1994 Part 1: 1-800 NEW FUNK
The Year Prince Lost His Way
It’s now 1994. Prince and Warner Bros. Records were in open conflict, and it was turning ugly. The record deal he had signed after the release of Diamonds and Pearls only required Warner to release one album a year. Their goal was essentially to find ways to slow down Prince’s output. Prince, on the other hand, was in search of ways to put music into the market faster.
On top of this, there was the situation with the closure of Paisley Park Records. This became something of a mutual problem with Prince and Warners, although I’m sure at the time neither of them would have admitted it in public.
On February 1st, 1994, Warner Bros. ended its relationship with Paisley Park Records, which more or less doomed the label entirely. It turns out there were some serious problems with the business. Once again, this is a situation where there are lots of conflicting accounts, and a shortage of reliable narrators, but here’s what all parties seem to agree on.
During the years of its existence, Paisley Park Records had signed many artists, who fell into two basic categories: artists Prince had recruited and was closely involved with, or artists of which Prince had little or no knowledge. The first category were a relatively small group of artists Prince felt were either worth development, like Sheila E., The Time and Tevin Campbell, or Prince just wanted to work with like George Clinton and Mavis Staples. The second group Prince seemed only vaguely aware of and was too busy to really keep an eye on. These were recruited by Prince’s management team, but benefitted from being “associated” with Prince and received guaranteed contracts with Warner Bros. as a result of the development clause in Prince’s record deal. There were a lot of these artists, but they were not selling very many records, often because they never released or even recorded any music. Prince trusted his management and had delegated responsibility to them to take care of that end of the business, but they were either incompetent or skimming off the top (accounts vary).
Meanwhile, the recording facility called Paisley Park was built as part of the deal that created the label. Warner Bros. was financing the whole thing, and insisted on a return on that investment, so at times, they would treat the studio as theirs (which was not entirely out of left field if you think about it) and artists would record in the studio without Prince knowing about it in advance.
Prince’s understanding of the deal was that Paisley Park was his place, and was not happy when randos would show up in his house to make their records, but there wasn’t much he could do about it. Add to this the fact that Prince was not keeping a close eye on what his management was doing with the label, and there was a recipe for disaster brewing.
Then 1992 rolled around. Prince re-upped with Warner Bros. and as part of the deal Warner “invested” in Paisley Park Records, which amounted to buying a controlling interest. Prince had not been privy to the financial dealings, so to him this probably looked like just another way to open doors to more types of projects and a more secure future making music. I’m certain that’s how his management sold it to him. And from a certain point of view that is true. From another point of view, the exorbitant advances Paisley Park (read: Prince and his management) had been collecting on these artists’ records over the last few years had meant Warner had been taking losses on these records and these artists that had failed to sell as well as Prince’s own music. For Prince’s management this was a desperation move. For Warner Bros. it was a way to get control of the situation at Paisley Park Records and get a good look at the books to see what was actually happening.
What I can say for Prince’s management was that their dealings were shady and unfair, but they did not (in a legal sense) amount to fraud, so when Warner did get a look at Paisley Park Records’ financials, it was instantly obvious what needed to be done: the company needed to be shut down. The company had been improperly run from the beginning, and there was definitely no salvaging the business now. Warner Bros. basically just wanted Paisley Park Records to go away, so they took a small cash settlement, and Prince took the physical property of Paisley Park and the publishing and master tapes of all the Paisley Park artists. Which, if you think about it, is a dick move for someone who would spend the next twenty years of his life trying to get his own masters back from Warner Bros., but whatever.
Prince instantly fired his management, and completely changed the way he conducted his business affairs for the rest of his life. He resisted any form of contract, did not like any long-term legal agreement. He never had a “management” structure that resembled anything like the rest of the entertainment industry ever again. His managers functioned mostly as highly-empowered personal assistants, but they had no decision-making powers of their own.
All these things sent his personal affairs into a tailspin for a few years, and made him a frustrating business partner. His music struggled to find the kind of market saturation it easily would have found otherwise for the next decade or so. It’s also what makes the music he will produce for the rest of his life the most interesting, forward-thinking and challenging of his career. Hopefully, it’s why you’re reading these articles. The 1980’s really just gave him the fame, notoriety, experience and financial resources to start breaking away from what he had already built without risking his career in the process. The truth is Prince didn’t really start blazing trails until 1994, the year when he lost his way.
Calhoun Square
Prince knew that he would get out from under Warner Bros. eventually, and once he did, he would never again put himself in a situation where he was completely reliant on a record label for manufacturing and distribution. So he opened a couple of retail stores so he would have somewhere to sell his music. It is a typical “Prince” kind of thing to do: absolutely convinced that he only needed his own products to keep an entire business afloat, and direct and simple in its approach to problem solving. There were two New Power Generation stores: one in the Uptown neighborhood of Minneapolis (of course) and the other in the Camden section of London.
It didn’t last long because “retail management” is not really in the skill set of a musical genius. Accounts differ, but the NPG stores closed down in less than five years, possibly less than a year. The store in Minneapolis is now a high end furniture store called “Go Home” and some of Prince’s more permanent alterations to the store still remain, so if you want to see an enormous mural of Prince on the second floor of a furniture shop, you know where to go.
In any case, I find it hard to believe Prince thought this was the way to work around the more conventional distribution model. What was the endgame here? Open an NPG boutique in every American, European and Asian City? There was another, far more practical method of getting music into people’s hands.
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