When his son, Elliot, turned 13, Sir Lucian Grainge, the music industry tycoon, arranged for Take That to perform at his bar mitzvah celebrations at Nobu, the upmarket Japanese restaurant in London’s Mayfair.
Elliot was grateful. But the boyband probably wouldn’t have been his choice of entertainment. At the time, his favorite musician was Eminem, an American rapper in possession of rather more edge than Gary Barlow.
Now aged 30, and bearing a striking resemblance to his father, Elliot joined Lucian earlier this week at the top table of the global music industry. But rather than working at Universal Music Group, which Lucian has led for 13 years, Elliot became the chief executive of Atlantic Music Group, whose Atlantic Records is the crown jewel label of Warner Music Group, making the father and son fierce rivals for musical talent.
Lucian, 64, is already considered by many to be the most powerful man in music. And Elliot’s promotion elevates him to the top echelon of the sector. Billboard estimates that the lad and dad will control 37.6 per cent of the US recorded music market.
To critics, green-eyed rivals and victims of Grainge’s rise, this all has a strong whiff of nepotism, albeit with a twist. “It’s awkward,” one senior industry source said. “But it would have been more awkward if he worked for his dad.”
Behind the scenes, conspiracy theorists are out in force, suggesting that this could be the first step in a grand plan by Sir Lucian for Universal to buy Warner Music. Wild speculation aside, even sensible industry heads are struggling to fathom how the arrangement will work. “How do the Chinese walls and corporate governance work?” asked a source at another label. “How do the companies ensure there is no sharing of information?”
The “nepo baby” charges against Grainge are not aided by the fact he is close friends with Val Blavatnik, 26, the Warner Music board member and son of the billionaire Len Blavatnik, the company’s largest shareholder. One supporter of the younger Grainge, who has followed his career closely, pointed out that he had earned his chance after building up his own independent label. “Maybe he was given a head start,” they said, “but he’s made his own luck ever since.”
For Grainge, who joined Warner last year when it invested in his Los Angeles-based label 10K Projects, the challenge is to prove to the industry he has earned his position at the top of Atlantic, which represents Ed Sheeran, Coldplay, Bruno Mars and Charli XCX. Before that, he faces an uphill battle to endear himself to his troops at Warner, a company that is going through a period of great tumult.
Elliot Grainge was born into tragic circumstances. His mother, Samantha Berg, went into a coma as she was giving birth and never recovered. She later died. Sir Lucian, a self-made man who rose from independent labels to the top of the music sector, remarried in 2002 and Caroline, his second wife, is in the process of adopting Elliot.
While his father has a Michael Caine-esque twang, Elliot’s private education in west London — he attended Orchard House School in Chiswick and Ibstock Place School in Roehampton — left him with a generic, middle-class accent that endured after he moved to Los Angeles at 16.
Today he lives with his wife, Lionel Richie’s model daughter, Sofia, and their newly born daughter, Eloise Samantha. As the chief executive of Atlantic, he will split his time primarily between his LA home and Warner’s New York headquarters.
Grainge will be filling the shoes of Julie Greenwald, the New York-based Atlantic Records veteran. His arrival also coincides with the departure of Max Lousada, the south Londoner who is the chief executive of Warner’s recorded music division, which oversees Atlantic and other labels.
“It’s awkward,” one senior industry source said. “But it would have been more awkward if he worked for his dad.”
His position is being eliminated to “flatten” Warner’s internal structure. The upshot is that Grainge will report directly to Robert Kyncl, the chief executive. Two former senior Warner staffers said some would see him as effectively No 2 in the company, but a senior company source said this was not the case.
According to Warner’s latest executive pay document, published in January, before Lousada’s departure was announced, he would be eligible to receive $90 million upon leaving the company. This included $82 million in company shares that he had built up over eight years.
It is also a risk for Warner because the departing Lousada has strong relationships with several of the company’s biggest artists, including Chris Martin of Coldplay. Ed Sheeran once said of him, “Max is definitely someone that I go to for advice very often and his advice is always spot-on.”
Three sources who worked with Lousada say his departure follows an unsuccessful tilt last year to replace Steve Cooper, the chief executive. As the boss of recorded music, which accounts for most of Warner’s revenues, Lousada was seen as his natural heir. “He shot for the moon and missed,” is how one source described it.
Cooper, a corporate turnaround guru who once led the doughnut-maker Krispy Kreme, was recruited to lead Warner when Blavatnik bought it off the stock market for $3.3 billion in 2011. Despite some staff reservations about Cooper’s non-musical background, he is credited with guiding Warner through a period of great change, as physical CD sales and downloads gave way to streaming, and invested in new labels to double revenues. Warner, which relisted in 2020, is today worth $16 billion. Its revenues last year totaled $6 billion and it made profits of $439 million.
Lousada had built up strong relations with Blavatnik, 67, the ultimate king-maker; but in the event, he appointed an outsider, Kyncl, the former chief business officer of the Google-owned YouTube.
His challenge is to keep Warner in the ascendancy at a time when many in the industry fear streaming growth is slowing now that Spotify and other platforms are well established. Rival platforms, such as TikTok, which enable young users to interact with music in new ways, share less money than Spotify.
The expectation is that Kyncl will attempt to establish Warner as a more tech-savvy business. Earlier this year, he said the company was developing an app that would sell “superfans” greater access to its musical stars.
Kyncl’s arrival in January 2023 preceded an executive shake-up. Val Blavatnik, then 25, joined the board, while the former YouTubers Ariel Bardin and Carletta Higginson were brought in as president of technology and chief digital officer.
This year, Warner has unveiled plans to cut 750 jobs, a move that Kyncl said would “free up more funds to invest in music and tech”. Many of the job cuts have hit its media outlets, including UpRoxx and IMGN, as well as individual labels. A former executive said that Kyncl often referred to a “north star strategy” for the company, but that many staff remained uncertain of what it was. “It’s just a short-term focus on the share price and profitability,” they said.
It is against this backdrop that Elliot Grainge starts his role. He joined Warner last year when it bought a 51 percent stake in his independent label, 10K Projects, for $102 million. Grainge developed a speciality for using data and analytics tools to discover artists on platforms such as SoundCloud before scaling up their fan bases on social media. The label’s signings included the rappers Ice Spice, Trippie Redd and Iann Dior.
Grainge started his business with more than $60,000 he’d earned from organizing music events in Boston, Massachusetts, while he was studying at Northeastern University. His father is said not to have invested in the business, but 10K did benefit from a deal under which Caroline Records, a Universal subsidiary, distributed its artists’ work across streaming platforms.
Grainge and 10K benefited from a wider trend for artists moving from major labels to indies. In the UK, figures from the BPI trade body show that independently released music made up 29 percent of the listening market last year, up from 22 percent in 2017.
The theory is that artists once had to sign up to large labels in order to thrive. Nowadays, those with large online fan bases can demand more generous label deals. This has opened the door to smaller indie outfits that are prepared to offer better terms to compete, including higher revenue shares for artists, more bespoke promotion work and greater possession of song rights.
Now that he sits at the top of a major label, Grainge has to find ways to enhance the appeal of Atlantic and Warner by offering more artist-friendly deals. Working with the techie chief executive Kyncl, Grainge wants to sign up top musicians with the promise of greater transparency, including more streaming data and information about their fans.
It is here, in the signing and retention of artists, that Grainge will compete with his father. How will this work? The Grainges’ answer appears to be that they keep business and pleasure separate.
During his boyhood in London, Elliot developed a penchant for table tennis. Matches with his father were said to be ferociously competitive: they’d sweat, they’d scream, they’d cheat. But when the match was over, they’d resume their ordinary, loving family life. From this week, it’s game on again.
William Turvill is chief business correspondent at The Sunday Times
