We’ve heard a lot in past few years about folks vowing to invest in the music business to level the playing field but let’s take a look at that.  The majority of these “start-ups” are focused on either tapping into royalty revenue, or music streaming.  Is that really investing in music?  The idea that investment in music is to help the artists or level the playing field is feeling more and more false as each new startup pops up.

There is a world of aspiring artists that these don’t help at all.  In fact, even on the major level, it hasn’t particularly proved beneficial, just different forms of the same problems.  If any of us really gave a shit and wanted to help “level” the playing field we would be focused on the incubator model for musicians.  We can learn from the pitfalls of the early tech incubators and genuinely help artists develop, create leverage, and own their assets.

There are a few new companies that are doing just this but they are either launched with or an investment from a major label, and generally speaking, their scope is narrow.  By design, an incubator in the music industry really does need to remain small, nimble, and focused.  But the real challenge remains the same, labels don’t want to invest until you are at revenue, investors want a piece of your royalties, and streamers want to monetize your assets without paying you wherever possible.

There are millions of artists that think they have what it takes but as everyone eventually figures out, it’s as much the team of dedicated professionals around the artists as it is the songs and the artist.   And development from an aspiring artist to a professional recording artist requires a substantial investment of time and money.  But this is where we’re going to make a real change.

I speak with artists all day long and a large percent of them actually do not understand the revenue model of the music business.  In the words of Marcus Lemonis, “If you don’t know your numbers, you don’t know your business”.   And the platforms that claim they are going ‘disrupt’ and bring investors to artists are going to fail unless they figure out the value of the business units around successful artists.

Educating artists early and building with them, as a business partner is where we create the leverage to grow and influence the future changes within the music business.  Artists don’t need to do it all but they do need to know enough to identify when a service provider or partner is not delivering, or how to understand ROI and valuation of fan engagement and leveraging brand equity.

So folks can continue to claim that they are investing in artists and helping to level the playing field but they’re not.  Not until Majors and VC’s are investing in artist incubators.  In the meantime, there are some great folks out there in this business passing this information on one by one.  Some of them are even investing time, money and resources in artists and their development.  But as it currently stands, it seems the VC money in music is in leveraging your rights for revenue and royalty loan sharks.

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