Join the Circus

In 21 years, Cirque du Soleil has grown from a funky band of street performers into a half-billion-dollar global company. It's a high-wire act of smart risk-taking, innovating around the clock, and staying uncomfortable.

Inch by inch, the aerialist in the red flamenco outfit edges her way up a tightrope stretched at a 45-degree angle from the main wire, 20 feet above the stage. Curling her toes downward to steady her grip, she clutches a fan for balance. There is no net. Snare drums strike up an ominous patter that warns the audience this is a trick with real danger. Suddenly, as the young woman nears the summit of the tent, her foot slips, and she struggles, desperately, to secure her footing. The crowd holds its breath, as if one errant sigh could send her plummeting. For a long second she hovers, perilously. Then, regaining her balance, she scampers the last few feet to safety, to thunderous applause.

It is a classic circus trick, performed flawlessly — down to the expertly executed "slip" — served up in a show that is unconventional, even by the bizarre standards of the big top. Sure, there are tumblers, but they are bouncing on beds, not trampolines; there are trapeze artists, but they twirl in the center of giant chandeliers, not between platforms. And what garden-variety circus is likely to begin with a death-bed scene starring a midget and a dying clown, with a band of acrobat angels hovering overhead? It could only be Cirque du Soleil.

The surreal new production, "Corteo," currently touring Canada, is the latest extravaganza produced by the privately held, Montreal-based entertainment company. It opened in late April, two months after the debut of "Ka," the company's $165 million martial-arts-themed production at the MGM Grand in Las Vegas. This fall, in partnership with Clear Channel Communications, Cirque will mount a 100-date North American arena tour featuring the music of Cirque. Next year, it will premiere its much-anticipated collaboration with Apple Corps, the Beatles' record company, bringing the total number of Cirque shows in Vegas to five. A deal is in the works with Disney to mount Japan's first permanent show in Tokyo in 2008.

At a time when audiences for all performing arts are declining, Cirque du Soleil has taken a particularly moribund segment of the market — the circus — and created an entertainment juggernaut, with a burgeoning record label, a retail operation, and a deal with Carnival Cruise Lines. And we're not talking circus peanuts here. The company's Las Vegas shows regularly play to sold-out audiences of "kids of all ages" — as long as those tykes are willing to shell out as much as $150 per ticket — for a daily gross of a cool million. Can't get to Sin City? Then it's likely one of the company's six touring shows will cycle through your town, whether it be Barcelona, Minneapolis, or Sydney, sometime soon. Throw in the additional resident show, "La Nouba" at Disney World in Orlando, and the company's ticket sales top 7 million a year — that's about 135,000 per week — for annual revenues estimated at between $550 million and $600 million.

Pretty impressive for an operation that began as a band of Quebec street performers 21 years ago. And even more impressive than the dollars is the way Cirque du Soleil has captured the public's heart: In Interbrand's 2004 poll of brands with the most global impact, Cirque ranked No. 22 — ahead of the likes of McDonald's, Microsoft, Volkswagen, and (ouch) Disney.

Clearly, we all have something to learn from these clowns (and acrobats and tumblers and dancers). You don't have to be a fan of the big top — though, really, who doesn't love a circus? — to understand that Cirque du Soleil is an impressive high-wire innovation act. Offbeat and wild it may be, but Cirque could still teach most businesses a thing or two about recruiting and retaining supremely talented specialists, coaxing extreme creativity from a diverse band of employees, and building a powerhouse global brand. But above all, it's a study in the virtues of taking big but controlled chances, as you'd probably expect in a business that's all about using skill and training to skirt death and disaster for the sake of beauty and laughs. "We like to take risks," says Daniel Lamarre, Cirque's president and COO, from a cafe in Barcelona, where he's visiting the road show "Dralion." "It's part of who we are. Every time we come in a comfort zone, we will find a way to get out, because being comfortable in our business is very, very dangerous."

The appetite for discomfort begins with the company's fundamental operating philosophy. Cirque has steadfastly refused to employ the impresario's favorite trick: Take a hit show (think Mamma Mia or Phantom of the Opera), clone it with a touring company, and send it on the road. Each Cirque du Soleil show is unique, one of a kind, despite stunningly high production costs. Even a traveling show, which doesn't require the enormous capital investment of a permanent theater, can cost upward of $25 million to mount and require three years to conceive, cast, design, train, and produce. And, as the backers of expensive Broadway stinkers like Taboo will tell you, even a fat wallet doesn't inoculate producers from the occasional bomb.

It's this willingness to take creative risk that is Cirque's original genius and the key to its competitive success, says Renee Mauborgne, coauthor of Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant (Harvard Business School Press, 2005) and professor of strategy and management at INSEAD. Cirque combined the thrill of the circus with the high production values and intellectual sophistication of the theater or ballet to create a new art form and, along with it, a new "blue ocean" market. The company's future, she says, will depend on its ability to sustain that culture of risk taking, particularly as competitors enter the market. "The danger is that when you begin to be imitated, you start entering into red-ocean competition, where your focus is on outcompeting rivals rather than on creating the next blue ocean," says Mauborgne. "Then the competition, and not the marketplace, sets your agenda."

Already the sharks are in the water. A rival clowncentric production called "Slava's Snowshow" is drawing raves for its "breathtaking images." The Canadian Cirque Eloize has been lauded as "a new generation of circus performers focusing on innovation, imagination, and show-stopping panache." Even venerable Ringling Brothers has added more theatrical elements to its show. And in late April, literally across the street from Cirque's original Vegas outpost, Steve Wynn debuted "Le Reve," a Cirque-style show, at his posh new $2.7 billion Wynn Las Vegas. Ironically, Wynn is the very guy who gave Cirque's founder, CEO, and creative guru, Guy Laliberte, his biggest break, by installing the company's first permanent show, "Mystere," at his Treasure Island hotel in 1993.

In Montreal, Cirque acknowledges the mounting competition but refuses to let it distract from the main mission. It must focus on the challenge of producing 11 blockbuster shows, often as much as 10 times a week, 52 weeks a year. That requires the ability to recruit, train, and replace injured or retiring performers, to continually find and develop fresh acts, and to maintain constant vigilance over the productions, from their costumes to their often daunting technical complexity. It has taken Cirque two decades to build an infrastructure — what director of creation Gilles Ste-Croix calls Cirque's "machine" — that can consistently deliver that level of support and innovation. Most important, however, is the company's ability to reinvent the brand with each new production. That, he says, is the toughest bar for competitors to overcome.

"A typical day at the office for me begins by asking: What is impossible that I'm going to do today?"

Lamarre agrees, pointing to the willingness of Cirque's Laliberte to put creativity before profits: "I haven't yet met anyone willing to invest as much money as Guy does in production, infrastructure, and risk taking." Cirque plows more than 70% of its profits back into new initiatives, R&D, and new shows every year, he says. "We built our brand on creativity, and if we don't respect this first value of our brand, it would be counterproductive for us long term." It can all make for a chaotic, stressful, demanding — or, if your DNA is up to it — exhilarating work environment. Says Lamarre: "A typical day at the office for me begins by asking: What is impossible that I'm going to do today?"

The saga of Cirque du Soleil is, if not impossible, then pretty improbable. In the early 1980s, in a small town near Quebec, a street performer named Gilles Ste-Croix and some friends formed a theatrical troupe called Le Club des Talons Hauts (the High Heels Club), specializing in circus arts: juggling, acrobatics, stiltwalking, music. One of the members was a fire breather and accordion player named Guy Laliberte. In 1982, the troupe organized a street performers' festival, which was so successful it inspired Laliberte to approach the city of Quebec with a proposal for a show called Cirque du Soleil (Circus of the Sun) to help celebrate Canada's 450th anniversary.

From the start, the show was hardly a conventional circus. It had outrageous costumes, original music, and clever performers — but no animals. Despite the dearth of beasts, it was a rousing success. Those initial decisions were brilliant, says Mauborgne, since they essentially redefined the game. By not featuring animals, Cirque eliminated one of the most costly and controversial parts of any circus. And by shifting the focus from an event geared to kids to one designed for adults, it could reinvent the pricing model as well. By combining the best of circus and theater, Cirque pulled in an audience the traditional circus had never seen: adult theatergoers accustomed to paying steeper ticket prices. In 1987, the troupe made its first visit south of the border, premiering at the Los Angeles Arts Festival. It was also Cirque's first big risk. Had the show bombed, the company was too broke to get the equipment back to Canada. Fortunately, it was a smash.

Cirque soon embarked on what would become a close and synergistic relationship with an industry that shares its coolheaded approach to risk: gambling. At the beginning of the 1990s, Steve Wynn saw a Cirque touring show and persuaded Laliberte to bring a big top to Vegas. The show sold out. With a gambler's eye for a potential big score, Wynn offered to build a permanent home for the company in his new hotel. "Mystere" opened in December 1993 and was sold out for a year. Wynn upped the ante in 1998, building a spectacular theater for "O" in the Bellagio. It was an instant sensation, and seven years later continues to sell out three months in advance. In 2000, shortly after Wynn sold his Mirage Resorts to MGM, Laliberte got a call from Terry Lanni, CEO of the new MGM Mirage and a Cirque fan from his days at Caesars Palace. Lanni was eager to field more shows in Vegas, so Cirque developed "Zumanity" and "Ka."

The partnership has been a blockbuster for both sides. For Cirque, the deal has brought a partner willing to sink hundreds of millions into creating unique venues for its shows. As for the MGM Mirage, "Ka" alone troops 4,000 folks a night past the MGM Grand's array of upscale restaurants, shops, and roulette wheels.

Half an hour outside of Montreal, in the scruffy suburb of Saint-Michel, sits the world headquarters of Cirque du Soleil, overlooking a former dump. The 100,000-square-foot complex, fronted with corrugated steel, looks less like the home of a circus than of a food-processing plant. Inside, there are three training studios, a costume shop, and a props workshop, as well as the casting team and corporate staff. This is the Cirque "machine" — the infrastructure on which the company's innovation process depends.

Cirque creators say that innovation, for them, always begins with a story. For example, Laliberte instructed "Ka" creator Robert Lepage to craft an epic tale that included martial arts, an art form no other Cirque show had yet explored. Then, to feed the shows' voracious appetite for hugely skilled performers, Cirque's innovation process shifts to the attraction, training, and retention of talent. Teams of new recruits are in constant training in Montreal before being dispatched to replace artists in existing shows, or to appear in new productions. With more than 700 artists (out of 3,000 total employees), culled from 40 different countries, and speaking 25 languages, the Cirque operation is like a mini United Nations, complete with translators.

At the moment, Florence Pot, head talent scout, is a woman on a mission: She's searching the globe for a quartet of wild and crazy guys for the company's next big show. The marriage of Cirque's performing arts and the Beatles' music will debut at the Mirage next summer in the space vacated by Siegfried and Roy. "The show will re-create the atmosphere of the Beatles before they were stars, when they were just young guys with no fear of trying new things," Pot says. For Cirque, that translates into a job spec that reads like a description of an L.A. skate punk: Wanted — four rebels who can run, jump, and do somersaults on Rollerblades. Must be compact, powerful, and bouncy. Fondness for "She Loves You" a plus.

Once the Beatles show is cast, it's not as if the casting team can go home. First there's the company's annual attrition of 20% of injured or retiring performers. Then there's Ste-Croix's pledge to produce four more shows over the next four years. And Cirque doesn't want standard-issue acrobats, jugglers, or trapeze artists. Cast members must also meet demanding artistic qualifications and, depending on the particular show, unusual performance requirements. In "O," for example, performers must be scuba certified. In "Zumanity," the R-rated show at Vegas's New York, New York hotel, gymnasts may be asked to perform topless.

Those requirements can be a challenge, even to experienced performers. Michelle Cassidy, an elegant blond dancer from South Africa, initially auditioned for "Zumanity." The Cirque casting team thought she was perfect en pointe, but a nonstarter for the company's bawdy cabaret-style show. "I just wasn't out there enough," she says. She was eventually cast as La Belle, a beautiful queen, in the tamer "Mystere."

Craig Paul Smith, a world-championship-level tumbler for Great Britain, was fine with the acrobatic tricks in "O," but, he says, "I got to the point where I was scared to put my head under the water because I was panicking so much." In "O," cast members must go underwater to change costumes or pick up props. "My breakthrough came when I told myself, 'You learn how to breathe, or you go back to England and learn a trade,' " he says.

The task of finding a constant supply of such versatile performers falls to Cirque's 12-member casting team. They show up at the Olympics and world championships to sign athletes. Others canvas the globe looking for fire jugglers, pole climbers, martial artists, bungee jumpers, Wheel of Death spinners, and artistically inclined midgets. To satisfy its ongoing need for slithery-limbed girls, Cirque supports a school for contortionists in Mongolia. Meanwhile, to staff the cast of "Varekai," Cirque scouts recruited traditional toe-knuckle dancers from a company in the Republic of Georgia that has a lock on the world supply.

Once cast, performers report to Montreal for six or eight weeks of basic-training boot camp, run by a Russian coach, Boris Verkhovsky. His assignment is tricky: to turn athletes into artists. It's not an easy transition, he says. The artistic process requires spontaneity, imagination, and creative risk taking — qualities that could get an elite athlete bounced off the team. "A lot of athletes come from an environment where they are literally told when to inhale and when to exhale," Verkhovsky says. "A side effect is that they're not very independent thinkers."

Besides teaching athletes how to unleash their inner thespians, Verkhovsky sometimes has to turn a class of raging divas into a cohesive band of brothers. To that end, he often prefers the also-ran to the medalist. "Somebody who almost made the team probably has the same repertoire of tricks, but is still hungry," he says. "The expectation of recognition is much less, so the prima donna syndrome is much lower."

And then he has to push the performer to achieve feats never attempted in an Olympic arena. That, he says, is Cirque's differentiator, and a requirement the boss insists upon. "Guy Laliberte consistently asks, 'Where's my f — -ing triple somersault?' " Verkhovsky says, "even when he's watching a contortion act. If he feels we're getting too comfortable and too artsy, he will remind us that this is a circus and it is about performance at the maximum level. That is the great challenge."

I've just settled into my seat in the theater in Las Vegas when a lounge lizard in tight black vinyl pants and a greasy pompadour grabs my hand and pulls me up to the stage. The gigolo says he has my ticket, "M-69." He wants me to retrieve it . . . from the belt buckle above his crotch. The audience seems to think this is a fine idea. My husband thinks otherwise. It's my job.

Welcome to Sleazy Cirque, a.k.a. "Zumanity," where full-frontal Pilgrims, obese vixens in fishnets and thongs, and guys clad only in codpieces cavort, much to the joy of bachelorette parties, gay cabaret hounds, and nice married couples alike. This is not your father's Cirque. Until 1999, Cirque shows had a relatively consistent look, since many were the vision of a single creator, Franco Dragone (who left to form his own company, ultimately creating Wynn's "Le Reve").

Dragone's departure forced Cirque to take one of its biggest risks ever: to open its doors to other creators. The results have given the company new creative juice, spawning productions as diverse as frisky "Zumanity," epic "Ka," and soon, the musically driven Beatles show. It is the creative equivalent of the gymnast's triple somersault.

That commitment to constant innovation may help Cirque avoid the biggest hazard facing creative companies: a focus on defending their turf, rather than creating the next blue ocean. It's a nerve-racking way to do business, and Lamarre concedes he never stops being anxious before a new show. But he and his team, he says, are dedicated to always seeking the next big wave. "If there's a pattern that exists, we're going to break the mold," he says. "We want to reinvent ourselves all the time." nFC

Linda Tischler is a Fast Company senior writer. She hopes to become a bungee girl.

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