Enter the Realm of Creativity

First rule: Call it a studio, not an office. Or even better, call it a University of Creativity. And, whatever you do, remember that Cirque du Soleil isn’t a circus. It’s a global entertainment company whose shows prompt even the jaded New York Times to write glowing reviews such as “stylish, technically dazzling entertainment…jaw-dropping visual grandeur.”

“I was recently in New York,” says Daniel Lamarre, Cirque’s President and COO, “and I overheard a man trying to convince another that he should visit our facility in Montreal. He actually did a great job of describing us – he said we were an international creative laboratory. I don’t want to sound arrogant, but I can see our studio becoming to creative people what the Harvard Business School is to businesspeople. The best of the best will want to visit us and have access to our unique network of creators and producers.”

Arrogant? Possibly, but also accurate. In less than twenty-five years, Cirque du Soleil has become one of the most recognizable brands on the planet with annual revenues of $600 million. And its rapid rise is even more amazing when you consider the company’s humble beginnings. Many companies get off to a shaky start, but the Cirque du Soleil literally began on a pair of stilts.

In the beginning

In the early 80s, Cirque du Soleil founder Guy Laliberte was a street performer in a small theater troupe near Quebec City. Life on the street gave Laliberte the ideal skills for a future CEO – he could simultaneously juggle, breathe fire, and balance on stilts. But he dreamed of expanding beyond the provinces and touring the world with his troupe.

Laliberte got his chance in 1984 when he was commissioned to create a show for the 450th anniversary of Canada’s discovery by Jacques Cartier. Perhaps it doesn’t sound like the most promising theme in theatrical history, but Laliberte jumped at the opportunity. He called his show Cirque du Soleil, or Circus of the Sun, and it featured not just tricks and acrobatics, but music, dance, and costuming – a total sensory submersion that had never before been seen in the world of the circus.

It was the genesis of the Cirque vision that continues today. Going to the Cirque du Soleil is not like seeing a show as much as it is like having a dream. Certainly the acts require a high degree of athleticism from its troupe – in fact, Cirque employs some of the most skilled athletes working today, including former Olympians – but the athleticism is combined with theatrical flair and high production values. The result is an experience that moves beyond entertainment and into the realm of art.

In the early days, Laliberte was the creative and financial decision maker. For example, when the money started coming in following the original 1984 tour of Quebec, he was advised to put profits back into the show. Laliberte demurred and started a second troupe, and then a third. Cirque du Soleil still puts as much as 70 percent of profits into developing new shows. Daniel Lamarre, who now oversees day-to-day operations, says, “We have to take risks because that’s how we began and who we still are. We built our brand on creativity, and we’ll never get too far away from that.” 

A marriage of cultures

About 3,000 people work for Cirque du Soleil and 900 of them are artists. A truly international operation, the Cirque troupe is composed of people from 42 countries who speak more than 25 languages. On any given day, a Cirque show is touring on five continents. “Right from the beginning we were a marriage of cultures,” says Lamarre. “Even when the troupe was much smaller, the members came from all over the world, and their input resulted in music, dance, and costuming from all their own cultures. Walking through our home office is like walking through the UN building. When people ask me how we became an international company I say, ‘But we always were.’”

Cirque du Soleil has been a well-recognized brand since it began establishing highly successful resident shows in Las Vegas and Walt Disney World in the 90s. But a recent study helped Lamarre refine his vision of exactly how the public sees Cirque. “We are known for our artistic approach, our uniqueness, the strength of our music,” he says, “but mostly as people who will always push the boundaries of creativity. Our clients say they walk away from our shows inspired.”

Merchandising in the form of CDs, tapes, t-shirts, and show memorabilia generates about 15 percent of total revenue. Recently the company has made inroads into new business ventures such as a partnership with Celebrity Cruises, and there are rumblings about further expansions into hotels, restaurants, and spas. But Lamarre believes merchandising and partnerships will continue to account for only a fraction of Cirque’s total revenues. The real money, and thus the real future, is in developing new shows.

Sales growth

Fifty million people have seen a Cirque du Soleil show, with 8 million attending one in 2006. Ticket prices range from $60 to $150 a seat, and 70 percent of their audience is repeat business. Customers tend to get hooked on Cirque, so constantly developing new shows for their loyal fan base, even at an average start-up cost of $165 million, is a smart bet. At present Cirque has 13 shows; seven of them are constantly touring among 100 cities, while the other six are resident, or nontraveling, shows. (Five of the nontraveling shows are in Las Vegas, surely the planetary epicenter for over-the-top entertainment.)

Each of the shows tells a different story from the martial-arts-themed KA and risqué Zumanity to the family-friendly La Nouba at Walt Disney World. Cirque du Soleil shows are often featured on the Bravo Channel and have three times won Emmys. Lamarre believes musically based shows will be the true wave of the future; Cirque’s most recent offering was Love, a show based on the music of the Beatles, and the company is currently negotiating with the estate of Elvis Presley.

At the time Cirque du Soleil debuted, they had a distinct sales advantage: There was literally nothing else like them on the market. Now there are a flood of imitators, and even the venerable old Ringling Brothers circus is adding Cirque-like acts. The competitors don’t bother Lamarre. “You can’t look at who’s following you, you must just keep innovating,” he says. “We went from doing O, which was our water-based show and which was treated like the end of the world, and then pushed the envelope further with Zumanity. It took us five years to convince people that the music of the Beatles should be a show and to get the rights to the songs. At Cirque we love to start with something that looks impossible and then make it happen. It’s in our veins.” •