Bono Brings Star Power
To Silicon Valley Fund
Bono, lead singer for rock band U2 and antipoverty activist, is starting a new gig: media and entertainment investing.
The 44-year-old rock star is joining Elevation Partners, a new Silicon Valley fund set up earlier this year by veteran technology investor Roger McNamee and John Riccitiello, who in April left his post as president of videogame maker Electronic Arts Inc. for Elevation.
Fred Anderson, 60, who retired earlier this month as Apple Computer Inc.'s finance chief, also will join Elevation. Mr. Anderson, who is a board member at Apple and online auctioneer eBay Inc., is credited with helping co-founder Steve Jobs steer Apple back from near death in the late 1990s. The appointments bring to six the number of managing directors at the fledgling private-equity firm.
The participation of Bono should sharply raise the profile of Elevation, which people familiar with the fund say initially will raise $1 billion for buyouts and investments in media and entertainment companies, seeking to profit from turmoil in those sectors. Bono has been the front man for U2 since its founding in the mid-1970s, helping to make the rock band one of the most popular in the world. The band's hits include the 2001 Grammy Award winner "Elevation," though a spokesman for the firm says the firm's name is coincidental.
THE NEWEST HAND
Some facts about Elevation Partners, a fund that plans to make buyouts and other investments in media and entertainment companies.
Expected funding target: $1 billion
Headquarters: Menlo Park, Calif.
Managing directors:
Bono, (right) musician; activist
Fred Anderson, former CFO, Apple Computer
John Riccitiello, former president, Electronic Arts
Roger McNamee, co-founder Silver Lake Partners, Integral Capital Partners
Mark Bodnick, founding principal, Silver Lake Partners
Bret Pearlman, former senior managing director, Blackstone Group
It is unclear how much time Bono will be able to dedicate to his new role. He will remain lead singer of U2, which is at work on an album that is expected to be released before year's end followed by a tour in 2005.
Elevation's partners declined to comment on details of its plans or Mr. Bono's responsibilities, citing a quiet period mandated by the Securities and Exchange Commission for private-equity firms involved in fund raising. Regine Moylett, a publicist for Bono and U2 in London, confirmed the singer's plans to join the fund but declined to comment further.
At the very least, Bono brings the fund a network of connections that span entertainment and politics. The musician in recent years has used his celebrity to raise global awareness of debt relief in the developing world and AIDS. He has strong ties to the White House and in 2002 accompanied then-Treasury Secretary Paul O'Neill on a tour of Africa to study the impact of foreign aid. Much of his debt-relief and AIDS work is handled by DATA -- or "debt, AIDS, trade, Africa" -- a not-for-profit organization he co-founded with funding from the Bill and Melinda Gates Foundation, George Soros's Open Society Institute and the Center for Global Development.
Elevation's expected focus on the music and entertainment investments comes as the music industry has been suffering a four-year global downturn in sales. While U.S. sales have recovered slightly this year, industry executives believe that woes abound, stemming from online piracy and rampant home CD burning, along with competing home-entertainment technologies like DVDs and videogames.
The depressed business environment has created a high degree of volatility that Elevation and others are hoping to exploit. Already, the industry has seen a spate of mergers and attempted mergers, spinoffs and label closures. In March, a group of private-equity investors led by Edgar Bronfman Jr. bought Warner Music Group from Time Warner Inc. for $2.6 billion and immediately began paring staff and roster size in an attempt to boost the operation's profitability .
Meanwhile, Sony Corp. and Bertelsmann AG are in the midst of an attempted merger of their global music operations, a process that could generate investment opportunities if U.S. or European regulators require the companies to shed any of their operations in order to gain approval.
Elevation is expected to look for investment opportunities in media and entertainment companies disrupted by the advent of the Internet and other digital technologies. Music, movies, publishing and other traditional media industries are grappling with how to exploit new distribution means -- including the Internet or cellular phones -- while stemming piracy that such technologies enable.
That is likely why Elevation is tapping Mr. Anderson. He worked with Mr. Jobs to help guide Apple into new businesses that combine entertainment and technology, most notably iTunes, now the world's largest paid online music business. Mr. Anderson also is known for helping end a liquidity crisis at Apple -- the company's cash stood at $3.2 billion as of March -- and has a reputation as a numbers man with a strong grasp of business operations. He also helped Apple negotiate with record labels and technology partners.
At Elevation, Bono could draw from some of his experience at U2 in working through tough issues that are peculiar to the music industry. In the 1980s, the band, with the guidance of its manager Paul McGuiness, cut a deal that gives U2 ownership of its albums' master tapes after its record label Universal recoups the money used to produce an album, an unusual arrangement providing U2 greater control over its music than many other artists. The band doesn't allow its music to be used for advertisements and has been an active seller of music online, including over Apple's iTunes service. Besides "Elevation," U2 is famous for such songs as "Sunday Bloody Sunday," "Where the Streets Have No Name" and "Beautiful Day."
Mr. Anderson and Mr. Riccitiello, who served as Electronic Arts' president for six years and strengthened the company's ties with Hollywood, will be in charge of Elevation's operations, the people familiar with the fund say.
Mr. McNamee is co-founder of technology investment firm Silver Lake Partners. The other two managing directors of Elevation Partners are Mark Bodnick, a Silver Lake director, and Bret Pearlman, who said last month he is leaving private-equity giant Blackstone Group to join Elevation.
U2主唱波诺加盟矽谷新基金
摇滚乐队U2的主唱兼扶贫活动积极人士波诺(Bono)又为自己找了一个新行当：投资于媒体和娱乐业。
这位44岁的摇滚明星加盟了Elevation Partners这个今年年初新成立的矽谷基金公司。基金创始人是科技产业的老牌投资者麦克纳米(Roger McNamee)和里奇蒂耶落(John Riccitiello)。里奇蒂耶落今年4月份刚刚卸去电子艺界(Electronic Arts Inc.)总裁一职，转投Elevation。
现年60岁的安德森(Fred Anderson)本月初刚从苹果电脑(Apple Computer Inc.)首席财务长任上退休，转身就加入了Elevation。安德森是苹果电脑和eBay Inc.的董事会成员，因九十年代末与苹果电脑创始人乔布斯(Steve Jobs)联手拯救了濒临绝境的苹果电脑而名声大振。这家新创立的私人持股基金公司已经有了6位董事总经理。
波诺的加盟会大大提升Elevation基金的知名度。知情人士称，该基金计划最初筹集10亿美元，收购或者投资于媒体和娱乐公司。这个行业的整合风潮有望给Elevation基金带来收益。
从七十年代中期U2乐队组建以来，波诺就一直是U2的领军人物，带领U2跻身于全球最走红摇滚乐队的行列。U2的畅销单曲“Elevation”曾荣获2001年格莱美大奖(2001 Grammy Award)，但基金发言人称基金名称和这支单曲重名纯属巧合。
波诺会在这个新角色上投入多少精力尚属未知。他将继续担任U2主唱，乐队正在紧张录制一张新专辑，计划在年底前上市，然后在2005年进行一次巡回演唱。
Elevation的几位合伙人拒绝讨论基金的详细计划，或者波诺在基金中承担的责任，并将之归因于美国证券交易委员会(Securities and Exchange Commission)对私人持股企业融资活动沉默期的规定。波诺和U2乐队驻伦敦的公关人员莫埃利特(Regine Moylett)证实了波诺加盟该基金的计划，但拒绝发表更多评论。
至少，波诺为Elevation搭建了一个网络，将娱乐界和政界联系在一起。近些年来，波诺热心参与了不少公益活动，提高人们对艾滋病防范意识和发展中国家扶贫事业的关注。他与白宫(White House)关系密切，2002年还与时任财政部长奥尼尔(Paul O'Neill)同赴非洲调研外国援助项目的效果。他在扶贫和防范艾滋病领域的工作主要是由非赢利机构DATA组织的，DATA正好是“债务、艾滋病、贸易、非洲”四个英文单词的首字母缩写。除了波诺，DATA的共同人还包括比尔?盖茨伉俪基金会(Bill and Melinda Gates Foundation)、索罗斯(George Soros)的开放社会研究所(Open Society Institute)，以及全球发展中心(Center for Global Development)。
就在Elevation将把投资重点放在音乐和娱乐行业之际，正值音乐行业遭遇持续四年的全球销售低潮。虽然美国市场的销售额今年略有反弹，但行业管理人士认为，网上盗版、CD家庭刻录的泛滥、DVD及视频游戏等家庭娱乐产品的竞争将继续使音乐行业举步维艰。
低迷的商业环境给Elevation和其他公司希望开拓的业务带来很高的波动性。音乐行业内并购、拟议并购、分拆以及倒闭的企业层出不穷。3月份，一个以Edgar Bronfman Jr.为首的私人资本投资者团体从时代华纳(Time Warner Inc.)手中以26亿美元收购了华纳音乐(Warner Music Group)，并随即对其进行裁员，以提高该业务的盈利能力。
与此同时，索尼(Sony Corp.)和贝塔斯曼(Bertelsmann AG)正试图将双方的全球音乐业务合并。如果美国或欧洲的监管部门要求它们分拆部分业务，那么其中可能蕴含投资机会。
预计Elevation将在那些遭到互联网和其他数字技术打击的媒体和娱乐公司中寻找投资机会。音乐、电影、印刷和其他传统媒体行业正纷纷致力于如何开辟新的分销手段（包括互联网或手机），同时遏制新兴技术催生出的盗版现象。
这也许就是Elevation看重安德森的原因。安德森和乔布斯一起帮助苹果电脑建立了融娱乐和科技于一身的新业务模式，也就是所谓的iTunes，目前它已经成为全球最大的付费网上音乐业务。安德森还因帮助苹果电脑摆脱资金危机而名声大噪，截至3月份，该公司的现金为32亿美元。此外，安德森还拥有出色的财务管理能力、灵活的商业头脑。他还促成了苹果电脑与唱片公司和技术合作伙伴的谈判。
在Elevation，波诺可以借助他在U2乐队的一些经验解决音乐行业所特有的棘手问题。在上世纪80年代，这支乐队在其经纪人麦克格尼斯(Paul McGuiness)的指导下达成一项交易。根据该交易，在其唱片公司Universal收回唱片制作成本之后，U2将获得唱片母带的所有权，这项非同寻常的安排使得U2对自身音乐的控制权超过了其他许多歌手。
该乐队不允许其音乐用作广告用途，其唱片在苹果电脑iTunes服务等网上音乐销售渠道中一直保持著热销的势头。除了Elevation之外，人们耳熟能详的U2歌曲还有Sunday Bloody Sunday、Where the Streets Have No Name和Beautiful Day。
知情人士透露，安德森和里奇蒂耶落将联手负责Elevation的运营。里奇蒂耶落曾任电子艺界总裁达六年之久，期间增强了该公司和好莱坞的联系。
麦克纳米是科技投资公司Silver Lake Partners的联席创始人之一。Elevation Partners的其他两位董事总经理分别是Silver Lake的董事伯德尼克(Mark Bodnick)和波尔曼(Bret Pearlman)。后者上月表示，他将离开私人资本运营公司巨头Blackstone Group，加盟Elevation。
