1) Somehow, TomorrowWorld’s Income Barely Changed From 2014-2015
No single anecdote in the story of SFX Entertainment’s rapid decline speaks to the company’s questionable business practices quite like the disaster that was TomorrowWorld 2015.
Due to what rumors indicate was the conglomerate’s failure to pay transportation providers, thousands of attendees of the Chattahoochee Hills, Georgia festival were left stranded near the venue overnight. To make matters worse, the festival’s organizers tried to blame the transportation breakdown on the rain – even though eyewitnesses came to us with testimonials that suggested otherwise.
Therefore, it might come as a surprise to anyone following what happened at last year’s edition of TomorrowWorld that it saw a negligible revenue decrease from over the last two years it took place. According to TomorrowWorld LLC’s financial statement, the company brought in roughly $29.4 million in 2014 – and compared to that, its 2015 gross revenue figure of $29.1 million on its own doesn’t indicate that its ticket sales suffered as much as they could have during what was arguably SFX’s most tumultuous period.
Of course, revenue figures alone don’t reflect the costs that must be weighed against them to calculate profits. In the case of TomorrowWorld 2015, it’s likely that the refunds and other concessions made to attendees whose lives were threatened were itemized under operating costs – and therefore didn’t offset the ticket sales themselves.
More than anything, the figure might reinforce that while SFX’s house of cards came toppling down around it, the company’s leadership opted to put all their eggs in the one basket that was TomorrowWorld. Even our own coverage of the festival reflected that at least its production values had not suffered despite the glaring setbacks facing its parent company, and perhaps its marketing budget was similarly shielded from losses.
If that was the case, time has told that it was not a successful strategy. TomorrowWorld’s organizers have announced that the festival will not continue into 2016, leaving an absence felt sorely by the electronic music community for much more than financial reasons alone.
Of course, SFX Entertainment‘s chapter 11 restructuring still has months of proceedings to go through, and as more documents begin to emerge, it will be easier to quantify the company’s economic impact on the EDM industry.
Special thanks for Harshal Rana for helping with the research for this article.