Q’s With Business Manager Jamie Cheek Of Flood, Bumstead, McCready & McCarthy, Inc.

Jamie Cheek
– Jamie Cheek

Jamie Cheek of Flood, Bumstead, McCready & McCarthy, Inc., handles the budgeting and financial planning for artists and their teams at every level of the business, and he has had a very busy last couple of months. Cheek jokes that he has been talking with some artists more in the last several weeks than previous years combined.

He took part in a recent Pollstar Live! One-on-One Digital Session with OVG President of Media & Conferences Ray Waddell to discuss what the money is like for artists at all levels, how his work is going, and different possibilities of what a comeback might look like. The content of this conversation has been edited for grammar, style and brevity, and the full conversation can be found here.
Pollstar: So how have artists’ finances been affected by the shutdown of the entertainment industry?
Jamie Cheek: Overheads are covered by touring. And to have this happen, almost overnight, where that is gone, and you’re sitting there with some of these big arena tours that go out, you can get up to 75+ people that are affected, that are planning to go on the road. You’ve got buses, trucks, sound, lights, video, merchandise partners that might have already bought all the merchandise for a tour. Some of that maybe could be used later, some of that might already have been printed up with the dates on the back of the shirt. 
There’s not a single artist that doesn’t want to help all those individuals that have been affected by that model. But how do you do that when your primary and only source of revenue was touring? So, and again, in the initial phase, with the postponement, there was some hope this might be just three months. And we could figure that out, if we at least know that revenue’s gonna be there. But now that we’re sitting in this period where we don’t know that, and obviously, that’s been here for a little bit, those become very difficult conversations. It is all different with every single artist, depending on what they can do and what their teams want to do, what their vendors can support. Some vendors will certainly survive through this, others are very challenged with that. You’re literally going person by person to try to create the economics for them as best you can, but it’s tough, there’s no other way to say it. It’s brutal, I’ve never seen anything like it.
Can you explain the financial differences between postponement and cancellation?
Postponements are never fun, there’s definitely a lot of work that goes on around them, certainly a lot of work from everybody that is involved to get them rebooked. But economically, usually those do happen within less than 12 months and maybe even closer to 6 months. If they’re gonna get rescheduled, you can usually predict what those economics are. An artist might be getting a little less revenue in, because promoters spend a bunch of money on advertising and need to re-spend more money on advertising for postponed shows.
But most of the time your vendors are really gonna work with you. They understand, essentially, that if you had a month-worth of touring early in the calendar year, and you shift it to a month-worth of touring in the back end of the year and they work with you, it will mean they end up with the same amount of money. So a lot of times you can mitigate those difficulties and it can still be a very good circumstance. The bottom line is you know that you’re going to get the income if it’s postponed, and if it’s rescheduled enough times, you won’t have a lot of the ticket refunds. 
Cancellation is a totally different ball game. Your income is gone. Especially, as quickly as it stopped for some of these artists, it’s back to what I said earlier, it’s a complicated process to line it all up. “Who are we not gonna be able to pay now?” And “How do we go down that list of who should get covered?” “What do all of our leases say?” A lot of times, with a lot of these big vendors, there are some typical, recognized ‘outs’ that if certain things happen beyond an artist’s control, that within a reasonable period of time, i.e. a year of getting back to home base or the shop, that some of those contractually can be ended. But [sometimes there is no out] and some of them are stuck with significant costs in that case. In normal times you would get cancellation insurance. Cancellation insurance can help with the majority of these things, but for those that don’t know, under most policies coronavirus is not covered and hasn’t been for a long time, so that is not something anybody has really been able to tap, at least in this period, unless you’re Wimbledon, I heard Wimbledon got all their money back.
It seems labels and recorded music haven’t been as negatively affected by the live shutdown. Do you think we might start to see more support from the labels for touring again? 
It looks like streaming is incredibly strong, it looks like royalties that come off something like SiriusXM are incredibly strong, it looks like there may be something to it. But we need to wait a minute, see the numbers that come out for April, May. But if that continues to be really strong, yes, I think hopefully, I expect there will be labels that can support touring. I’ve even seen some labels be proactive with mid-level acts that might have had some 360 money that was due back to them and let the artist use that to pay band and crew for a while. The label is saying “whatever we can do to help, don’t worry about that right now, use it on the touring front.”
I do think good label partners can help many of our artists with that. How deep they can go and how much they can help if we don’t have touring, I don’t know. But logically, I think tour support would be significant, perhaps if they need [to help develop] a new act. Maybe they were more used to tour support stopping once artists got to the mid level. Maybe now that goes longer. For the mid-level act, maybe that money is not there for a support act like it used to be. It could certainly be the label that picks that up.
As a business manager, what are best and worst-case scenarios for a comeback?
The worst case is there is no touring until there is a vaccine and cure, and maybe that takes 12-18 months to develop. Could you play out a story where there is no touring in 2021? I don’t think I can get myself to believe that even just on a human level. I can’t imagine living in a world where that exists. But could you play out that scenario if you followed that path, sure, while at the same time doing the things you need to do if the situation is more optimistic than that. 
The best case is there is still touring this year, maybe at the end of the summer. The Gulf Jam is selling tickets, they are planning on rolling Labor Day weekend. I still work with artists that have venues on hold this fall, festivals booked this fall. Do those play because there is enough hope in a vaccine sooner than we expect? Do they play because someone creates something none of us are thinking about how to put people safely in a concert space? I think that’s the best-case scenario, touring this year.