, just air comes out.

David:                        Exactly. Exactly. Here’s your key. I’m a believer, ultimately in Cryptocurrency and third-party currencies that will have value. I still think there’s a lot to shake out. For all of its negatives, I actually thought Libra and Facebook’s foray into that with the partners they had stood a chance before Facebook started going down its own issue hole. But I don’t know that the benefits of Cryptocurrency for live entertainment and ticketing are any different than its benefits for any other vertical necessarily.

LP:                             One more and then we’ll get you to.

Male Voice:               [unintelligible 01:14:08] category within live events are you kind of most excited about or think has the most potential? Obviously, there’s like music festivals, there’s sports, the things that have been around for a long time. Now there’s newer things like e-sports and thousands of people going to watch those. And there’s kind of experiential events. In Seattle, we had this they took the Mariners baseball field and from like Thanksgiving to New Year’s Day they did this big Christmas thing, the world’s largest Christmas tree, and ice-skating rink. It sold out like every night. What things in live events?

David:                        Funny thing is every ballpark in the country had the world’s biggest Christmas tree and ice-skating rink during the holiday season.

Male Voice:               Like they were doing like a driving range in the stadium where you could like golf from the upper deck into the actual field. Just curious what things you’ve heard about that you’re excited about in the space?

David:                        Look, I think that, I think food festivals, I think anything where it gets people out of the house and engaging in an environment that isn’t solely focused on the screen that’s in their hand I think is going to have value. Because I actually think people do want those sorts of experiences that force them to put the phone away, for that reason alone. But, you know, people will say, well e-sports is just having people look at another screen. It’s not. E-sports, until you’ve experienced it, it’s hard to explain. And there’s generational things too. Like my mom will not understand a video game competition. She just won’t get it. But I think that the beauty for us in what we do is this market is just expanding because of the things you just talked about. As long as, in the end, it’s about quality and the quality of the experience, as long as that’s there and there’s value for the consumer in experiencing it, and there’s some reason for them to be there, there’s going to continue to be significant growth.

I think some of what you’ll see coming about I don’t necessarily believe in the sphere that MSG is pushing. But I think that venue design and venue experiences also going to be another big area and differentiator in growth opportunity. I think what you’re able to do in the venue from an entertainment perspective, an engagement perspective versus just sitting in your seat and watching event, I think that too is going to change. I think Mark Ruxin and MIXhalo the opportunity to use your own headphones to listen to the mix at a concert, or even adjust the mix, I think that’s a great way to enhance the experience. I think things like that are just going to continue to grow and evolve.

LP:                             Yeah, the live space does seem to be a pretty limitless greenfield right now and the only things that seem to be the limiters are more macro things that would have much bigger societal repercussions. You know, global pandemic, which makes people afraid of public gatherings. Terrorism, that scale. Environmental catastrophe. Those are all the things that, you know, they’re real, they’re threats, they’re increasingly so. Deals. I start to see stuff creep into deals in terms of insurance and mitigation around risk. But those are the macroeconomic or societal inputs in terms of just the business itself. Clearly people are clamoring to part with their money for experiences, especially built around infinity.

David:                        I think we will have to get more serious about security. At live events. And I think what’s going to end up happening is you’ll see the borders of the venues get pushed out. If you think of L.A. live, around Staple Center, eventually the entrance to Staple Center is going to be the entrance to L.A. live. And people will have to go to venues earlier because they’ll going to have to go through full airport style screening not just sort of the casual stuff that’s done today. And because of that, they’ll want to get to the events earlier. And once they’re in the venue, they’ll going to have to find food, or other options. Like the O2 in London. I think it’s an opportunity to create a longer experience and more revenue for those venue operators. But there’s going to be period of time where it’s going to pain in the ass for consumers.

LP:                             Squeezing out the middle again.

David:                        Yup.

LP:                             The big will get bigger, and the small will move to the fringes, and the middle guy’s going to have a hard time. Anybody else before we release David to the wild? Think you’ll make your five o’clock?

David:                        From here? Easy.

LP:                             Great. Thank you.

David:                        I’ve done worse.

LP:                             All right.