PrimeSport, a leading sports VIP, travel and hospitality firm based in Atlanta, Ga., has acquired Philadelphia-based CID Entertainment, an innovator in the world of VIP music packages and enhanced experiences for events like Coachella and last year's Fare Thee Well, Billboard has learned. Terms of the deal were not disclosed.
The move expands PrimeSport's roster of more than 150 official teams, leagues and event partnerships to include elite music festivals, concerts and live stage shows. CID counts Bonnaroo, Coachella, Lollapalooza, and Desert Trip among its event clients, as well as tours by such artists as Luke Bryan and Kenny Chesney (among many others), and CID-produced destination events including Luke Bryan's Crash My Playa, Phish: Riviera Maya, and the Mad Decent Beach Party. CID founder Dan Berkowitz will remain as CEO and retain a stake in the business. The firm will continue operating under the CID banner.
Berkowitz says that while operating as an independent has its advantages, he had long been considering joining forces with a partner that would not conflict with his current clients, which are primarily large tour and festival producers Live Nation (Bonnaroo, Lollapalooza, Bryan) and AEG Live (Coachella, Desert Trip, Chesney).
"With all the M&A going on in the music business, we've talked to a bunch of people, but we wanted to stay neutral," Berkowitz tells Billboard. "My goal is to create the best experiences for fans of live music, to bring people closer to the music that they love. But all the while I've wanted to grow CID in a less-than-bootstraps way."
Bootstraps or not, CID's growth has been substantial since Berkowitz, a former roadie, launched the firm in 2007. Riding concurrent waves -- both the festival boom and touring artists' desire, and need, to constantly seek both new revenue streams and diversified fan services -- CID has expanded from a one-man operation to a team of more than 70, with offices in Philadelphia, Denver and Nashville. "We took a very small 'friends and family' round [of investment] back in 2008, and other than that it has been less-than-bootstraps to date," says Berkowitz. "If Crash My Playa 1 doesn't go well, I'm moving in with parents, no joke."
Andrew Zinberg, Chief Commercial Officer for PrimeSport, calls CID a "wonderful fit" for PrimeSport and a "natural extension" as the company seeks to transcend sports into the lucrative and growing enhanced experience world of music, where fans pay big bucks for better views of the stage, upgraded food and beverage and accommodations, and other perks. PrimeSport has close to 150 official partners in the sports realm, including "blue chip" teams, leagues, properties, and events, and "now we have an even greater touch point to bring to them," Zinberg says, adding that the two companies have a similar view about what fans want (be it sports or music): access.
"What I loved about CID, as I looked through their dek and compared it to ours on the PrimeSport side, the second slide of each of the deks -- completely by coincidence -- is about 'how do we bring fans closer to the action itself?'" Zinberg says. "We can learn a lot from Dan, because there's so much he's done, so much experience he's got, and his fans love him. For us, the most important part is helping Dan further grow the exceptional business he's built."
CID will not only broaden PrimeSport's horizons into music, but will also "help them on the experiential level" Berkowitz says, as the "enhanced experience" aspect of CID's offerings moves into the sports arena. "And they're going to help us on the scalability, because they're very good at that. I will operate CID as I have, with the help of some really smart people over at PrimeSport."
PrimeSport indeed boasts an impressive client list, indeed the Bonnaroos and Coachellas of the sports world in the NCAA Final Four, the National Hockey League, 19 National Football League teams, many NASCAR tracks, and college football bowl games, including the College Football Playoff.
The deal between CID and PrimeSport takes place at a time when the lines continue to blur between the music and sports world as consumers more and more seek live entertainment of all types and turn to "experiences" over "stuff." That was evidenced last weekend when the Battle At Bristol, billed as the largest college football game ever, saw Tennessee face off against Virginia Tech in front of 156,990 spectators at the Bristol Motor Speedway -- a PrimeSport client. Pregame music performers included Kenny Chesney, Sam Hunt and The Band Perry. "Now we have an additional extension to bring to that track in terms of how to truly monetize all of the assets they're bringing together for their fan base," says Zinberg. "We'll dive into all of those things in the coming months. Right now, our goal is to give Dan more resources and ammunition and allow him to do what he does, because he's really exceptional at it."
While the sports sponsorship space is "a very mature business," Zinberg says, the hospitality sector is, "ever-evolving, and it all comes back to getting the fan a little closer to the action itself. The passion for sport and the passion for music is very similar in terms of the affinity for teams, leagues artists, etc., they mirror each other very well. The goal here is to capitalize on that type of affinity, and at the same time make sure creating products and services and offerings that are going to really allow the fans that point of access and engagement with their favorite teams, their favorite musicians, whatever it might be."
For Berkowitz, the deal is a validation of sorts for his early vision of "offering fans more than just a ticket," and the start of a new chapter after spending the last decade re-inventing the VIP concert for some of the biggest music events in the world. Berkowitz says he will remain deeply engaged in running and growing CID, albeit without the specter of huge financial risk hanging over his shoulder.
"Now that [the deal] is done and my only job is running CID, what a blessing," Berkowitz says. "We're not juggling hotel payments so we don't run out of money, stuff like that. It's not like I'm flying into Lokn' on a helicopter, but I'm not moving back in with my parents."
Further, Berkowitz says the people at PrimeSport "knew how important it was for me to keep the spirit of CID alive, because what is CID without its people? Nothing," he says. "They bought CID because of the people, and the relationships we have in the music industry, the artists we work with, the producers we work with, the managers and agents we work with. That's what CID is; other than that it's just air."
The official announcement of the deal is expected to come later today.
UPDATE: This story has been corrected to show that the CCO of PrimeSport's last name is spelled Zinberg, not Zimberg.