Music Crowdfunding: Sam Tsui Kickstarts Debut, Songkick Detour Expands, JOBS Act For Labels
Music crowdfunding continues to work its way into the fabric of the music world. YouTube star Sam Tsui recently used Kickstarter to fund a debut album rather than signing with a label. Songkick Detour is expanding its concert crowdfunding borders. And the JOBS Act continues to suggest future possibilities for music companies such as record labels that are yet to be realized.
Part of the promise of crowdfunding music that we're already seeing in practice is the shift in creative control based on funding sources. Many fans seem enthusiastic about supporting artists' work and that's keeping control in the hands of artists.
Keeping the Control in Artists' Hands
In an interview Tsui said the campaign revealed their base of support:
"The first thing was to get upfront capital. We did a Kickstarter campaign. I had never done one before and had no idea if people would support the project. We exceeded the goal [$30,000] in the first two days and more than doubled it. It was the first indication that people are excited about us doing this album."
Songkick Detour Expands Program
"I’m excited to say that today we are coming out of private beta and opening up to any fan in London. Very soon we’ll launch Detour across the UK and have been thrilled at the emails we’ve been getting from fans and promoters across the world asking when Detour would come to their city."
The JOBS Act for Record Labels
Miguel de Braganca discusses "Record Labels and the JOBS Act" in Berklee's Music Business Journal. While we've seen a powerful response to pledge-based and participatory crowdfunding, the possibilities are wide open for equity crowdfunding.
Braganca gives an example of one of the complications ahead:
"Because of the Act’s annual $1m ceiling per firm, the label’s corporate entity cannot fully micro-finance more than one act, which renders the instrument useless for risk management."
"What the label must do is create a holding company for each act being marketed to investors and transfer the ownership of the artist-label contract into the new entity. The public can then invest in a specific act through the holding company’s presence on a funding portal."
Peter Alhadeff considers "Music and Equity Crowdfunding" from additional angles.
Hypebot Senior Contributor Clyde Smith (@fluxresearch/@crowdfundingm) also blogs at Flux Research and Crowdfunding For Musicians. To suggest topics for Hypebot, contact: clyde(at)fluxresearch(dot)com.