This site is a blog for musicians and music industry people. It is a free educational resource and it is also the way I advertise my music consulting services. I am an entertainment professional with deep roots in the music industry. Throughout my music career I have been a major label A&R representative, a music supervisor, an artist manager, a reality show producer, a bass player and the head of a digital record label.
Matt Urmy is the CEO and co-Founder – along with Jonathan Sexton – of Artist Growth, a mobile software platform that helps artists manage the many intricate pieces of their music careers. Matt got his start in the music industry as a songwriter, a touring musician and recording artist, both with his bands and solo. Raised in Nashville, Tennessee, he is also a published writer with an MFA in poetry and has recorded three albums. Artist Growth is a platform that provides amateur musicians and pros a suite of tools to track daily tasks, coordinate projects and grow their music careers strategically. Through the software, users can manage finances, gig calendars, inventory, industry contacts, social media, performing rights organizations and get mentoring resources from top experts in the music business through the company’s AGtv channels. In addition to launching Artist Growth, Matt also teaches creative writing at Nashville State Community College, is developing his first Broadway musical and is working on an album with Cowboy Jack Clement.
I recently talked to Matt about the challenges he has encountered throughout his own career as a performing musician and how the Artist Growth platform directly addresses these challenges and can help artists interested in building sustainable careers within the music industry.
How did you find your way to the music business?
MU:
I came to the music business much like a lot of other people in it. When I was a kid, I started writing songs, and I wanted to be in a band. So, I started a band. And that turned into a high school band, then a college band. And then being out of college, I went solo and spent about a decade driving up and down the Eastern Seaboard playing gigs in bars and clubs.
Which bands were you in?
MU:
I was in two. I was in one called Telescope and then another band called The Whiskey Scars, which was a honky-tonk country band. It was by far the most successful band I was in. I was also in that band with Jonathan, the other founder of Artist Growth. He played bass. We founded it just as a way to pay the rent. We went and convinced this club owner in Knoxville and said, “Hey, if you pay our rent every month, we’ll put a band together and play here every Thursday night.” He went for it, so we got our rent paid for a couple years. We put this country band together, and it turned out to be this wildly successful, really fun honky-tonk band. The only problem with it – as you might imagine with a name like The Whiskey Scars – was that it was not a band that was in any way sustainable. You can’t live like that for very long before things start to go very wrong for you.
After a couple years, we packed it up. Both of us had children during that time, so Jonathan and I came off the road. We took a couple years off and stayed at home with our kids, worked day jobs and at about the same time came back to touring and hooked back up. So, we came back to our touring career really engaged in trying to move forward in the business. It wasn’t just about having fun and being on tour; it was about making money and understanding marketing. It was also the first time in my life I had ever worked with promoters and publishers who were actually professionals. I started learning all these things from them about how you’re supposed to do things and what the protocols are.
It was really one awakening after another. And having moved back to Nashville, I was meeting people who were veterans in the business. And all of that awakening and learning that happened coupled with the fact that Jonathan and I were completely dissatisfied with the online software tools available to independent musicians that we sat down and decided to design one ourselves. Once we did that, initially, we got such a positive response from people in the space here in Nashville that we kept going with it. And eventually, it turned into a product we were able to raise a million dollars to develop, implement and market.
As touring artists, we decided to build something for ourselves, and then we realized we had something everyone could use. So, now we’re not touring anymore once again and are instead going to be traveling around promoting this new product we built.
Obviously you had problems and experiences on the road that made you say, “I need to create something to fill this void.” And you built a product that solved these problems. Knowing what you know now, what would you have told yourself when you were just starting out playing music and touring that you’ve learned by building this solution?
MU:
The first thing I would’ve told myself is, “You need something that you can use to keep track of everything that’s easy to use and understandable.” That was my #1 problem. And each of the things I needed to keep track of was small, but they all added up to something big. For example, I needed to retain a list of every show I performed somewhere and have that accessible. And then, I needed to find a way to retain email addresses I collected at clubs. I also needed to have a way to put together a collection of every set list that I played at every club. They were all written down on pieces of paper, and I would lose them. Sometimes I would carry them around in my guitar case for a while and reuse them. But eventually, they’d get lost or I would spill a glass of wine on them. I would also lose receipts. I didn’t keep track of them, even though I had a glove box full of them. I also needed a list of how many records and how many t-shirts I sold at each show.
There was a lot of basic data keeping. And I didn’t have an understanding in my early 20s of how to use Microsoft Excel, FileMaker Pro or any of these file-keeping systems. They were tools that for me were really cumbersome and a pain in the ass to use. So, my solution was just not to keep track of anything. And it was so easy for me to justify it by saying, “That’s not what I do anyway. I’m just supposed to be an artist.” If I could talk to myself at 20 again and Artist Growth existed, I would say, “Yeah, you are an artist. And what you need is a tool that allows you to keep track of stuff and remain an artist and not have to learn how to use really fancy accounting software or a really fancy contact management system. You need a simple tool that’s easy to use and allows you to keep track of everything.”
What ends up happening is that after a certain amount of time, you do end up in a meeting with somebody who starts asking you questions: “How many records did you sell last quarter? How many did you sell in the last two years? How much merchandise are you moving? How big is your mailing list?”
How do you think things would’ve gone differently if you had these tools? Would The Whiskey Scars have gone somewhere else if you had access to that data?
MU:
I think we would’ve had the option to go somewhere different. There are always so many components that factor into whether or not a band is going to take the leap from being a concept that’s getting its feet wet on stage and in the studio to an actual act that’s invested in and becomes a business. That could be a lack of data or a lack of understanding, so you never get the meeting or the chance to meet with people who can take your career to the next level. But it could also be that your lifestyle isn’t sustainable or that you hate your drummer and it’s doomed from the beginning, or that you have a child.
It’s hard to say if The Whiskey Scars or any of my other bands, or even I as a solo artist in my mid 20s had been able to have access to Artist Growth, that I would’ve been the next John Prine. And of course, ultimately, you have to have the quality art to back it up.
I find it interesting, because you guys are collecting data I never even thought of. How would somebody use every set list they ever had?
MU:
What there is now is live performance royalty registration, which is a real revenue stream for somebody just starting out. You can get $200 or $500 every quarter in the mail from your performing rights organization (PRO) for performing. But you have to submit those set lists. And you have to submit those set lists with venue data. Artist Growth has over 30,000 venues in the system already. So, there’s the venue data. Now you just need a set list and a way to submit it. And that’s what we built.
We’ve tried to take all the ways there exist to have a revenue stream and have created a data tracking and data entry system that will be really easy for people to use. And we want it to actually turn into money for people or to help them leverage a meeting or get to the next meeting with people. Of course, the art has to be there.
It all goes back to the art. All the producers and managers we talk to say over and over again, “It’s all about the song.” And it is all about the song, the record and the art. If that’s there, the data just reinforces that. You can have all the data in the world. But if the music is terrible and makes people want to turn their radio off, and you can’t sing, then the data doesn’t matter. But if you really have something, and you really believe in what you do and are on a journey to discover your voice and get better, and if the feedback you’re getting is positive and it’s something you love to do and that you are passionate about, Artist Growth’s tools can help you. Artist Growth helps that kind of person start to put together the information that’s necessary to jump from the concept band or the concept artist who might have an independent record and has played locally, to somebody who is actually able to make music their career and have a team of people that are going to support that career. All that data matters now, because the landscape has changed.
You pretty much had me at “$200-$500 per quarter.” That’s pretty impressive. Explain to me how that works.
MU:
Live performance royalties are relatively new. But PROs collect these blanket licenses. They call it “licensing a venue.” They go out to all these venues – restaurants, bars, theaters, any establishment that plays music. They say, “You’re a business and you’re playing music in here, and entertaining your customers and guests is part of what brings in music and helps you make money. We represent the artists that make the music that helps you get business into your establishment. And since you’re using their art, which we represent, you need to pay us a fee to be able to do that.” So, the PROs collect all that money and distribute it out to the artists they represent.
BMI, for example, has over 400,000 artists that are affiliated with them. They collect money for all these licenses all year long from venues, big and small – restaurants, diners, coffee shops, as well as theaters, stadiums, etc. And now, with live performance royalties, what an artist that is affiliated with BMI does is send them the set lists they played at the venues that pay the licensing fees to BMI every year.
And you guys have taken this to the point where all an artist’s songs are registered with Artist Growth, and that process is fairly automated?
MU:
Yes. What you do with Artist Growth is upload your catalog. You put your registered work catalog into Artist Growth, and from that, you’re able to create set lists from the songs. You just drag and drop, make a set list and the system automatically connects it to a date, a gig and a venue. And we have the venue data built into our system. So at the end of the night when the show’s done and you’re doing your close out, you just hit “submit.” It’s kind of like sending an email. But we take all that information and you can send it off to your PRO. Once you register your set lists this way, every quarter, you get paid by the PRO for these performances. Part of the money the venue has paid the PRO is to cover the cost of the performance you did the night you performed there, so you’re entitled to some of that money. They send you a check in the mail. It’s not a ton of money. But a couple hundred bucks here and there really matters when you’re at the beginning of your career and trying to make it.
Part of the spirit behind the platform is also helping artists understand the business they’re in. That’s why we have AGtv and a mentoring portal. We have experts that the general public has never had access to before providing information on a wide variety of subjects, including legal issues, contract negotiation, songwriting, production, engineering, etc. Artists can go to these people whose expertise has previously been under lock and key within the business for decades and watch videos with information on their phones or tablets from some of the best minds in the business. These industry people talk to them about how to position themselves and get ready to really go for it. They tell musicians how to sidestep landmines, make a call to a radio station that doesn’t know who they are – and to navigate a lot of other challenges like that. This information really matters to artists in the beginning, because they don’t know the protocol. So, we provide career management and career mentoring.
I’m not even sure I would know how to call a radio station cold other than winging it, so that’s promising information.
MU:
Yes. And it’s not just information we put in there. You watch the channel and get one of the top radio promoters in the country telling you how to do it and how to follow up and when. And then the system will send you reminders saying, “Don’t forget to call that radio station back today,” so you don’t have to remember to do it yourself.
And people can check all this out on the Artist Growth website?
MU:
Yes. You can sign up for everything right there. And once you have your account, you go to the Apple App store or the Android Market – depending on which mobile device you have – download the apps, and you’re off to the races.
I don’t want to throw anybody under the bus, but there are a ton of artist services companies. The problem I think that’s most unanswered that you solve is the one attached to live performance royalty registration. Are there any other problems out there that your application solves that aren’t solved by the other sites out there – Nimbit, ReverbNation, etc.?
MU:
I think the main differentiator between our platform and those platforms is that those platforms mostly help with the distribution of content and the marketing and promotion of that content. I’ve personally used ReverbNation, and then I moved onto Nimbit. I’ve gone through several of these companies for my own personal career. And all reporting metrics that were available to me were based around the response to my marketing efforts. So, I had metrics for my email campaigns, metrics for my social media, metrics for the sales of the content that they digitally distributed for me. From a business and even a marketing standpoint, all this information was relevant. But what they didn’t have is a really integrated, streamlined system that allowed me to track my own personal data from my career on the road and details like royalties, licensing deals that I would do with a TV show, etc. They also didn’t offer me access to expertise that taught me how to get those opportunities, or once I had that opportunity, expertise that showed me how to leverage it into actual income. These services were just there to help me let people know I had a record or that I was going to go on tour and track the responses I got back.
And the information these other services provide is valuable and important. That’s why we don’t have digital distribution as part of Artist Growth or direct-to-fan marketing or widgets to put on your website. We don’t have website templates or an email client like ReverbNation has, because there’s already so much of it out there. What artists really need is to learn how to participate in the business side for their own career and then actually interact with the industry. They don’t need just another way to reach out to the fans. It’s very important to interact with fans, but artists also need to understand how to have a career in music and how to get in touch with people that can help them take that career to another level.
I think that’s solid advice whether you’re using Artist Growth or not. Obviously you’ve provided a solution to help carry all this advice out – keep tabs on things, make sure everything is orderly, be aware of your time expenditures and where your money is coming from, etc.
MU:
Yeah. And there are a lot of people out there that don’t even know what a performing rights organization is. I talked to some friends of mine back in Knoxville that were asking about Artist Growth, and I was talking about live performance royalty registration, and I was rattling off PROs like BMI, etc. They didn’t even know what those were. And they didn’t know it was free for them to go affiliate with them or that all they had to do was pay a $25 registration fee and they could start getting checks. That blew their minds. It’s easy for me to know about it because I grew up in Nashville, which is a Mecca for the music business. But when you’re living in a suburb of Decatur, Georgia, or out there in some of those places on the West Coast you don’t necessarily know what an organization like BMI can do for you.
And that’s part of what we really wanted to do with the Artist Growth tools. We wanted people to really understand what all the opportunities are, even when you’re at the level where you’re technically an unknown artist. There are still opportunities for you to grow a business, way beyond just Facebook and YouTube. Quantifying where your career is at is so important. It’s important to artists, but it’s also important to record companies, publishers and managers. If you have the right information, they don’t have to guess what 10,000 YouTube views means in terms of a revenue stream. They can look at your revenue stream for the past six months or two years and say, “Look at this growth. I can take this to another level.”
It’s about hard data. And that’s where we’re headed in the entertainment industry. The Internet and technology has taken us to a world and a paradigm where data are so readily available that there’s no reason to not include them in the process.
And how does it work for you guys on a business level? How do you make money as a business, and how much do you charge artists?
MU:
This was the biggest challenge for us when we were designing the platform, because for me, it was very important that this platform could scale. I wanted it go be valuable to a 12-year old sitting on his bed after doing homework with an iPad and his first acoustic guitar and trying to learn what it means to write a song. But I also wanted it to be valuable and useful for someone planning a large enterprise tour with multiple people on a team, multiple road teams out there working simultaneously. How do you build a software platform that scales all the way across the industry like that?
That’s how it got broken down into mentoring and management. A 12-year old doesn’t have much need for a financial and inventory and accounting management system, but he does have a need for mentoring and AGtv. What we’ve done is designed the system so that as your career grows, you can access bigger parts of the system. You can download the app from the Apple App Store for free. If you have an account with Artist Growth, you can just watch AGtv and just get the mentoring. And those channels can be 99 cents per month or $1.99 per month to subscribe to the library, where you can go in and access al the content.
If you want to buy into the whole system and subscribe to the entire thing and have the accounting, gig management and the smart scheduling management that has all the push-note integration, the search database, the AGtv, the quick sale and all that, it’s $4.99 per month flat for everyone. We wanted to keep it really cheap.
The way it scales from there is, depending on how big your team is, you can add other members to the account. You can do it in two ways. You can add members who are “read only” and don’t have access to all the financial and inventory data and contract details but can get set lists, schedules, tasks and to-do lists assigned to them and can report back with project details. Those accounts are 99 cents per member. Then, you can have an admin account added on. The way it works is that anyone else inside the system that has their own $4.99 account can be invited to be an admin of another account. So, if I was a manager and had ten bands, I would buy myself an account and all of them an account, then make myself an admin of all ten of them. Then I can manage all ten of them from a single place on my dashboard on my mobile device or computer. And then those bands can have those individual smaller members. You scale it out as much as you need. A whole management company could admin 600 artists from one account if they wanted to.
But if you’re a small band just starting out, you can pay $4.99 per month and have all members use the same login info to get in and out, as long as everyone is cool with everyone seeing all the information. Then as the business grows, and you’re hiring other people but don’t want them to have their finger in all your data, you can start adding on team members that have different permissions.
We didn’t want people spending money on features they didn’t need. So, if you don’t need accounting and inventory, you can just watch AGtv. As soon as you’re selling records and playing shows, get the $4.99 per month service and start giving people access so you can be a team. Then if you get signed to a management deal, add on an admin and let them have access. If you have to add on a road crew, you can add on some read-only members and distribute tasks for them.
Again, use it to help you manage only where you are, then as you grow, the account can grow. The hope is that it’s cheap enough that anybody can use it.
For more information about Matt Urmy and his new platform for artists, visit the Artist Growth website. You can also follow the company on Twitter and Facebook.
Karl Alomar is the COO and President of VYou.com, a social platform that provides video profiles for users with content structure in the form of conversations. A serial entrepreneur with an MBA from Columbia Business School, Karl has built companies with revenues in excess of a hundred million dollars, with an emphasis on tech over the past 15 years. The VYou platform allows users to connect with experts, interact with their favorite celebrities or organizations or communicate with friends and families. Video created on the site can be embedded and posted anywhere on the Internet, providing artists, bands and others with a very personal way to connect and interact with their fans and promote their brands.
Karl talked to me recently about how he got into the technology space, how the VYou platform works and several specific ways artists can use the features of the platform to promote their music and build meaningful relationships with their fans.
Thanks so much for talking to me, Karl. Tell me a little bit about what led up to you joining up with VYou.
KA:
I started a couple companies prior to finding my way to VYou. I started my first business in 1998. It was a video platform, but more for video distribution and video monitoring. It was more on the business level than the consumer level. I sold that company in 2000 when I decided to go to business school at Columbia University in New York. During that time, I started another company that was much more of an internationally-based business but again, with a technology backbone. I sold that at the beginning of 2010 after building it to about $130 million in revenue.
Then, I met the founder of VYou, Steve Spurgat through some advisory ventures I was doing at that point. I got very intrigued by the concept of VYou and what he was doing and decided to jump into the business at an early point to get it through the launch. I helped get it funding and get it to where it is today.
There have been a lot of players in the streaming space – and not all of them have been successful. What was your goal when you set out to help found this streaming company?
KA:
Steve Spurgat originally conceived of the business. The concept was initially more oriented around creating a fully-encaptured personality online. The idea is, all the people in the world you would want to have a conversation with, you wouldn’t necessarily be able to talk to – like Deepak Chopra or others like that. Users can encapsulate their full personalities in video and online so anyone can communicate with those personalities at any time. It was never thought of as a streaming business. It was always thought of as a video or an online clone of your personality that people can interact with freely.
That obviously evolved, and it became more conversational. It started transforming into more real time and today, is more of a video and Q&A-based platform. It allows people to answer questions they receive on video and is all short messages vs. long, streaming videos. We average 30 seconds to one minute per response. And what happens is that as you build that database of content, people are able to, through natural language processing, interact with the content at free will. You start getting this seamless conversation taking place between all the members of your audience with that profile on VYou.
And you’ve had a number of high-profile musicians use the technology and the site.
KA:
Yes. We’ve had a bunch of musicians either using the technology directly themselves as a platform or using it through interviews and other events that are taking place through companies like Flavorpill or VH1 – everyone from Lenny Kravitz and Moby, down to independent artists. We’ve had a bunch of independent artists and young, newly-signed artists who have yet to have albums come out or have just had early albums come out. We’ve had a huge spread of musicians, and there’s a lot of musical talent on the platform right now.
What would you say some of the best uses of this video platform are for somebody promoting either themselves or the products around themselves?
KA:
The best conceptual use case is basically the ability for an artist to communicate and connect with their fans on a much more intimate level. And the applications that allow that are these interactive videos, which is all crowdsourced questions and content. Through these videos, artists really feel that they can directly respond to those questions and have that intimate connection to their audience. The beauty of it is, no matter who asks the question, the people that come in and experience that communication afterwards will always feel like it was a direct, one-to-one communication for them. It creates a simulated intimacy even though it’s on a broadcast platform.
There are a couple different ways that works. The most obvious way is that people set up a profile and use it part of their social activity. They link it into their Facebook, their websites and use it as part of their Twitter posts. They use it as a straightforward Q&A communication platform with their audience. And their audience gets a feel for what inspires them, what’s going on around them and all the information about what’s happening with and around the artist – announcements about new videos, new albums, new shows, or whatever it is they want to announce.
There are a couple other applications that we’ve found interesting that we’re working on right now. The platform also allows you to record short message videos. We call them status updates. And I see a lot of artists using that when they’re on the road or when they’re going to perform somewhere or do things where they’re essentially sending videos out to their fans. And because of the social connection to Facebook and Twitter, you get this immediate distribution of whatever it is you choose to post. So, we do see artists putting these status updates out there and telling people what they’re doing, where they’re going, or giving the audience a feel of what it’s like to be that artist on a day-to-day basis.
Your description makes it sound pretty portable and user friendly. How is it different from doing a YouTube vlog or some other sort of video diary?
KA:
There’s a very big difference. First of all, you can do it all on your mobile phone or on an iPad. Secondly, it’s a direct webcam-to-web functionality, so you just have to press a single button. You don’t have to upload a video and there is no editing involved. You take out your phone, record, then post it. And as you post it, you can choose to share it on Facebook, Twitter or wherever else you want online. So, it’s a much simpler process than the one you’re going to have to do through any other more traditional video broadcasting platform.
And for non-joiners like me, do you have Droid support?
KA:
We’re going to have Droid support at the end of December. We actually have a big design upgrade coming this month. The Droid support should be coming along with that or right after that.
That’s great. And what are some of the other applications you see as being particularly useful for artists?
KA:
One of the ones we see a big benefit on and that we see a lot of publications using is the ability to encapsulate a video interview with an artist. And the beauty of this is, it’s all short message video. And it’s all packaged into a pre-existing player that lives within the publisher’s page. Flavorpill is a great example of a publisher that’s using this. Essentially, it allows for video content to be encapsulated in an interview that can be recorded anywhere. You’ll have an artist that’s halfway around the world that will want to do an interview with Flavorpill. So, they’ll set up their profile and record all the interview questions. Then the artist can sit down and answer all their interview questions. You’ll see a lot of people sitting in hotel rooms, concert halls or in their apartments responding to questions. It becomes a really nice interview platform within the industry, which gives a really good user experience to the audience.
The final thing that comes straight off the top of my head in terms of use case is some artists also use the montage feature or the open question feature. To explain what that is: the core of the platform is this “push” technology where people are pushing their profiles or their brands out to the world, advertising themselves and getting to know their audiences in that way. But, there’s also a “pull.” The pull is, there can be an artist who has a following, or just wants to put a question out to their audience. And they can actually pose a question to their audience and pull video responses from their audience. Some artists use this feature for contests. Others use it simply to gather or create community chatter around a particular theme or idea. The idea is, you put the question out to the audience, and all the audience members will come back and start answering these questions. We have this unique player that plays all the answers sequentially. It allows you to search through and see different people answering the same question. So, we have artists using this feature to broadcast a contest or an opportunity or just to generate chatter and communication within the audience itself to encourage more interaction.
Surely when you got into online video, you did ton of research and continue to do a lot of on-going research. Do you think interactive video is going to stick? Are the metrics you’re tracking showing this to be making a real impact?
KA:
Absolutely. One really simple example is Flavorpill. The time on site for the pages that had interviews on them were twice as long or even longer as the time on site for the rest of the pages on the site. It wasn’t that the rest of the site had bad content on it. They actually have great time on site on average. But with the interview pages, the audience gets very engaged in these videos.
I think what VYou does is take the real person, whereas Twitter and Facebook have this buffer that makes you wonder whether it’s actually the real person or someone in their place filling in the content, tweeting, posting, etc. VYou says, “This is the real person. This is true, intimate conversation with the real artist.” And it allows that artist to really create a more intimate relationship between themselves and their audience.
The internet is evolving more and more. It started with just text, which turned into rich text with images. Then, images started becoming animated, which eventually turned into video. Then, social media was introduced. Now, social media is starting to integrate video as well. And creating that opportunity where you’re really able to make people feel like you’re talking to them and really communicating with them on a very personal level is something that is specific to social video. You can’t really get it in another delivery format.
To learn more about Karl Alomar and his work in the social video space, and to check out the VYou platform’s new video features releasing in January, check out the VYou website.
Jeff Yapp is the Founder and CEO of NXTM and WHOOZNXT, a platform that helps artists find opportunities to connect meaningfully with their fans, build their following and get real-world exposure. A self-proclaimed “classically-trained” products marketer and known as an innovative marketing expert, Jeff got his start in the music and entertainment industry when he went to work with Pizza Hut on entertainment-based marketing and properties. This eventually led him to Hollywood and a job as Executive Vice President, Program Enterprises for MTV, where he worked with the MTV, VH1, CMT and Logo networks to build the scope of their brands in the emerging digital market. While at MTV, he was able to grow the division significantly and worked with content for movie studios, gaming, sports, home entertainment, consumer products, radio networks, publishing and business development. Jeff also led the team at Viacom that successfully acquired Harmonix in 2007 and launched Rock Band 1 and 2, which earned 50% of the revenue in the video game market the year it was launched. In 2007, his team also won an Emmy for its work in the 3D avatar-based virtual world with the games Virtual Laguna Beach and Virtual Hills. In the 1990s, Jeff also worked as an executive at 20th Century Fox, where he was responsible for launching the campaign that reintroduced the Star Wars franchise. He launched WHOOZNXT in 2010 and immediately signed mega-artist Taylor Swift on as an investor and his first client.
I got to sit down with Jeff and talk about his experience in the entertainment and music industry, how WHOOZNXT works for artists and why developing a meaningful relationship with fans is so critical for artists that want to make it in the music business.
Thanks so much for taking the time to talk to me, Jeff. How did you get started in the music industry?
JY:
I started in packaged goods marketing, and that morphed into a move into the entertainment business. I started at General Foods. I was a basically a “classically-trained” packaged goods marketer. Then I went to work for Pizza Hut, where I started to get involved in entertainment-based marketing and properties. That got me exposed to Hollywood, and I went to work for 20th Century Fox in the video department. I headed global distribution for Fox, and it was really my big step from packaged goods into entertainment. Then I had a stint in retail, and a big set internationally, which gave me some perspective there.
Most recently, and something that is probably most relevant to this conversation is that I spent time at MTV. I took that background of classic marketing, content and video development, all the way through to retail distribution. My job at MTV was what I jokingly called in the “rats and mice” division. It was all the things that were not related to television. So, I had the movie studios, the gaming studios, consumer products, publishing, business development and technology across all the music groups: MTV; Vh1; CMT and Logo. It gave me a front-row seat in the music business.
I was at MTV for about six years during the implosion. I was there when the business was really changing and everyone was looking for the next savior. When I first got there, the savior was supposed to be AOL Music. And then it became Yahoo Music. And then there was Myspace. What was interesting was that there were a lot of pluses and minuses. On the plus side, these social platforms and digital platforms were getting bands unbelievable exposure for the first time ever. All bands potentially had access to these huge audiences, and they weren’t having to go through a gatekeeper like a label. But that was good news and bad news, because now 10 million bands had unlimited access to fans. It became this amazing morass for fans to sort through it all and really start to provide some meaningful exposure that could help a band go from local hero to superstar.
That’s the thing I got interested in. I said, “How do you take all this online activity and translate it into the kind of exposure that a good band needs to break out?” The A&R budgets continued to decline along with the ability for anyone to make investments in artists, because there was pretty much a one-in-ten chance an artist would have a successful hit. I started to think about how I could make that potentially more interesting in terms of which bands to focus on and which to give exposure to. And that’s where WHOOZNXT came from. I was really looking at Myspace, and looking at this amazing platform with ten million bands plus. But then you go to it and have no idea, if you’re a fan, where you want to go and what you want to listen to. It’s really not a great discovery platform. So, I said, “How do I translate digital success into real-world exposure?” That was the first kernel for WHOOZNXT.
And, really it was something that was not being done. What was interesting to me was that there were hundreds of companies that were toolkits and playlists and things that were digital ends. Myspace was a digital end. At MTV, you could really see our exposure impact on bands. You could take our video rotation at 2 a.m. and generate more online activity for a band than the front page on Myspace, which was kind of telling to me. It was obvious why some labels had done well. If you take the live performance, the radio campaigns, television campaigns and the digital campaigns and roll them all together, that package, with talent, gave you a shot at helping a band break. I felt I could bridge that in some way.
I started WHOOZNXT about a year and a half ago. And as a startup, you have to get some credibility. So, I approached the one artist that had used the digital platform to build a fan base pretty amazingly: Taylor Swift. At a time when everyone told her they were not interested, she lived on Myspace. She talked and sang to her fans and had an amazing connection with them on Myspace. I showed her what I wanted to do, and she became my first investor and client.
It was a pretty amazing story. It seemed like Taylor’s success was pretty random, but in the back of my mind I always believed that there were probably 25 other Taylors that will never have the same shot.
And she’s on an indie in Nashville signed to a major.
JY:
Yes. She is signed by Big Machine through Universal.
It’s one of the few situations where someone would have the flexibility to do such a partnership without being hand strung through infinite layers of red tape.
JY:
Absolutely. And I got to Taylor right after the release of her first record, so she was just starting to explode. Having spent time with her and her family, I realized how many random things had to happen for someone as gifted and as talented as she was to have the shot she has today. That’s what became interesting to me. So many things had to happen that were completely unrelated and random for her to get into the situation that’s allowed her to become the global superstar she is. I wanted to see how we could take some randomness out of that type of story. And that’s when I came up with the idea for WHOOZNXT.
We’ve created a platform that’s free for artists to register on. The thing that’s confusing to artists when they first come to my platform is that I don’t ask them to do anything except register their entire social grid. I don’t want them to have to fill out another profile or upload their music or videos for the 50th time. When we first started this, the bands asked, “What are we supposed to do?” And I said, “Focus on growing your fan base by writing great music and performing it live. This is a report card. This is you chart and will tell you how well you’re doing and what you need to do to grow your fan base. Because, at the end of the day, success as an artist is going to be tied to your fans and their depth of commitment to you. They need to be willing to part with a dollar for something you do.”
One of the many reasons I was excited to talk to you is that you’re clearly a guy with a formal business acumen. A lot of music business startups are built on a dollar and a dream. And people get through on pure, unbridled passion and somehow get through to an investor. Sometimes it works. But more often than not, people don’t really take a look at the marketplace before they go in and spend a lot of money and time developing things.
I think it’s interesting that you took a look and didn’t find any filtration systems or referral programs that were good. I think there have been some, but they have come and gone so quickly because they require people to sign up for yet another platform and fill out another profile. As far as I can tell – and I just signed up my first artist with WHOOZNXT a half an hour ago – you guys are really just establishing clout and then building additional opportunities based on what people have built through their own momentum and relevant to the career level that matches theirs.
JY:
Exactly. Say my top opportunity is a performance on Jimmy Kimmel Live or a chance to open up for the Virgin Mobile Free Fest. How do the people in charge decide which band they go with when there are thousands of bands being pitched to them?
One of the things that started to ring true was one of the ideas we thought a lot about: the concept of fan validation. There are a lot of “heat indices” out there and algorithms to predict who is going to be the next big band. But at the end of the day, the only thing that has truly determined how big an artist becomes is the size of their fan base, defined by those who will go see their shows and buy their music. Today’s world is very different from even three years ago; now, an artist’s fan base really lives in the online social communities. They don’t spend a lot of time on their website or on another dedicated site. So, it’s on Facebook, YouTube and wherever their fans are that artists need to be.
So, we thought, “Why don’t we just aggregate how fast they’re growing fans across a particular platform?” Every month, the band that has grown the most fans will be “the hottest.” And every month, we’ll restart back at zero and track it all over again. Because the truth is, in the music business, if you write a new song, your life can change if it connects. It’s not the fact that you have 22 million fans. It’s the rate at which you’re growing your fan base. For example, Justin Bieber is hugely popular today. But his rate of growth has definitely slowed. We think we’ve discovered something pretty interesting.
We started WHOOZNXT at South by Southwest. We turned on our system at 4 a.m. the day before the launch, and immediately a band jumped out called Asking Alexandria. We were scratching our heads, because we hadn’t heard of it, and it wasn’t a band people were talking about when we got to the festival. We talked to journalists, and they hadn’t heard of the band. And we talked to someone at Jimmy Kimmel Live, and he hadn’t heard of them either. We thought at first we might have done it wrong. But, it was clear that they were 2-1 in terms of fan growth over anybody.
What’s funny is, I started in the research department at a subsidiary of Atlantic called Lava. And what they had drilled into me was that the only thing that predicts future sales is existing sales. So, quite literally, we would look for things that were unaffiliated with major distribution that were selling or things that were unattached to major labels but on radio stations and getting requests and requests in record stores. For a company that was a Fortune 500 company, it was a little amazing that this was the only research we really did. A company in another industry would be willing to spend a million dollars determining whether someone wanted white or off-white tube socks. The music business would spend that much money on videos without knowing if there was any market for the product whatsoever.
JY:
Yes. It’s all pretty interesting. When we started at South by Southwest, we knew we were going to see 90,000 music fans throughout the week. And we picked this band Asking Alexandria to feature. We then found out after we picked them that they were voted “longest lines.” People had to spend the night. And they filled 4,500 seats at a show the day after South by Southwest in Dallas. The coolest thing that happened to me was, a week before this band was going to play on Jimmy Kimmel, I was sitting at Taylor Swift’s label waiting for a meeting. And the head of marketing said to me, “Who the hell is Asking Alexandria?” He had no idea I was working with them. I asked why he was asking, and he said, “Universal Distribution has just named them the ‘Band to Watch’ because their first-week sales were so strong.”
So, fan base growth rate as a predictor of a band’s success feels like a pretty good model. They have continued to have an amazing summer. They opened up the Warped tour and are going to take their own tour this fall with venues with 4,000-5,000 seats and 30 dates.
We’ve evolved the site too. If you go on the site and look at “WHOOZ HOT,” you’ll see something pretty cool. It’s an idea I had when I was at MTV. I was wondering why we were picking who we thought was hot. I wondered why we didn’t let the fans pick who they like. So, for “WHOOZ HOT,” we use the ranking system from WHOOZNXT and rank our bands. You can categorize them by genre, by geography or by level. You can say, “What’s the hottest double-platinum rock band in Detroit.” Then the system automatically reaches into a particular band’s YouTube and pulls out the hottest video in the last 48 hours. Basically we’re creating a next-generation music channel on the fly, where the channel is completely programmed by the fans.
That’s a daunting task, but one that is certainly a worthy one.
JY:
We have it going, and it really feels good. At MTV I was always wondering why we weren’t programming videos this way. Now I have it. I feel like we’re doing things for artists that other people aren’t doing for them. And we’ve put together an exposure network. It will continue to fill out, but it includes television partners like ABC, Comcast and Time Warner, and radio partners like Clear Channel and Westwood One, live performance partners like AEG Live and Live Nation. We now have about 80 gigs. We’ll go to 140 in September. And when we add Guitar Center as a partner, we’ll hopefully get another 280. We’re filling it out to where we’ll ideally be able to offer opportunities for bands they wouldn’t have without us.
You have such a unique vantage point as someone that has built a business around a science you created for determining which bands are going to be successful. Ultimately, I want to ask you how you turned this into a profitable business for you. But, first, I would really like to know if, as you’ve studied the different ways people engage their fans, you’ve noticed that certain social networks or methods work better than others?
JY:
Having now spent probably the better part of four years looking at social media, there is no way a band will ever tweet, blog, post, interact, profile their way to success. The conclusion I’ve come to is that the music business at its core has not changed: It’s all about the artist and their connection to their fan base. Without that connection, nothing you do on social media will lead you to success.
It’s really funny, because it’s still about the song and how the song connects with a fan. What has changed fundamentally is that with that song, the acceleration of awareness has changed overnight. The way I think about it today in terms of how I determine which are the best accelerants for that song, is that Twitter is the real-time measure of your impact in a situation. So, when you perform live, Twitter will be a huge indicator of how well a song connects with fans. Twitter is easy, fast and it provides a ton of feedback.
The second most impactful medium is Facebook. People will take time to post, share blogs or “like” on Facebook. Facebook is the digital equivalent of buying a single. Back in the 1950s or ‘60s, once you connected to a song, you would buy the single. At the point when people were really buying records, SoundScan was that universally-accepted measurement of engagement. That’s really all it was: “Were you engaged enough to buy a record?” We didn’t have objective ticket information, so SoundScan was that chart that basically identified how hot somebody was.
I would argue that when you decide to “fan,” “follow,” “like” or “subscribe to,” those are statements of engagement. They are digital engagements, but they’re the next level. And I think that’s what gets really interesting, and that’s what we’re using as the next “chart.”
I have people coming to me all the time and saying, “I want to do a viral video like Kreayshawn.” And I think, “OK. Go write a hit song and call me back.” There’s a fantastic story about Kiss interviewing managers. Gene Simmons swaggered into every potential manager’s office and said, “We want to be on the cover of every major magazine. What are you going to do about it?” And they ultimately signed with Doc McGhee. His response to that question was, “The plan is simple. You put your make-up back on, and you kill the president. Now let’s get to work.”
JY:
Gene called me once when I was working at MTV. And a conversation I had with him has really affected the way I think about fans. He said, “I have 1,000 fans that will pay $10,000 for whatever I do. And I have 10,000 fans that will pay me $1,000. I get $10 million bucks to get out of bed. What are you going to do for me today?” What he taught me – and he’s smart – was that all fans are not created equal. What it is incredibly important for artists to understand today is that they need to understand who their core fan is and stay honest and true to those folks.
When most artists start to fall apart, it’s because they lose sight of that core fan base, the ones that got them there. Our whole communication with artists is focused on their fans. What we’ve done with Justin Timberlake and Taylor Swift is to analyze their business through their core fan base: how much they are engaged; the revenue they get from them. We spend a lot of time trying to take care of the core fan.
Do you have any exciting things coming up at WHOOZNXT you’d like to share?
JY:
We’re really focused on band registration. My job is really getting cool, and it’s really about getting people involved. I know you wanted to know how we make money. The thing that’s interesting about music is that it’s a global platform. But the folks that follow the “emerging artist” category – people who are into music enough to really want to discover unknown bands – are who you think of as the taste makers that really have some influence. They’re the kids in high school you went to in order to find out which bands were the hottest. They are also the toughest people for brands to target. That’s why I think WHOOZNXT this is such a huge business opportunity. Just based on the 25,000 bands we have on the platform, I think we’re at 154 million fans. That’s a crazy number. That’s why I think we’re representing the future of the music business for bands.
It still takes money to be a developing act. There are no two ways about it. And I think that money is going to come from brands. And my job is to help connect those bands and marketers in a way that is organically true to the band and organically true to the fan, but also creates opportunities for artists and provides them with the capital they need to build their business.
Along those lines, have you started the process of building in potential brand partners for underwriting?
JY:
Yes. The first one we started with was Samsung and the Summer Krush events. The second one is Virgin Mobile. I can’t announce our biggest project yet, but it’s going to be a huge and exciting program for kids in the college market.
The thing we’re finding is that every brand – whether it’s a car or a soft drink, anything that has to do with the youth market – becomes really interested in this space very quickly. What I set out to do when I was at MTV is figure out what the future of MTV was going to look like. And this is the analogy I think is interesting: Cable was a piece of technology that enabled the rise of channels like MTV and ESPN – channels that anybody in the broadcast world said would never happen. A new technology showed up that gave you a whole new paradigm under which to build new businesses. And that’s where we are today too. YouTube is a global platform, completely interactive and on demand, and serves micro audiences rather than macro audiences. And there needs to be a completely new business model to support that next-generation video model. And we’re hoping our site can represent that business model.
To learn more about Jeff Yapp and his platform for artists, please visit the WHOOZNXT website.
David Choi is a singer, songwriter and producer. Originally from L.A., he grew up playing violin and piano and came into singing and songwriting when he was in high school. His music has been played on major channels like NBC, FOX, VH1, MTV, A&E, E!, Travel Channel, Style, PBS, Food Network and the Disney Channel. He has also worked on creative projects with companies like Kelloggs, Starburst, the American Cancer Society and Samsung. David was chosen in 2004 by David Bowie as the grand prize winner in his Mash-up contest. Shortly after, he won the USA Weekend Magazine John Lennon Songwriting Contest for teens and appeared in USA Weekend alongside Usher.
David Choi is an amazing example of a DIY artist that has used YouTube annotations, playlists and embedded links to connect to existing fans and continue to turn new people onto his music. In fact, on YouTube, he has amassed over 884,000 subscribers and has had over 95,000,000 YouTube upload video views. In 2008, he produced and released his first album, Only You, followed in 2010 by his second album By My Side.
Recently, I sat down and talked to David about his success in the music business as an artist and songwriter, why he has been so successful at marketing his music through YouTube and some advice he has for artists that want to connect with fans and build their careers.
Thanks so much for taking some time to talk to me, David. How did you get into the music business? And how did you build such a following using YouTube?
DC:
I grew up playing violin and piano. I was forced to play and actually hated it. But then I discovered songwriting in high school. This kid brought in a CD and said, “I created this music.” And it had never clicked in my mind before that you could actually create something from your own mind. That’s how it started. I started when I was 16 and started interning with music companies – the whole thing a lot of people in the industry do and have done. About six years ago, when I was 19, I got signed to Warner/Chapell as a staff writer, which I got through a workshop with ASCAP. I just put in my stuff and got selected out of 2,000 people throughout the United States along with about 15 other people. I got really lucky.
I started posting to YouTube in about 2006, and I kept posting. In my second year with Warner/Chapell, I posted a YouTube video just for fun. I wrote the song in about 15 minutes. It got featured on the home page somehow a couple weeks after I put it up. I wasn’t expecting anything, and I wasn’t even pursuing a career as an artist. I was strictly a songwriter and producer. About a week after my video was featured, it already had half a million views. And that’s kind of what got the ball rolling. I didn’t even start doing shows until 2009. Everything just started growing, and life took me in a little bit of a different direction than I intended. I’m still doing the producing thing but am focusing on the artist thing for now. In conjunction, I’ve been trying to do a lot of things with YouTube and other social media.
Let’s talk about that. Over the years, a lot of people have been featured on the home page of YouTube. And that didn’t wind up leading to a career, as it has for you. It seems like YouTube is where you’ve exploded. I notice you do really interesting things there with playlists and annotations, like the feature on your new album. Is there advice you can give people who want to market themselves on YouTube?
DC:
To be honest, I think a lot of the success I’m having through YouTube is because I started early. I’m not saying it’s too late for other people, because there are plenty of people that are rising to the top. There are some people who have only been on for a year and are just growing like crazy. YouTube definitely has changed from what it was when I first started. In 2006 it was more about, “Oh, wow. This person is making a video from their house. It’s so unpolished and unprofessional.” But the landscape on YouTube is changing, and now everyone is getting HD cameras. It will still work to not have polished videos, but it seems like the trend now is that everything is much more polished, because above all, YouTube is a video site. It was never really a music site; it was always a video site.
As far as advice for people that want to use YouTube well goes, I think consistency is very important. You have to be persistent.
How often do you post videos at this point?
DC:
I don’t really post as much as I would tell people to, because I’ve just been doing it for so long and am a little tired of it. I think I’ve been posting about one every 10 days or so. But I’ve been doing that for five years, so there have been periods of three months where I haven’t posted anything. That’s really bad. You should never do that. But I guess it’s a little more understandable for me since I’ve been doing it for such a long time.
I think if you’re just starting off, you should definitely do it every week. Another thing that seems to work is recording a cover of one of the more recent songs that came out and posting it, because people will be searching for that. It’s all about views and reaching an audience. And there are a lot of people searching for the new music that comes out. So, if they see your cover up there, they can listen to it and make their judgments about whether it’s good or bad. And if they like it, they might become a fan. They might check out some of your other covers or see if you have any originals. That’s the direction I took it. I did covers and hoped people would check out my originals.
I agree. I’ve found covers are a very good way to combat consumer fatigue. I don’t know about you, but when somebody says they’re a musician, I kind of roll my eyes. It’s gotten that bad sometimes. When somebody is bringing me something I’m somewhat familiar with, I’m more likely to give it a chance.
DC:
Yeah. That makes sense. Definitely.
How did you select the covers you chose?
DC:
I just looked at the top charts on iTunes and chose something in the Top 10. For me, personally, my selections were based on which songs I liked. And I really liked oldies, so I did a lot of covers of oldies. The label didn’t like that so much at the time.
Labels used to crack down a lot more on YouTube covers. Lately I haven’t heard of anyone getting into real trouble for it, other than a wrist slap – a take-down notice or an infringement notice.
DC:
Nobody has been sued yet on YouTube for doing a cover. But there have been channels that have been suspended. I actually got suspended before because I got three strikes for doing a cover of “What a Wonderful World,” which I did twice. Nowadays, there are things being worked out with labels and publishing companies. I’ve seen a little bit of progress happening. Really, you can’t stop it. People want to share music. And of course there are two sides to the story, and I completely understand both. There’s the business side, and then there’s the whole creative idea of being able to share music because it brings joy to people’s lives. My viewpoint is that we should find a solution and find a way to monetize everything.
And I think people are starting to chip away at it. For example, Sony emailed me, and they said they are getting into the YouTube thing too. The truth is, YouTube is very powerful; everyone is on it. But that’s a whole other topic.
I notice you’re also really big on collaboration. Has that contributed to getting a lot of fans and viewers?
DC:
I would say that collaborating is definitely another tool to expand your fan base. It’s a great way to get a new audience, in a way similar to doing covers. It’s about drawing a different crowd. Of course there are some politics involved. There are issues like, “How much am I going to promote this person, and how much are they going to promote me?” But aside from that, generally collaborations help mix their fans with yours and your fans with theirs, depending on how much you and the other artists promote.
You have to throw a little caution to the wind when getting into business with someone new and hope that they will at least provide an equal output of effort so you’re not just getting someone who is leeching off your brand equity.
DC:
Yeah. The way you worded it makes it sound like a business. And it kind of is. At the same time, most people started YouTube because it was something they did for fun or because they were bored. It didn’t used to be a business, and most people didn’t go into it thinking it was a business. Maybe they do now, because it’s a partner program. And now people get excited when they find out they could possibly make money from it. But when I was first getting into it in 2006, everyone that was also getting into it thought it was just all for fun. Now there’s actually a business model you can follow with it.
Do you get performance royalties checks from the stuff on YouTube? Do you see any income from the videos you post?
DC:
I guess it could be considered a performance royalty, although you don’t get paid per view. It’s similar to AdSense. You definitely don’t make as much money through these ads as you would through a commercial on TV. In terms of the amount of money you can make on your original content – it’s probably around $1,000 per million views.
If you think about TV, and if it was working the same way as YouTube, an ad that played on a TV show that gets 2 million viewers in a night would make $2,000. Mainstream media charges tens of thousands of dollars for commercial placements on a TV show that gets 2 million viewers, whereas on YouTube, you get $2,000. That’s why the industry is not happy. I don’t know if mainstream media is asking for too much money or if YouTube is undervaluing people’s content. That’s also another subject.
But is YouTube a good source of income? For some people it is. For musicians, I wouldn’t say it would be a main source. But it will help you get people to your shows and it will help drive album sales. And people share videos. So, it helps with exposure as well.
On the new release, you used links and annotations within video really well. Can you explain exactly what you did on that album promo?
DC:
It’s an interactive CD basically. I decided to do it because I know people are going to steal my music anyway. So, I made it available on YouTube with some voiceovers telling people what they were listening to and where they can get it. So, if they don’t want to hear a version with my voiceover, they can get the album on iTunes. It was basically a way for me to make it easy for people to listen to my music and for people like you to embed it in blogs. A musician that loves YouTube would love it if you embedded their videos. You’re just sharing it. It’s expected that the videos will be shared.
Do you have any parting words of advice for artists or songwriters?
DC:
If you’re a musician, and you don’t have videos on YouTube, you have to do it. It’s free advertising. If I look at myself as an example from a third person perspective, I think it’s funny that someone who had no ambition to be an artist and travel around the world performing, through the power of YouTube, was forced in that direction. I think that alone right there is enough reason for all people that want to do music to be on YouTube. People are using it already, it’s free advertising, and for me, it’s the biggest promotional tool – more than Facebook, Twitter, anything else.
To learn more about David Choi, visit his website. You can also check out all his music on his official YouTube channel. Below is his song “By My Side,” an example of how he uses annotations in his YouTube videos to promote his music.
Rand Rognlien is a musician, entrepreneur and the founder of MusicNomad.com. While most of his business experience prior to Music Nomad was offline – Rand has quickly built a thriving web based business that offers information and resources to musicians.
Rand, thanks for taking the time to speak with me. Tell me why you founded Music Nomad and what you are hoping to accomplish with it?
RR:
The idea behind Music Nomad was to help musicians online and let them go to one place and demystify the business side of the music industry. When I started I didn’t know anybody in the music business and I didn’t know the business side other than my own personal experience as a gigging musician. I was, in a good way, not jaded by all the things that people usually are. When I ask them about the industry they usually shake their heads and swear and say, “It’s like the Wild, Wild West and tough to make money.” I went about it as I had in the past with business and just jumped right in. I started to figure out the best way to scour the entire industry for information that lets musicians navigate this huge industry. I was focused on the DIY artists, because they don’t have the resources, the money, the skill set or the time to really make it happen.
At the end of the day, every band is like a company or a business, and it’s the business side that many artists have a hard time seeing. I focused my business background and my music background on how to help level the playing field for the DIY artist. There are three basic pillars on the site: produce your products; distribute your products; support your products. The producing your products is recording your music and getting your music merch together. Distribution is obviously handled by record labels and digital distributors. Back in the day, everyone thought, “I have to get signed by a record label” but at the end of the day, record labels were mostly just distributors. Without establishing your brand and understanding your niche record labels really can’t help you. It’s just like in any other packaged goods businesses. The distributor just helps you get closer to a retailer who helps us get closer to our customer. But if the product sucks and you don’t have a close connection with the consumer distribution is not going to help. The last point is support your products. Once you get your recordings together and you now want to sell them, you need to sell them through distributors online or traditionally. Then, you need to figure out street marketing and hire a PR person or think like an organization and think about supporting the people in your company with things like health benefits. You need to figure out how to procure the services you need in a cost effective way, like CD duplication services. These are things you need to think about when you’re figuring out how to support your products. At Music Nomad we break it down into media contacts and provide a large database of music media, so when you’re on the road you can support your tour and get reviews on your music. Like any other industry you have to keep current by reading the trades. In our case it is reading musician forums and industry blogs. We have links to such periodicals and have band and fan management tools that help you manage your band on an ongoing basis.
What have you found to be the biggest things that DIY artists get stuck on, the biggest stumbling blocks?
RR:
Selling music online successfully is something that people are continually trying to figure out but more specifically we get a great deal of questions and interest in articles about managing fans.
What has been the most compelling advice you’ve collected on fan management?
RR:
It comes back to the core of the business. Fans are the customers. You have to really develop your brand and find your niche and create that intimate relationship directly with your fans. Treat them like gold and think like a business person when cultivating these relationships. Do you have an e-mail list? You would be surprised how many bands either don’t have one or don’t do anything with the names and addresses they collect. I just talked to a band yesterday who had collected two hundred addresses at a show and when asked what they were going to do with the list they said, “Well, we haven’t really done anything with it yet, because it’s a lot of work.” Those are the things you have to think about. If you work with strategic partners there are a whole other set of things to think about. Does your record label own your list, or did you negotiate that you would own it if you left the label? Does your merch provider have names of people that bought your product? I’m sure they do, and most would give those names to you. What about the people that downloaded your music, do you have their information? One of the biggest areas I see with bands is they don’t understand the importance of managing their customers, which should be on their e-mail list, and then how to communicate with their customers and fans on their list in a way that they want to be communicated with.
I would imagine then that you review services like FanBridge and ReverbNation?
RR:
Yes. We do write-ups, and we rank them in terms of what we feel like is the best. We’ve talked to Fan Bridge many times and Lou over at ReverbNation. We talked to people at shows or over the phone and rank them. And then we give tips and advice. I’m going to be posting later today or tomorrow, I think it will finalize around the 20 biggest e-mail tips that help to increase your fan base. You can go to that article area of fan management and stay on that page for half an hour and become a smarter band about that particular area. That’s the idea behind it. It’s like sheet notes and yellow books we used to have when we were kids.
Before starting this interview you mentioned that one of the most problematic areas or most researched areas on your site was finding a rehearsal space and to that end you’ve assembled a very comprehensive list of rehearsal studios?
RR:
On our existing Music Nomad site, we have over 250 rehearsal studios you can go and navigate by city and state. It’s the most comprehensive list out there. The problem is you have to go and click through. And in L.A., there are 100 studios and you have to click through and call them. I can tell you, because we personally called all of them, that you get recordings half the time and dead ends and it’s just frustrating.
Renting rehearsal space to musicians is a very volatile business. A majority of them don’t stay around long.
RR:
Yeah. We went through those and decided to make it easier for musicians. They can go to Craigslist, which everybody hates and studio owners hate it because some people want to come with their girlfriends and rent by the hour.
Yuck. That would explain the state of some of these places I’ve rehearsed at…
RR:
It’s true. Anyway- studios really don’t’ like it. Also if they advertise on Craigslist they get people wondering if they are really a legitimate studio or some guy just trying to make some extra money. After talking to rehearsal studios over the last year or two, we went and saw there was a huge need because there is no one place to go to look at pictures and type in zip codes. On April 1st we created a beta part of our site called “Open Studios” that allows studios to first upload their profiles, which is studio information and then create rooms that are available for rent. The hourly rooms would be shown as available almost always, and then the monthly rooms that are actively looking to rent would be there. They can upload pictures and load-in information, etc. Within the first 45 days we’re up to 70 studios that have uploaded their profiles and created over 300 rooms. The studios really want it to work, because there is no place they can actually have a catalog of pictures and a place for musicians to find out about them. The musicians go in, type in the zip code and choose hourly or monthly. Then they can sort by distance from their house, cost, etc. They can click on pictures and e-mails. We don’t actually book the room, but we make the connection between the studios and the musicians.
How does that work for you and your business?
RR:
Music Nomad in general is partially funded by me. In the beginning I wasn’t thinking about creating revenue or profit. If you look at my site, there are no advertisements or sponsorships. On the second page there are some Google Ads but there’s no big business there. I’m looking at micro businesses around it that can help accelerate the growth of the company and provide more musician resources. Open Studio is one of those, where if it becomes a place with enough traffic studios have told us and we have told them that we may have a monthly nominal fee. And if it works, they have no problem with that. Clearly that would be the main revenue area that studios would be able to have their profiles. There are other things, next steps, like an online reservation system. We could logically build it, like Open Table does. They’ve shown some interest in that, but that’s Phase 2. We have an interesting thing we’re creating called “Waiting List,” so if musicians can’t find a studio in their area, they can put their name in to be notified when a studio opens up in that area. And that’s going to be a feature where both musicians and studios can benefit. As soon as studios post a room, it can be e-mailed to musicians wanting to know. We give weekly reminders to studios about what they say is available. So it’s been well thought out.
What are some of these other micro businesses?
RR:
We created this thing called “Virtual Band Manager,” which allows you to type in your one e-mail request for a quote for services. We lead you through what you need to put in to the system to get a quote back. For example, “I want 100 shirts in these colors, shipped to this location, and it’s a t-shirt or a hoodie or a hat.” And you just hit “send” and it sends to roughly 15 companies that we’ve determined are the good music resource companies, and we e-mail that to them without your e-mail sent to them, and they go to our server and fill out the price for that order. And the musician comes back in five working days, and the confirmation of their quote and information for their particular request for quote is all there and they can decide what to do. And we do that for merch and for CD duplication. It’s back to my experience with buying products. I’m trying to help musicians buy a little better. The resources and merch companies and duplication companies love it, because we’re giving them qualified leads. Everybody wins. Virtual band manager and Open Studio are the first two micro businesses we are rolling out and we don’t and won’t ever take anything from the artist’s side.
What is next for you as a company?
RR:
The goal is to continue to stay very authentic to independent musicians and what they say are their most troubled areas, and try to build out more resources and tools and content around those subject matters as well as making sure that all the different resources we have on there are legitimate and timely. We actually click through and every link works every 60 days. We have a 99.7% accuracy rate in terms of links. Our primary business purpose is to help keep qualified, ranked and reviewed resources for musicians. In order to do that we want to write more articles in places we see musicians going. We’re using the data we have about what they’re clicking on and feedback we’re getting online and through social networks and planning to write more.
For the last eight moths I’ve been developing a cleaning product line for guitars and drums. I looked at this business because I ran a business that sold cleaning products for cars. On closer inspection of the existing products I saw all the cleaners out there have acid in them and can burn you, or they have silicone and oil in them, which can damage equipment or abrasives, or they were clearly just soap and water and there was nothing effective in there. I have been testing a product line with musicians and drum and guitar techs, music store owners and have developed high-quality proprietary formulas. These will launch under the Music Nomad brand name – Music Nomad Equipment Care. A portion of the proceeds will go towards musician advocacy and back to Music Nomad to help fund this site and additional research and tools. On the label it says that and on the story on the back it talks about helping musicians.
Your business is very similar to that of the modern musician. You’ve created all this content, and now you’re looking to repurpose the community that has risen up around your content and drive them to your ancillary businesses.
RR: This is what I know. I know how to do it really well and I’ve done it before. Nobody’s really paid attention. They’re all really big companies that have a small number of products. We’re going to focus on doing it really well. We will start to be in stores within 30-60 days with this product. That’s a side note, but an important note.
Thanks very much for sharing your experience and your story.
RR:
I don’t know if I have a unique story, but I have a passionate story about wanting to help musicians in a way.
Learn more about Rand and his company by checking out Music Nomad
Zack Zalon is the Co-Founder of Hello Music. Prior to founding Hello Music Zach was the President of Virgin Digital and prior to that he was the Vice President of Farmclub.com. Zach got his start in the music business booking and managing a nightclub in L.A. called the Troubadour.
Thanks for taking the time to speak Zach. Before getting into what your are up to with Hello Music – tell me about what your view of the plight of independent artist is these days. You’ve had an interesting and diverse background in music – what do you see going on?
ZZ:
I’ll step back a bit and tell you my view on the world of the unsigned or the unaffiliated artist was formed quite a long time ago. When booking the Troubadour in the early 1990s I had the opportunity to book and promote in excess of 1,000 bands and meet with many of them one-on-one and discuss things with them both from a business perspective and also from a social standpoint. I really learned on a pure and fundamental level what it was they were going through in terms of trying to get signed, become better at writing songs, at driving people out to the night clubs and creating a fan base. It gave me a very unique perspective directly into the lives of those artists. A lot of those artists were fortunate enough to get signed, and some of them are actually very well known today, and some of them that were absolutely extraordinary never really got that opportunity. It was an interesting thing for me to have seen. I left the Troubadour in 1994 to start an Internet services business, which was pretty early. But I started it primarily because I recognized this would be a tremendous opportunity for independent artists to be able to have direct connections of their fans and direct connections to a community that I believed at the time would only take a couple years to bubble up. It’s obviously taken quite a bit longer than that. That was where my original perspective came from.
So, tell me about your company. It seems a bit like a gated community to me but then again I didn’t have any music to upload and promote. Tell me the mission statement with specifics.
ZZ:
When you survey the landscape and look at what independent artists are going through today, the challenges are drastically different and more impactful or more challenging than they were back in 1994. Our belief is that things haven’t really gotten better for artists – they’ve gotten worse. It’s more difficult to find an audience, there are more artists than ever before and more consumption than ever before too; but there are so many places from which to consume music, how is anybody ever ultimately ever going to take root or make money unless they get signed or get a lot of support from a major label? That’s still a great opportunity, but it doesn’t happen to a lot of artists. When we survey that landscape we recognize that tools alone probably aren’t going to provide the kind of resources artists need. What they really need is value. Whatever that might mean, they need something that’s valuable. For us, value is when a filter meets opportunities. That’s what record labels have done for many years. They’re a filter and mechanism for determining who the best artists are for any particular category. And they have opportunities through the relationships they have with radio companies, merchandising companies, producers, recording studios, touring and booking agencies. Those are the things a record label does extremely well.
I find that there is a sense now that we’ve done away with all the filters and tastemakers, and all of a sudden there’s been such an influx of content – not just music, but everybody’s going, “Actually, I want someone to filter some of this for me because I’m overwhelmed.” So, I agree with you philosophically.
ZZ:
Totally. By the way, the people that are clamoring for the filter, it’s the consumer and the artist. There’s a recognition that crowdsourcing and the long-tail don’t really work when it comes to music consumption. You can’t put two million bands out into the ecosystem when there are two million consumers. What’s going to end up happening is that every band is going to have one person listen o them once, and that’s not the kind of compelling music consumption experience that music fans like, and it’s definitely not the kind of compelling experience that drives success to artists either.
A very concrete example is happening on MySpace. There are just too many bands promoting themselves. It is done so much that it is hard to take anyone seriously.
ZZ:
And while Myspace is an excellent toolset for artists to be able to house their content and direct their fans to it, it’s not a powerful toolset for them to actually gain momentum. It’s just a place to be. And that’s frustrating for artists because those at the top of their game are sitting right next to those that are whistling in the shower. There is no digital service that really exists that matches what the record labels have been doing for years. However, that’s not to say that there aren’t awesome toolsets and opportunities for artists that do exist. What we did realize is that there are actually some fantastic things that exist on the Internet. There’s just no layer of compatibility for them. So for an artist to be able to take advantage of the things that exist in the ecosystem, they’d have to spend more time managing their services and their relationships online than they actually would be touring, writing songs and honing their craft.
We saw an opportunity for us to provide real value to artists and partners to get in the middle and actually start to create that layer of compatibility. So, for instance, yes, record labels do a good job of promoting to terrestrial radio. But there are in fact amazing digital radio services that exist in the marketplace today. There are great online merchandising tools, and great services for getting your music up on iTunes or self-promoting a CD. There are phenomenal tools that exist in the landscape, but there’s no glue holding them together. That’s a real problem for artists as well. What we did is, we went back to the beginning. It’s a very simple model. It’s a filter-meets-opportunities or digital A&R model. That’s what Hello Music is. Here’s how Hello Music works. For any artist – it doesn’t matter how many songs they have – they upload their music and they input some data about their band and about their music, and it’s totally free. We listen to every single track that gets uploaded and identify key characteristics: Are they good? How bad are they or how good are they? It’s important for us to know. Even if they aren’t very good as an artist, it’s important for them to find value from Hello Music. We want to know who they sound like. We need some contextual information. Do they sound like Alice in Chains, or do they sound like Alison Kraus? Ultimately if we’re going to help an artist, we need to know something real about them. What genre and sub-style categories do they fall under? What are their great qualities and some qualities that need some work? What kind of opportunities do we think might be valuable to them?
So you’re building the better Independent Music database with a lot of metadata and ancillary genre information and “sounds like,” etc., correct?
ZZ:
We’re starting with that. But in fact, that’s only the first step. The second step then is this layer of compatibility, what we call “opportunity modules.” What we’ve done is established a series of partnerships across the landscape that we give our artists the opportunity to connect to. It’s very simple for them to use. If the opportunities are applicable to the artist based on the level of quality and the style they are, there are any number of dozens of things an artist can do through Hello Music. For instance, we have established relationships with Yahoo Launchcast, which is one of the most popular Internet radio services in the world. Slacker radio. We’ve established relationships with Getty Images/Pump Audio, which is the #1 online licensing source for music for television, commercials and movies. We have a deal with Lyric Find for delivering lyrics throughout the ecosystem. If an artist is interested in having their music represented inside of Mog or Zoon, Media Net is the service that powers that, so we have a distribution deal through Media Net. TopSpin for self-promoting your content online. TuneCore for pushing your content through Apple iTunes and other services. There are many of these relationships we’ve established.
Aren’t many of these things services that artists can go to directly?
ZZ:
In some cases they’re not. Let’s talk about what it means to be an artist. If you’re an artist and you want to put your content up there, great. You can’t get your stuff on Yahoo right now unless you go through Hello Music, because Yahoo doesn’t have a mechanism to establish who’s good enough to get high rotation on their Internet radio stations. Slacker has the same problem. Slacker would love to work with you if you’re a great artist, but they don’t have an artist submission toolset. So in those particular cases, they work with us. We’re the exclusive mechanism for getting content up there, because we know a lot of data around who’s good, and it’s a trusted source for those people to be able to pull from. In the case of some of those other services – let’s say Getty Images/Pump Audio – of course you can put your material up there. But because our stuff is pre-filtered, we get a premium category which increases the likelihood that you’re going to get licensed through somebody. You have the rights to go to it yourself. We don’t own your rights or ask you to give us any more than the right to distribute the content on a one-by-one opt-in basis if they are interested. You don’t have to do it if you don’t want to. The final point – and this is really important – is there are services that cost money like TuneCore or Bandize, who we’ll be announcing a relationship with in the next few weeks – and we are pre-negotiating significant discounts across the board: 30-35 percent discounts across the board. Even if we can’t make you money, we can save you money. And if we can make you money on a service where you can already do something, first of all, we already get premium category listings. But here’s the other thing – when you put your music up in Hello Music and want to distribute it through TuneCore or TopSpin, you don’t distribute it through them anymore. You press a button and the rest of it is automated on the backend. You don’t have to upload your music on these other services anymore. We do it for you. You don’t have to go and re-input your data. When the revenues are there to be collected, you don’t have to figure out a mechanism to get that into your PayPal or bank account. We can do it for you. The majority of the efforts for creating the technology we’ve developed has been focused on this layer of compatibility. Trust me, artists hate the thought that for them to participate in 12 different services they have to upload 12 different things 12 different times. With Hello Music, you upload it once and you can distribute it many times through many different services. The benefits are obvious.
What’s your business model? How does this benefit you guys?
ZZ:
The truth is, we are basing our entire business model on doing right by the artists. We provide value to artists one way or another, and when we provide value we expect to be paid for it. That means we don’t make any money unless an artist makes money or saves money. And that’s it. There are dozens of free services we’re linking up to where we don’t make a dime, but we know we’re doing right by the artist. An example would be Next Big Sound, which is one of the new data scraping analysis tools that’s come out for the music industry. These are great tools and an awesome opportunity for artists to be able to see what’s going on with the consumption of their music out in the ecosystem. The problem is if Next Big Sound doesn’t even know who to look for, they can’t find you. So it’s another deal we have where we’re providing the names of the artists that upload directly to Next Big Sound. Next Big Sound is then able to go analyze the data on the Internet and artists are able to access that. We can’t make any money off that ever, but the marketing value for an artist is pretty substantial. It helps them to exist in the ecosystem and takes them to a place where we don’t think there are other services to help get them to, because we’re doing it in concert with all our partners. We are actually playing a very small role, and we’re counting on our partners to do a great job for artists. When they do, we all win, because the artist wins too.
What kind of percentages are you looking at? Can you elaborate on that at all?
ZZ: I can, and when we go live with Phase 2 in the next week or so, which is the opportunity end, you’ll be able to see each one of the modules and the economic breakdown of every one. They vary. They are everything from free to micro-pennies to 10 or 15 percent of a regular transaction. It really comes down to what the opportunity is. The opportunities will change and grow over time. An opportunity for us – because it’s so modular – is, if you’re an artist and you put your music up there, you can imagine we’ll put you in touch with dozens of interesting opportunities, some which might be cool for you and some which might be not. Maybe we’ll be able to buy out a glut of Les Pauls and sell them to you at a ridiculous discount. To me that’s an opportunity because it provides value to artists that may need something for less. Maybe we’ll ultimately have some sort of an insurance deal that we’ll figure out with some company. One may say that that’s considered an opportunity for artists. Perhaps there’s a national countdown show or Top 40 countdown on radio where the host is interested in talking to artists that may be the Top 40 stars of the future. Where else are you going to get that but someplace like Hello Music? Any one of these you might either say, “That’s really cool. I’ll try it,” or “That’s not really up my alley.” They point is, at least we’re focusing on trying to find really valuable opportunities for artists by connecting them in an extremely easy way to partnerships out in the ecosystem that already exist.
Is there a social networking component to Hello Music as well? In other words, are the profiles viewable by other people and interactive?
ZZ: No. We’re a professional services tool for artists.
It probably would have been redundant at this point – too many networks these days.
ZZ:
Our feeling is that we’d love to push that content out to our partners who could then make it public, and maybe we’ll eventually tie our API up to Myspace, and they can get a page there too. We don’t win based on page views or ad sales. We only win based on success stories for artists out in the landscape that we helped.
They say that the most successful colleges are based on the number of applicants they reject. What is the ratio of people who get through this filter?
ZZ:
Everybody gets through the filter. We’re not about rejecting. We’re about accepting. If you put your music up there and are not a very good band, we’re not going to get turned away. You’re just probably not going to get programmed into Yahoo. But you still could find real value from some of the other services we provide. Perhaps ultimately there’s also some other kind of online songwriting class that comes up, or perhaps we have the ability to connect you with a guitar player that could help take your band up to the next level. Maybe we can get you discounts on rehearsal space, or maybe there’s some kind of showcase for up and coming bands in your area that you’d be interested in.
Well, sure. So some of the opportunities are available to everybody, but what percentage of the people get the premium opportunities where they are flagged in a beneficial way to TuneCore, Yahoo, Pump Audio, where they get preferential treatment?
ZZ:
That’s a good question, and it’s one I can’t answer with a lot of accuracy yet, because it’s so early. Our initial expectation was that no more than 10% of the artists that uploaded would reach the quality criteria for being programmed into Yahoo. But in actuality, so many of the early artists have met that criteria that it will be an interesting challenge for us. We have 10,000 tracks in the system right now, which is a small number but a good start. We can’t program 10,000 tracks and a lot of those are excellent. My guess is that this will change over time. I don’t know the answer, but if the ratio of quality to total number of tracks continues at this rate, it’s going to be amazing.
You would be unique if you had the problem of finding too much good music.
ZZ:
I’m with you. We’re not counting on that continuing, and in fact our mission is not just to find the best, but to help the rest. I don’t mean to sound hokey about it. But in a way we want to find opportunities to take artists that aren’t ready and help them at least get another rung up the ladder in terms of quality and preparation. That’s really important to us. Over time, that’s what we’re going to have to focus on. I will tell that as of a week and a half ago, we started moving artists through the ecosystem, even though we’re not fully ready with the interface for the artist. We started to push that stuff through. And we have somewhere in the neighborhood of 45 success stories that we can tout now. We have almost a dozen artists in high rotation in Yahoo, we have our first group of content going through Slacker and have over 35 songs that we’ve delivered to a company called Play Network. They do 65,000 retail locations throughout the country including Starbucks and have a great new internal initiative surrounding the unaffiliated music market, and because we have such a rich database of content now, we’re working in close partnership to try to get those artists out into the landscape.
Tell me in closing if there’s any advice for artists?
ZZ:
I would say this: Even though I started by saying that this is a bad time to be an artist relative to the path because the path isn’t really there, the reality is there’s an entirely new path that’s emerging. Even though it might be a very confusing and challenging time to be an artist, I genuinely think that’s going to be changing dramatically over time. And I strongly recommend if there’s an artist that’s out there that knows something or has heard something about Hello Music, that they upload the music they have and give it a shot. We are only and singularly dedicated to success stories around artists. That is our entire mission. But we need artists to do that with. They are our partners, and I am very confident that in the coming months there are going to be success stories surrounding some of the things we’re doing with our artists that it’s going to help change that conversation from what’s gone wrong to where things are going to start to go right again.
Check out Hello Music
