The colorful history and present-day innovation of industry entrepreneur Steve Lehman
By Mike Kinosian
Managing Editor/West Coast Bureau Chief
LOS ANGELES — Several enterprising Los Angeles radio station employees in the mid-1980s ingeniously laid the foundation for what would become one of the most renowned, esteemed radio syndication companies this medium has witnessed.
Generally corroborated is that the initial investment for Premiere Radio Networks was a modest $30,000, which in turn helped to trigger first-year advertising billing for the novice venture in the neighborhood of $2 million.
By any standard, that qualifies as an ultra-impressive, if not eye-popping, startup. More than a quarter of a century later, that figure has ballooned by 200 times.
As a result, it is perhaps not one bit surprising that one of the chief architects of that empire again has his creative juices flowing with a project involving the fates and fortunes of fellow industrialists.
Plain Truth Genesis
“National Lampoon’s True Facts” was the first radio show syndicated under what was then Steve Lehman Productions. “It was a very successful launch,” he recounts of the daily 90-second feature; Premiere Radio Networks would later distribute “The National Lampoon Radio Hour.”
At the time, Lehman was the midday talent at Los Angeles’ KIIS-AM/FM and he became chums with a triumvirate syndicating “The Plain-Wrap Countdown” — Tim Kelly, Louise Palanker, and Ed Mann. “We all worked together at the station,” Lehman points out. “We merged the companies together and the next show we launched was ‘The Cla’ence Update’ of ABC-TV’s ‘All My Children.’ That was the early genesis of Premiere Radio.”
Subsequent to taking the company public, Lehman envisioned a personal five-year exit strategy, although he realized timing markets that precisely is unrealistic.
Even so, there were three relatively rapid offers for Premiere and Lehman admits that he and his partners happened “to get very lucky” based on the consolidation that was eventuating in radio. “I could start to see consolidation taking place at an early stage. I realized that, without distribution, there was vulnerability in becoming just a program supplier. When there were 100 different radio groups, I could offer my programs to multiple different groups and end up getting strong affiliations. As the universe shrunk in terms of the number of groups — and as those groups became more powerful — that really was the catalyst for me seeing vulnerability in the model and exiting at a time when we were able to get a high multiple for the company.”
With Lehman serving as president; Kelly as executive vice president; Mann vice president of affiliate relations; and Palanker as creative director, Premiere was on its way to becoming a great American success story. Shortly down the road, another highly conscientious individual — Kraig Kitchin — became an integral cog as vice president of sales and later the company’s high-profile president/COO. “Early on, our competition was ABC, CBS, NBC, Westwood One, and United Stations — all much stronger entities,” recollects Lehman, whose entrepreneurial passion continued to drive and to motivate him long after he departed Premiere.
Essentially starting with only one or two shows, Premiere rocketed to the point where Lehman and his cohorts sold the company for just under $200 million almost 20 years ago. “I learned a tremendous amount and had a phenomenal experience growing and taking a company public,” he remarks.
Self-confessed “Type-A” personality Lehman attempted retirement for about one week, but he explains, “I am at the point in my career where I want to work on deals that I think can become billion-dollar platforms. I want to work with people with whom I enjoy relationships. This is my evolution as an entrepreneur. I am very fortunate to be in a position where I can pick things that I am passionate about and I want to do.”
All of that neatly sets the stage for the birth of his latest effort – “Business Rockstars.”
Innovators Apply Pedal to the Metal
Roughly 1600 members across the United States comprise Media Entertainment Technology Alpha Leaders (METal), an eclectic (invitation-only) organization of billionaires, CEOs, entrepreneurs, technologists, and media/entertainment people. Its chief executive officer, Ken Rutkowski, invited Lehman to speak about the convergence of traditional media and new media.
After delivering his speech at a METal confab several years ago, Lehman was asked by one of the billionaires present to leave the following day to join a 10-person think tank aboard the METal member’s yacht in the Pearl Islands. “I flew to Panama and spent four days with people such as the founder of Atari, Nolan Bushnell; the head of Google, South America; and the person who will be the next president of Panama,” Lehman recalls. “All we did for four days was light our heads on fire as we brainstormed on cool things. Through METal, I saw that Ken was a great communicator and a super-connector. That is one of his greatest strengths. He is the most connected person I know. I would go to the METal meetings and I saw that Ken is brilliant on stage. My idea was to create a show about entrepreneurship. It would be to bring in powerful, accomplished CEOs and have them explain how to start a business.”
Over and above pure success stories though are those who failed in spectacular fashion only to rebound. “I saw the need for something that was not ‘old politics’ on talk radio,” declares Lehman, who was fascinated by an article that indicated there are 30 million “wantrepreneurs” in the United States. “I thought that is a great audience to try to educate and to entertain about something I am passionate about — entrepreneurship. ‘Business Rockstars’ is an entrepreneurial business platform that is driven by radio, television, and social media. Those are the springboards to the monetization model, which is live events, content and product sales, and membership.”
It seemed only natural that Lehman would inquire if Rutkowski ever considered radio and would be interested in serving as host of such a program. “He had done some radio work in Chicago and he told me that he loves the medium,” Lehman states of the former CNET Radio, San Francisco technology person. “I ended up getting Ken a weekend job in Los Angeles on talk KFWB, where PD Andy Ludlum gave him a trial on the KFWB stream.”
That evolved to a weekend position, which in turn, blossomed into a full-time job there doing “Business Rockstars” and as Lehman notes, “We agreed to stay live/local for the first year.”
In the meantime, as of April 1, the program’s distribution platform has been broadened to the extent that the daily, two-hour (10:00 am – 12:00 noon, PT) show is heard on the Wall Street Business Network, WGN.FM, CRN, tunein, iHeartRadio, and a live streaming platform through YouTube. “We started on WGN’s live streaming feed and we are up on live video and audio on WGN.FM — along with Jonathon Brandmeier in the morning,” Lehman points out. “[One-year Tribune talk WGN, Chicago president and general manager] Jimmy deCastro is building out this platform, which essentially is backing a live-streaming model into FM radio.”
Hour two centers more on established “rock stars,” delineated as those who have raised or sold their company for more than $25 million. “We have a benchmark of success,” Lehman stresses. “With Ken’s connections, we are able to attract some of the biggest CEOs who love being part of this platform. We do not get into the companies — it is more about their train wrecks, adventures, successes, and failures, as an entrepreneur. They talk about the challenges to raise capital and to take their companies public. The focus is on a CEO’s journey and we do interesting elements inside the show.”
Representative of that is “The Incubator” segment, in which a product or project that heretofore had not existed is developed on-air. “Anyone can take the ideas and run with them,” Lehman exclaims. “There have already been four businesses launched on ideas that listeners have generated on-air. We do ‘Business Mentoring’ on Tuesdays and Thursdays when a seasoned CEO will mentor a company live on the air.”
Genuine “rock stars” — in the familiar sense — appear each Thursday as the program looks at the business of music.
Singer-songwriter-record producer Akon (real name Aliaune Thiam, the first solo artist to hold both the #1 and #2 spots simultaneously – twice), for example, has already been on the show three times. Pink Floyd’s Scott Page is one of the show’s mentors, as are Richard Gibbs of Oingo Boingo and the drummer of Smashing Pumpkins, Mike Byrne. “Akon was on two weeks ago and actually signed the person he mentored that day,” Lehman discloses. “Akon has 54 million social followers and is the one who signed Lady Gaga. He is a regular mentor on ‘Business Rockstars’ because it is exciting and he loves it. He gives back and he gets to meet new talent.”
Monetization Model Modification
Target audience for the live daily radio broadcast tends to be aforementioned “wantrepreneurs” with Lehman insisting that starting/growing a business is “one of the hottest spaces on the planet,” evidenced by the popularity of ABC-TV’s “Shark Tank,” as well as other projects starting to surface. FremantleMedia (“American Idol,” “The Price is Right,” “X Factor,” “America’s Got Talent,” “Family Feud,” “Let’s Make a Deal”) recently finished shooting a “Business Rockstars” television pilot. “We are on radio and beginning to grow our footprint there,” Lehman proclaims. “We are in the beta phase of live-streaming on YouTube and we are in very serious discussions with a huge live streaming partner. We hope to have that solidified in the next two months — that would give tremendous visibility to ‘Business Rockstars.’ Moreover we are building out the back end of our website — BusinessRockstars.com, which is a great resource for people interested in starting a business, but who do not know where to begin.”
More so than ever, it is Lehman’s contention that content drives distribution and monetization; the paradigm that he is changing is the monetization model. “I am not going after traditional network radio advertisers,” he asserts. “We are creating our own webinars, products, memberships, and monetization model through our own infrastructure. We have targeted an area that I think is incredibly important for the United States and for people who want to try to create their own destiny as they create something that they can own and be in control of their lives. The content of ‘Business Rockstars’ acts as a driver. There has been no greater time for the distribution of content on different platforms. We see new live streaming channels, live audio, live video, and web-based distribution models that increase the population of content dramatically.”
Whenever “Business Rockstars” does product sales, webinars, or memberships, zip codes are tracked and Lehman emphasizes that the radio affiliate participates in the revenue stream from any sales that occur in their ADI. “We have a monetization model where we are actually giving radio stations money as part of this platform — no one has ever done that before,” he maintains. “The only thing that I am doing to pivot on the traditional radio model is to find new ways to monetize the content.”
Year one of “Business Rockstars” was devoted to developing/evolving the platform; creating the base radio show and television pilot with Fremantle; and the back end social interactivity, which Lehman stresses is “so important for our model.”
Attention has been on branding and content — rather than sales. “I am not aware of many network radio shows that have close to 400,000 Twitter followers as we do — and our social campaign is less than one year old,” Lehman boasts. “We have over 150,000 Facebook ‘Likes.’ In so many ways, that differentiates us as a startup.”
Social interaction is a key component for the show’s brand development. Radio is as well and Lehman describes it as “one of the greatest megaphones” of all media. “We see it as a great live brander, along with television, live streaming, and social media.”
Collaborative Beach Environment
Not only is multi-tasker extraordinaire Lehman chairman of Business Rockstars, the tri-athlete (“bad swimmer, medium biker, slow runner”) is a three-year partner of Airplay Intel, and partner with Andy Schuon of “C”-Student Entertainment; Schuon’s resume includes being president of Infinity Broadcasting, president/CEO of Napster, executive VP of programming for MTV and VH1, and program director of Los Angeles’ KROQ. “Andy was at the NAB where Mel Karmazin was the keynoter,” University of Nevada-Las Vegas alum Lehman notes. “Mel said that radio is populated by C-students. We called Mel and asked if we could use the name and that we would give him credit — he said there would be no problem.”
Virtually everyone with an AM stick ponders that band’s precarious future. With AM’s audience continuing to age, it prompts Lehman to comment, “Much of the content on AM radio is very stale, but ‘Business Rockstars’ is a fresh idea.”
Silicon Beach is Southern California’s version of Silicon Valley and Lehman remarks, “There are now more venture capitalists in Silicon Beach than almost anywhere else in the world right now. Santa Monica-Culver City-Venice has become such a hotbed for new companies.”
Housed in the former Google building at 6th Street and Arizona Avenue in Santa Monica where “Business Rockstars” originates are approximately 100 startup facilities. “It is a collaborative environment,” Lehman declares of Real Office Centers (ROC). “That is where we get many startups on the show. When it shot the television pilot, FremantleMedia built a showplace facility for us on the first floor. There is a four-camera shoot for a daily radio show and a live video stream. Anyone who sees our operation says this is where things are going. This has completely reinvigorated me — I am having a great time doing this.”
The forthcoming second of this two-part special feature highlights “Business Rockstars” host Ken Rutkowski.
Mike Kinosian can be reached at Kinosian@TALKERS.com.