by Billy Nilles | Sat., Jan. 19, 2019 3:00 AM
It was supposed to be the party of the century.
Billy McFarland and Ja Rule's Fyre Festival was billed as the music festival to beat all music festivals. With its gorgeous deserted island setting in the Bahamas, its high-profile line-up of talent, its promotional blitz that included the likes of Bella Hadid, Hailey Bieber, Emily Ratajkowski, Kendall Jenner and many more A-list influencers—not to mention its luxury price tag indicating that attendance was the ultimate sign of status—these two weekends in April of 2017 were meant to be FOMO-inducing days that would make Coachella look like mere child's play.
And then with one unappetizing tweet involving cold slices of cheese on some bread, Fyre Fest quickly became the schadenfreude of the century. The scam to end all scams. A cautionary tale of the power of influence in the social media age that left thousands robbed of their hard-earned dollars, stranded some in nightmarish conditions in what was essentially an undeveloped parking lot outside of a Sandals resort, and led to jail time and lawsuits galore.
But as we're learning this week with the twin releases of Hulu and Netflix's competing documentaries—Fyre Fraud and Fyre: The Greatest Party That Never Happened, respectively—there was so much more to this story than we originally knew. And all of it is stranger and more wild than any fiction.
To understand how Fyre Fest went so horribly wrong, leaving unfortunate attendees in refugee camp-like conditions upon arrival and Bahamian locals deprived of wages owed for back-breaking work in direct sunlight—and to know how it should've seemed so painfully obvious that this was the only possible outcome for this story—it's important to go back to McFarland's past.
The son of real estate developers with a preternatural obsession with making money—his first get rich quick scheme, so he claims in his interview in Fyre Fraud, came in grade school when he told a classmate he could fix her crayon for a dollar and then hacked into his classroom's handheld computers, placing an advertisement for his services where all the children would see it—McFarland claims founded his first company at 13 before dropping out of Bucknell University in his freshman year to launch a content-sharing site called Spling. Shortly thereafter, he launched a new venture, a "black card" service for NYC wannabes called Magnesis—"Latin for absolutely nothing," McFarland quipped to the New York Post in 2014—that would give members access to perks across the city, including access to the members-only townhouse in the West Village, while duplicating the member's pre-existing debit or credit card's magnetic strip on a sleek matte black stainless steel card, for the annual fee of $250.
By 2017, the company had expanded to Washington, D.C. and San Francisco and had nearly 40,000 members, had 25 employees and, according to McFarland's claims, had raised $3.1 million in venture capital, including investments from the late Aubrey McClendon, co-founder of Chesapeake Energy, who was indicted by a federal grand jury on charges of conspiring "to rig bids for the purchase of oil and natural gas leases" in March of 2016 and died the following day in a single-vehicle collision.
But by 2017, the company had already moved away from its black cards in favor of a digital app that focused on getting its members tickets to the hottest events in town. Luring members with the promise of access to things like Hamilton performances and Jay Z and Beyonce concerts, Magnesis began failing to live up to its end of the bargain, with members complaining that specifics relating to their purchases would be held from them until, they were told, the day of the event, before their purchases were simply canceled outright just days prior.
According to one former employee who appears in Fyre Fraud, McFarland would allegedly list these tickets for sale before ever having any in hand, going out and purchasing them the day of, using funds raised from sales for a future event, with the implication being that each new batch of tickets for sale were offered simply so the entrepreneur could fulfill the orders for the event that was quickly coming up.
Despite the growing concern that McFarland's ability to follow through was clearly outmatched by his enticing promises, he continued to garner attention. Enter: Ja Rule.
When Ja, real name Jeffrey Atkins, met McFarland, he was a rapper whose popularity had waned precipitously and had just been released from prison for a two-year sentence for gun possession and tax evasion. In 2015, he joined Magnesis in what was purely a figurehead position, as the former employee admits in the Hulu doc.
Despite Ja's arrival, McClendon's death began a period of trouble for Magnesis—until, that is, Carola Jain, wife of hedge fund manager Bobby Jain entered the picture and became Billy's new core investor. Quickly, Billy and Ja had a new venture, Fyre Media, a talent booking service intended to help people rent out celebrities to appear at their events. And the festival? It was originally intended to work as promo for this app.
"After working on the app for three to five months, we started to think about ways to promote it," MDavid Low, Fyre's creative director, said in the Netflix doc. "In a meeting, I had actually mentioned, 'Why don't we throw a festival, like a concert, for industry professionals?' That idea Billy kinda hooked onto and then it morphed pretty dramatically outside of any input from me or Ja into what became the Fyre Festival."
And thus, Fyre Festival was born. With dates in April in mind, McFarland, Ja, and Grant H. Margolin, the company's Chief Marketing Officer who entered McFarland's orbit back in the Magnesis days as a client with a lot of ideas for how to improve the company, set out to mount a music festival with only about five months time on Norman's Cay, an island in the Bahamas with little to no infrastructure for such an event.
"They would've had to create all the infrastructure," Bahamian reporter Ava Turnquest noted in Fyre Fraud. "We're looking at a year of planning and construction."
But first, a commercial had to be filmed. Jerry Media, the social media branding and content production with a network of in-house influencers born out of Elliot Tebele's popular Instagram account @f--kjerry, was hired and cinematographer Michael Swaigen was commissioned to film a shoot on the island. "What they told us was this client was pretty much here to party, so we needed to keep it professional and get the commercial out of the shoot, even if things around us were chaotic," he said in Fyre Fraud. ""It was one of the more ridiculous, ambitious creative treatments that I'd seen. Included on it was getting the models swimming with sharks in open water, that M.I.A. music video on the runway with all the cars riding sideways; we wanted to do something like that with golf carts on an airplane runway. Pretty quickly, it became clear that it was unfeasible."
And yet, the shoot happened, involving models like Bieber and Chanel Iman. The spot was edited on the island and a plan was hatched for scores of influencers to post an orange tile on their Instagram feeds all at the same time, all linking to the video that presented what The New Yorker writer Jia Tolentino called in Fyre Fraud "perfectly generic fantasia of what an Instagram come to life would be."
"It was nothing but backdrop with montage-friendly bliss," she added.
And it worked.
"Within 48 hours, they sold 95 percent of their tickets," Jerry Media CEO Mick Purzycki claimed in the (Jerry Media-produced) Netflix doc. "I think people thought that this was one of the new hot things that was starting to take over the American and global market."
And then things became real.
"People would message me things like, ‘I quit my job because my boss wouldn't give me time off.' ‘I sold everything I own.' Just listing these crazy actions that they took just to go to this fantasy island festival," former Jerry Media employee Oren Aks noted in Fyre Fraud. "But there was nothing built."
Suddenly, McFarland realized that, with just four months to go, they had to actually get to work. "Billy started panicking," Delroy Jackson, McFarland's local fixer in the Bahamas, claimed in the Hulu doc. "He said, ‘Listen, people are actually buying into it. So we have to have a festival.'"
First, they had to find a new island. It seemed that, despite claims that he'd forked over $10 million to own Norman's Cay, the true owner of the island was not pleased with the boast in the promo that it was once Pablo Escobar's island—a connotation they were explicitly forbidden from making because of the obvious unsavory reputation that comes along with the famed drug kingpin and, you know, murderer—and kicked them off the island forever.
"Six or eight weeks out, he had to find a new location on a neighboring island and then start the process all over again," event producer Andy King explained in Fyre. And all those luxe accommodations that had already been sold, the luxury tents and villas? They didn't exist on Grand Exuma, the new site.
"The site was on a hill and at the base, what I saw was pretty much a housing development construction site that was hazardous in many ways," Luca Sabatini, who was involved in the stage and technical production and only contacted 45 days out from the event, explained. "And that needed a lot of work."
While haphazard planning was taking place on the island, folks elsewhere were beginning to wonder exactly what was going with this festival. There was no update on what the site looked like (because there wasn't one yet), with Jerry Media continuing to post the same imagery involved with the promo shoot. If questions were asked, or criticisms lobbed, on social media, they were deleted. "The decision was to screenshot all of the legitimate question and forward that over to the Fyre team and then delete all of the negative comments that were degrading the brand," Purzycki explained in Fyre.
Soon, a Twitter account called FyreFestivalFraud, run by NYC venture capitalist Calvin Wells, popped up after Wells, familiar with McFarland's Magnesis schemes, began looking into the validity of the promotional materials. After reaching out to agents of some of the bands listed on the line-up—Blink-182, Disclosure, Major Lazer, among others—and learning that no one had been paid yet, he took a "more active role in investigating everything," he said in Fyre. "What I realized is that they had rented an area effectively north of Sandals resort and then what they had done is Photoshopped out the bottom portion of the map to make it look like they were on a deserted island," he added. "I thought the world's gotta know what's going on."
When the Twitter account failed to make much impact, he tipped off Comcast Ventures that their $90,000,000 valuation of Fyre Media might not be entirely truthful and warned them not to invest until after the festival. And then McFarland's hustle for new investors began. But first, a major purchase was made.
"And then they order two million dollars worth of booze," Jackson said. "Who the f—k orders two million dollars worth of booze, though? You know the duty on liquor in the Bahamas? 45 percent of two million." They now owed $900k in taxes.
After taking out a loan from an individual named Ezra Birnbaum for $3 million, with a maximum interest rate of 120 percent and a payment of $500,000 needed within 16 days, McFarland turned to the people who'd already spent thousands of dollars on their festival tickets to essentially bail him out. Attendees began receiving emails explaining that the festival was cashless and they would only be able to make purchases utilizing a wristband onto which they would need to pre-load funds, recommending they fork over thousands for all the experiences they certainly wouldn't want to miss out on. And when those emails went unheeded, aggressive phone calls began.
"The urgency wasn't ‘Let's make this a cashless experience for our festival attendees.' It was ‘We can't put on the festival because we don't have any money,'" former Fyre product designer Shiyuan Deng claimed in Fyre.
"It was a staggering amount of money. The first batch of kids had loaded $800,000 on these wristbands," King added.
As it became increasingly clear that there were no funds to pay for all the charges that had incurred, McFarland began committing actual criminal acts, promising vendors wire transfers, only to send screenshots of a confirmation page with the tracking number cut off, never actually wiring the money. With nothing really built and the day of arrivals getting closer and closer, McFarland was repeatedly told he should cancel the event, that the press would be worse if he simply went through with what was sure to be a disaster. The only problem? Cancellation wasn't an option because all investors had been told that in the event of such a thing, their investments would still be recouped. And yet, there was no insurance policy on the event for McFarland to turn to. He had no choice but to soldier on.
And then the inevitable happened. After a night of monsoon-like rain the night before that undid nearly all of the work that had been accomplished and Blink-182 became the first act to pull out of the festival, the first round of attendees began to arrive. Some were shuttled to an off-site location, the Exuma Point Restaurant (which only had 25 minutes to prepare for them), where they were held for six hours, getting quite drunk. "Quite frankly, it was probably the best part of the entire experience," Purzycki, who'd only just arrived himself, said. The later arrivals were taken directly to the site, where they discovered that they'd been truly duped. The gravel pits had been filled in with sand, there was no direct access to a beach, no food, no water, no electricity, and the luxury tents were, in actuality, leftover disaster relief tents from Hurricane Matthew—and there weren't nearly enough of them. But there was plenty of booze, stacked in pallets next to kiosks marked "Bar."
Despite attempts to check everyone in in an organized fashion, McFarland then made the decision to jump on a table and tell the crowd that, if they had a villa reservation, they should go get a tent. Which they did. All at once. Utter pandemonium broke out and, by nightfall, it became a sort of looting situation involving some very drunk people who'd been promised something else entirely.
By the time the world saw the infamous "cheese and bread" tweet, the media was all over the debacle and the remaining acts on the line-up were canceled by Fyre Media employee Samuel Krost, who'd been responsible for booking them. The local Bahamians were livid, now demanding their payment and coming to collect. Meanwhile, the unlucky attendees were just trying to get the heck out of dodge. As for McFarland, "Billy's nowhere to be seen," music festival consultant Marc Weinstein noted. The official response, drafted by Margolin, said the event had been canceled due to circumstances that were "out of our control." Ja would shoot off a tweet saying the event "was NOT A SCAM...[and] is NOT MY FAULT."
Before the weekend was even over, McFarland, Ja, and the rest of Fyre Media were hit with multiple lawsuits and yet, according to footage of a conference call between the men and their employees held that very Monday, they were still under the impression that they could spin their way out of the mess they had made, pointing to Samsung and their exploding Galaxy phones as an example of a company weathering a storm.
When one employee asks if what they'd done with the festival was, in fact, fraud, Ja replied, "That's not fraud. I'd call that false advertising."
Cut to two weeks later and McFarland has invited Swaigen to his penthouse to pitch a recovery documentary. "He was living in this posh clean penthouse, removed from it all by many layers of glass. And he wanted to get to the Bahamas to try and recoup money for investors," the filmmaker said. On the alleged bullet list of things to do? Rob customs to get their seized merch back. "As we're on our way to land, the entire government switches over and comes out with a statement pretty much barring Billy and the Fyre Festival for the rest of eternity."
Around this time, the FBI began sniffing around, speaking to employees of Fyre Media who'd been told that there would be no more official employment or payroll, but that he wasn't laying anyone off, effectively ensuring that he wouldn't have to pay any unemployment benefits. (Unemployment is only available if you've been laid off, not if you "voluntarily" quit.) And on June 30, 2017, he's arrested and charged with wire fraud, pleading guilty to two counts and admitting to using fake documents to attract investors in March of 2018.
And you'd think that's where this strange saga came to an end, right? Not quite.
As revealed in Fyre, while out on bail, McFarland got back to work. He invited videographer Kindo to begin documenting his life in his penthouse. "We talked about my experiences in the legal system and I'll never forget what he said to me," Kindo said. "He looked me dead in the face and said, ‘I'm not going to jail.' It was like this man either knows something I don't or he's certifiably insane." In the room with them in some of the footage is "a guy named Angelo," who would turn out to be Angelo Roefaro, the press secretary for Sen. Chuck Schumer.
At the same time, folks who'd "attended" Fyre Festival all began noticing solicitous emails from a man named Frank Tribble Jr. Tribble was writing on behalf of NYC VIP Access, offering tickets to for sale to exclusive events like the 2018 Masters, the Victoria's Secret Fashion Show, the Met Gala, and the Grammys—all events that do not offer tickets for sale to the general public. And right there in Kindo's footage? You guessed it. Tribble.
"The first time I met Frank Tribble was at the hotel," Kindo said. "I had never seen him before…The strangest thing was he actually had on a Magnesis hat…a Fyre sweater."
McFarland had recruited Tribble to be the face of the new company, while—and this was all caught on camera—he'd write the scripts for the emails and the phone calls. And according to the FBI, 15 people had given them over $100k for the tickets. "It's hard for me to say if these guys didn't know what was going on, but I also know that Billy's really good at keeping a level of information below and above," Kindo said.
After a VICE (who also produced Fyre) story documenting McFarland's new scheme was published, he was re-arrested on June 12 and faced an addition of a third count of wire fraud and one of money laundering.
"William McFarland, already awaiting sentencing for a prior fraud scheme, allegedly continued to conduct criminal business as usual," United States Attorney Geoffrey Berman said in a statement at the time, according to the New York Times. And on October 11, 2018, he was officially sentenced to six years in federal prison, agreeing to a lifetime ban on serving as a corporate officer or director and forfeiting $26,191,306.28.
In the fallout, the Bahamian workers remain unpaid, with Exuma Point Restaurant owner Maryann Rolle out $50,000 of her own savings to pay her employees. Low, who has re-teamed with Ja, who is still named in as a defendant in many lawsuits, on ICONN—an attempt to re-brand the Fyre app, is being sued by American Express for $250k thanks to charges he says McFarland told him would be reimbursed. And Margolin, who did not admit or deny any of the SEC's charges, agreed to a seven-year director-and-officer bar similar to McFarland's and a $35,000 penalty.
Among the many famous faces who'd been enlisted to promote the event on their Instagram accounts, several have since deleted their posts, which, in turn, became fuel for the Federal Trade Commission to crack down on disguised sponsored content. (Among all the people involved, Ratajkowski was reportedly the only one to use the hashtag #ad.) And Hadid was the only one who acknowledged and apologized for her role in promoting the event, tweeting, ""I feel so sorry and badly because this is something I couldn't stand by, although of course if I would have known about the outcome, you would have all known too."
"I think it's really easy to play Monday morning quarterback for myself, looking back, saying, 'I should've done this, I should've done that.' And I certainly made a lot of mistakes, there's no question about that. But before we had the worst luck, I think we had the best luck," McFarland said at the top of Fyre Fraud. "It sounds crazy, but so many things had to go right to make it this big of a failure. Everybody fully believed that we were going to put on an event that was going to change the landscape and deliver an experience people would talk about for years."
Ironically, he was absolutely right.
Fyre Fraud is now available to stream on Hulu, while Fyre: The Greatest Party That Never Happened is waiting for you on Netflix.
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