EDM Canada had the opportunity to interview one of the most powerful people in the electronic dance music industry. Jason Strauss is the co-owner of the Marquee Nightclub & Dayclub in Las Vegas, tied for the top earning nightclub in the U.S, and Tao Nightclub, the third highest earning club in 2012, as well as co-owning LAVO and other nightclubs and restaurants. He has earned his place among the top industry leaders in Las Vegas and one of the most influential in the U.S. Jason Strauss talked to EDM Canada about a variety of topics ranging from the EDM explosion in America, on whether Las Vegas has overtaken Ibiza, Hakkasan and Light, the importance of EDC Las Vegas to the local economy, his interest in the Toronto nightclub scene, and much more. Enjoy:
EDM Canada: What's your view on the current state of electronic dance music in Las Vegas and in America in 2013?
Jason Strauss: It's exploding. It's becoming much more mainstream, and it's becoming a regular means of programing for on-premise nightclubs and for festivals. I think the explosion and success of Ultra in Miami and EDC in Las Vegas have really been the staples to propel it. I think one of our nightclubs, Marquee here in Las Vegas, really helped launch it on a national scale, and that EDM was here to stay. Marquee was the first nightclub in Vegas that was built specifically to cater to electronic music. Everything from the DJ booth, to the sound system, to the way the place was laid out, and we were the first nightclub to do strictly EDM programing. Every other club in town always dabbled in it, stepped their toe in the water, but never jumped in, and we were the first to do it. So I think the combination of the success of Marquee in Vegas, where a lot of nightclubs from around the world take their cues from Vegas, being the nightlife capital of the world, and with the success of Ultra and EDC, the movement has just exploded.
Do you see it continuing?
Yeah, we haven't seen any turn down at all. Our numbers are just as explosive as they were last year and we're actually having a lot of growth for our daytime pool parties where we have EDM programing. We're growing in that department pretty dramatically.
You are the co-owner of Marquee, Tao nightclub, and LAVO in Las Vegas which has brought in an estimated combined total revenue of $195 million in 2012 and they are among the top 3 grossing clubs in the U.S. How did you manage to gain such success in the ultra-competitive Las Vegas nightclub scene?
I think us coming from New York with a brand like Tao and Marquee, where the brands were established in New York, and the national recognition that these places offered a certain level of service, and a certain level of experience. I think when we came to Vegas that really helped give us an establishment. I also have to chalk it up to our operation and corporate culture, a culture that we've been able to create with our employees. We're 3,200 employees in Vegas right now for the Tao Group and that is something that we're really proud of. We've been buying into the fact that the guests comes first, and that we have to deliver an experience every time that they walk into the room because word of mouth is the most powerful thing. So I think the collaboration of our success in New York, with a great corporate culture, and just a lot of hard work would probably be the third thing, is where we've been able to maintain our position.
On the importance of VIP Bottle Service: "it is somewhere in the realm of 50-60% of the overall revenue of the club."
How important is the VIP bottle service to your clubs bottom line?
Dramatically important. It is somewhere in the realm of 50-60% of the overall revenue of the club. But it's important to mention that it's one component of the club. Without regular general admission of guests, and without them there, the bottle service doesn't work. And without the bottle service, it's hard to afford top line talent in Vegas. So it really coincides with each other, it is a synergistic melange to get a night, and a nightclub to get where you need it to be. By having both a very strong general admission guest and a very strong bottle service customer.
It seems in the past year there have been a few conflicts between the bottle service guests and DJ programing. Has that ever been a problem in the Las Vegas club scene?
That comes from secondary markets where you have small venues where DJs and artists come to play and the management team is more concerned about catering to the high end champagne buyers rather than the overall experience. I think Vegas, ourselves, and other venues in town have done a really good job of balancing it. And I think the most successful venues that are doing EDM have a ginormous dance floors which really accommodates the general admission guests so that we can live in both worlds. With Las Vegas and the size and scale that it really has is able to cater to both demographics and the artist is really enjoying the fact that both types of guests are enjoying the music and the vibe.
What do you think of the new Hakkasan nightclub that just opened at the MGM Grand and the upcoming Light nightclub at Mandalay Bay? Are they both game changing venues that will shake the nightclub industry in Las Vegas?
I think it all remains to be seen as it's a little too early to tell what kind of impact they've had. They have been open for 2 weeks and we haven't missed a beat on our numbers year over year. It's too early to tell the impact it will have.
"Tao has been opened for almost 8 years now in Vegas and we've seen at least 6 of our competitors shut their door when they opened their doors after us. So if you are not at the top of your game you will get hurt and you will close down."
Do you expect that some Las Vegas nightclubs will suffer going forward with the opening of Hakkasan and Light? How do the other Las Vegas nightclubs perceive them?
I'll just defer to my last answer because it's just too early to tell. If you don't have a corporate culture, management, and marketing team that punches in every day to really fight the battle to keep your venues relevant, venues fall out of favor very quickly and shut their doors. Tao has been opened for almost 8 years now in Vegas and we've seen at least 6 of our competitors shut their door when they opened their doors after us. So if you are not at the top of your game you will get hurt and you will close down.
Deadmau5 is rumoured to be earning $425,000 per gig at Hakkasan, do you think these rising DJ fees are sustainable?
I don't know what he gets paid to be honest with you but Vegas is an interesting town where a lot of casinos own the nightclubs so sometimes the goal of a very profitable bottom line is not always the main goal. Maybe sometimes it's about driving traffic to the overall property. For us, we have don't live in that world, we look at a P&L (profit and loss statement) on our individual business and not be ancillary to the benefits of driving traffic. We use the philosophy of looking at last year's track record and paying the artist appropriately for their draw, ticket sales, and overall revenue. I don't know how the other groups do it but that's how we do it. And whether the DJ fees are sustainable or not, it's just too early to tell.
So you think it's corporate culture, the kind of corporate culture you have developed at your clubs is more important than the DJ itself?
I'm not saying that. The DJ, the service, the experience, is all that makes a place successful. It's all equally important. But if one of those components are lacking then you are going to suffer quickly.
On Ibiza: "For the last 3 years everyone has asked me if Las Vegas or Ibiza was bigger, but we blew Ibiza out of the water two to three years ago with infrastructure, technology, the talent bookings, the revenue spent, and in the number of people through the door – it's not even in the same hemisphere. I don't know how it keeps on getting compared."
2013 feels like a watershed moment for Las Vegas and EDM, is this the year that Las Vegas inherits the torch from Ibiza as being the premiere destination for electronic dance music in the world?
I think we did that last year. I think last year was the year with the Electric Daisy Carnival selling out as far in advance as they did and with the amount of talent and shows they did in Vegas. Nowhere else in the world can compete with this type of experience and it really puts a flag in the ground that Vegas is the nightlife capital of the world, and definitely the EDM capital of the world. For the last 3 years everyone has asked me if Las Vegas or Ibiza was bigger, but we blew Ibiza out of the water two to three years ago with infrastructure, technology, the talent bookings, the revenue spent, and in the number of people through the door – it's not even in the same hemisphere. I don't know how it keeps on getting compared.
How much bigger is the Las Vegas EDM scene as compared to Ibiza in terms of revenue?
I don't know off-hand but I know we do dramatically more. That's what I know.
The current DJ landscape in Las Vegas seems to be centered around progressive house, and the big room sound, do you think there is room for other major DJs from other genres to step in and secure residencies as fans become more aware of other genres?
Yes. I think there's going to be a younger electro, dubstep movement happening in a venue sooner rather than later. I definitely see the tech-house arena being successful in New York and L.A. We actually do a Friday tech-house night at Marquee in New York which does extremely well. It's just around the corner to see these two genres come to Vegas on a more permanent level.
In Canada I've been seeing a definite awakening to deep-house/tech-house with major festival starting to incorporate their own tech house stages. Do you envision one of your venues adopting what you've done in New York?
We are looking into it and we're very much considering it.
Jason Strauss on trance music at Marquee: "Trance is as strong as it has ever been and we continue to do it because we've had success doing it and we believe in it."
Your clubs seem to have embraced trance music by booking such acts as Armin Van Buuren, W&W, and Dash Berlin. How do you see the current state of trance music, because I'm a trance fan myself, in Las Vegas? It just seems to me like other Las Vegas clubs have not booked trance acts like Marquee has. Why is that?
Although we have different genres in our lineup, we definitely have the most trance programing than any other venue in Las Vegas. The reason we've done it is because we've had dramatic success doing it. The ticket sales are great, the energy and experience is great. We had Armin spin last Saturday at the Marquee day club and it did record breaking numbers. It was an unreal event and you can look at our Facebook for the pictures so you can see that there wasn't even one place to stand on a 30,000 sq feet pool deck. Trance is as strong as it has ever been and we continue to do it because we've had success doing it and we believe in it.
How important is the day club vs. the nightclub? Is there a big difference? What's more popular at the moment?
The nightclub houses more people and it does more financial revenue with more people through the door. But they are both very synergistic because we promote out of each experience for the other one. Everyone that comes to the nightclub on Friday night all get invited to the day club the next day. We really market synergistically between the two venues. The way Vegas is programed is that there are more people that go out at night then during the day.
You and Noah Tepperberg have built a clubbing empire in America, how has your business relationship evolved over the years?
We've been partners for over 20 years and it's almost like having a family member. If we do fight it's almost like fighting with your brother and those fights are very rare. We are as close as we've ever been as a partnership for 20 years. Hardest thing to find is a good business partner and I'm very lucky to have one.
I noticed that you opened a Marquee nightclub in Australia, do you have any plans at opening a club or venture in Canada in the future?
We were very interested in Toronto but we really haven't been approached, and to be honest, we don't know the market well. But we know how explosive the music is out there and the demographic will be ready for our style of experience. We're told that all the time by people who live there, and by friends of ours in Toronto. We haven't been approached and if we were, we would be extremely interested. Right now we're working on a deal in Asia and that will probably be the next announcement.
Do you have any comments in regards to Robert Sillerman and SFX Entertainment entering the US EDM market? What do you think of his moves into the EDM world and what do you think the effect will be on the overall market? Do you think SFX is good for the EDM economy?
I think it's great that institutional money is coming and trying to fund and do things for EDM type of businesses. I think institutional money gives these business more of a chance to grow quickly and become more sophisticated. I think it's definitely a positive. Bringing more European festival brands and evolving a company like Beatport, along with some of the other purchases he made - I think that if he lets them grow in a better way I think it will be a strong positive for everybody.
On the rumour that EDC Las Vegas might relocate: "I think it will be a colossal, epic f*ck up to lose Electric Daisy Carnival for Vegas and the Vegas economy and for what it does for everyone that lives here."
What do you make of the rumour that Insomniac and that EDC Las Vegas might leave the city if the Las Vegas Commission adopts that tax?
I think it will be a ginormous disaster for Las Vegas. The amount of people that it drives, and the amount of money it creates - EDC Las Vegas is the largest festival in America and it drives more business than any fight night or big event that Las Vegas does all year around including New Years. I think it will be a colossal, epic f*ck up to lose Electric Daisy Carnival for Vegas and the Vegas economy and for what it does for everyone that lives here.
Do you listen to a lot of electronic dance music in your spare time?
Who are your favourite DJs?
Obviously if I wasn't a fan I wouldn't have them as a resident in our venues. I grew up in Manhattan listening to Erick Morillo and the Subliminal Records type of sound which is close to my heart because it was something I grew up on. I'm enjoying the different genres a lot and I'm recently getting into the tech-house sound, and the sounds of Richie Hawtin, Loco Dice, and Marco Carola. Those are the sounds that I'm getting more drawn to lately. But I always have an amazing time listening to anything from Kaskade to Armin as I love their music as well. I'm all over the board as I don't have a specific style I enjoy. But if I had to pin point it down, it really comes down to where I came from with that Subliminal and Erick Morillo deeper house sound.
Are Las Vegas nightclub owners such as yourself closely watching what's going on at the Wynn venues with the booking of Loco Dice and Eric Prydz as it might be the start of a change that will bring more tech-house related events in Las Vegas?
I know that Loco Dice only did one event so far over there and I don't know how it did. And I don't consider Eric Prydz tech-house. I haven't heard his set in Las Vegas but what I've heard in reports is that it's not a tech-house set but more of a progressive house set. So no main nightclub has put their flag in the ground yet for the tech-house genre as everyone has been keeping it pretty mainstream except for Marquee, as we have dabbled into the trance world and we're the only ones really looking outside of the box pushing the envelope on that side. We've done some interesting things with new up and comers like Disclosure and Tritonal as we're trying different sounds coming out of the festivals.
What can we expect from Jason Strauss in 2013?
We will be announcing a new restaurant concept in Vegas. We will be launching a Tao restaurant and lounge in downtown New York, in the meatpacking district in September that will be a giant 30,000 sq feet restaurant. We will be announcing a project in Asia and we are very close to getting a hotel deal done in America. I don't want to say specifically where because we don't have to jinx it but we're very close to getting a Tao hotel deal done. Those are our new business developments that we're working on and then the rest of the time we're really maintaining our position in each of the markets as the premiere destination for nightlife and EDM.