UPDATE: Fame House Acquired By UMG For $1 Million, Will Continue To Also Serve Non-Universal Clients
UPDATED: Fame House has always been on the list of non-core assets that a bankrupt SFX thought it could sell. In the end, only one real bidder stepped up to offer. [UPDATE AFTER THE JUMP]
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A federal bankruptcy judge has approved the sale of SFX owned music marketing firm Fame House to Universal Music Group. Fame House's impressive client list includes Eminem, Pearl Jam, Ice Cube and Tiësto.
UMG agreed to pay SFX $1 million for Fame House along with $400,000 in debts and liabilities. UMG was the sole bidder in the auction, reports Amplify's Dave Brooks for Pollstar. “After evaluating its assets, the Debtors no longer viewed the Fame House business as core to the SFX platform nor sustainable long-term under SFX’s ownership,” SFX attorney Adam Keil wrote in a court brief.
Whether UMG will operate Fame House as an independent company or absorb the team within its greater music group is not clear.
UPDATE FROM THE OFFICIAL ANNOUNCEMENT: Fame House will remain based in Philadelphia and continue to provide and expand on their world-class services as an agency for Universal Music as well as third-party clients. Mike Fiebach, CEO and founder, and Eric Hahn, Chief Strategy and Marketing Officer, will continue to lead the agency.
Full text of the official announcement –
FAME HOUSE ACQUIRED BY UNIVERSAL MUSIC GROUP
Fame House to Accelerate Company’s Social Media, Branding, Live Events and Consumer Initiatives for Artists and Labels
SANTA MONICA, May 27, 2016 – Universal Music Group (UMG), the world leader in music-based entertainment, today announced the acquisition of Fame House, an award-winning, innovative digital marketing agency whose clients include artists, brands and festivals including Eminem, Pearl Jam, Mitchell & Ness and Tiësto.
Fame House will remain based in Philadelphia and continue to provide and expand on their world-class services as an agency for Universal Music as well as third-party clients. Mike Fiebach, CEO and founder, and Eric Hahn, Chief Strategy and Marketing Officer, will continue to lead the agency. Fiebach and Hahn will report to Boyd Muir, Executive Vice President and Chief Financial Officer, and Michele Anthony, Executive Vice President of UMG.
The acquisition of Fame House will advance UMG’s strategy to create unique commercial opportunities for its artists and labels through social media, consumer engagement, direct-to-consumer and direct-to-fan initiatives, as well as activations for brands, sponsors and live events.
“At Universal Music, we have created artist and label services that are unrivaled in our industry, ” Anthony said. “Fame House will provide digital marketing services and social media expertise for our artists and labels to build fan engagement and reach new audiences through compelling direct-to-consumer and merchandising experiences, as well as create activation opportunities for brands and sponsors and for our live events.”
Muir added, “UMG’s acquisition of Fame House is further evidence of our evolution into a multifaceted entertainment company that can provide a broad range of services for artists beyond recorded music, publishing and merchandising. I’m looking forward to working with Mike, Eric and the entire Fame House team on unlocking new creative and commercial opportunities for our artists and labels.”
“We are eager and excited to continue to build Fame House as a part of Universal Music Group,” Fiebach said. “We believe that we can build a game-changing business with UMG. I am thankful to Boyd, Michele, Mike Tunnicliffe, Peter Sinclair and the rest of the UMG management team for recognizing the potential of Fame House and for giving us this incredible opportunity. With the resources and support of the world’s leading music company, the sky is now the limit.”
Added Hahn, “As someone who has only wanted to build a career in the music industry, the opportunity to work in the UMG family is an absolute dream come true. We believe that the UMG leadership is at the forefront of innovating positive evolution in the industry and for them to recognize a company that we built as a key ingredient in their strategy is something we are very proud and appreciative to be a part of.”
Founded in January 2011 by Fiebach, Fame House is a digital strategy agency with offices in Philadelphia, New York and Los Angeles that’s built to uniquely serve the needs of the modern music industry. Fame House’s early foresight into crafting services around the new opportunities of connecting artists and fans online led them to help establish a new key role within the music ecosystem serving artists alongside labels, management companies, event companies and agents.
About Universal Music Group:
Universal Music Group (UMG) is the world leader in music-based entertainment, with a broad array of businesses engaged in recorded music, music publishing, merchandising and audiovisual content in more than 60 countries. Featuring the most comprehensive catalog of recordings and songs across every musical genre, UMG identifies and develops artists and produces and distributes the most critically acclaimed and commercially successful music in the world. Committed to artistry, innovation and entrepreneurship, UMG fosters the development of services, platforms and business models in order to broaden artistic and commercial opportunities for our artists and create new experiences for fans. Universal Music Group is a Vivendi company. Find out more at: http://www.universalmusic.com
Surprising if only a $1.4m valuation, but maybe the association with SFX was toxic, the economy is worse than we think, or that number is wrong? The team and clients each seem like they’d be worth way more than that to someone. Great move by Universal which should pay off really nicely for them and their artists.
My sentiments exactly, Brian.
– not only that, these founders now have another boss. To me 30% debt (or any debt) is the first sign of trouble in paradise.
My last thought goes out to the staff. I hope not too many are forced to leave.
I’d be curious to see how many leave on their own & start up similar or look for
a new roof to hang under. Best of luck to all.