Game-Changers: Jonathan and Susan Lipp (The 2016 NAMM Show)

Jonathan and Susan Lipp, the heads of music retail powerhouse Full Compass, joined NAMM President and CEO Joe Lamond at “Breakfast of Champions” during the 2016 NAMM Show. In a spirited interview with Lamond, Jonathan and Susan weighed in on everything from adapting to game-changing technologies to the importance of advocating for music education.

An edited transcript of the interview:

How did this all start?
Jonathan: The original Full Compass was founded in 1971. I had three partners, and we built a recording studio from scratch.

In 1977, my mother died, and I had a very small inheritance. I decided to start selling merchandise instead of using it as an engineer. That was the beginning of Full Compass Systems.

Around 1980 is when all of a sudden multitrack recording equipment became affordable, and the future fate of traditional recording studios was on the line. And many went out of business.

And you were there for the whole ride. This wasn’t done alone, right?
Susan: It was done alone because I didn’t meet Jonathan until 1978—immediately took over his life and changed everything. (Laughs)

He thought selling stuff meant a little dusty store in a 500-square-foot office right in the middle of a big building. And I said, ‘No, we’re not going to do that.’

I said, ‘Now we’re going to do it the real way.’ I came from theater. My background was managing a professional theater. 

Jonathan: And we became a sales team. I understood everything about the stuff.

Susan: And I knew nothing about the stuff, but I knew how to open and close. 

Jonathan: She would get on the phone. She would open a sale, turn it over to me, and I’d talk about the stuff. And then she’d try to get me off the phone before I talked them out of it, so she could close. (Laughs)

You were selling high technology products, and then you started selling musical instruments. What was the connection there?
Jonathan: A lot of what we’ve done has been based on opportunity. We started out mainly selling to radio stations. It was the only national market for pro audio in the ’70s. There were maybe five dealers who sold nearly everything nationwide. And it was on that model that we got started. But that’s less than 2 percent of our business today.

That is part of what is the challenge to everybody here. Technology changes, and you can’t rely on your original mission to continue doing business. Hardware disappears. Being primarily focused on pro audio, we used to sell a lot of equalizers and limiters. This was all hardware. Now, there’s really nice esoteric stuff you can still buy—many of them that use vacuum tubes still. But the main line of products—the graphic equalizers that everybody was using through the P.A. system—is now electronic. It’s either part of a console or part of a DSP. So all of sudden, there are pieces of hardware that virtually disappeared, although the functions remained in software. 

I think if you’re looking into the future, this is an ongoing challenge in MI also. We’re seeing the beginning of functional virtual reality. The goggles are mainly gaming-oriented today, but there may be a time when [with] tactile gloves you’ll really be able to play air guitar and get sound out of it.

We’ve seen that move back into pro audio. We’ve seen people move back towards tactile surfaces that they’d abandoned. They realized that even in recording, where it can all be done on a computer, they want a piece of hardware to touch.

Susan, you and I have had long conversations about the male-centric industry that we’re in. You’re hugely successful in this business. In one thought, what would you tell the women in our industry to encourage them?
Susan: First of all, we can’t think of ourselves as different than men. (Applause) We are the same. Except for the fact that we ask questions. (Laughs)

We ask questions, and I’ve found that the most successful salespeople in our industry … women selling to men works so well because the women ask questions. All of sudden, they know exactly what these guys need. So we’re asking the question of, ‘What do you really need?’

We’ve been to Washington many, many times, and we were able to push this bill through that was a complete victory for music, for children and for our industry. Why did you get involved?
Susan: I got involved because I really love kids. And I noticed that kids grow into adults, and if a kid has a music background, their brains work better, and then those become our employees. And most of my employees—78 percent of them—are musicians. When you’ve got 225 employees, it’s pretty cool to see 78 percent that are musicians. By the way, 12 percent are theater people. 

Jonathan and I have been going to [Washington, D.C.] for eight years. I went one year by myself.

We absolutely love going to Washington. It is probably the most fantastic thing you can do for yourself. It makes you feel wonderful. You’re so empowered by going to Washington and talking to people who you may or may not know. And then I’ve discovered that you get to know these people pretty well. And then you take it back to your own state, and you talk to the people in your state.

We really, really are into it. We love what is coming of it.

Jonathan: So few people have really ever talked to their representatives. And you’re talking about the alienation from a government that most people feel. And the fact is that they’re accessible. They do want to hear. And the fact that so few people actually talk means that your voice means much more than it would otherwise.