Artist management agency, Jed Root Inc., is ceasing operations, WWD has learned.
The company, which has offices in New York, Paris and Los Angeles, will shut down Saturday. The news was confirmed by Jed Root’s Swiss parent company RPRT AG.
RPRT chief executive officer Oliver Fietcher offered: “The legacies of Jed Root were too big and heavy. At the time of the acquisition, we bought a company based on profitable numbers. But after a review of an expert from the U.K., we recognized that Jed Root had — at the time of the transaction — an accumulated loss of [more than] $6.5 million. We did several cash injections to stabilize the business, unfortunately, without success. The Jed Root companies owe RPRT $3.6 million in loans and [more than] $4.5 million in management fees. The group liquidity of Jed Root based on our daily cash book is USD 90,000, therefore, I have to freeze the operative business by tomorrow and try to protect the debtors of all local subsidiaries of the Jed Root Group.”
Sources at Jed Root contested Fietcher’s assertion that the company had accumulated a loss, offering that, even if it had, it should have still been able to persist without halting operations. Nonetheless, the company began to unravel after RPRT acquired the agency from founder Jed Root in June 2015.
Since then, the company has been unable to pay invoices to artists and vendors, racking up millions in unpaid bills, insiders said. In order to help manage the business and look for growth opportunities, RPRT brought back Root in 2016 in an unofficial capacity.
Sources told WWD that Root claims he had not been paid following the sale of his company, but he was given a monthly salary to come onboard. Root did not respond to calls for comment.
Payments aside, the agency’s decline took a very real turn on Friday morning.
According to sources with knowledge of the situation, the firm’s New York staff was in the process of moving out of its Chelsea offices to its smaller work space near Union Square when Root was notified to let go of all employees, including himself. The news came after the move was completed. The office had been whittled down from 30 to about 10 in recent months. And it wasn’t just office workers who had been fleeing the company — artists, too, have been leaving after not receiving payment for their work.
Artists who spoke to WWD on the condition of anonymity said they were considering legal action; some were owed hundreds of thousands of dollars, with two photographers owed as much as $800,000 a piece, sources said.
Earlier this week, the London office notified talent that the parent company RPRT locked them out of their bank accounts.
“They are allegedly sending credit notices to my clients and then sending me my invoices so I can invoice directly,” an artist said.
According to a source with knowledge of payroll, clients’ payments had been routed to RPRT, which is supposed to disperse the funds to the offices, but the parent company had been holding on to that cash.
It wasn’t too long ago that Jed Root was once one of the most high-profile talent agencies, home to top photographers, hair and makeup artists, stylists, illustrators and set designers, who are responsible for the imagery in GQ, Paris Match, Elle, CR, Porter and various editions of Vogue, among others.
Although it’s unclear what will happen next with RPRT and Jed Root, insiders tell WWD that Root plans to open a smaller agency — one that he controls — in hopes of building up his brand again.