Meet the Gen Z Kingpin of TikTok
This 21-year-old CEO built a booming business hyping musicians on TikTok. Will Trump’s proposed ban bring it all crashing down?
While Hollywood has always been known as Tinseltown, in the past year it’s become a TikTok town. The hills of L.A. are now full of “collab houses,” where the sole task is to churn out video clips of lip sync battles and choreographed dance routines. Hype House is the most (in)famous residence, where 16-year-old Charli D’Amelio, known as the Queen of TikTok with more than 60 million followers, and her almost-as-popular 18-year-old sister Dixie initially set up shop in 2019.
The sisters, who have been compared to the Kardashians and rumored to be launching their own reality show, occasionally wandered down the hills to one particular destination: the offices of Flighthouse. There, under the direction of a 21-year-old named Jacob Pace, the sisters — and other influencers — would shoot playful one-minute vignettes for TikTok. Flighthouse’s first recurring series, the wildly popular “Finish the TikTok Lyric,” which debuted in August 2019, featured the sisters D’Amelio smashing a buzzer to try and be the first one to sing the remaining line from R&B singer Doja Cat’s “Juicy,” a clip that has been viewed more than 30 million times. (For the record, Charli won the round, singing “I keep it juicy juicy, I eat that lunch. She keep that booty booty, she keep that plump.”)
In just a few short years, TikTok has risen to both a social media behemoth and a powerful buzz machine for the music industry. It’s become a sort of MTV for Gen Z, a place that can propel up-and-coming artists like Doja Cat to her first Billboard №1 hit. The platform is also resurrecting recent hits that have come and gone: Lizzo’s smash single “Truth Hurts” was actually released in 2017, but in 2019 surged to the top of the charts after thousands of TikTok users created their own videos to the song. Using the hashtag #DNATestChallenge they copped the singer’s line “I just took a DNA test, turns out I’m 100% that bitch,” while swabbing their mouths with a Q-Tip. In fact, the Billboard Hot 100, which tracks the most popular songs in the U.S., has been chock-full of hits that went viral on TikTok.
And it turns out that Flighthouse is the secret engine making a lot of these songs take off. Pace, Flighthouse’s CEO, isn’t the youngest person at the new age production company where he oversees 20 employees, but he’s perhaps the most connected. Since moving to Los Angeles from his native Texas when he was 16, Pace, with his winsome smile and boy-next-door looks has networked like a seasoned veteran in the halls of power in the music business. Last year, he made Rolling Stone’s Future 25 list of innovators and disruptors in the music industry, and has managed to win over hard-boiled music executives from Capitol to Columbia, with charm and a deep understanding of what makes TikTok, well, tick.
While other digital marketing firms are still struggling to figure out how to use TikTok as a promotional tool, Pace seems to have cracked what makes content — and artists — pop on the platform. “Working on the creative with them is much different than paying for a post,” says Zach Friedman, the manager of Surfaces, a pop group from Texas that has taken off on TikTok. “Anyone can get Joe X influencer to do a post, but really developing a piece of content that people are going to want to share is an art.”
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Now, just as TikTok’s massive influence has ballooned, it’s come under increasing attack. During the lockdowns this spring, young people flocked to TikTok. By May 1, it had become the most-downloaded app in the world, with more than 2 billion downloads, according to internet research firm Sensor Tower — 315 million of them in the first quarter of 2020 alone. In May, TikTok seemed poised to juice its already massive influence on the music industry when it hired CEO Kevin Mayer, the Disney bigwig who launched streaming service Disney+ and helped orchestrate Disney’s uber-successful acquisitions of Marvel and Lucasfilm.
But TikTok faces growing cybersecurity concerns over the company’s China-based parent company ByteDance as well as possible censorship (including claims that the TikTok has suppressed content with LGBTQ and Black Lives Matter hashtags). In early July, Secretary of State Mike Pompeo said the Trump administration was considering an outright ban on TikTok in the U.S. This was after the app had already been banned by the U.S. military and the entire country of India, TikTok’s biggest market. Corporations such as Wells Fargo have asked employees to delete the app from company phones, and Congress is soon expected to pass a bill that would require all federal employees to delete the app from their devices.
Pace’s Flighthouse has built a thriving business making songs TikTok hits. But how long will it last?
Pace flashes a million-dollar smile as he tells me he slept in this morning — meaning he got up at 6:30 a.m. instead of the usual 6:00. It was still early enough to sneak in a quick workout in the backyard of the Hollywood rental house that he shares with two friends. With a post-workout protein shake in one hand, he’s been scanning his phone for morning updates from Digiday and AdAge while waiting for Postmates to deliver an egg-and-cheese sandwich before a regular 8 a.m. Zoom call with members of his team at Flighthouse.
Pace grew up in the middle class Upper Valley neighborhood in El Paso, Texas with his father Michael, a real estate agent, and his mother Ayleen, who ran her own accounting business. In 2013, at age 14, Pace got into electronic dance music. But whereas an average teen might have gone to a music festival or bought a few albums, Pace began pitching and writing daily articles for the music industry blog, EDM Sauce. He also started recording his own music that he promoted via YouTube. “My music was shit,” he says, laughing. “But I started promoting other acts on my channel, and it got noticed.”
His work caught the attention of Los Angeles-based music executive Alexandre Williams, who at the time managed Gold Top, a DJ who had a hit single with rapper Soulja Boy (“Gold Like This”) in 2014. Williams and his partners at Create were looking to sign more artists, ones who could use some guidance from someone with social media savvy. By the time Williams asked Pace to come work for them in L.A., Williams had no idea he was 16 and still in high school. At first Pace turned him down — “I never thought my parents would say yes” — but Williams kept bringing it up, and Pace eventually convinced his mother and father to let him go to Hollywood. Pace says he had picked up a lot from listening to his dad sell real estate. “He knew that I was going out there to hustle,” he says. “I wasn’t going out there to party.”
When Williams picked up Pace at the airport in Los Angeles, he was surprised when a teenager got into his car. “We had no idea, it was hilarious,” says Jonathan Strauss, who co-founded Create with Williams in 2017. “I started thinking, ‘Would I let my 16-year-old kid move to Los Angeles to work for people I’ve never met? Probably not.” But they quickly learned that Pace was not your average kid. “From the second I met him, he’s one of the best salespeople I’ve ever seen,” says Strauss. “But he doesn’t speak like a sales guy. He can go to a CMO of a massive corporation and speak like a 21-year-old who’s an expert in what he does.” Create is itself a cutting-edge company that, in addition to managing an artist’s publishing royalties, uses a proprietary software program that hunts down the tiniest bit of revenue generated by YouTube streams. Their expertise is in such demand that many of the major music labels have hired Create to find any potential royalties owed to their own artists, and now Create handles the YouTube accounts of Jennifer Lopez and other musicians.
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In 2017, Strauss and Williams hired Pace to be their VP of Development. Within months of starting the job — back when the nascent TikTok was still known as the lip sync site Musical.ly — Pace came across the Flighthouse account run by two teen brothers, Andrie and Aries Carigo, from their home in L.A.’s Koreatown. Instead of producing their own videos, the pair created new versions of songs like Major Lazer and Justin Bieber’s “Cold Water” where the song was sped up so Bieber’s vocals sound like he was huffing helium. Songs that have been altered or remixed are hugely popular on TikTok because their uniqueness sets them apart from standard versions found on streaming or the radio. The original Flighthouse account had already accumulated 1 million followers, and Pace pitched Strauss on the idea of using it to promote Create’s artist clients. Strauss paid the teen brothers in the mid-five figures for the account.
From there, Pace began cold calling and emailing marketing executives at music labels to pitch Flighthouse as a shop that had bigger ambitions than producing just 15-second videos for kids on their phones. “It’s hard to describe the energy field around Jacob Pace,” says Jacqueline Saturn, president of Caroline, Capitol Music Group’s independent distribution company. When Saturn visited the Flighthouse offices, Pace told the exec he followed her on Instagram and asked if he could join her for her usual 6 a.m. workout at a park near her home. “Most people aren’t up at 6 a.m. to work out, but he showed up at 5:55 dragging his co-worker with him.” she says. “We talked and shared our favorite songs.” Saturn, who now calls Pace a friend, says she was impressed with his innate ability to connect with people as well as a natural understanding of the digital landscape. Soon, he was promoting new acts like Lil Nas X, Arizona Zervas, Doja Cat, and Surfaces, each of which got an early boost of success via TikTok.
Pace quickly recognized that the key to a song’s virality on TikTok was the users’ ability to snatch the audio from any TikTok video with just a few clicks and use that as a soundtrack for their own videos. This was especially potent when influencers like Charli D’Amelio were involved; after she danced to “Lottery” by KCamp last fall, thousands and thousands of teenagers quickly posted videos of themselves dancing to the song.
For Surfaces, Pace and Flighthouse issued a call out to TikTok influencers like D’Amelio, paying some of them low five figures to compile their favorite videos of 2019 and set it to a custom made remix of Surfaces’ single “Sunday Best.” Before the stunt, “Sunday Best,” released in January 2019, was averaging 200,000 daily streams on Spotify. One year later, daily streams of the original song have tripled and is still working its way up the charts. “Flighthouse hasn’t reinvented the wheel but they’re so far ahead of anyone else that does these things and that’s because of Jacob,” says Surfaces manager Friedman. “He is a savant.”
Each of Flighthouse’s videos, like the one with the D’Amelio sisters, are shot at the sprawling, block-long offices of its parent company Create Music Group in Hollywood, which hold five separate recording studios and an enormous soundstage to film content. The videos have helped Flighthouse reach more than 25 million followers, making it the most popular TikTok brand account.
Although Flighthouse has grown to mid-seven figures in revenue, according to Pace, there are challenges ahead for the business — namely the many challenges facing TikTok, the largest of which is a potential ban by the U.S. government. Of course, any ban on the app would be immediately challenged in court, but it has TikTok’s parent company rattled enough that it is reportedly exploring a possible sale to existing shareholders like Sequoia and SoftBank. It has also hired an army of lobbyists to press its case in Congress. At the same time, there’s growing competition from other TikTok-like video apps, including Reels, which Instagram plans to launch in August, and the upstart Triller, which is partially owned by the major music labels and claims to have 50 million monthly users in the U.S and another 20 million in India, following the TikTok ban.
Pace says he doesn’t believe the government can shut down TikTok. When he first got the alert on his phone that Pompeo was threatening a ban he says he burst out laughing. “There’s no way, but who knows?” he says, “I’ll put my trust in Kevin Mayer to work it out.”
While Pace’s reaction might be youthful hubris, he knows that regardless, Flighthouse eventually needs to diversify. His goal is to build Flighthouse into a sort of Viacom for Gen Z, an omnichannel distributor of creative content that isn’t fully reliant on TikTok. He’s also looking at expanding his presence on YouTube, where the brand already has 347,000 followers, and potentially Snapchat or Triller.
Pace says he’s adopting a wait-and-see attitude to see where the kids migrate if TikTok does indeed vanish from the screens. (Flighthouse recently created an account on Triller, but so far it only has one follower: Jacob Pace.) In the meantime, he and his team are also spending hours glued to TikTok and Soundcloud searching for new songs and artists for their potential next project: launching their own music label. Regardless of what happens with TikTok, he’s confident he’s cracked the formula for making a hit song. “Sometimes labels take credit for things they didn’t actually do,” he says with a laugh. “But we know how to work a record.”