Mysterious ways ... the highs and lows of U2’s huge fortune
As Bono’s tax dealings threaten to eclipse U2’s release of a new album, John Meagher looks at the wealthy band’s jam-packed back catalogue of investments, canny and otherwise
November was supposed to be a special month for U2. These weeks would be all about building excitement for the release of their 14th studio album and first in three years.
But while U2 and Bono have been in the news, the forthcoming album, Songs of Experience, has only been a footnote in the conversation.
Instead, the frontman has had to come out to defend his investment in a Lithuanian shopping centre. The so-called ‘Paradise Papers’ — millions of documents about the tax-avoidance schemes of celebrities and big corporations — showed that Bono’s money has filtered through a Malta-based firm in order to minimise his tax bill.
Bono says he’s “distressed” by the revelations, but insists that — to the best of his knowledge — everything is above board.
It’s not the first time Bono and U2 have had to answer tricky questions about their tax affairs, but it could hardly come at a worse time with Songs of Experience set for release on December 1.
Even their latest single, Get Out of Your Own Way, is being scrutinised with fresh eyes in the wake of the Paradise Papers. In lyrics penned by Bono, guest star Kendrick Lamar raps that “the filthy rich can only truly own what they give away”.
And Bono, by anyone’s definition, is filthy rich. Estimates vary wildly, but some US reports suggest his net worth is in the region of $600m.
U2 have been enthusiastic investors for years, with a keen eye for start-ups with potential.
Facebook may have moved well past the start-up phase by 2009, but it was still in its infancy compared to today. That year, U2, through the Elevation Partners investment group Bono had co-founded, spent $86m on a 2.3% share of the social media site. Six years later, they cashed in for an eye-watering $1.4bn.
U2 have also had a close relationship with Apple — having worked with then CEO Steve Jobs around the time of the launch of the iPod. And, they inked a lucrative deal to allow Apple to give away a free copy of their last album, Songs of Innocence, to all iTunes subscribers, a figure that in 2014 stood at 500 million people.
The band also bought a $300m stake in the US business bible, Forbes — ironic, perhaps, as their wealth is regularly featured in the magazine’s annual Rich List.
But U2’s extracurricular activities have not always been a success. They may well rue their involvement with the Spider-Man Broadway extravaganza. The project was beset with problems, mishaps and delays and wound up costing $75m to stage. It’s not thought to have recouped that amount in a threeyear run between 2011 and 2014.
The band continue to record much of their music in the Hanover Quay studio, in the centre of what’s now thought of as Dublin’s ‘Silicon Docks’.
The purchase of their studio has not been without controversy. In 2013, it was sold to a U2 entity for €450,000 and the figure was considered so modest that it was the subject of an investigation by the Dail’s spending watchdog.
There has been controversy, too, around the One charity, which was co-founded by Bono in 2002 to raise funds and awareness for Third World countries. In 2010, it was criticised for allocating just 1% to good causes.
While U2’s PR machine will have been disappointed by the Paradise Papers, the story pales in comparison with the revelation in 2006 that U2 moved part of their business to the Netherlands for tax-savings purposes.
It was news that angered many, especially those who had grown weary of Bono’s pleadings for the West to open its pockets to the poorest corners of the world.
In 2015, Bono justified the band’s approach to tax in an interview with Sky News, arguing that just because he had campaigned for a fairer society, it did not mean he had to be “stupid” in business.
“It’s just some smart people we have working for us trying to be sensible about the way we’re taxed. And that’s just one of our companies, by the way. There’s loads of companies.
“And we pay a fortune in tax. Just so people know, we pay a fortune in tax; and we’re happy to pay a fortune in tax, people should. But that doesn’t mean, because you’re good at philanthropy and because
I’m an activist, people think you should be stupid in business and I don’t run with that.”
But such an argument doesn’t wash with his more trenchant critics, including the journalist and lecturer Harry Browne. In his book The Frontman: Bono (in the Name of Power), Browne accuses Bono of “amplifying elite discourses, advocating ineffective solutions and patronising the poor. [Bono’s approach to Africa is] a slick mix of traditional missionary and commercial colonialism, in which the poor world exists as a task for the rich world to complete”.
Whatever one might think of Bono — or his music — few could accuse him of being stupid with his cash. And with the Innocence + Experience tour set to get underway next year, that cash pile will grow ever-larger.