All the world's a stage for entertainment maven

By Matt Golosinski

Maybe it was the early trumpet lessons or the subsequent tuba and guitar study that turned Jerry Mickelson onto his lifelong passion. Or perhaps the love of music was there from the very start for the co-founder of JAM Productions, a Chicago-based independent production company, the largest of its kind in the United States.

Then again, the roots of Mickelson's success might owe something to his youthful quest to gain admittance to the best shows of the early 1970s, including those put on by blockbuster acts such as Led Zeppelin and the Rolling Stones.

“I got tired of getting bad seats at all these concerts,” said Mickelson, a self-described “music nut,” during his Jan. 17 address to a Kellogg School audience as part of the Distinguished Entrepreneur Speaker Series, sponsored by Loop Capital Markets and the Larry and Carol Levy Institute for Entrepreneurial Practice.

Where some kids might grin and bear the indignity of a nosebleed perch, this college sophomore decided to start his own production company. Mickelson's father tried to dissuade him from abandoning a career in law, to no avail. But he did convince his son that an entertainment venture required a partner to share the bumps in a nascent and ruthlessly competitive industry. Enter Arny Granat, the son of a Mickelson family friend.

The two, who had never met, began their partnership with a phone call. After eight months, they put on their first show in March 1972. The band? Fleetwood Mac.

“We got lucky and sold out our first concert,” recalled Mickelson.

But he also remembered the challenges facing the budding company: He and Granat couldn't afford an office, so worked out of an apartment. The duo also faced an uphill battle cracking into the production world and initially found it difficult to gain anyone's attention.

The young partners persisted, though, doing whatever it took to make a name for themselves, including cutting their own budget radio spots that they induced local disc jockeys to play.

Today, 36 years later, Mickelson can land whatever seats he wants, including prime real estate at shows for thousands of artists with whom JAM has cultivated relationships. The company has worked with top arena bands such as U2, Smashing Pumpkins, Rush, REM and Dave Matthews Band, as well as smaller acts and even comedians such as Steve Martin. Over its lifetime, JAM has produced some 15,000 events, and in 2005 earned more than $107 million in gross sales, according to Mickelson. In 1997, JAM expanded its business model to include a theatrical division that produces and invests in Broadway plays, such as “STOMP,” “Spamalot” and “Glengarry Glen Ross,” for secondary markets.

The secret to JAM's success has been the company's commitment to forging close, mutually beneficial relationships with artists, said Mickelson. “We've worked hard to build and keep relationships from the bottom up,” he added.

To pursue these ends, JAM works with many variously sized venues, ranging from modest clubs to arenas, and also owns three Chicago properties — The Riviera, Park West and The Vic Theatre. This strategy proves effective, said Mickelson, because younger talent can headline at a Chicago venue such as Martyrs' or Schuba's and then work to establish a larger fan base that could, someday, enable the artist to perform at Soldier Field or U.S. Cellular Field.

This approach is important, said Mickelson, especially today, in a time of media consolidation and associated bottom-line considerations that often demand an artist emerge as a full-blown superstar or else get consigned to the also-ran bin.

“Back in the late 1960s and early 1970s, there were 12 major record labels,” said Mickelson. “Today there are five.” Furthermore, he noted that labels used to “invest in an artist's future,” rather than demand immediate payoffs.

Today this is no longer the case, he said.

“Bruce Springsteen would never make it [starting out] in today's market,” said Mickelson. Instead, the singer-songwriter would likely remain a regional player, performing primarily in New Jersey.

Mickelson extolled the virtues of JAM's loyal staff and said the company was fortunate to never have had to fire anyone over its three-decade history. He credited his employees with much of the company's longevity and stability.

He had no such kind words for ticket scalpers who, he said, have caused prices to jump for top events. “We abhor scalpers,” said Mickelson.

But rival Clear Channel earned the most scorn, with Mickelson referring to the media company as “the evil empire.” He concluded his presentation with details, including copies of e-mails he stated outlined Clear Channel's “illegal” monopolistic practices against JAM. Several of the documents were marked “confidential” and one included a reference to a Clear Channel strategy to “kill, crush and destroy” the competition.

In March 2005, a court awarded JAM Productions $90 million in damages stemming from litigation between the two companies related to a Supercross motorcycle racing contract.

Always act in accordance with the law, Mickelson advised the Kellogg audience. And in any event, exercise superior care with respect to all internal communications, particularly those that might someday end up before a judge.