Grateful Dead Profits Are Far From Moribund


Sue Swanson was more than a fan of the Grateful Dead. She was an old friend and employee, and Jerry Garcia’s death five years ago hit her like a death in the family.

“My daughter, Rose, called me with the news,” says Swanson, who had recently lost her mother too. “I sat in my car and wept from my soul. My life rug had been pulled out from under me.”

The core of friends and staff members who made up the Grateful Dead organization felt orphaned by Garcia’s death on Aug. 9, 1995. The band officially dissolved four months later.

But five years on, the Dead’s legacy has proved healthy, not to mention lucrative, for the still close-knit supporting cast members like Sue Swanson.


They remain part of the Dead’s afterlife, active in merchandise sales, CD releases and Internet projects.

“You don’t have to be on the payroll to be part of the family,” said Swanson, but the Dead’s staff members were always their ultimate fans. The devoted following helped make the Dead one of the longest-lived and most successful touring bands of all time, playing an average of 80 concerts a year and earning millions despite the fact that they never had a No. 1 hit.

“No one ever quit the Dead. They never wanted to,” said Dennis McNally, the band’s biographer and publicist since 1984.

Swanson’s role, for example, evolved from first fan to bill and payroll handler to--after Garcia’s death--tech maven, responsible for everything from the Dead’s Web page to the health of office computers. She has helped transform Grateful Dead Productions’ merchandising department into the band’s new face.


The intense loyalty between band members and crew developed during the years of touring, when the Dead deployed a legendary sound system that could take more than 12 hours to assemble.

“Members of the crew were members of the band,” said McNally. “Some crew members had more input into decisions about things such as ‘Do we go to England or not?’ than some of the band members themselves. That may have been because said members were a bit more rowdy and outspoken.”

Executive decisions were made at board meetings attended only by band members, but the entire staff joined in at band meetings. Formalities were as scarce as crew cuts.

“Most decisions were made over a cup of coffee and a joint,” McNally said.


That management style served the band well. By 1986 they were selling out stadiums consistently, followed throughout the country by loyal fans known as Deadheads. The Dead soon became a fixture on Forbes magazine’s annual list of the 40 wealthiest entertainers, typically selling $50 million worth of tickets a year.

In the late 1960s, the band had cut weekly $25 checks to everyone living communally in their residence at 710 Ashbury, in San Francisco. When the band’s income skyrocketed, everybody benefited. The Dead was the first band to extend benefits such as profit sharing and health coverage to employees.

“We had people with what I’d call a limited education working on the crew making six-figure salaries,” says McNally, who estimates that at the height of their popularity, the Dead employed up to 60 people. Now there are about 30.

When Garcia died at 53, his health destroyed by years of heroin use, the company laid off some employees. Others went into semi-retirement. But many were absorbed into merchandising, filling orders for legions of mournful fans.


“What happens when a rock icon, any icon, dies?” said Swanson, who went back to work the day after Garcia died. “Everybody wants a T-shirt with their picture on it. It sounds mercenary, but it’s not. It’s what it was.

“The great gift for me personally was that I was so busy, I could take the grieving in pieces when I had time.”

Company headquarters is an old Coca-Cola bottling plant north of San Francisco where, to the beat of Bob Marley echoing through the warehouse, a handful of workers moves through a maze of metal shelving packed with goods.

From sports bras to bath salts, dog bowls to the ubiquitous tie-dyes, Grateful Dead Productions earned almost $15 million in merchandise sales in 1998. Much of it bears the Dead’s most recognizable emblem: a circular skull emblazoned with a lightning bolt. With music sales and concerts by various band members, McNally estimates that Dead-related items bring in about $70 million annually.


Fans have been fed a steady diet of CDs from the Dead’s vast archive of live concert recordings: 18 volumes and counting.

Tapes of virtually every Dead concert and recording are stored in the vault, which is kept at a cool 68 degrees and is rigged with oxygen-gobbling Inergen gas in case of fire. David Lemieux, one of the archivists who took over from the late Dick Latvala, picks and prepares live recordings for commercial release.

“I could listen to this music 14 hours a day. In fact, I often do,” says Lemieux, 29, who attended his first concert at 16.

Without any suggestion of exaggeration, he says he would sacrifice his life to preserve the tapes.


Grateful Dead Productions has been exploring ways to make the vault’s contents electronically accessible; with unidentified Silicon Valley heavies, it plans to start an outside company that would create a Web-based archive. Fans have always been permitted to trade concert recordings on condition that no money change hands, but the Dead plans to charge a download fee for a digital, CD-quality recording.

“We’re waiting for the technology to evolve,” McNally said.

The plan, however, has caused an uncharacteristic falling-out in the family. Bassist Phil Lesh objects to what he sees as a buyout by outsiders. In a recent letter to fans, he wrote, “I have come to the very sad conclusion that the Grateful Dead is no longer a band but a corporation whose board members no longer have a common vision.”

As for the band’s live music, it hasn’t entirely stopped.


There’s the Furthur Festival, started by band members in 1996. And beyond their various solo ventures, some perform in the Other Ones, which rehearses in a space adjacent to the vault and is planning a tour this summer.

One of the Dead’s two drummers, Bill Kreutzmann, retreated to Hawaii after Garcia’s death but showed up recently at the office and tried out spontaneously for a spot in the band.

“I needed to come back because my heart was getting funny” and emotional, Kreutzmann said during a rehearsal break.

That’s why some family members never left. “I got on the bus when I was 16,” said Swanson. “By the time Jerry died, I was a grandmother.”



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