Dave Graham was "blown away" by last year's inaugural BottleRock Napa Valley, the four-day festival that drew thousands of music lovers with a lineup that included the Zac Brown Band, Kings of Leon and dozens of other acts.

"It was the coolest thing that I had ever experienced in Napa, socially speaking," said the Napa native. "It was like, 'Are you kidding me?'"

Last year he was there as a fan. This year, he's running the show as CEO of the newly formed Latitude 38 Entertainment group, which took over operations of the financially troubled festival in late January and has been working against the odds ever since to save the BottleRock brand.

Thus far, Graham's crew has been successful. The second annual BottleRock, which many believed might never happen, opens Friday. The three-day festival returns to the Napa Valley Expo center with more than 60 bands on five stages, including headliners Outkast, The Cure and Eric Church. It's a surprising turn of events for BottleRock, which came under fire almost the moment the festival gates closed last May. Although the inaugural affair drew an estimated 100,000 fans, it left many vendors unpaid. Lawsuits followed and the original organizers, BR Festivals, eventually filed for Chapter 11 bankruptcy, having racked up nearly $10 million in debt.

That's enough to give any event a black eye and scare away potential suitors. But Graham looked over the books and saw where he believed the founding fathers had made some key mistakes, most of which had to do with spending money on things that didn't really have a sizable impact on ticket sales. He felt if they could streamline -- cut back the number of days and lose the comedy lineup, for example -- they could turn things around.

"First-year companies have to brutally prioritize and not get caught up spending time and money on things that are not mission-critical to the business," said Graham, whose background is in tech and seed investing. "I don't stand in judgment of the founders -- any founder, any entrepreneur, is going to make mistakes."

So he formed Latitude 38 with some fellow Napa Valley entrepreneurs and began negotiating an asset purchase agreement to take over BottleRock. Selling points included the brand name as well as an important database -- last year's ticket buyers. As part of the agreement, Latitude 38 assumes none of the original liabilities associated with BR Festivals. Still, even though it's technically not their debt, Graham and crew have committed to helping pay off the vendors and have already eradicated roughly half of the debt -- some $5 million.

Outkast performs on the first of three days of the annual Sasquatch music festival Friday May 23, 2014, in Washington. The reunited duo plays Saturday at
Outkast performs on the first of three days of the annual Sasquatch music festival Friday May 23, 2014, in Washington. The reunited duo plays Saturday at Bottlerock in Napa. ((AP Photo/seattlepi.com, Jordan Stead)))

One of Graham's biggest challenges has been to educate various stakeholders, from vendors to city officials, that they aren't the same guys who ran the first BottleRock into a financial hole. Steadily, Graham and his partners -- Justin Dragoo, Jason Scoggins and Joe Fischer -- are starting to win the community's confidence.

A key victory was to convince the Napa Valley Expo to once again host the event.

"I think in the beginning we were pretty set that (BottleRock) wasn't going to happen in 2014," said Joe Anderson, CEO of Napa Valley Expo. Yet Latitude 38 changed their minds.

"They make full promises and they carry through on their promises," Anderson said. "They have been great to deal with."

Latitude 38 is definitely battling the clock, given that the APA transaction wasn't finalized until late January. Plus, many booking agents had heard all the stories about the festival's financial woes.

"It took awhile for them to understand that we weren't those (original BottleRock) guys," Graham said. "That takes time. So, everything was just accelerated."

Still, Latitude 38 was able to land 2014's most heralded reunion (hip-hop act Outkast), one of country music's hottest artists (Eric Church) and one of modern rock's most iconic acts (The Cure). Looking beyond the three headliners, however, many have noted that this year's undercard isn't nearly as strong as last year's.

While other music festivals, such as San Francisco's Outside Lands and Southern California's Coachella, are doing banner business and selling out well in advance, BottleRock has faced several challenges and has turned to some nontraditional methods to move tickets. Notably, they've partnered with Internet deal sites to sell the tickets -- often at a severely discounted price. One Groupon deal offered daily tickets for $99, which probably didn't sit well with folks who paid $149 for the same tickets through the BottleRock site.

Still, organizers aren't expecting to make a large return on investment, at least not in 2014.

"You don't get into the festival business and, in one year, expect to be wealthy and highly profitable," Graham said. "We are taking our lumps in a lot of ways this year -- but knowingly, right?"

Follow Jim Harrington at http://twitter.com/jimthecritic and www.facebook.com/jim.bayareanews.

BottleRock Napa Valley festival

Featuring: More than 60 musical acts, including OutKast, Eric Church and The Cure
When: May 30-June 1. Gates open at noon each day.
Tickets: Single-day tickets start at $149; three-day passes begin at $279. There are also some discounts available when buying four tickets. Visit www.bottlerocknapavalley.com.