How the Zappa Chain Became a Big Noise on the Israeli Music Scene

In the space of just 11 years, the Zappa group has established itself as a major player – confounding those who said it was impossible to make money in such a challenging industry.

Ron Yitzhaki

Herzliya’s Camelot Club closed its doors in 2006. In 2009, the Barby in Kfar Sava fell. Israeli music lovers still mourn the demise of their favorite haunts, especially the Roxanne, the legendary Tel Aviv rock club that crumpled in 1994 together with its owner’s finances.

The Israeli nightclub scene seems to be a hard place to survive, what with the regular wars, economic crises, fickle tastes, changing trends and demands of regulation.

Yet there’s one success story that’s impossible to ignore: The Zappa group, currently celebrating its 11th year and dominating the entertainment scene like nobody ever did before.

Zappa runs a chain of clubs, a ticketing agency and a production company. It’s involved in more than 100 gigs and concerts a month – both at its own venues and with external productions. This year, the group is likely to reach its target of selling 700,000 tickets in a year. Industry sources estimate its annual turnover at some 150 million shekels (about $40 million).

In short, Zappa is believed to be responsible for anywhere between 10% to 20% of all music shows in Israel, to which it also supplies the food and drinks.

The group has grown so big and strong, it can execute whatever idea it chooses, says a major Israeli producer. “They have money, they’re very liquid and they have the space. When producers want to stage a concert, our biggest problem is where to do it. Zappa created places for itself around the country.”

It can decide to hold a festival of its own design, or match up a couple of singers. It’s also very efficient at sales, the producer adds.

Average occupancy at Zappa clubs is about 80%, rising to 100% in peak season – which in Israel is the winter. But the Zappa brand has long passed beyond mere rock shows – it also encompasses jazz, opera, electronic raves, plus private events, corporate shows, kiddie shows, and even lectures. It also imports talent. If an Israeli steps out of the house for any form of entertainment other than a movie, Zappa is probably involved.

“The formula is simple: Zappa understands what the public wants,” says Gil Teichman, owner of one of Israel’s biggest lighting companies. “It knows what shows they’ll want, and provides a platform that includes the technical side, logistics and food.”

Rock and a bread roll

Zappa was founded in 2004 by Yoni Feingold, who runs the roost together with brother Noam and sister Ruth Hacohen. Yoni is not a fan of the press and hoped to thwart publication of this article, though he did answer TheMarker’s questions.

Success in business didn’t come easy. He started out with the Tel Aviv club Zig Zag, and was also a co-owner of the ill-fated Camelot – which was actually two clubs, one in Tel Aviv and one in Herzliya.

What lessons did he learn from the Camelot era? He blames its problems on the second intifada that began in 2000 – if it weren’t for that, Camelot would have been another Zappa, Feingold believes. “All the fundamentals were there – the concept of serving food and drink, with the platform of music shows.”

Zappa clubs in Tel Aviv and Herzliya may feature as many as nine shows a week, with rather less in the Jerusalem club. Its slick marketing is conducted almost entirely online. The group’s website boasts 250,000 unique visitors a month, and hundreds of thousands of people receive emails about its shows.

The Zappa administration consists of dozens of people with diverse responsibilities. The company is managed by Yoni, together with Amit Segev as co-CEO. Sister Ruth handles location management and the events department; brother Noam handles relations with the artists.

Their system involves opening the club doors several hours before showtime. People come early to get good tables or seats, and meanwhile buy food and drink. “We don’t serve food during the show – and, of course, food is part of the experience we create,” says Yoni Feingold. As for reserved seats, that’s not how Zappa rolls – it’s more freewheeling, he says.

Kinder and gentler to the talent

Zappa’s winning combo is evident in its ability to earn money throughout the food chain – and not just with the food. Let’s take an Israeli who attends a rock concert in the park. The money he paid for his ticket gets shared by a vast number of entities other than the performer: The ticketing agency takes 10%; the municipality will take 10%-15% for use of the venue; the sound, lighting and stage people each take a cut; so will the show’s producer; finally, the artist gets whatever’s left. If you buy a hot dog or beer, remember that the seller is giving the producer a quarter of that exorbitant price you just paid.

If he goes to a show at a Zappa venue, though, the artist gets a share and Feingold et al apparently get the rest.

Zappa club tickets depend on the artist, but usually range from 110 to 140 shekels. However, the price may be much higher for a really popular, one-off event like a band reunion. Zappa generally charges more than the competition: for instance, a standing-only ticket to a Hadag Nahash hip-hop/funk concert will cost 25% more than at the Barby club in Tel Aviv.

Yet it’s hard to hear a bad word about Zappa. As one man who represents artists put it, “This is the most dominant company in the market, and yet it’s the most pleasant to work with and contributes the most to the Israeli music industry. It’s rare for someone that big to behave with such charm – they don’t have a drop of arrogance. All they have in mind is how to do good for the artists.”

Artists have plenty of other choices if they want – they don’t have to work with Zappa, he adds. “It isn’t that if you don’t appear there, you won’t appear anywhere. They’re just another platform. But their strength is in not being belligerent.”

The artists themselves also smile upon Zappa, where the policy is for the club to take 20-30% of each 100 shekels a customer pays for a ticket (minus tax); the artist gets the rest (from which he pays his musicians, and any lighting and sound people he brings – although the club provides these services, too).

They’re pros, says a singer who works in Zappa clubs. Israel doesn’t have that many club-goers; and what clubs there are don’t make money – which she believes is mainly because they’re founded by dilettantes who have no idea what they’re doing, let alone how to hawk tickets. They don’t know the difference between a monitor and a shoehorn, don’t know how to market tickets or even how to hang posters properly. Zappa is different: “The stage will look good and the sound will be good they’ll fulfill their obligations and you’ll get your money.”

Shouldn’t that be a given? Well, a lot don’t pay the artist properly, she says.

During the interview, Yoni Feingold downplays the importance of his role: The one in the spotlight is the artist and, he says, the company doesn’t interfere. “At the end of the day, we’re the stage for the artist,” he says modestly. “We are his partners in creating the audience experience.”