How to make a Collective work
It’s armed with fresh funds, a new marquee investor, and a slew of acquisitions. Can Collective Artists Network be a blueprint for a rapidly changing talent management market?
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Earlier this year, Zerodha co-founder Nikhil Kamath invested in the Mumbai-based talent management and media firm Collective Artists Network (CAN), taking over the stake once held by InMobi’s Glance.
Earlier this month, it bought a storytelling and marketing agency Terribly Tiny Tales for an undisclosed amount.
These events, along with other recent changes among India’s biggest talent management agencies, mark a changing point in the business of managing talent.
What can legacy and new-age talent management firms learn from CAN’s journey so far?
CAN’s Blueprint for Modern-Day Talent Management
In 2021, talent management firm Kwan rebranded itself as the Collective Artists Network. Company filings show that in its first full year operating as CAN, it made over Rs 113 crore in revenue from operations with a net profit of Rs 18.2 crore. A year later, revenue rose 80% to over Rs 200 crore, while net profits more than doubled to just under Rs 40 crore.
At its height, Kwan was best known for managing top film and sports stars including actress Deepika Padukone and tennis champion Sania Mirza. In 2012, it set up a joint venture with US-based Collective Artists Agency (CAA) to collectively manage talent across South Asia (although it was dissolved four years later). In 2019, it partnered with Sony Music India’s publishing arm to form Big Bang Music, a joint venture representing a slew of independent, largely urban-focused Indian artists.
CAN is carrying forward Kwan’s interests in creating IP and owning brands from publishing music to creating consumer goods brands fronted by their top talent. For instance, CAN had already tied up with Kamath’s Gruhas to set up a Rs 150 crore fund for early-stage consumer startups. Last year, it acquired Under 25 Universe, a student community firm that organises college events and sets students up to become campus influencers and secure marketing gigs. This fits in with CAN’s social media influencers business Big Bang Social, that offers brands a ‘marketplace’ of social media influencers for their marketing needs.
CAN’s expansion into a social media, entertainment, and IP business reflects in its rounds of fundraising as well. While traditional agencies remain bootstrapped or strike deals with production houses, CAN has had a diverse set of investors. In 2021, digital advertising firm InMobi’s subsidiary Glance invested Rs 15 crore in the company. Along with this deal, it also secured funding from the Mumbai-based alternative investment fund (AIF) Nepean Capital. As of FY23, it held just over 27% of the company, giving partial exits to individual shareholders as well as the Glance InMobi, which reduced its stake from 10% to just above 8% during the year, company filings show.
Fits and starts
CAN’s filings also show the difficulties in scaling up a network of various entertainment and social media ventures like this. While CAN has remained profitable at the consolidated level until FY23 (it is yet to file financials for FY24), many of its ventures are still in losses.
Big Bang Records, its indie music label, made Rs 4.68 crore in revenues in FY23, but with losses of Rs 2.41 crore. The previous year, it had a higher topline—Rs 5.58 crore in revenue—but with losses worth Rs 5.53 crore.
CAN also wound down several celebrity-led brands that it launched over the last few years, including DCraf, a personal care brand fronted by actor Rana Daggubatti and EK, an apparel and accessories brand headed by director-producer Ekta Kapoor.
CAN’s joint venture Glance Collective ran these brands, also to feed into its video commerce business Roposo. The company’s filings show in FY22, the company made Rs 1.22 crore in revenue from operations with losses of just over Rs 16 crore. The next year, revenue grew manifold to Rs 13 crore, but losses more than doubled to Rs 36.4 crore.
Talent management firms aren’t new to building celebrity brands. Matrix Entertainment has a successful joint venture with beauty e-retailer Nykaa in Kay Beauty, the cosmetics brand fronted by actress Katrina Kaif. In FY23, Nykaa-KK Beauty made Rs 60.5 crore in revenue and Rs 6.8 crore in profits after tax. Social media personality Raj Shamani also launched a venture called House of X in September 2022, promising to help social media stars to quickly launch their own consumer brands. House of X is backed by VC firm Lightspeed and a long list of consumer startup founders including Nikhil Kamath (again), Vidit Aatrey (Meesho) and Varun and Ghazal Alagh (Mamaearth).
CAN’s newest acquisition, Terribly Tiny Tales, is a rare profitable social media venture. In FY23, it made just under Rs 8 crore in revenue from operations, up from Rs 6.5 crore the previous year. It made profits worth Rs 19.5 lakh, up 26% from the previous financial year.
However, in CAN’s larger picture, Terribly Tiny Tales is a small piece, financially and in the scale of its operations. However, it brings not only a network of creators but also monetisable IP, including short films, podcasts, and web series.
The takeaway
The larger lesson from CAN’s metamorphosis is that the differences between traditional talent management firms and ‘new-age’ social media influencer agencies are getting erased. Merely making commissions from the work brought to top film and sports stars may not be enough to scale up in this business.
Already, talent management firms across the board have been joining hands and consolidating operations. In December last year, Matrix Entertainment acquired rival Bling. In 2020, production house Dharma Productions formed a joint partnership with sports talent management firm Cornerstone, best known for managing cricketer Virat Kohli. The venture, known as Dharma Cornerstone Agency or DCA, has been branching out of its roster of film stars to include singers and musicians and social media personalities and paparazzi favourites such as Orry (Orhan Awatramani).
More agencies will branch out to lines of business they aren’t already in to span film and sports stars, social media and influencer marketing, new IP, and personalities in new forms of entertainment.
Last Scroll Down📲
Scan the big media headlines from the week gone by
In the money: Zee Entertainment is raising $239 million via offshore bonds foreign from investors, the company said in an exchange filing today (pdf). It has been cutting costs and looking for funding ever since a merger with Sony Corp failed.
Bill and miss: The Indian government has added more provisions to a draft of the controversial Broadcasting Services (Regulation) Bill but hasn’t shared a revised version with stakeholders yet, Hindustan Times reported. The bill seeks to regulate online news, OTT platforms, and other digital content platforms.
Keep appearances: News anchor and India TV chairman Rajat Sharma has been elected as president of the News Broadcasters & Digital Association unanimously. He is also suing a political spokesperson for defamation where the evidence doesn’t seem to be in his favour.
Another one: One more millennial media company in the US stands accused of fraud. Carlos Watson, founder of Ozy Media, was found guilty of defrauding investors and faces up to 37 years in prison. His co-founder was accused of impersonating a YouTube executive in fundraising calls.
Jackpot: With over $1.25 billion in global box office earnings, Inside Out 2 became Pixar’s biggest film ever, bringing relief to the animation studio struggling with box office duds and extensive layoffs.
Trumpet 🎺
Dissecting this week’s viral ‘thing’
Photojournalists’ careers are defined by iconic images, almost always captured when they’re unexpectedly thrown into a moment in history. The trouble is that these photos may become iconic in ways that the journalist may neither have intended nor expected.
This photo of a shaken but triumphant Donald Trump, taken by the Associated Press’ Evan Vucci moments after an assassination attempt, may come to define the 2024 US elections. It has already drawn comparisons with Iwo Jima and made it to the tattooed limbs of some of his ardent supporters. His opponents worry that a pump-fisting Trump against the star-spangled banner may have cemented his return to the American Presidency, while Vucci says he is merely satisfied with a job well done.
Could Vucci’s photograph have the power to alter events this year? It’s worth considering the unexpected influence photographs like these can wield over history. Consider this story of British photographer Platon, who waited amid intimidating guards for over eight hours to get a portrait of Russian president Vladimir Putin in 2007, when he was named Time magazine’s Man of the Year. As Platon tells it, Putin loved the photos and the Russian authorities were keen to have it in a museum exhibit as well.
But, ten years later, Putin banned a version of the portrait, dubbed ‘gay clown’, after it became the symbol of protests against his crackdown on rights for sexual minorities in the country. How’s that for making history?
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