- Before Billy McFarland founded the infamous Fyre Festival, he ran a company called Magnises.
- Magnises cloned its members’ credit cards onto a knockoff of an American Express Black Card and offered exclusive access for cultural events and travel.
- While running Magnises, McFarland displayed an obsession with his personal image and misrepresented the company’s capabilities – features that ballooned into the disastrous Fyre Festival.
- Jenny Bapst, a former real estate agent, tried to help Magnises find a new townhouse after they were kicked out of their previous one for allegedly wrecking it in a party.
- Bapst told INSIDER that McFarland misrepresented company finances and wanted to figure out how to sleep with models.
Billy McFarland was under pressure.
In 2014, his VIP card company, Magnises, was kicked out of its Greenwich Village townhouse after its parties allegedly caused tens of thousands of dollars in damages. They needed a new place to stay.
At the same time, the company was growing. That November, McFarland was interviewing Jenny Bapst to help run the business. Bapst had more than a decade of experience in model management and exactly type of industry connections and business experience needed for Magnises. The company offered a modified credit card that gave people discounts to cultural events, aimed at the same luxury-tinged customer base that McFarland later attracted – and scammed – with Fyre Festival.
In a stroke of serendipity, Bapst was also a licensed real estate agent and was familiar with Manhattan’s townhouse market. While still hoping to get hired by Magnises, she offered to show McFarland potential new venues. The townhouse was a key part of Magnises’s offerings: For just $US250 a year, members could spend as much time as they wanted there and drink from the house’s bar. Located in downtown Manhattan, it was meant to evoke the exclusive glamour of Soho House and other private social clubs.
Bapst started showing McFarland different townhouses, felt that but something seemed off. McFarland never explained how Magnises planned to run an essentially commercial business in a residential property, which got the company in trouble in its previous location. And while McFarland wanted to upgrade to a nicer townhouse from the company’s previous one, which cost $US13,750 a month, Bapst got mixed messages over whether they could afford it.
“I was showing him a beautiful, very luxurious townhouse in Chelsea,” Bapst told INSIDER. “He loved that place. It was $US30,000 a month, and Billy was like ‘We can do it, we can do it.’ And the COO was like, ‘Billy, this is not in the budget. We don’t have that kind of money.'”
McFarland insisted that he get the place. Bapst confronted him in the bathroom, trying to figure out if they could afford it or of she was just wasting her time.
“That’s when he told me, literally, ‘Jenny, do you think I would get laid more by models if we get this space?'” Bapst said.
Bapst decided to stop trying to work with Magnises after that. She ended up joining Select, a competing business, where she is the company’s director of business development. And Magnises ultimately got a location in SoHo before the company fell apart in 2017.
Billy McFarland’s failures at Magnises foreshadowed the Fyre Festival disaster
McFarland’s tenure running Magnises, which is now defunct, demonstrate the same flaws – an obsession with himself, a lack of understanding about money and responsibility to pay people, and a willingness to mislead people to the point of outright fraud – that ballooned to a much larger scale for Fyre Festival.
Magnises was founded in 2013, around the same time as Select. Both companies provide members with a card that offers discounts and exclusive access for cultural events.
Magnises in particular was proud of its technology, which cloned members’ credit cards onto knockoff American Express Black Cards to use as a status symbol for young people who couldn’t afford the real thing.
But while Select spent its early years developing relationships with restaurant companies and event venues, Magnises put all of its chips into marketing, Select employees say. Select still exists, while Magnises doesn’t.
Some of the fly-by-the-seat-of-your pants approaches McFarland took with Fyre Fest were honed at Magnesis. Christopher Stanley, the COO of Select, told INSIDER that on one occasion, McFarland attempted to lie about his identity in order to glean details from Select executives about how they ran the business.
It was in early 2014 – after Magnises already landed a puffy New York Times feature about its benefits – that both McFarland and Select’s executive team were at a business event for members of the hospitality industry. McFarland identified himself as “Lyon, or Daniel, or something else that’s not his name” and tried to learn how Select functioned, Stanley said.
“He was like, ‘So, you guys are pulling a lot of partners, a lot of restaurants. How exactly are you doing this? Are they all legit?'” Stanley said. “He’s trying to figure out how we do it. Also questioning if they’re legit which, to me, says that some of what he was advertising was not.”
Stanley’s colleague, bewildered that McFarland would think he’d pry the information out of him, batted away his questions.
“At the end of the conversation, finally my colleague was like, ‘Yeah, I’m not gonna tell you anything about our company. And by the way, I know who you are, Billy,'” Stanley said. “He was just a very weird dude.”
‘He’s like that kid that’s disrespectful to the waiter’
Under McFarland’s leadership, Magnises kept pivoting its business model. First it provided an exclusive card (though Stanley doubts the company really rejected 70% of applicants, as advertised). Then it switched to restaurant partnerships, then travel opportunities, then ticket packages. Stanley viewed it as a series of get-rich-quick-schemes run by someone who spent most of his time grooming his personal image.
“The marketing, as crazy as it was, it worked. They just didn’t have anything substantial to stand behind it,” Stanley told INSIDER. “And then Billy’s obsessive need to be all about himself and his image, and ‘Will this help me get laid?’ sort of created a disaster.”
In her time with McFarland, Bapst observed that he wanted to spend more time having lavish lunches and bragging about dating models than building a business.
“It was like he was a child trying to live this lifestyle that he didn’t even belong to,” she said. “He’s like that kid that’s disrespectful to the waiter because he pays for it. He’s not humble.”
And about that Greenwich Village townhouse – in a $US100,000 lawsuit filed by the townhouse’s landlord in 2015, the owner said that McFarland and his guests “trashed” the place, his parties leaving it “in a state of total disrepair, rubble, and disarray” after attendees “damaged and destroyed several windows and virtually all the kitchen appliances.” The lawsuit was settled in 2016.
The ultimate fall of Magnises is well-documented. It drew widespread media attention with the help of Ja Rule promoting it with media appearances, although McFarland reportedly mislead the public about the number of members it had.
In January 2017, Business Insider published a story about customers complaining about unwanted charges and unkept promises. At that point, McFarland was focusing his energy on Fyre Festival, to be held in May. Later that year, Bloomberg reported that Magnises stiffed multiple vendors.
By the time Fyre Festival came around, Magnises was defunct. McFarland is currently serving a six-year prison term for committing mail and wire fraud for his work on the festival.
McFarland’s attorney didn’t immediately respond to INSIDER’s request for comment.
- Read more:
- People have raised over $US160,000 for a Fyre Festival caterer who was left broke after using her own life savings to pay staff
- 10 wild revelations about the epic Fyre Festival failure uncovered in Netflix’s new documentary
- An ultra-luxury music festival where tickets cost up to $US12,000 is a disaster – and attendees are freaking out
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