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The Billionaires at Burning Man

(Bloomberg Businessweek) — For his 50th birthday, Jim Tananbaum, chief executive officer of Foresite Capital, threw himself an extravagant party at Burning Man, the annual sybaritic arts festival and all-hours rave that attracts 60,000- plus to the Black Rock Desert in Nevada over the week before Labor Day. Tananbaum’s bash went so well, he decided to host an even more elaborate one the following year. In 2014 he’d invite up to 120 people to join him at a camp that would make the Burning Man experience feel something like staying at a pop-up W Hotel. To fund his grand venture, he’d charge $16,500 per head.

Tananbaum, a contemporary art collector who resembles the actor Bob Saget, grew up on Manhattan’s Upper East Side and graduated from Yale and Harvard, where he earned both an M.D. and an MBA. After years of starting, selling, and investing in health-care companies, he founded Foresite in 2011. A private venture capital firm with $650 million under management, San Francisco-based Foresite specializes in the health-care and pharmaceutical industries.

Busy building his portfolios, Tananbaum only made it to Burning Man in 2009, the festival’s 24th year, but instantly fell under its spell. While his peers in San Francisco’s high finance circles took up kitesurfing or winemaking, he devoted his spare time to preparations for the next burn. “Jim put a tremendous effort into trying to create something very special for the Burning Man community,” says his friend Matt Nordgren, a former quarterback at the University of Texas, who went on to star in the Bravo reality show Most Eligible Dallas.

For 2014, Tananbaum wanted a camp that was aesthetically novel, ecologically conscious, and exceedingly comfortable. In the spring he and his team sent out a detailed invitation, enticing potential guests with an early vision of the camp, named Caravancicle. Anyone concerned about living in a hot, unforgiving wilderness could rest assured. There would be no roughing it at Caravancicle. Accommodations would consist of a series of cubical tents with carbon fiber skeletons. Each cube would have 9-foot ceilings, comfortable bedding, and air conditioning. The surrounding camp, enclosed by high walls, would be safe and private. Amenities would include a central lounge housed in a geodesic dome, private showers and toilets, solar panels, wireless Internet, and a 24-hour bar. Guests could count on a “full-service” staff, who would among other things help create “handcrafted, artisanal popsicles” to offer passers- by. To help blend in with the Burning Man regulars, who tend to parade around the commons in wild, racy outfits (if anything at all), the camp would include an entire shipping container full of costumes.

Each year as the festival nears, there’s a fresh round of speculation that the event has finally jumped the shark, or become overrun by Silicon Valley tech bros. Tananbaum and Ari Derfel, a Berkeley restaurateur he hired to co-create his 2014 camp, didn’t see it that way. (Neither Tananbaum nor Derfel commented on the record for this article.) The two admired the vaguely utopian, anticommercial culture Burning Man has cultivated over the years.

In Black Rock City, as Burning Man’s annual improvised metropolis is called, there are no advertisements and no wandering vendors selling glow sticks or overpriced beer. (Coffee, from a central cafe, and ice are the only commodities for sale.) The community ethos is loosely governed by “The 10 Principles of Burning Man,” set down in 2004 by co-founder Larry Harvey. These include radical self-reliance (because there’s no water for miles), radical self-expression (get your freak on, people will love you for it), and a “gift economy” (everyone ought to bring something to the party). Over the years, revelers have formed camps—some themed, some just friends and friends of friends in a cul-de-sac, effectively creating microhoods within the sprawl of RVs, tents, domes, and other temporary buildings erected on-site.

With preparations for Caravancicle well under way, the creators of Burning Man were going through their own reorganization. As the event outgrew its origins in San Francisco’s bohemian street theater scene, it had become an LLC, doing upwards of $20 million in annual ticket sales. (In 2015 the majority of individual Burners will pay $390 for a ticket.) Last year, to better manage growth, the six founders of Burning Man transferred their private ownership of the event to the Burning Man Project, a nonprofit, and expanded its governing board. Tananbaum was offered a place on it. He was voted in as the board’s 18th member in April 2014, joining a mix of new members that includes Chip Conley, a celebrity hotelier turned Airbnb executive; Jennifer Raiser, founder of a luxury senior- care company; and Matt Goldberg, a former Dow Jones executive now with QVC. The mission of the new organization is to propagate the Burning Man culture throughout the world, in part by launching a series of smaller, regional festivals. In theory, the beefed-up board will use its far-reaching professional connections to help accelerate the global spread. “It’s not a thoughtless amassing of rich folks,” says Harvey of the expanded board. “But if you want to change the world, you’d better get some people who have real muscular power.”

For Tananbaum, his improbable journey from the precincts of the East Coast Establishment to the inner circle of one of San Francisco’s great countercultural institutions appeared complete. As it turned out, the honeymoon was short-lived.     On Sept. 11, Beth Lillie, a 25-year-old former dog walker in Los Angeles, posted an essay on Facebook, detailing her experience working as an employee—or “a sherpa,” her word—at Caravancicle. It had been more than a week since everybody at Burning Man, including Tananbaum’s guests, had sobered up and returned to their everyday lives, but the experience was still fresh in Lillie’s mind. Her grievances were raw, her portrait damning, and her tell-all account immediately touched off a backlash against Tananbaum that mirrors the San Francisco culture wars of recent years, in which symbols of the area’s surging tech wealth have become lightning rods for anxieties over class and privilege. Overnight, Tananbaum had become the Google Bus of Burning Man.

At the outset of her account, Lillie noted that her goal was not to damage anyone’s reputation (she used made-up names), but rather to provide a behind-the-scenes exposé of the “boring closed off” camps catering to high rollers that were increasingly taking root along a stretch of road that had become known as Burning Man’s “Billionaires’ Row.” According to her post and a subsequent telephone interview, Lillie says she first heard about the job through a friend in Los Angeles. She thought landing a paying gig at Burning Man would help fund her annual pilgrimage to the festival, which she’s attended every summer since she was 18. After meeting with Derfel, Lillie was excited that the camp’s organizers hoped that Caravancicle would help bring about a personal transformation among some of its wealthy, powerful guests. Lillie liked the idea of using Burning Man as a crucible to re-educate the 1 Percent. She signed on to work as a bartender and server. Her pay would be a flat rate of $180 per day.

Lillie says that when she arrived at Burning Man on the eve of the festivities, she found a camp in disarray. Camp Caravancicle had subcontracted much of the construction work to the leaders of a neighboring encampment, and everything was running behind schedule. Tensions between the two tribes were high. The staff had been told ahead of time that Leonardo DiCaprio would be staying at the camp. The expected presence of a Hollywood celebrity heightened the pressure.

Originally, the plan had been for employees to greet guests as they arrived and to acclimate the uninitiated to the unique environment of Burning Man. But with the staff scrambling to put the finishing touches on the accommodations, social engagement largely fell by the wayside. So, too, did the popsicle stand, which was never built. Many of the wealthy guests arrived on private planes, tired and ready to be pampered, only to find a harried, semi-professional staff struggling to meet their expectations.

Instead of a spirit of inclusiveness and harmony, Lillie says she found herself in an environment dedicated foremost to protecting the VIP status of its wealthy inhabitants. Paying guests were outfitted with wristbands like patrons in an exclusive nightclub. Lillie says that while bartending she was given orders to restrict the free cocktails to paying guests. Staff members held a “secret meeting,” Lillie claims, in which employees broke down in tears complaining, among other things, that a few of the male campers were trying to grope them while they worked. The only employees who appeared to be enjoying themselves, Lillie wrote, were the attractive models, a posse dubbed the “mistresses of merriment,” who had traveled from L.A. ostensibly to flirt with and help entertain the male guests. During the telephone interview, Lillie concedes that she never saw any harassment of workers take place. But she says the introduction of paid laborers like her into the libertine atmosphere of Burning Man created an awkward dynamic. “It was like a bunch of old, married men expecting a freaky sex party at Burning Man. … The girls were all kind of looked at as though we were going to be a part of that.”

Lillie says that rather than re-educating the 1 Percent, the camp was only reinforcing the class divisions of the real world. Roughly three days after arriving, Lillie left Caravancicle and spent the rest of Burning Man crashing with friends. “It was such a disaster,” she says.     Camp Caravancicle was not the first of its kind, and over the last few years many fervent Burners have come to believe such accommodations are covertly commercial, unfairly gobble up many of the event’s limited number of tickets, and violate various Burning Man principles, such as participation and radical self- reliance. This, in part, is why the response to Lillie’s post was so swift and fierce. Within days a new group popped up on Facebook, calling itself the Sherpa Liberation Front, dedicated to retaining the “anti-corporate, anti-consumerist integrity” of Burning Man through “good-hearted guerrilla theatre.” Photos allegedly capturing the mistresses of merriment cavorting at Caravancicle circulated. An anonymous blog called Burners.me, which chronicles all things Burning Man, lambasted Tananbaum’s involvement in “Sherpa-gate” and applied pressure to the Burning Man Project to take action. When Lillie held an “Ask Me Anything” session on Reddit, various commenters suggested pulling group pranks on the plug-and-play camps at next year’s Burning Man. One idea was to wander into such zones dressed as maids and butlers. A petition on Change.org called for Burning Man’s founders to put an end to the scourge of “commodification camps” and for Tananbaum to resign from the board. “The dude got special placement, unlimited tickets from a secret sale, early arrival, late departure, and some of the wealthiest people on the planet paid him a f—ton of money to package our event for their pleasure,” read one typical comment on the EPlaya forum, where the anger raged. “See you in the dust, Jimbo. Can’t wait to meet you.”

Tex Allen, a performance artist in the Bay Area who’s worn a clown nose in public every day for the past four years, says this episode highlights growing discontent with camps like Caravancicle. “It was already brewing, but Beth [Lillie] broke it wide open,” he says. The original Burning Man board of six, he adds, “got caught” turning a blind eye to Billionaires’ Row. Allen says that adherence to the 10 Principles is one of the things that separates Burning Man from for-profit, commercial summer festivals such as the Electric Daisy Carnival (EDC). “If you want to party, book a VIP camp at Coachella or EDC,” says Allen. “Once you’ve gotten that out of your system, and maybe you’ve had a realization that you need to contribute to this community, then come back.”

In December, with the controversy boiling online, Michael Mikel, a Burning Man co-founder, wrote a post on Facebook (since deleted) stating that he had conducted a “personal investigation” into Caravancicle. Mikel concluded that the camp had failed in part because of Tananbaum’s poor choice of contractors and his decision to have a large public bar that didn’t stock enough booze to keep up with demand. “While he has been quite capable of amassing a fortune in the world of venture capital, it does call into question if he is ready and able to help navigate the Burning Man ship,” Mikel wrote. “Then again, there is nothing like failure to add to one’s experience.”

Mikel also fired back at Burners.me, revealing in public for the first time that the anonymous “troll” who publishes the site is tech entrepreneur Steve Outtrim. Mikel went on to claim that Outtrim owned “several expensive homes” across multiple continents and each year flew to Burning Man in his own plane. The guy stirring up class outrage, in other words, was himself a card-carrying member of the 1 Percent.

Outtrim responded. “Yes I have been successful in tech, took a few companies public,” he wrote. “So what? I don’t own a plane and have never flown to Burning Man in one. … Here’s a photo of my RV, which I have driven to Burning Man myself since I bought it for cheap on eBay in 2011.” In an interview, Outtrim points out that for years there have been wealthy people at Burning Man. In the past it wasn’t in people’s faces. “What’s really been an issue with the Caravancicle camp,” Outtrim says, “is the involvement of someone from the Burning Man Project’s board of directors.”

Historically, he adds, Burning Man was “a great leveler”—nobody in Black Rock City cared who you were. The prevalence of costumes allowed the rich and famous to mingle with the masses. “For a lot of captains of industry and the celebrities, it was a chance for them to go and be a normal person at the party like anybody else,” says Outtrim. “But bringing in servants is where it’s become a bit of a problem. It’s pushing buttons related to class war in San Francisco.”     For now, Tananbaum remains on the Burning Man board, less because he’s stubbornly hanging on than because they want him there. He’s not an interloper; he’s a strategic hire. It’s also a reminder of what happens when a local, indie brand tries to go global. In a lengthy essay on the organization’s website in December, Harvey, the festival’s co-founder, acknowledged that in recent years there had been a rise in the number of ostentatious camps that “swaddled their members in a kind of cocoon that bears a strong resemblance to a gated community.” Such camps may be distasteful, he went on, but pose little threat to the overall Burning Man experience and mission. “The curdling gaze of celebrities or the intimidating presence of the wealthy cannot possibly inhibit the remaining 99 percent of our citizens from participating,” he wrote. “What I think these camps are really guilty of is being gauche. This is not so much about morals, it is more about manners, and we’re convinced bad manners can be mended.” A few weeks later, in a phone interview from San Francisco, Harvey says he sees the controversy over Caravancicle as a great opportunity for true believers to re- examine the 10 Principles. “It would be a shame to waste a good crisis,” he says. While he never stepped foot in Caravancicle, Harvey had met Tananbaum before he joined the board and was impressed by his idealism. In retrospect, Harvey says, it might have made sense to more actively engage with new board members like Tananbaum to discuss the Burning Man values they were expected to uphold. 
On Dec. 17, Tananbaum broke his silence, penning a letter of apology to “anyone who felt disrespected by our camp” while also criticizing Lillie’s “SherpaGirl” tell-all, which he called “a disappointing account of her few hours in our camp.” He proceeded to answer his critics by going point by point through the 10 Principles and defending his camp’s compliance with each, especially “radical inclusion.” He reminded everyone that “people from all walks of life” are welcome, including, in theory, masters of the universe.

For his part, Harvey, who personally invited Grover Norquist last year, continues to see the arrival of the ultrawealthy as a good thing for Burning Man. “I want to convince people that it isn’t as if the 1 Percent represents an evil bacillus that like Ebola will sweep through our city,” he says. “That’s not possible. Much of the anger is because of a feeling of impotency. The whole issue of the 1 Percent has been a matter of public discourse for some time now, and nothing has changed. People are frustrated. … My mission is to reform the 1 Percent.”

To contact the author on this story: Felix Gillette at fgillette@bloomberg.net

http://www.msn.com/en-us/money/companies/the-billionaires-at-burning-man/ar-AA910Bw

 

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The Millennial Juggernaut: Biggest Buyers of Luxury/Newest Home Owners Panel Discussion

As the media continues to focus on millennials who have struggled to get a toehold on their financial independence during the economic downturn, millions of other millennials have amassed sizeable fortunes while still in their twenties.

Millennials make up nearly a quarter of all U.S. millionaires, or about 5 million individuals, according to a survey conducted by the Shullman Research Center. With a purchasing power of $1.68 trillion, they are poised to soon become a transformational force as buyers of luxury products and services; and, importantly, home owners.

Don’t expect millennials to define luxury the way their parents did. They are ‘the new disruptors’ forcing retailers to re-evaluate their marketing and product development strategies and create customized, innovative products and experiences.Continue reading

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Our Members

Our extensive and exclusive membership of over 1,000 of the world’s most prestigious companies and brands exemplify the highest standards in terms of quality, style, design, craftsmanship, creativity, service and innovation. We have multiple membership categories to fit our members needs, by chapter.

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Welcome New Member: Luxury Interactive

We are pleased to welcome Luxury Interactive as a new member of The Luxury Marketing Council.

Founded in 2007, Luxury Interactive is an annual summit that brings together luxury brand executives from 15 business verticals to network and share their insights on challenges and opportunities in digital and online.

Through extensive research, Luxury Interactive identifies and analyzes trends in luxury business and procures a speaker faculty of senior executives who deliver inspiring case studies on how to acquire and retain customers via omni-channel touch-points.Continue reading

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The Annual Summer Garden Party Recap

The Annual Summer Garden Party Event Recap

This past Sunday, June 14 guests and friends of The British American Business Council of Orange County, The Luxury Marketing Council of Southern California and The World Affairs Council of Orange County put on their best summer attire and came out to Newport Dunes Resort for The Annual Summer Garden Party. Upon arrival, guests were greeted by vintage luxury cars and were entertained by talented pianist, Gip Noble. The Olde Ship British Pub and Restaurant catered the event and served traditional tea bites and desserts like cream cheese and cucumber sandwiches, sausuage rolls, scones with fresh cream and jam and lemon bars.

While sipping on Pimm’s Cocktails, Champagne Jacquart Rosé and English tea, guests were invited to play croquet and bid on silent auction items or partake in the annual fascinator and hat competition! The two winners were Kim Shipman and Mona Tomassian who won most whimsical hat. One lucky guest even won 2 tickets to the U.K., thanks to our sponsor, Virgin Atlantic. The quintessentially British event was complemented by the always predictable, perfect weather of Newport Beach! Cheers!

Click on the link below to review the menu catered by The Olde Ship British Pub and Restaurant!

The Olde Ship Tea Menu

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Conversations with President and COO of Crystal Cruises, Edie Rodriguez

Crystal Cruises

With their 25th anniversary approaching, we visited President and COO Edie Rodriguez in Los Angeles, California at the corporate headquarters of her award-winning ultra-luxury cruise line, Crystal Cruises. We covered everything from life, travel, business and all things luxury.

Q&A

What inspired you to join the cruise industry years ago? Did you travel often growing up?

I developed a passion for travel at a very young age, visiting amazing destinations with my family. And then as I grew professionally as a travel consultant, I became more enamored with luxury travel and subsequently the cruise industry. So much so, that I’ve traveled to all seven continents and nearly 200 countries, and have sailed many-a-times on my birthdays.

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New Dimensions in Storytelling: Innovations in Retail Design Utilizing New Media to Radically Change the Way Luxury Brands Engage and Delight Their Customers

This evening’s program will take you on a journey to understand why connecting with the customer must now include perfectly styled and truly innovative visual and sensory engagement points that extend beyond the customers’ expectations. These customer experiences can successfully cross all media platforms and translate to the global community.
Join four distinguished creatives who are pushing the boundaries of selling products and services for a dynamic visual presentation and lively discussion that explores how to capture your customers’ attention and stimulate them to purchase at every point of impact.

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Champagne Master Class at The Riviera Country Club

On Tuesday, May 12 the Luxury Marketing Council hosted a Champagne Tasting with Floriane Eznack of Champagne Jacquart. Floriane is the winemaker at Champagne Jacquart and was in town from France and agreed to give a special presentation for Luxury Marketing Council members and guests.

The event was held at The Riviera Country Club in the Pacific Palisades. Upon arrival, guests were treated to champagne and elegant and delicious passed appetizers such as seared ahi tuna and shiso orange glazed beet skewers with tarragon sauce, Irish cheddar and black truffle macaroni and cheese and cold pressed foie gras on brioche with bing cherries.

After the appetizer hour, guests were invited to sit in the Grand Ballroom where Floriane Eznack gave an insightful and fun presentation on the process of making champagne from choosing the grapes to the bottling process. During the presentation, guests were poured 4 different types of Champagne Jacquart wines including Brut Mosaïque, Brut Rose, Blanc De Blancs and Cuvee Alpha.