Scott Borchetta, left, of Big Machine Label Group announces the signing of Tim McGraw at the Country Music Hall of Fame and Museum in Nashville on May 21, 2012 (Photo: Steven S. Harman/The Tennessean). Click image for a gallery of McGraw over the years.
Country superstar Tim McGraw?s manager was on a mission. He called it: ?Find a future home for Tim.?
The mission took manager Coran Capshaw into meetings with chief executives at the world?s biggest media corporations ? companies such as Sony, Warner Music, Capitol Records, Universal Music. He was on a quest to negotiate a deal for one of country music?s biggest commodities, a 40 million record seller and a movie star who had just parted bitterly with his former company, Curb Records.
In the end, however, McGraw chose a small, independent label, Big Machine Label Group, started seven years ago by former radio promoter and NASCAR driver Scott Borchetta. The label has fewer than 50 employees and remains a relative newcomer to Nashville?s country music business, which has long been dominated by establishment record companies with corporate headquarters elsewhere.
?When I knew that I was going to be looking for another record label deal, I knew there would be lots of different scenarios and lots of different ways to put a deal together,? McGraw said at the formal announcement of the deal last week at the Country Music Hall of Fame and Museum. ?Ultimately, I wanted someone who was passionate about what they did and believed in their artists, and that?s what led me to Scott Borchetta.?
Borchetta?s company has traveled an unusual trajectory during a turbulent time in the music business. The industry has undergone massive corporate downsizing as music sales plunged, while many entrepreneurial efforts to launch new labels have quickly fizzled.
But in 2006, Big Machine revved up Nashville?s music scene in a big way. Just a year after Borchetta, a former promotions executive for Universal Music Group, launched his label, it released Taylor Swift?s debut album.
Since then, Big Machine?s star has risen so sharply that even country superstars such as McGraw ? estimated to have brought in $35 million last year ? have decided to hitch their ride to it. Rascal Flatts, Martina McBride, Reba McEntire, Jewel and The Band Perry are among its growing roster of artists, which also includes many starting their careers.
With McGraw?s addition, the growing musical empire gets the one piece it?s been missing: a male country superstar.
The deal also is likely to bring fringe benefits to the entire Big Machine roster, said David Ross, a country music business analyst.
?A superstar artist like Tim McGraw not only sells records, but becomes a powerful chess piece commanding leverage at radio, distribution and among a wide variety of media channels,? said Ross, founder of longtime industry publication Music Row and author of Secrets of the List, about music and technology.
?This power can be especially helpful, if used properly, in bringing opportunities to the label?s mid-level artists that they might not otherwise have access to.?
Borchetta launched Big Machine in 2005 after his sudden departure from Universal Music Group, where he had been a radio promoter.
At the time, major recording companies were in an upheaval that began in the late 1990s. Hundreds of executives were let go in Nashville, Los Angeles and New York, and artist rosters were pared down, as well.
?You had an abundance of experienced talent out there, forget just the artists, but executives, too,? said Jon Loba, a former Big Machine executive who now works for Broken Bow Music Group. ?A few of them tried their hand at starting labels. It was almost unheard of at the time.?
Borchetta was among a handful in the Nashville music industry who went into business for themselves. Country music was still dominated by the major record labels, with head offices in New York or Los Angeles and offices or subsidiaries in Nashville. The big labels had a near monopoly on relationships with radio stations, who were key to launching new music. And they ?aggressively tried to keep that genie in the bottle,? actively lobbying stations against playing independent music, Loba said.
Most independent companies either quickly ran through funding or ? if they had any success at all ? entered partnerships or agreed to be bought out by major record labels.
Country singer Toby Keith?s Show Dog Records launched in 2005 but merged with a Universal Records subsidiary in 2009. Category Five Records, launched by former record label executives, launched in 2006, released an album with artist Jerod Neiman and then folded a year later. Equity Music Group, founded by singer Clint Black in 2003, enjoyed some initial successes with Black?s albums and Little Big Town before closing amid financial difficulties in 2008.
Among those startups, Big Machine is among the few left a decade later. Broken Bow, started in 1999, is another exception, with artists such as Jason Aldean, but it had to be sustained through lean early years by the deep pockets of its founder, entrepreneur Benny Brown.
Without the catalogue of royalty-earning music or a diverse roster of hit-makers and new talent to develop, most startup labels couldn?t sustain the financial losses.
?You have to be able to withstand substantial losses or be really lucky,? said Loba, who said his boss Brown called Broken Bow?s early years his ?$5 million education.?
?If you don?t have investors willing to stick around for three to five years, you better have a hit immediately.?
Big Machine, on the other hand, had hits immediately that brought in cash.
In its first year, it had a No. 1 single with singer Jack Ingram (?Wherever You Are?) and placed five singles in the Top 30 country charts.
Swift released her self-titled debut on the label a year later. By 2009, she had helped catapult the label into position as the highest-selling record label on Music Row. She provided the financial leverage to help keep the label going, Loba said.
David Maddox, assistant professor of music business at Belmont University?s Mike Curb College of Music and Entertainment, said that Borchetta ? a second-generation music industry executive ? has brought to artists like Swift both experience and innovation.
?He had one leg in the past and one in the future,? Maddox said. ?He came up through the old business model, but he?s also an innovator, and that?s what made him competitive with existing labels. Also, he had the advantage of a smaller company. He can move much faster than them.?
Today Big Machine?s roster continues to break records. Swift has sold 20 million albums and remains the top-selling digital artist in history.
Its longtime country stars have a solid history of hits. Reba McEntire has sold 30 million albums; Rascal Flatts, more than 10 million. Martina McBride has 18 million. And McGraw, with 40 million in his 20-year musical history, remains the best-seller.
With lower overhead than labels that still employ hundreds or thousands of workers, the company is attractive to a star such as McGraw because he?d likely be able to make a better deal, Ross said.
?If you were a superstar, you would not even consider going to a label unless you thought they could handle your music and marketing,? Ross said. ?Scott?s proven that beyond a shadow of a doubt. Then you look at the labels and say, who can give me a good deal? My guess is Scott gave him a very good deal.?
Borchetta, who declined to be interviewed for this story, hinted as much during a news conference May 21 after McGraw joked how relieved he was that he could still get a record deal in Nashville over the age of 30.
?It?s a pretty good deal,? Borchetta quipped back.
At 7 years old, the company is among the oldest independent labels in Nashville, but in recent years ? inspired in part by Borchetta?s efforts ? new successes are emerging. Among them are Average Joe?s Entertainment, which represents Montgomery Gentry; Bigger Picture Entertainment, which represents Zac Brown Band; and Broken Bow, which just signed Randy Houser away from a major record label.
And the 50-plus-year-old Curb Records ? the longtime independent label that McGraw just left ? remains the oldest independent label in Nashville. McGraw was signed to Curb Records by Borchetta?s father, Mike, 20 years ago.
Borchetta also said it won?t be long before fans hear new music on the McGraw label.
?Sooner than later,? Borchetta said. ?He?s 20 songs into the most amazing music I?ve ever heard.?
?? Anita Wadhwani
The Tennessean
Reach Anita Wadhwani at awadhwani@tennessean.com or 615-259-8092.
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