Billionaire Haim Saban Pledges $500 Million for New Record Label
Saban Music Group (SMG) will be a Los Angeles-based music company with a global outlook and a roster to match.
In late 2018, the same topic of conversation would come up every time entertainment mogul Haim Saban chatted with two of his friends, Lucian Grainge and Lyor Cohen. "They thought we were on the cusp of the golden age of the music world," recalls Saban. "The first thing that came to my head was, ‘If this is the golden age, why am I ignoring it?'"
Saban decided to pay attention, to the tune of half a billion dollars: He plans to invest $500 million in Saban Music Group (SMG), a new Los Angeles-based label and music company with a global outlook and a roster to match. It will be led by CEO Gustavo Lopez, whose Latin entertainment company, Talento Uno Music, was acquired in May by Saban.
The money doesn’t come with a timeline or strings attached. "I can tell you that that $500 million is available now,” Saban says flatly. "The timing of the expenditure will depend on the opportunities presented to us. I don’t think it will be 10 years, but I think it could be next week, or in two or three years."
Those opportunities will fall under two main categories: artist development and acquisitions. Already, SMG has signed Colombian reggaetón star Reykon and Puerto Rican YouTuber Daniel El Travieso — both from Lopez’s Talento Uno — as well as Israeli duo Static & Ben El and French artist Marie Monti. And it is negotiating with three music companies regarding acquisitions: a Latin business and two "general market companies that don’t know Latin exists," says Saban. The point is, he stresses, SMG will have a Latin focus but will branch out.
A music venture with Latin roots makes sense for Saban, 74, who has had a long career in entertainment — beginning as a musician, then as a record producer and record-label owner — and is a major Democratic Party donor, particularly on pro-Israel issues, as well as a philanthropist. (The Saban Family Foundation has donated $420 million to charity since 2000.) But Saban may be best known for launching the 1993 children’s TV show Mighty Morphin Power Rangers, which he eventually leveraged into the Fox Family Channel, a joint venture with News Corp. In 2007, Saban also led a group of investors to acquire Spanish-language media giant Univision Communications, and remains the company’s chairman. The two companies will function independently from each other, he says.
Lopez’s background is entirely in Latin, He was the longtime GM and executive vp at Universal Music Latin Entertainment, where he launched the Latin urban label Machete Music, home to artists like Wisin & Yandel and Don Omar, and also ran UMLE’s regional Mexican labels, Fonovisa and Disa. After leaving UMLE in 2017, Lopez launched Talento Uno with a small roster of up-and-comers.
Saban says SMG’s competitive advantage lies in his investment in the business. But, he adds, “the management of the company is solely in the hands of Gustavo and his team.”
Lopez is aware that SMG doesn’t have huge names, but he isn’t worried. "Bad Bunny wasn’t a superstar two years ago," he explains. “We’re in a world where artists are developing at a faster pace than they ever were. One of our goals is finding artists that have strong regional appeal and make them into international stars."
The plan is to be strategic. "We are not going to sign 100 artists," says Saban. "This is going to remain a boutique label with significant resources to put behind the very few artists that we will sign. Except for hip-hop, there is no limitation to the categories of music we will look to be involved with. We will be very opportunistic."
This story first appeared on Billboard.com.