December 1, 2005
Music Exec Rocks Philanthropy World
Growing up, Richard Foos dreamed of becoming a social worker, a reflection of his bedrock belief in the Jewish concept of tikkun olam, or healing the world. As a college student at USC in the early '70s, he helped establish an organization called The Free Store, which gave residents of South Los Angeles free clothes, tableware, plates and other household items.
At the same time, Foos craved the thrill, excitement and creativity of building businesses. Around the time he opened The Free Store, the indefatigable future music mogul founded Mojo Records. Although his record delivery service went belly up in less than three months, Foos had caught the entrepreneurial bug.
In the end, the cofounder of legendary Rhino Records and Shout! Factory discovered a way to meld his business acumen with social justice. Call it commerce with a conscience.
At Rhino, Foos gave employees paid time off to perform community service, encouraged company employees to mentor disadvantaged youth and, eventually, donated 2 percent of Rhino's pretax profits to combat AIDS, homelessness and other problems. In the decade between 1991 to 2001, the company gave an estimated $2 million to various community-based charities, said Gary Stewart, former Rhino senior vice president of A &R. At upstart Shout!, which is trying to replicate Rhino's success by mostly selling overlooked, offbeat CDs and DVDs -- including TV shows "Freaks and Geeks" and "America's Funniest Home Videos" -- Foos has adopted many of the same policies that made Rhino one of the country's most socially aware companies.
"My parents were philanthropists and believed that you had to give back. I always believed that," said Foos, a 56-year-old Brentwood resident. "The '60s radicalized me and really shined a light on the problems we had. But they also made me optimistic that we could solve them."
Foos has put his money where his mouth is -- literally. He became a millionaire after Time Warner acquired all of Rhino in 1998 for a reported $60 million. In the years since, Foos has donated a substantial amount to charities that address poverty and education issues. He declined to reveal how much.
A hands-on philanthropist, Foos serves on numerous boards and does more than simply write checks. At Chrysalis, for example, which helps to train and employ the long-term unemployed, he contacted several large developers and convinced them to hire some of the clients to clean windows, sweep sidewalks and perform other maintenance work, said Adlai Wertman, the group's chief executive. For many of the formerly unemployed men and women, it was their first job in more than a decade.
"I think Richard's one of the most forward-thinking entrepreneurial philanthropists in the city," said Wertman, whose nonprofit organization has offices in Skid Row, Santa Monica and Pacoima.
Besides Chrysalis, Foos sits on the board of Rock the Classroom, which offers music programs in Los Angeles inner-city elementary schools. A passionate Jew who belongs to three synagogues, he also serves on the board of Jewish Vocational Service, a Los Angeles-based nonprofit job placement and job training organization.
As big a contribution as Foos has made in the philanthropic world, he has left an equally indelible mark in the music business. Before Rhino's existence, record companies would slap together greatest-hits packages, compilations and reissues with little regard to sound quality, marketing or historical significance. Thanks to Rhino's obsessive attention to detail, replete with extensive liner notes, remastered sound and beautiful packaging, reissues have become big business and much beloved by consumers.
"I think the best thing we did at Rhino was to help convince the industry, and more importantly fans of music, that there wasn't some line of demarcation between whatever was out and what had come before," said Stewart, who now oversees iTunes Essentials as chief music officer of Apple Computer. "At its best, we helped rediscover artists like Bobby Fuller, Love and the MC5, and we did it in ways that transcended pure archivalism and nostalgia."
Foos, a record fanatic, co-founded Rhino Records in 1973 in a Westwood storefront. He and Howard Bronson, a former student rep for Columbia Records, initially stocked the threadbare store with used records they picked up at swap meets and from the bargain bins of record stores. With no credit, little cash and no business plan, they forged ahead in the belief that chutzpah and good music would prevail in the end.
Their bet paid off. Rhino, the little store that could, won customers with its knowledgeable staff and wacky publicity-generating promotions. On Jewish Day, for instance, they handed out free corned beef sandwiches to customers and encouraged them to bargain for the best deals. One Thanksgiving, they sold "turkey" albums for 40 cents a pound.
In 1978, Rhino -- named partly in honor of "Rhinoceros," Eugene Ionescu's absurdist play that celebrates nonconformity -- reinvented itself as a record label. In the beginning, the iconoclastic company put out novelty discs by such acts as Gefilte Joe and the Fish and a street busker named Larry "Wild Man" Fisher. Rhino then began releasing reissues by Sonny and Cher, Dionne Warwick and other acts that record companies deemed so uncool that they willingly licensed their songs for a pittance.
Unlike the major labels, which often put out greatest hits, compilations and oldies albums without much care, Rhino staffers slaved over them; in the process, they rescued the reputations of many an artist, including the Turtles and the Monkees. Over time, Rhino single-handedly created the profitable and increasingly popular reissues business. Given their employees' passion and musical knowledge, Rhino succeeded in making money even when the majors began competing against them head-to-head.
From the beginning, Foos considered employees partners rather than peons. Foos and Bronson looked for fellow music fanatics who also shared their concerns for social justice. Until the company grew too large, the pair often sat in on interviews themselves. In 1996, former U.S. Secretary of Labor Robert Reich gave Rhino a coveted award for its corporate citizenship.
"We are highlighting companies that treat their workers as assets to be developed, rather than as costs to be cut," Reich said.
Foos eventually left Rhino after the corporate buyout, partly because Rhino's loosey-goosey culture got squeezed in the pursuit of the bottom line. More meetings and less fun led Foos and some of his longtime Rhino executives to eventually leave their beloved company and start Shout! Factory (Foos still retains ownership of the Rhino record store in Westwood).
When talking about the 3-year-old Shout!, Foos speaks a little quicker, as though he can't get the words out quick enough. The L.A.-based company now has 35 employees. In the cutthroat music/DVD business, it turns a profit, Foos said.
"There's kind of an archeological bent to what we do, trying to unearth all these cool TV shows and other stuff that excites us and will hopefully turn on the public," he said. "I love what I do."
Shout! is but one of the loves of Foos' life. He said he adores his 10-year-old daughter Harley ("like the motorcycle"), his wife and Judaism. The religion engages him spiritually, challenges his intellect and reinforces his views about the importance of doing good works.
Foos' love of Judaism led him this year to co-found a new record label specializing in Judaica music and Jewish artists. He hopes Jewish Music Group (JMG) can help bring Jewish music and artists into the mainstream. Among JMG's first releases is "The Debbie Friedman Anthology," a two-CD retrospective of the 30-year-career of the pioneering singer of Jewish music.
"I want to be remembered as a good guy who tried to do his best for himself, his family, his friends and the world," Foos said.