http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/25/ybstart125.xml

Starting out

By Jenny Hirschkorn

Recording profits live on stage

It all began with an argument. Adam Goodyer and James Perkins, friends since they met at school in Devon at the age of 11, couldn't agree on which had been the last song played at a gig they had attended at the Brixton Academy. "Wouldn't it be great," they thought, "if we could settle the dispute by having instant access to a recording of the concert."

That was the seed from which Concert Live, their enormously successful recording business, took root. The pair began to research the viability of their idea - whether it was indeed possible to record live music concerts and have the CD available for sale as the audience left the venue. "We looked into the technology and did a lot of market research as well as a business plan and then took the plunge," explains Goodyer.

In the finest traditions of funding a business, they borrowed as much as they could from friends and family, but then received a boost with the introduction of seed capital from business angel and former Microsoft UK managing director, Alistair Baker, also known affectionately as Chairman Mao. "He's so important, he must be referred to as Mr Baker or, better still, Sir," jokes Goodyer.

Then came the not insignificant challenge of landing agreements with performers, artists and their existing recording companies. Goodyer and Perkins had found their respective talents led to a natural division of labour, with Goodyer in charge of money and strategy while Perkins is very much the man who makes things happen, so it fell to him to convince the bands and record companies that this would be a "Good Thing" for them.

He says, "Probably the hardest thing we have to deal with is bringing about a change of mentality. There was a lot of resistance to it at first, because no-one gets to hear it before it goes on sale."

Worries about quality were quashed when it was shown that the specially split signals, fed to a mobile studio in a large truck outside the venue, would produce a top-notch recording.

Perkins managed to demonstrate that the product would help the performers in their own strategy for growth, rather than simply providing just another source of revenue. The CDs fit in as a marketing tool, driving artists up the mainstream charts, and so keeping everyone, including the recording companies, happy.

They have become pretty accurate at estimating how many CDs of a given concert to produce, allowing for the fact that around half of all their sales comes after the event via their website. "We try to be as lean as possible, and unlike big companies who press up perhaps 100,000 copies with all the risks that entails, our excess stock runs into the hundreds at the most," explains Goodyer.

Recordings cover the full range of artists, from older, well established performers like Wet, Wet, Wet and Simply Red to current chart toppers and lesser-known, up and coming bands.

It took a while for the theory to filter through into proven upsales for the groups covered, but since that became apparent, in mid-2006, Perkins says things have gone "mental". In the busy autumn touring season, Concert Live can be working as many as five major arena tours concurrently, and turnover this year is forecast to hit £1.75m, up by more than 75pc on last year.

Music is a glamorous industry and one in which many young people aspire to work. Since Concert Live won an award from Make Your Mark, an organisation that helps young people turn their business ideas into reality, they have been ambassadors for makeyourmarkinmusic.org.

"It's great to be able to support creative young businesses, particularly in an industry like music which is in a state of flux, and at the same time keep our finger on the pulse," reckons Goodyer. "We're a company that prides itself in being at the forefront of how music is consumed."

Do: If you have an idea you shouldn't be afraid to see if you can make it work, but at the same time you need to make sure there is the ability for that idea to make money before you throw your life savings into it.

Don't: Rush into partnerships with third-party companies who will be representing your brand to consumers without having a strong service-level agreement in place. Our biggest problem has been when we have had to outsource part of our service, particularly on our web-based orders.

PROFILE

Name: Adam Goodyer and James Perkins
Company: Concert Live
Founded: 2005
Staff: 8 full-time and up to 150 freelancers at a time
Start-up funds: £100,000
Turnover: £1.75m projected

Good article. I found their "Don't" advice particularly interesting:

Don't: Rush into partnerships with third-party companies who will be representing your brand to consumers without having a strong service-level agreement in place. Our biggest problem has been when we have had to outsource part of our service, particularly on our web-based orders.

Looks like they still ain't happy to let that one go yet