Sydney Benson

Ryan Davis

Ella Erickson

Brenna Eakin

Candace Johnson
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TABLE OF CONTENTS

EXECUTIVE SUMMARY……………………………………………………………….……..2

THE BUSINESS……………………………………………………………………….………..3

COMPANY STRUCTURE, INTELLECTUAL PROPERTY, AND

OWNERSHIP………..…………………………………………………………………..……...8

INDUSTRY
ANALYSIS……………………………………………………………………………….…….10

MARKETING PLAN…………………………………………………………………….…….12

OPERATIONS PLAN……………………………………………………………………….….13

FINANCIAL PLAN………………………………………………………………….…………15

CRITICAL RISK FACTORS………………………………………………………….………..19

APPENDIX………………………………………………………………………………….….21
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Executive Summary
Live Nation Entertainment is an American entertainment company that promotes events
and provides venues for events such as concerts. Due to the COVID-19 pandemic, in-person
events came to halt, thus decreasing the need and demand for tickets and taking a big chunk of
Live Nation’s revenue. Luckily, Live Nation was able to make numerous refunds to those who
purchased tickets to live events, and allow patrons to keep their tickets in the case that the event
was rescheduled.

With a promising year ahead in terms of live events, stock in Live Nation Entertainment
has risen, which allows Live Nation to continue dominating the promotion and entertainment
business worldwide. Live Nation relies on ticketing, concert events, and sponsorships to hold
their place as the “global leader in live.” There are over one thousand business partners and
sponsors who work with Live Nation. Sponsors include CitiBank, Hilton, T Mobile, American
Express, Uber, and Bacardi. The variety of sponsors proves a domination of many different
industries such as hospitality, technology, transportation, retail, and food and beverage services.

Live Nation appeals to a large target market, due to the variety of artists and shows
produced by the company. This being said, a majority of artists who tour with Live Nation appeal
to young adults, while utilizing online sources to purchase tickets and find information on events
and artists. These online sources create an accessible and quick way for consumers to buy into
the company.

The management team at Live Nation is split into three sectors: leadership, concerts, and
ticketing, each with specialized members who keep the company running smoothly. Michael
Rapino serves as the CEO, atop many men and women who come from different business and
educational backgrounds. The expertise of each member of the management team contributes to
a successful group of leaders who provide entertainment to the world. They run various
committees among their Board of Advisors which adds to their diverse background and strategy
compared to their competitors.

With such a large employee base, Live Nation is able to capitalize off of various areas in
the music industry. Moving towards touring, they currently own 275 venues globally. With
offices in 40 countries with 110 managers who manage over 500 artists, Live Nation shows that
they are meeting their consumers demands globally.

As mentioned before, the live music industry took a big hit as a result of the ongoing
COVID-19 pandemic. With many customers, artists, and sponsors relying on Live Nation, the
company struggled to meet and surpass the income of the years prior. A switch to online only
events created a risk for their marketing team. Creating and incorporating new and up to date
livestreams and capitalizing off of this is new territory.
 3

The Business

The Opportunity

At Live Nation Entertainment we are the Global leader of live entertainment. We are the
world's largest producer for live entertainment, the world's leading ticketing platform for artists,
venues, festivals, sports, theater, and more, and have a sponsorship team that works at
global,national and local levels. We are able to work with artists in the music industry to bring
their music to the world. We also provide our Artist Nation with management, business
marketing and consulting for all genres of music. Live Nation took advantage of the opportunity
to produce concerts at large scales both nationally and globally. Despite the challenges with
COVID-19, it led us to the opportunity to capitalize on producing virtual concert events with our
concert series Live From Home.

Description of the Business

Since 2005 Live Nation has been fortunate enough to produce over thousands of concerts
over the years. Annually we are able to produce 40,000 concerts, and 100+ festivals in 40
different countries with 200+ different venues. We have been able to tour 4000 artists and bring
in a total of 98 million fans annually (Biz at LN, 2019).

Due to COVID-19 Live Nation was impacted due to the pandemic. In 2019 live nation
generated 3.770,000,000 in quarter three from concert tickets and sponsorships. In 2020 during
quarter three Live nation generated 184 million in revenue leading us to a 95% decline from
2019. Despite the hardships from COVID-19, Live Nation Entertainment has continued to power
through this pandemic by maintaining a strong cash management discipline while planning ahead
for a future events post pandemic (Music Business Worldwide, April 7, 2019, 2020.) To help
combat Covid, Live Nation has partnered with other event industries to provide our public health
system with venues to administer the COVID-19 vaccine. By helping our public health system
with the vaccination process, we are able to help get the country back on track.
 4

In 2020 some of the initiatives that we took to provide entertainment during the pandemic
included re-organizing and reducing our cost structure by 200 million, producing concert
streaming events advancing our technology initiatives globally and reinforcing our balance
sheet's (Live Nation Entertainment, 2020). As we enter into 2021 we believe that we will
encounter a big comeback this year. Our artists are ready to get back to performing for their fans.
Over 80% of our fans are still holding onto their concert ticket and over 60% of fans are holding
onto their festival tickets. Our fans are also ready to make up for lost time from the past year
while 64% of our fans plan on attending live music events more than they did previously (Live
Nation Entertainment, 2020). With that being said we are fortunate and looking forward to being
able to start holding in person, COVID safe events by the end of summer and beginning of fall.

Competitive Advantage

Below is a simple visual that compares Live Nation to one of their competitors,
Eventbrite. When comparing the two side by side, one sees that both have their own advantages,
but the visual does a great job synthesizing some of their strong competitive advantage points.
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Description of the Business Model

According to Live Nation Entertainment Reports Fourth Quarter and Full Year 2019
Results, they have seen effective growth in revenue, operating income, and adjusted operating
income in all of their segment’s thanks to their “flywheel business model”.

What is a flywheel business model? The idea behind this is simple: imagine pushing a
massive flywheel from the beginning, which takes an immense amount of effort at the start.
Overtime, each rotation of the flywheel gets easier and easier, due to an accumulation of
momentum. This is what Live Nation has stuck to and it has benefitted them greatly. “No matter
how dramatic the end result, good-to-great transformations never happen in one fell swoop. In
building a great company or social sector enterprise, there is no single defining action, no grand
program, no one killer innovation, no solitary lucky break, no miracle moment. Rather, the
process resembles relentlessly pushing a giant, heavy flywheel, turn upon turn, building
momentum until a point of breakthrough, and beyond”. (www.jimcollins.com).

How the Business will Create a Sustainable Advantage

The scale and vertical integration of Live Nation (which includes artists, booking agents,
promoters, venues, fans, and sponsors). They’ve created their own supply and demand dynamic
by supplying the venues and receiving levels of demand from artists/fans. The whole idea of the
“flywheel” business model parallels the definition of a sustainable competition advantage
compared to a regular competitive advantage.

Current Status and Requirements

Based on the below image, one can see how Live Nation stands with their ownership /
deeply invested interest of different types of venues.
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Description of What the Business Needs to Move Forward

Live Nation’s will need to continue to grow their network of promoters and sponsors if
they want to build the business even more in the future. This will set them apart from its
competitors and gain more attention from their existing customer base and ever-growing new
customers. Live Nation also needs to be aware of threats such as artist retention. Their business
model revolves around hosting and promoting entertainment events for artists and bands and
can’t afford to focus energies on “one hit wonders”. Thorough analysis of the artists and bands
they are interested in and the patterns of each of their fan bases is crucial in what they need to do
to move forward successfully.
 7

The Management Team

Live Nation’s Management Team is split into three market leading divisions:
Ticketmaster, Live Nation Concerts, and Live Nation Sponsorship. “Live Nation annually issues
over 500 million tickets, promotes more than 35,000 events, partners with over 1,000 sponsors
and manages the careers of 500+ artists. Its ecommerce sites average 80 million unique monthly
users.” (Live Nation Leadership, 2021).

Leadership in Live Nation starts with CEO Michael Rapino. Michael Rapino has been
CEO since 2005 and has also served on the Board of Directors since 2005. The rest of the
leadership team consists of the President Joe Berchtold, CFO Kathy Willard, Executive Vice
President and General Counsel Michael Rowles, and Executive Vice President of Operations
Jackie Beato. Before joining Live Nation in 2011, Joe Berchtold was President of Technicolor
Creative Services. Prior to that, he was a partner with McKinsey and Company and has a B.A. in
Economics and Masters in Business Administration. Kathy Willard was appointed in 2007 after
working as Executive Vice President and Chief Accounting Officer at Live Nation for nine years.
Willard has a Bachelors in Business Administration and Certified Public Accountant. Michael
Rowles was appointed in 2006, after serving as Senior Vice President, General Counsel and
Secretary of Entravision Communications Corporation. Before that, he was a partner in the law
firm of Zevnik Horton L.L.P., where he had a general corporate practice. B.A. in Speech
Communications, business minor, and law degree. Jackie Bealto served as Senior Vice President
of Finance and Treasurer at Caesar’s Entertainment for ten years. Before that, she was the U.S.
Equity Derivatives Trader at Deutsche Bank. B.S. in Industrial Engineering and MBA (Live
Nation Leadership, 2021).

Leadership is then split into concerts and ticketing. The President of U.S. concerts is Bob
Roux, Chairman of Global Music and President of Global Touring is Arthur Fogel, Chairman of
the U.K. and Ireland is Denis Desmond, and the President of Live Nation EMEA (Europe,
Middle East and Africa) is John Reid. Ticketing Chairman is Jared Smith and the President is
Mark Yovich.

Live Nation also includes a Board of Directors consisting of various advisors and
committees. There are twelve directors whose basic responsibility is “to exercise his or her
business judgment and act in what he or she reasonably believes to be in the best interests of the
Company and its stockholders. In discharging that obligation, a director should be entitled to rely
on the honesty and integrity of the Company’s senior executives and the Company’s outside
advisors and auditors,” (Live Nation Governance Documents, 2021). The names of the directors
go as followed, Gregory B. Maffei, Maverick Carter, Ariel Emanuel, Ping Fu, Jeffrey T. Hinson,
Chad Hollingsworth, Jimmy Iovine, James S. Kahan, Randall Mays, Michael Rapino, Mark
Shapiro, and Dana Walden. Composition of the Advisory Board consists of the Chairman of the
Board, the President Chief Executive Officer and Director, then the General Members.
 8

Committees consist of the Executive Committee, Nominating and Corporate Governance

Committee, Compensation Committee, and the Audit Committee. Key professional service
providers which Live Nation has are a law firm, accounting firm, and business consultants. Their
Law Firm is run by Michael Rowles of General Counsel Live Nation Entertainment Inc and their
Accounting Firm is run by Kathy Willard, Certified Public Accountant (Live Nation Leadership,
2021).

Company Structure, Intellectual Property, and Ownership

Organizational Chart

Description of Organizational Structure

Michael Rapino became the President and CEO of Live Nation in 2004. We employ numerous
different executives at Corporate and Divisional Levels. The executive positions range from Vice
President - Operations to Head of Investor Relations along with many more positions.
Considering we are a global company, many of our executives work in numerous foreign
locations and are not represented in the organizational structure.

Legal Structure

In 2010, we acquired Ticket Master Entertainment LLC and changed our name to Live
Nation Entertainment. Our corporation's legal entity is detached from our owners and has limited
liability. Live Nation Entertainment is a publicly traded company.

Ownership Structure of the Business

There are 10 major companies that are shareholders of Live Nation, which include the
following: Formula One Group, The Vanguard Group Inc, Public Investment Fund (Investment
Company), Canada Pension Plan Investment Board, Marsico Capital Management LLC, Findlay
 9

Park Partners LLP, Principal Global Investors LLC, Fidelity Management and Research Co.
LLC, SSgA Funds Management LLC, Capital Research and Management Co. (Global Investors).
Their disbursement of equities can be found at
https://www.marketscreener.com/quote/stock/LIVE-NATION-ENTERTAINMENT-13449/compa
ny/

Live Nation has three parent organizations that include the following: AMFM Operating
Inc, iHeartMedia, and Live Nation Entertainment.

Live Nation has been formed as a corporation. This means that at one point in time, Live
Nation used to be a partnership or a sole proprietorship and eventually declared themselves as a
corporation (i.e. becoming Live Nation Inc.)

Live Nation is a merged company between Live Nation and Ticketmaster (this merge
occurred in 2010).

Intellectual Property

While we create, own and distribute intellectual property, we also strive to protect our
brands, trademarks, patents, copyrights along with other authentic and acquired works, ancillary
goods and services. Our trademarks consist of “Live Nation”, “Ticketmaster”, “House of Blues”,
and “The Fillmore”, along with the logos for each of these. These trademarks have been
registered in multiple foreign countries. We are certain that our trademarks and other proprietary
rights are valuable and crucial to our efforts to build or brand and market our services. We
believe we have taken to proper steps to protect our proprietary rights and prevent
misappropriation of these rights.
 10

Industry Analysis
Industry Trends

The ongoing COVID-19 pandemic that exploded in early 2020 had every organization involved
in the music industry scrambling for alternative options to live events. Live Nation was no
exception. The pandemic has presented unique opportunities and created new trends for Live
Nation. Transition from live events to virtual events has become the largest trend of 2020.
Ticketmaster, a subsidiary under Live Nation, launched a live-stream ticketing service in
response to the success of social media livestream events during the pandemic. According to
David Marcus, EVP of Ticketmaster’s global music team, “Our technology quickly pivoted to
selling streaming tickets at scale, and the acceleration in artists going virtual to engage has been
remarkable, so too is the readiness of fans to pay to access their favorite artists in this way,”
(Courtney, 2021). However, as much as the organization has been adapting to virtual events, it is
also preparing to transition back to live events.

Industry Size

Live Nation is the world’s leading live entertainment company. The company is devised of four
major divisions: Ticketmaster, Live Nation Concerts, Artist Nation and Live Nation Media and
Sponsorship. This means Live Nation has a significant stake in almost every aspect of live
entertainment. Since its inception, Live Nation has steadily grown as an organization within the
music industry. The organization currently has about 10,500 employees and counting (Live
Nation, 2020). Live Nation dominates a large aspect of the live music industry and based on its
current trajectory, will only continue to expand even through the pandemic.

Industry Attractiveness

Live Nation has been experiencing steady growth as an organization and has reached the point
where it is well-established in the music industry and mature. In 2019, Live Nation achieved 9
years of consecutive growth and profit, but has recently experienced financial setbacks since the
beginning of the pandemic in January 2020. Live Nation believes the pandemic will not deter
long-term success of the organization. “Live Nation says it has $1.9 billion in liquidity, enough
to carry the company until it hopes concerts can return at full scale outdoors in summer 2021,”
(Millman, 2021). As restrictions continue to ease up in the year 2021, there are more
opportunities for live shows with more venue space and seating available in accordance to social
distancing guidelines. Overall, throughout the pandemic, Live Nation has not lost its footing
within the music industry which proves its maturity as a company.

Profit Potential
 11

Before the pandemic struck America in early 2020, Live Nation experienced consistent, steady
profit. As of 2019, the organization’s total yearly revenue was up 7% at 11.5 billion dollars
(Rolling Stone, 2020). However, with the pandemic devastating live entertainment, total yearly
revenue was only at 1.9 billion dollars (Live Nation, 2020). With the postponing and
cancellations of live music events at once, there became a sudden, drastic decrease in the
organization’s revenue stream. However, many customers who purchased tickets for events
under Live Nation have opted to hold on to tickets purchased for an event that has been
postponed/rescheduled rather than refunding tickets. 83% of fans who purchased tickets have
opted to hold on to their tickets (Live Nation, 2020). This is a hopeful sign for Live Nation as it
shows promising customer retention as well as a good customer return rate.

Target Market

Description of Target Market

The target market of Live Nation is difficult to pinpoint as live music is enjoyed by a variety of
ages and other demographics, but this organization is, at its core a concert promotion company.
The two main groups Live Nation should narrow its lens on are potential concert attendees as
concert ticket sales provide the most income for Live Nation. The ideal potential concert
attendee is tech-savvy, willing to purchase and use a virtual concert ticket, frequents live music
events, and is willing to spend money for front-row seating. Based on the qualities, the ideal
target market for Live Nation is between the ages of 18-30 years old in a middle to upper class
range with free time. On the other end of the spectrum, Live Nation’s other focal target market
should be large event coordinators looking to partner with a company like Live Nation to
promote and sell tickets for their event.

Competitive Position within Target Market

Competitor Analysis

While Live Nation does not have many competitors on the same maturity level it is on from a
financial and size standpoint, there are a few that have potential to pull from the described target
market. Companies that are most similar to Live Nation that pose the largest threats are StubHub
and Spectra Experiences. Like Ticketmaster, StubHub is a ticket exchange and reselling
company and provides services for large and small-scale events like concerts, sports and other
live entertainment events. Stubhub threatens Live Nation/Ticketmaster because like
Ticketmaster, it generally sells tickets for larger-scale events in larger venues which threatens to
pull from live large-scale event coordinators who need a medium to sell event tickets. It also
threatens to pull from the concert attendee target market as they may use stubhub to purchase
tickets over Ticketmaster. Owned by Comcast, Spectra Experiences is a company that
encompasses all aspects of live entertainment management much like live nation as a whole.
Spectra focuses more on client-based work rather than customer-based work. It is all about
 12

connecting clients to venues and promoters, creating partnerships, and coordinating events. Well
not as well known, Spectra’s yearly revenue rivaled Live nation’s the most. Spectra’s estimated
annual revenue was at 2.4 billion dollars (Owler, 2021). Lastly, Spectra was founded in 2015.
Being a newer, and still private, company, Spectra has more growth potential and based on its
current trajectory, shows promising signs of rivaling Live Nation.

Marketing Plan
Product Feasibility and Strategy

Live Nation does not necessarily supply its customers/clients with a product, more of a service,
with the exception of tickets. While tickets are sold for an event that is not necessarily owned or
created by Live Nation, the ticket is being sold through its platform which appeals to the client
target market as Live Nation has a huge, international reach. The concept of selling event tickets
through Live Nation works well because of its convenience level. Its website is easy to navigate
and has a plethora of events available on the website at any given time. Customers can shop
around for an event on a date and time that works for them. The ticket buying process is easy,
secure and tickets can easily be accessed online or mobily. Because of its convenience,
customers are more inclined to use live nation as a ticket purchasing platform. This especially
appeals to the potential concert attendee target market. It is made for younger people who
frequent events and are experienced with navigating online platforms.

Pricing Strategy

As Live Nation acts as the “middle man” between customers and events, it profits from both.
From ticket fees to event parking revenue, Live Nation directly profits off taking a percentage
from each outlet a customer spends money at an event. As Live Nation is not directly selling
these services to a customer, it has the right to take a percentage of revenue from these services
at an event because the event as a whole takes place through Live Nation. The amount of money
Live Nation makes from events depends on the price of the ticket, the number of customers that
buy a ticket for an event, and price of venue and amenities.

Channels of Distribution

The largest channel of distribution Live Nation has is through Ticketmaster with the distribution
of tickets for live events. Event tickets for every client under Live Nation are listed on the
website and mobile app. Tickets purchased are then securely sent to the customer via email
and/or text message and can be scanned or printed at the time of the event.

Promotions and Advertising

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Promoting tours and artists in a unique way is Live Nation’s specialty. The company prides itself
in curating branded content for customers and events to create a more personalized experience.
90% of fans welcome brands into their live event experience, (Live Nation, 2021). Live Nation
creates exclusive custom content for events that can only be accessed through Live Nation. From
behind the scene interviews, live streams, and more, Live Nation curates custom content that
adds to the experience and creates a brand for an event. This is what gives live nation the edge
among competitors and they use that as their main selling point when trying to appeal to
potential clients as well as customers. Live Nation partners with huge platforms like Facebook,
youtube and twitter which adds to the appeal. Since Live Nation is already a mature company, its
advertising and promotion is not necessarily about promoting the brand, but flaunting the unique
features it has above the competition and its level of reach across the world.

Operations Plan
Method of Production or Service Delivery

A. https://www.vault.com/company-profiles/media-entertainment/live-nation-entertai
nment-inc
i. Live Nation operates in the Concerts, Ticketing, and Sponsorship and
Advertising.
1. Concert Segment: they promote live events on a global scale
through their owned venues and/or venues they have a vested
interest in. They also operate and manage music venues and
festivals around the world.
2. Ticketing Segment: tickets are sold on behalf of their different
clients and Live Nation retains a fee or charge by providing these
services. Tickets are sold through websites, on mobile apps, call
centers, and in-person booths.
3. Sponsorship and Ad Segment: Space is sold in different venues,
tickets, websites, and other areas to help other brands reach their
fans on Live Nation ad space.

Availability of Qualified Labor Pool

Live Nation has career positions available in North America and Internationally. We have
our job postings on multiple different platforms to ensure numerous access points for potential
employees. These sites include lnejobs.com, Glassdoors, ZipRecruiter, Indeed, FlexJobs, and
LinkedIn. As of December 31, 2020, Live Nation has employed 8,200 full-time employees
(LiveNationEntertainment.com, April 15, 2020). Live Nation has been ranked as the most
 14

innovative and best place to work by LinkedIn, Fast Company, Human Rights Campaign
Foundation, Forbes and more (LiveNationEntertainment.com, April 15, 2020).

Business partnerships

Live Nation Entertainment works with numerous brands in a partner-like way.

Partnerships range from venues, brands, festivals, and online servers. Venues that have parterend
with Live Nation and formed a continuous relationship include House of Blues and The
Fillmore. As mentioned before, brands that have partnered with Live Nation Entertainment cover
most areas of business such as food and beverage, hotels, banks, transportation, cellular
companies, and even companies such as Asics and Pantene. Beyond well-known brands, Live
Nation continues to partner with music festivals all over the country. Festivals include but are not
limited to Lollapalooza, The Governor’s Ball, and Bonnaroo. Another section of business
partnerships is listed under “Monthly Uniques” on the Live Nation website. These monthly
uniques include Setlist.FM, Ticketmaster, and Ones to Watch.

These partnerships with artists, brands, and other companies allow Live Nation to form
an authentic relationship with other entities. Partnerships go beyond formulating artists and
brands, but allows fans and consumers to develop a liking to Live Nation and all it does for the
entertainment industry. Live Nation also works to promote their partners in hopes of turning their
relationships into a profit. These partners are able to promote their own products or services at
Live Nation events while also fueling Live Nation as a whole.

Quality Control

To ensure quality control, Live Nation provides ticket insurance to those who purchase
tickets for events. Allianz Global Assistance Event Ticket Protector Insurance is available up to
30 days before the event. As for venues, Live Nation currently owns 275 venues. With offices in
40 countries with 110 managers who manage over 500 artists, Live Nation shows that they are
meeting their consumers demands globally.

Customer Support

Live Nation provides a comprehensive customer service platform complete with FAQ’s, a
customer service email, phone number and live chat. The customer service page on Live Nation’s
website provides pictures, visually explaining step-by-step processes for each FAQ. Most FAQ’s
are related to ticket orders and returns and what to do if a show is canceled or postponed. Live
Nation provides ticket security and if that security is compromised then customer service ensures
recovery. This makes ticket management simple for both the customer and service provider.
 15

Financial Plan
The top sources of revenue for Live Nation are Concerts, Ticketing, and
Sponsorships/Advertisements. Live Nation achieved $1.65 Billion cash savings in 2020
However, the money saved comes with a price. Due to COVID, revenue decreased by 84% to
$1.9 billion as a result of less shows happening. Further, there was a $950 million cost reduction
achieved in 2020. Live Nation Entertainment utilizes 10-K forms, which are required by the
SEC, and all documents are published publicly on the Live Nation website. Below are quarter
four highlights comparing 2019 to 2020.
 16

Overview of Financial Projections

Live Nation released numerous financial statements and projections for 2021 within the
“BIZ AT LN” sector of their website. Capital expenditures are predicted to be $150 million in
2021. “The 10 analysts offering 12-month price forecasts for Live Nation Entertainment Inc have
a median target of 90.50, with a high estimate of 100.00 and a low estimate of 65.00. The median
estimate represents a +9.51% increase from the last price of 82.64.” (CNN, 2021).

With live events projected to ramp back up in the latter half of 2021, Live Nation is
projected to return to normal revenue-wise if not surpass previous years. Stock in Live Nation
(LYV) has already risen and is back on the positive side, aiding in a direct relationship with
financial success. Live Nation has been continuously releasing “forward-looking statements” that
regard COVID protocols, outdoor activities, and current expectations of spending and earning.
As expressed in these forward-looking statements, there are many things that cannot be
accounted for at the time of these statements, and that there is always a risk that things may not
go as expected, especially during unprecedented times.

Income Statements

Live Nation Entertainment has continued to post all their financial information online for
public access and use. Overall revenue in 2020 was $1.9 billion compared to $11.5 billion in
2019. Earning significantly less than previous years, Live Nation, like many other entertainment
companies, struggled to succeed throughout 2020. By doing financial reports and analyses in
quarters, data can be placed in certain quarters in order to organize finances. For instance, music
festivals count in the quarter in which the event starts. Ticketing saw a $1.9 billion loss in 2020
compared to a gain of $325 million in 2019. Concerts saw an 84% decrease in revenue. With
this, show counts also decreased from 40,237 in 2019 to 8,117 in 2020, with about 7,100 of these
shows taking place in the first quarter of 2020 prior to the COVID-19 related shutdown. Live
Nation Entertainment has many loyal sponsors and advertising partners, but even sponsorships
saw a 60% decrease within the last year. Luckily, advertising did not take as a big of a hit as
concerts and ticketing because sponsors, partners, and shareholders were still able to advertise
merchandise, virtual events, and other sources of revenue throughout the dismal year.
 17

Balance Sheets

The amount of total liabilities and equity in 2020 was $10,589,303. With 83% of those
who purchased tickets through Live Nation keeping their tickets (whether for rescheduled shows
or not), this continued to bode well for Live Nation financially, despite the cancellation of all live
shows. Luckily, Live Nation was able to maintain 90% of their sponsors from February 2020
through February 2021. Operationally, Live Nation is prioritizing marginal growth as business
ramps up.

Statement of Cash Flows

For Live Nation, free cash is a representation of how much cash is available to,
“optionally repay debt balances, make acquisitions and fund revenue generating capital
expenditures” (Live Nation, 2020). In 2020, about 60% of free cash was attributed to concerts.
 18

At the end of the fourth quarter of 2020, the company had total cash and cash equivalents of $2.5
billion this includes:

I. $643 million of free cash.

II. $962 million of available debt capacity
III. $417 million of net cash
IV. $2.0 billion of available liquidity.

Payback and Exit Strategy

Live Nation refunded $282 million for rescheduled Live Nation shows and $842 million
for canceled Live Nation shows throughout 2020 due to the COVID-19 Pandemic. After a year
without live shows and fear of not being able to make a comeback, Live Nation’s stock has risen
again as a result of vaccines being widely available and allowing people to return to normal by
mid 2021. As of 2020, Michael Rapino reported $3.8 in total liquidity (Live Nation, 2021). Live
Nation then amended their original credit agreement. This amendment allowed for successful
cost reductions and flexibility regarding debt agreements, in order to make it through the
pandemic. As of this time, Live Nation allotted room for $940 million in debt. Further, Live
Nation utilized government support programs to finance any losses and difficulty the company
had once live shows ceased in March of 2020. The liquidity held by the company is predicted to
account for the ability to fully fund operations once they return to normal.

The global refund rate for Live Nation Entertainment was 17% as a result of numerous
refunds, which is not normally the case. Live nation is followed by thirteen analyst companies
that are able to forecast and report on financial estimates and opinions. With numerous investors,
Live Nation Entertainment encapsulates many different parties to form a large corporation with
multiple subsidiaries such as Roc Nation and Ticketmaster.

Financially, Live Nation’s strengths and resources include fans, artists, online
services/ticketing, distribution networks, and sponsors. Together, these fuel Live Nation’s
financial success and continued monopoly of the entertainment industry.
 19

Critical Risk Factors

Management Risk

Due to the loss of revenue due to the pandemic and the large management team, there is a
risk of losing members of the team. Live Nation has multiple committees with various
employees and risk losing these with loss of revenue.

Marketing Risks

With Live Nation/Ticketmaster’s new virtual streaming ticket service, its marketing shifts
and creates more risk promoting events online. In order to create a sense of normalcy, Live
Nation’s marketing team has to work harder to attract consumers into participating in online
events. While the ideal potential live event attendee target market is tech-savvy and familiar with
navigating the internet, the in-person live event appeal is gone. In order to make a virtual event
seem just as appealing as a live event, Live Nation must attempt new and out-of-the box
marketing techniques. Since this is the first pandemic that we, as a society, have collectively
lived through in a digital age, it is unknown what marketing efforts work and what does not.

Ticketmaster released the virtual streaming ticket service in February 2021, nearly a year
after the pandemic caused international lockdowns and halting of live events, after experiencing
success with sporadic virtual events through Live Nation and Ticketmaster. It was smart on
Ticketmaster’s end to wait to launch a full-scale ticketing service as it was unknown how the
public would react to virtual events, but on the other hand, the desire and need for virtual events
is slowly dwindling. Throughout the year of 2021, social distancing guidelines have eased up and
the distribution of vaccines is continuously increasing. More in-person events are taking place
and as summer 2021 quickly approaches, many are eager to get back to in-person gatherings and
events. The demand for virtual events is decreasing. If Ticketmaster released this service earlier,
perhaps during the peak of international lockdowns, it may have seen more success.

Operating Risks

When promoting live events amidst a global pandemic, there’s risks of producing too
many tickets. Covid makes it more difficult to predict consumer buying patterns and Live Nation
has had to readjust their forecasting of ticket production to compensate for this.

Financial Risks

The need to reschedule events and refund tickets that were already purchased caused a
significant drop in revenue from 2019 to 2020. With this came a 17% refund rate, which is way
higher than years past since Live Nation did not run into many situations where they had to
refund numerous tickets at a time and for a prolonged amount of time. Further, the
 20

unprecedented cancellation of live shows caused a general loss of revenue and a much less
successful fiscal year. Going forward, financial risks are predicted to subside as live venues open
back up in hopes of a more normal entertainment year in 2021 and 2022. From this point on,
financial risks continue to be normal risks that come alongside large companies.

Intellectual Property Infringement

Trade secrets are at risk with Live Nation since they are such a large company.
Employees could end up revealing information to other competitors from previous employment
areas.

Other Risks as Appropriate

Another risk is of artists not fulfilling their responsibilities as a client of Live Nation. As
a company who owns 275 venues and manages over 500 artists, there are a lot of risks of
negative PR associated with an artist or event.
 21

Appendix

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Governance Documents. (n.d.). Retrieved from

https://investors.livenationentertainment.com/corporate-governance/governance-documents

Income Statement. (n.d.). Retrieved from

https://investors.livenationentertainment.com/financial-information/income-statement

Live Nation. (n.d.). Retrieved from https://www.experiencepinpoint.com/our-work/live-nation/

Live Nation. (2019, August 23). Original & Branded Content. Live Nation for Brands.

https://livenationforbrands.com/capabilities/original-branded-content/

Live Nation Entertainment Reports Fourth Quarter & Full Year 2019 Results. (2020, February

27). Retrieved from

https://www.livenationentertainment.com/2020/02/live-nation-entertainment-reports-fourth-quart

er-full-year-2019-results/

Live Nation Entertainment Reports Fourth Quarter & Full Year 2020 Results. (2021, February
25). Retrieved from
https://www.livenationentertainment.com/2021/02/live-nation-entertainment-reports-fourth-quart
er-full-year-2020-results/

Live Nation Entertainment Reports Fourth Quarter & Full Year 2021 Results. (2021, February
25). Retrieved from
https://www.livenationentertainment.com/2021/02/live-nation-entertainment-reports-fourth-quart
er-full-year-2020-results/

Live Nation Entertainment, Inc.: Company Profile. (n.d.). Retrieved from

https://www.vault.com/company-profiles/media-entertainment/live-nation-entertainment-inc

LYV. (n.d.). Retrieved from

https://money.cnn.com/quote/forecast/forecast.html?symb=lyv#:~:text=The 10 analysts offering
12,the last price of 84.90.
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Live Nation. (2021, January 21). Retrieved from

https://www.musicbusinessworldwide.com/companies/live-nation/

Me, I. C. (2021, February 11). Live Nation Launches A Livestream Ticketing Service. Retrieved
from https://celebrityaccess.com/2021/02/11/live-nation-launches-a-livestream-ticketing-service/

Millman, E. (2020, November 05). Still Without Concerts, Live Nation Revenue Dropped 95%
in Its Third Quarter. Retrieved from
https://www.rollingstone.com/pro/news/live-nation-revenue-drop-q3-2020-1086584/

Owler. (n.d.). Spectra Experiences. https://www.owler.com/company/spectraexperiences

Rohit. (2020, May 22). Mo Concerts Mo Money - A look at Live Nation (NYSE: LYV).
Retrieved from
https://blog.thesharmas.org/2019/06/11/mo-concerts-mo-money-a-look-at-live-nation-nyse-lye/

The Flywheel Effect. (n.d.). Retrieved from

https://www.jimcollins.com/concepts/the-flywheel.html