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David Bowie FAQ:Personal Life:
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Bowie's financial status is a question often shrouded in mystery.
While he was undoubtedly fleeced by managers early in his career, and may have
indeed been almost bankrupt during portions of the early Diamond Dogs tour in
1974, he obviously learned from this experience, and decided to forgo the
traditional outside management company. He instead formed his own management
company, Isolar Enterprises (see Contact), in the 1980s. This
arrangement
has allowed
him to gain much greater control over his music business.
Although Bowie nearly always refuses to comment on his financial affairs, in
1997, a British business magazine named him the world's richest musician, with
an estimated worth of $US900 million (yes, 900 million dollars). If true, this
fortune would certainly not be from just his musical releases (since Bowie has
never sold in the same huge numbers as other popular artists like the Beatles),
but is likely to include savvy financial investments which Bowie has made in
fields other than just music.
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George Tremlett's Bowie biography, published in 1995, examined Bowie's financial
affairs in some detail and concluded that he was worth a lot more than people
suspected (this was before the British business magazine survey). Tremlett
suggested that the main source of Bowie's wealth was not his record sales (which
don't match those of other legendary acts like the Beatles), but his earnings
from three of his tours (Serious Moonlight, Glass Spider and Sound and Vision)
which were three of the most successful tours commercially ever, coupled with
publishing-related income (royalties from airplay, movies, licensing,
commercials, other acts covering his songs etc.), all of which was skilfully
invested so that his capital doubled every 5-7 years.
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Bowie entered a financial transaction in 1997, which became known as the 'Bowie
bonds'. The banker who organized the deal was David Pullman of The Pullman
Group, a division of Fahnestock & Co.
This garnered much interest on Wall Street, as it was the first time a musician
had undertaken such a deal, whereby royalties on an artist's back catalogue are
used as 'asset backing' on an issued bond.
Prudential Securities bought all $US55 million of the securities on the day they
were issued. In effect, Bowie received $US55 million up front, in return for
agreeing to pay back the full amount (plus interest each year) at the end of the
bonds' time period. The worth of Bowie's back catalogue was used as
"collateral" in the sense that future royalties will go towards paying the
interest (and guaranteeing the principal).
When the bonds expire (repaid in full),
the royalty rights will revert to Bowie, and he'll be
able to sell them all over again.
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The same year, Bowie re-signed his back catalogue to EMI, and received an
advance of $28.5 million.
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Dara, torrie
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