Fyre Fest - Grade: B+ PDF

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Fyre Fest

By: Christian Colonna, Ladan Alkhiliwi, Ryan Zoobalan, Julian Font, Yasmeen Shaaban. Abstract

The purpose of this paper is to analyze a popular controversy that happened to an organization and break down the various events that took place before and after the situation. The ethical dilemma chosen by our group was Fyre Festival, where founder Billy McFarland committed fraud against thousands of stakeholders who were invested in his idea at a high end music festival. We will break down what exactly happened, the way the organization handled the situation, the stakeholders who were directly impacted by the fraud, the type of culture the organization had, how the organization can bounce back from this, and last but not least our own position on the subject.

Fyre Fest What Happened? In 2017, Billy McFarland and Ja Rule set their sights on creating Fyre, a new app that would all you to book talent acts easier. The two thought the best way to promote their new app would be to throw a music festival in the Bahamas that was unlike any other festival. The company promised to have the best food, art, and music in the industry. Fyre targeted a wealthier demographic who were willing to pay top dollar to spend a weekend on a private island in the Bahamas with celebrities and social media influencers all around them. Fyre originally started marketing the festival with videos of multiple celebrities and social media influencers partying on Pablo Escobar’s private island in the Bahamas, which is where Billy and Ja Rule originally planned to host the event. The original promotion videos of Fyre showed these celebrities and influencers partying, spending days of boats, and jet skiing. These were all amenities Fyre was hoping to sell as packages when tickets came out. Their demise became public the first day the festival was supposed to happen and as people arrived they saw the horrible truth of what has been happening on the Fyre festival site.

Eric Levenson and Deborah Bloom wrote in a CNN article, “Those who shelled out up to $12,780 for the luxury weekend in the Exumas, in the Bahamas, found themselves Thursday treated to mass disorganization, half-built tents, and catered food that was little more than limp cheese sandwiches” (Bloom and Levenson, 2017). Since the festival wasn’t ready by the time people started landing in the Bahamas, Fyre executives insisted that they be taken to a beach restaurant to start their party as they frantically looked for ways to send their guests back on flights that they didn’t have scheduled. As that day went on guests were bussed to the location of the festival to find nothing but hurricane relief tents, mattresses scattered, and a Fyre team that were ill prepared for anything. Billy’s first idea was to start checking in guests and act as if everything was normal, he told his DJ to hook up his speakers and start playing music and told some workers to start passing out alcohol to keep guests entertained. As nightfall came people started to come to the realization that they weren’t going to be able to leave the festival that day and it became a survival of the fittest situation where groups started to run and grab tents and mattresses; the food that was on location were just pieces of bread with cheese and lettuce in between them. Many people went into panic mode and as they were rushing to grab supplies many people were injured. Most people when they think of Fyre Fest today think of the people who paid tens of thousands of dollars and arrived to a festival that was in shambles. Fyre Fest did many unethical things up to the day of the festival. Billy McFarland gained the trust of everyone around him, but most importantly his investors trusted him. Since he was the CEO of Fyre his main concern was making sure there was enough funding for the event. He acted unethically and did illegal things like telling his investors they were making more many than they actually were to make sure they are happy and to keep investing. On top of lying to investors he made sure that his team around

him were on board and when one employee raised questions to him, Billy threatened to replace him if he told investors what was actually happening with their money. His way of schmoozing investors and threatening any employees who crossed him were a reason why he got away with it for so long. Along with Billy’s shady way of treated his investors, what he did to the locals in the Bahamas who worked day and night to try and get the festival ready is astonishing. Michael Baggs writes for BBC News saying, “Fyre Festival wasn't just a miserable experience for the people who paid to party, it also had a major impact on the local people of the island who helped organizers build the festival” (Baggs, 2019). Everyone on the island knew or worked for Fyre and many people who worked for Fyre left their other jobs to help prepare for the festival that never happened. At the wake of the chaos on the first day it became clear that the festival wasn’t going to happen and many locals weren’t paid for their work they did. They decided to rush to the house where Fyre executives were staying at and demand for their money, but did not receive their payment. When Fyre executives left they started to not answer their phones or reply to people who worked so closely with them in the Bahamas. When they asked Billy where the money was to pay their workers he continued to lie to them and say he’ll get them their money, but he never did. What role did the organization’s culture and leadership play in the controversy?

What was the impact on the various stakeholders? (christian) There were various stakeholders that were involved in the aftermath of the FYRE festival. These stakeholders include customers, employees, investors, suppliers, promoters, and communities. They all equally had very terrible experiences and lost a lot of money, yet some

lost much more than others. Stakeholders including those who promoted the Fyre Festival on Instagram to their millions of fans as well as Billy McFarland himself, the founder of Fyre, were impacted negatively by the trust of the public. Additionally, both have dealt with lawsuits as a result of their position with Fyre. Customers were directly affected by the result, or lack of result, of the Fyre Festival. Ticket prices “started at $1,500 for the most basic level covering flights from Miami to the Fyre Cay 'island', tickets, meals and hospitality,” and ticket prices ranged from $1,500 to $25,000 for the most expensive package. (Blair, 2019) Fyre founder Billy McFarland “was sentenced to $26 million in restitution” to pay back the customers for the money lost from tickets. (Beck, 2019) These customers had to deal with being stranded on an island with a minor supply of necessities such as shelter, water, and food. They had the worst physical impact of the whole Fyre Festival experience. Next is the employees. They were certainly affected by the drama as Fyre, and were the direct ones to blame for Billy’s actions. Many of the Fyre employees were warning Billy that this festival was just not possible, but he refused to listen and continued to take investments from investors. Most employees knew it was a bad idea and had to deal with the aftermath of Billy’s decision making. It needs to be known that “McFarland didn’t just scam the Fyre Festival participants; he allegedly defrauded investors and employees out of millions of dollars, too.” (Blickley, 2019) The employees believed in Billy and what he was trying to do until they realized it just could not be done anymore. Some employees were not being paid by McFarland while he was out in the Bahamas working on the festival. Additionally, the ones that were getting had experienced their checks bouncing. Billy kept telling the employees that they would be paid soon, but ultimately never were. The employees of Fyre were not the only employees that were working the festival for Billy. Billy had hired staff to work the event, including local suppliers

from the community in which the event was being held. One staff worker, “Maryann Rolle said her team worked round the clock preparing 1,000 meals a day for festival staff but went unpaid when it imploded in April 2017.” (Halliday, 2019) These staff members went viral when the Netflix and Hulu documentaries released in early 2019, creating awareness to those watching. A GoFundMe was started to pay Rolle for her losses from the event, amassing to almost $80,000 in donations. The last, and possibly most impacted group of stakeholders from the fraud of Fyre, were the investors. These investors personally trusted Billy and believed he was a bright young man. Billy had “induced over 100 investors to invest more than $27.4 million” into the Fyre Festival, giving them investment pitches that were as overly exaggerated as you can possibly think. (Price, 2019) These investors were simply lied to by Billy, and “McFarland was ordered to pay $26 million to investors in the festival.” (Arcand, 2019) Altogether, Billy McFarland had a severe negative impact on thousands of people, including customers, employees, staff and investors. How did the organization respond? Which moral philosophy most closely aligns to the organization’s response? Considering Fyre Festival was being promoted on a variety of different social media platforms by some of the most popular influencers across the internet, it was only a matter of time before the organization responded to the matter at hand. As Fyre began to receive backlash from their unsatisfied customers, reliable news sources, and the general public, the two executives who put together the event issued a statement the Friday following the eruption of the scandal.

Our position on Fyre Fest:

What is your team’s position—do you agree or disagree with how the situation was handled? Which moral philosophy does your team think should have been used in the decision-making process? Provide at least three reasons why the reader should accept your team’s position. Conversely, provide three reasons why the reader should reject the opposing position We disagree with how the situation was handled. Fyre Fest did the minimal when it came to handling the whole situation.

How can Fyre prevent this from happening again? Since the whole incident was unraveled, there have been two different documentaries made about what happened at Fyre Fest and what led up to it. There doesn’t seem to be any future for Fyre as a company or for the CEO Billy McFarland, who is currently sentencing his six years in prison for fraud charges. As for Ja Rule his reputation doesn’t seem to be going that well either, since he was the lead endorser for Fyre. If for some reason in the future they ever got another shot to create another music festival, I think the biggest thing they can do is to have someone head the company with ethical standards and have a strong code of conduct for the whole company to abide by. They also will need much more time to plan out the event because the 8 weeks the team had to create and organize this festival the first time obviously wasn’t enough time to do it.

References:

Arcand, R. (2019, January 20). Ja Rule Slams New Fyre Festival Documentaries: “That Money Should Have Went to the Ppl in the Bahamas” Retrieved from https://www.spin.com/2019/01/ja-rule-slams-new-fyre-festival-documentaries/ Baggs, M. (2019, January 18). Inside the world's biggest festival flop. Retrieved from https://www.bbc.com/news/newsbeat-46904445 Beck, L. (2019, January). Did Fyre Festival Ticket Holders Get Their Money Back? Their Fight's Not Over Yet. Retrieved from https://www.bustle.com/p/did-fyre-festival-ticket-holders-get-their-money-back-their-fights-notover-yet-15827388 Blair, O. (2019, January 25). 9 questions we still need answered after watching Netflix's Fyre Festival documentary. Retrieved from https://www.cosmopolitan.com/uk/entertainment/a25986366/fyre-festival-documentary-netflixquestions-answers/ Blickley, L. (2019, January 17). ‘Hell Has No Wrath Like A Millennial Scorned’: Lawyer Suing Fyre Festival Gives Updates On Case. Retrieved from https://www.huffpost.com/entry/fyre-festival-documentarieslaywer_n_5c3e5d70e4b0922a21d9984d Eric Levenson and Deborah Bloom, CNN. (2017, April 29). When a $12,000 luxury festival in a Caribbean paradise turns into chaos. Retrieved from https://www.cnn.com/2017/04/28/entertainment/fyre-festival-disaster-trnd/index.html Halliday, J. (2019, January 20). Online fund for unpaid Fyre festival staff raises tens of thousands. Retrieved from

https://www.theguardian.com/world/2019/jan/20/online-fund-unpaid-fyre-festival-staff-raisestens-of-thousands Price, J. (2019, January 19). 5 Biggest Takeaways From Netflix's Fyre Festival Documentary. Retrieved from https://www.complex.com/music/2019/01/5-takeaways-from-netflix-fyrefestival-doc/...