January 18, 2011
Radio is more than a career for Michael Carter; it's essentially in his family's DNA. He basically inherited heritage Urban KPRS/Kansas City from his grandfather -- but not until he earned the right to run it. As owner of a mom & pop station, Carter has had to keep KPRS up and running through the consolidation craze, the economic downfall and the tumultuous transition to the PPM. Here's how he has achieved success with the family business.
How did you become owner of KPRS?
My grandfather owned it and I started working there early on. But I had to spend time at McDonald's to understand the value of working in the family business. Although KPRS is in Kansas City, he had to move to Florida for health reasons, so I moved down there with him, although I still "worked" for the station.
I was 17; I had everything going on ...driving a '73 Dodge ... with my own American Express card ... I lived on the beach ... I had juice ... I could do whatever I wanted to So one day, out of blue, my grandfather called me into his office and said, "Here's the deal ... give me your keys." I go, "Keys to what?" He said, "The radio station ... you're fired."
I went, "Oh my God!" I didn't know what to do; I was crushed. So I got a job at a nearby McDonald's, which in Cocoa Beach, FL, was a hard gig to get. I could surf in the morning, when the surf was the best, then work the rest of the day.
Every now and then my grandfather would show up at the McDonalds and get something to eat and watch me work. I don't know why he even ate there; he was a great cook. So I would mop the floor over to where he was and say hello, but he didn't pay much attention to me. This went on for about two years ... through the Thanksgivings and Christmases, all the holidays ... we also saw each other at family gatherings, but he never talked about putting me back into the radio business.
Then one day out of the blue, my grandfather called me and asked, "Do you get it now?" I said, "Yes, sir," and he said, "Well, if you ever act like you used to, you'll never work for my business, I promise you that." So he hired me and put me under Skip Finley, who told my grandfather that he could straighten me out ... I was still a punk ... he'd beat me down so hard to make me work. And that's what happened; he basically saved my radio life.
My grandfather told my grandmother to name a new President. I was sure it was going to be Skip, which I thought would be great, but they chose me. I almost fell down. My grandmother came out and said, "Michael Carter, your grandfather said you'd understand what this means," as she handed me the keys to the station.
So you had ownership during the early days of deregulation; I would imagine there were parties who wanted to buy the station.
They tried to buy us ... and those multiples were huge - 26, 28 times cash flow - and a lot of guys backed out and sold, but most of those guys had already put in so much time and effort ... their kids were already grown... so when someone offered them 28 times cash flow, it made sense for some of them to sell while the getting was good. But my grandparents were not interested!
Why did you decide to keep KPRS in the family?
My grandfather died on January 1st, 1989. He told me to make sure my grandmother was okay, so I took care of her. Now if anybody knew my grandmother, she was one bad-ass woman ... and she wanted to keep the station in family hands. It was something that kept her going until the day she died on January 1st, '03 ... you know, KPRS FM 103.3!
I'll never forget that! Those two people worked hard and did without so one day their grandkids could have something to call their own and be their own boss ... well, guess what -- that's why we keep it in the family!
KPRS is one of the few heritage Urban stations in the country. How do you balance your use of heritage vs. staying fresh?
That is something we're concerned about. From my perspective as the owner, you have to be willing to listen to others. If you think you have the answer to everything, you're going to find out how stupid you really are. I'm seeing things today I never even thought about a few years ago. Look at the digital side of things. Hell, I just am now learning how to make a call on my smartphone! If you don't stay on the cutting edge of technology, you ain't got a chance! So this Old Dog has to learn tricks!
How has KPRS handled the transition to PPM?
You know what, we've been very fortunate. Unlike stations in Philadelphia or New York City, which had to switch over very early in the game, we were able to look at how they did things and learn what we can do ... and just as important, what not to do. We just learned to not make any rash moves that cost us ratings and make the right moves to gain them ... if possible!
There have been Urban stations that were the #1 radio station in the market for years under the diary and suddenly, using a new ratings system that values cume more than TSL, they drop from #1 to #10 without doing anything different. They're behind Rock stations that have more cume, while the Urbans are killing them in TSL! If you're that Urban station, which went from first to last ... what do you say to your advertisers? I lost money on McDonalds last year because of that situation.
What's more, in our market we have no black buyers, so what am I supposed to do? We have to man up and go out there and tell advertisers directly -- not through an agency buyer -- that we know how to deliver. We always have to find new ways to skin the cat.
One thing is certain: I am not going to let anybody tell me that my radio station is not valuable. We've been in the broadcasting business for 60 years - and we're not here because we're some punks. We can deliver audience ... and at the end of the day, it's the value of the station that counts and THAT'S what we have to drive home!
With all that you're up against, are you confident about your prospects for 2011?
I'm very confident that business is going to get better, because if you don't have the guts to take it to the hoop, you need to sit your ass down on the bench. That's it. I'm not going to sit here, complain and make excuses. You need to step up and get real. You need to be creative and think about it. You need to re-think your strategy.
There's so much money out there in digital; make it work for you. Make sure you have the right people in place to make it happen, who understand how it can work.
The other thing is to get your ass out on the street and talk to people. Here it is, 7:30p on a Friday night before Martin Luther King Day ... and I'm out here, working. I'm not giving up. You deserve to lose if you expect people to do everything for you.
So what's in your future? Could you see yourself buying some more stations?
I would love to have a few more stations, but the deal is the banks aren't not going to loan me any money; besides, why get into debt in the current state of the economy? We worked hard to get out of debt! Now if the banks would work with me, that's one thing, but I'm not going to put myself in a situation where I'm taking on risk just so I can have a bigger ego and be broke doing so!
It sounds like you'd like to keep KPRS in the family. True?
Let me tell you something: The only reason I'm doing what I'm doing is because I hope my kids truthfully want to do this. That's what my grandparents did for me. When my grandfather died, Ragan Henry -- God rest his soul -- came and offered my grandma money for the station ... and she said, "Hell, no ... because I got this crazy grandson of mine who thinks he might want to be a radio station owner."
I have four kids -- 27, 10, nine and very adult six-year-old (who reminds me of her grandmother), And like my grandparents did for me, I want the same for them! But it's got to be here first, soooo ... got to go sell something!
It's not just about the money or prestige or how many stations we own; it's about family pride! And believe me when I tell ya ... I'm damn proud of my family!