The South by Southwest music festival bills itself as "the premier destination for discovery." It's also the destination for truckloads of cash, as music and art fans flock to Austin, Texas, each March. Last year's event brought nearly $100 million to the city, according to one analyst.
The more than 200,000 "creative class" types — musicians, media gurus, filmmakers — who come to South by Southwest (often known merely as SXSW) spend money not only at the official event, but also in Austin's rich underground economy.
The annual festival has become a cash cow for the city, says Ben Loftsgaarden, an economic analyst with Greyhill Advisors who studied the economic impact of last year's event.
"About $99 million, almost $100 million, was basically injected back into the Austin economy over that nine-day festival period," he said.
Lofstgaarden says this year's visitors might spend a bit less, because of the tough economy. But the money is not just going toward tickets. There's a kind of underground economy that has grown up around the festival: food vendors, merchandisers, knickknack sellers, cab drivers.
Well, maybe not exactly cab drivers. For the SXSW crowd, pedicabs, or bike taxis, are all the rage.
"The attenders for SXSW are much more likely to take a pedicab versus a cab," said Amy Waller, a pedicab driver who moved to Austin from Baltimore. "It's just cooler. It's trendier — that's why we're making money."
Waller says she hopes to make some pretty good money shuttling conference attendees to and fro. "Maybe like a month's pay at my day job, my 9-to-5," she said.
If that happens, Waller already knows how she'll spend the loot.
"Everyone kind of plans what they're going to do with their money," she said. "My plan is to try to buy a motorcycle, so I can get rid of my car. That's what I'm banking on, that's my goal."
During the festival, there's no shortage of food. Marc Stimak owns Texas Picnic Company Barbecue and Char Pit, a mobile food trailer.
"We do chopped beef, Carolina pulled pork and Alabama chicken," Stimak said. "Comes with a white barbecue sauce, 12 ingredients. It's killer good."
And in a nod to Tex-Mex tradition, you can get it all in a tortilla. Every year, mobile food vendors take up strategic positions all over downtown Austin. In a good SXSW year, Stimak will make almost four to six times what he would in a normal week.
"It's kind of like our Christmas, if you will. This is the Christmas season," he said.
Even so, Stimak says people are spending a bit less. Patrons who used to buy his two-for-one taco special just for themselves are now splitting it with friends.
But because almost all of the vendors are local, most of the money spent on things like food and transportation goes back into Austin's economy.
Mike Shea, SXSW executive director, says Austin is the perfect partner for the festival, especially compared with other — colder — cities.
"Every time it freezes in New York, we get another hundred registrations in Austin," he said.
And with every one of those new registrants, Austin prepares a little more food and a few more cabs.
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