Safety In Numbers

Local Music Business Upstart Bets That Rapid Growth Is The Key To Survival

In less than a year, the Parma-based Jigsaw Entertainment Group has become one of the largest players in the Cleveland music scene. The group controls four clubs, one in every major sector of the city: the Jigsaw Saloon, Peabody's, the Hi-Fi and, as of October 1, the Agora.

The company will fund expansions and a major renovation of the theater, a landmark on the near East Side. Jigsaw management will run the Agora's 1,700-seat theater and 400-seat ballroom. The Agora's Backstreet Café - now open only sporadically - will become an active restaurant, open for lunch on weekdays. The café now serves food at all shows, offering a scaled-down version of the Jigsaw's renowned menu. And plans are in place to open a 5,000-square-foot club on an upper floor by spring.

The Jigsaw Group has also expanded into a different aspect of the entertainment business: The group has purchased the West Side Lava Room Recording studio and Metrosync Studios, which is housed in the Agora complex. Metrosync will change its name to Lava Room East.

"The ultimate goal is to turn the Agora into a music complex," says Jigsaw partner Phil Lara, a 39-year-old Cleveland native who made a bankroll in the medical business. "We'll have studios. We can do live recordings - something like you see in Detroit with the Majestic. The entertainment industry is in a paradigm shift. The value … went from the record companies to the venues."

The Jigsaw Group purchased Parma's decades-old Jigsaw Saloon and Stage (capacity around 400) in November 2007 then Lakewood's Hi-Fi Concert Club (capacity 200) in May 2008. In June, the group signed on to manage downtown concert club Peabody's, taking over a 750-capacity complex that includes the Pirate's Cove and Rockstar Cleveland rooms.

Lara says that controlling venues of various sizes will allow his company to maintain relationships with groups as they grow, whether they're budding national bands or popular locals.

After adding the Agora and studios, Lara says, the company will have around 120 employees, from bartenders to producers. The group plans to invest $1.5 million in the Agora over the next five years.

Before the Agora merger, it might have been tempting to dismiss the Jigsaw newcomers as enthusiastic, cash-flush dilettantes. Wealthy investors buy clubs all the time, and few of them last. With the Agora, however, Jigsaw has partnered with Henry "Hank" Lo Conti, a 43-year veteran of the concerts-and-clubs business.

"It was something I felt I needed to do," says Lo Conti of the merger. "[The Jigsaw Group] was bringing something to the table I lacked. I'm working on other things. I could not devote my time to the place like I used to, to get on the phones and do things to get the promoters excited. [The Jigsaw] was willing to commit the money and take the time. Phil has some good people with him. That impressed me."

Lo Conti, 79, founded the Agora in 1966. Through the '70s and '80s, he grew the Agora name into a 13-club chain that stretched from Florida to Connecticut. In the '70s, he founded the Legend Valley/Buckeye Lake Amphitheater, which hosted one powerhouse festival bill after another. In the '90s, he opened a club in Russia and brought the Warped Tour to Cleveland and Amsterdam.

Times have changed.

No matter how big their bankrolls, brains or balls, even the best-connected concert promoters have been hard-pressed to compete with corporate conglomerates that have bought up the concert business one venue and promotions company at a time. And Lo Conti says the Jigsaw partnership could help him compete with Live Nation (formerly Clear Channel), the corporate behemoth that purchased the Cleveland-based Belkin Productions empire and competed with the House of Blues chain before buying it in 2006. Live Nation now controls the House of Blues (and its small Cambridge Room sub-club), Tower City Amphitheater and the Plain Dealer Pavilion at Nautica, as well as presenting most shows at the Q, the Wolstein Center and Blossom Music Center.

Lo Conti compares the 2008 concert business to the housing market. "I think acts and managers are bleeding the money out while they can get it, taking every dollar they can get out," he says. "We have to start a campaign with these acts. You can't continually screw the public. I've been watching the industry for 43 years, and it's going the same way radio went - and radio is dead."

The Cleveland club is the sole survivor of the Agora chain, which Lo Conti divested himself from in the '80s. Once home to shows by artists like Bruce Springsteen, the Agora has waned in recent years. It hosts occasional concerts in the theater, but most are in its smaller ballroom. The venue occasionally partners with both House of Blues/Live Nation and Jigsaw/Peabody's for big shows. But Lo Conti often competes with them.

Lo Conti recalls losing a 2004 Marilyn Manson concert when House of Blues outbid him, raising the price from $45,000 to $65,000. And that was the increasingly rare opportunity when he even had a chance to compete for a show; when they can, agents prefer to sign to a promoter or chain of clubs for a whole tour.

"So I see a trend," says Lo Conti, "and I thought it was time to do something to make an investment to make us more competitive."

Built as an opera house, the Agora Theater has good sound and sight lines. It has 1,100 seats for a capacity of 1,700. House of Blues has around 160 seats with a 1,300 capacity. Both have ample parking. A cash infusion could help the Agora's kitchen and VIP loges.

The Jigsaw mergers place most of Northeast Ohio's A-list rock clubs under the control of two companies now: either Live Nation/House of Blues or the Jigsaw. Bands that don't want to rage for the machine will have fewer options. (Lara recently dispelled a rumor that bands would have to sign a non-compete contract to play his clubs. Lo Conti says the Agora will maintain all its policies with bands and employees as they stand.)

The city's two remaining independent clubs that book national rock talent in volume - the Beachland and Grog Shop - declined to discuss how the Jigsaw Group affects the playing field. Michael Belkin, president of Live Nation's Cleveland office, says he still plans to use the Agora Theater for occasional big shows, even though the Jigsaw-Agora combination "could be competition for [House of Blues]. But this is nothing new. All the clubs [are] competition, so it was competition yesterday, it's competition today and it will be competition tomorrow. It's not much different. … The clubs they're aligning themselves with are all credible. … I don't know if it's necessarily good or bad for the city. I don't know if it will bring more or less entertainment, or higher or lower ticket prices."

Lara and Lo Conti aren't betting that controlling four Cleveland clubs, two studios and the Euclid corridor lunch crowd will help them survive against the world's largest concert promoter. Lara says the Cleveland connections are just stage one. When it was just an upstart, House of Blues proved touring bands will go out of their way if they know they'll get good hospitality and quality food.

"You'll see [the Jigsaw Group owning] other clubs in other cities, approaching the music business in a different way," says Lara. "Our goal is a regional network of clubs in select cities, so we can offer strong resources and opportunities."

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