Montreux Jazz Festival expands its brand to Singapore, Brazil

The Montreux Jazz Festival, one of the largest and longest-running in the industry, is keeping its 50-year-old brand fresh by spreading it beyond Lake Geneva without comprising its famed values of intimacy and creativity.

The iconic Swiss brand is expanding its global franchise of jazz clubs and increasingly looking at international licensing of its annual festival, which celebrated its golden jubilee this July.

Friday marks the official launch of the Montreux Jazz Cafe in Singapore following successful openings across Switzerland, Paris and Abu Dhabi. The venue is aimed at showcasing emerging musicians in addition to top-notch international talent, such as English soul legend Omar Lyefook who will be performing on Friday.

"The last thing we want to be is a Starbucks of jazz clubs," CEO Mathieu Jaton told CNBC. "We're very selective about locations and Singapore made sense as it was a gateway to Asia."

Meanwhile, the music festival, which currently takes place in Tokyo and Montreux, will be expanding to Rio de Janeiro next year, set for the military base of Fort Copacabana.

The festival—a key contributor to the Swiss economy, bringing in an estimated $60 million in direct revenue for the town of Montreux—could be a welcome source of income for Brazil, which is currently in recession.

The festival was no stranger to international licensing, having previously staged collaborative events in Detroit and Atlanta, but those came to an end as they did not meet Montreux's standards, Jaton said

A view of the 'Music in the Park' stage during the 50th edition of the Montreux Jazz Festival on July 1, 2016 in Montreux. The 50th edition featured big names such as Neil Young, PJ Harvey, Carlos Santana, Caetano Veloso, and many more.
FABRICE COFFRINI | AFP | Getty Images
A view of the 'Music in the Park' stage during the 50th edition of the Montreux Jazz Festival on July 1, 2016 in Montreux. The 50th edition featured big names such as Neil Young, PJ Harvey, Carlos Santana, Caetano Veloso, and many more.

"We've been working with a Brazilian promoter for years so I trust him to execute our brand. But now, we have to find the money to make that happen," Jaton continued.

The 41-year-old is among the rare breed of executives willing to forgo profit to ensure his brand's integrity and music-first approach remained intact.

Because the brand operates as a foundation, not a for-profit enterprise, Jaton wasn't "playing the same game" as other music industry players, he said.

"I don't have any shareholders so I don't have people waiting for money. I can work for creativity. We have a budget of 30 million Swiss francs ($30.54 million) for the annual festival, but if I'm making money, my margin is less than 1 percent. If I'm losing money, it could be in the range of 1-2 million francs."

It's foolish to expect a quick return on cultural investments, he added.

For the festival's 50th birthday this July, the budget was increased by 2 million francs for special celebrations and the event ended up eking out a tiny profit of 300,000 francs. "Luckily, my whole team and I are crazy. We're not in this for money, it's for passion," Jaton remarked.

Unlike entertainment-heavy festivals boasting high-production such as Coachella and Glastonbury, Montreux has focused on creating unique experiences for the artist and attendee, ranging from surprise jam sessions to improvisational performances, said Jaton.

"Our main halls are small and our artist fees are not as high compared to other festivals. So why do major headliners still come to us? For us, an artist is a friend, not a contract. Everything we do is based on human relationships."

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