Imagine a lab where college students would be challenged to envision and create the future of music. At any given time, there would be dozens of music-focused research studies, startup ventures, emerging technologies, and innovative projects that students could assist for a single semester or an entire year.
Picture a classroom where students would be taught how to ask music consumers thoughtful questions and elicit meaningful answers in order to create a product that aligns with their needs. They might start out the course with one vision for a new Internet radio website and app, for example, and end up presenting a completely different concept by the time the semester’s final projects were due.
Envision a music business program that would go beyond teaching students how to read record label contracts and create online marketing plans to showing students how music can be used to catalyze innovation and entrepreneurship.
Many of these ideas are being incubated and iterated upon at the Institute for Creative Entrepreneurship (ICE) that Berklee College of Music founded in January of 2014 and appointed Sonicbids founder Panos Panay to manage.
Panay, the founding managing director, has been laying the foundation for the institute, naming key advisory board members, developing music and technology partnerships, and teaching classes on creative entrepreneurship, among other things, for over a year now. His ambitious plan is to build a Massachusetts Institute of Technology (MIT) Media Lab for music, wherein an interdisciplinary team of academic researchers and startup practitioners would attempt to create the future of music across every vertical. It’ll take Panay several years and fundraising efforts to achieve, but he’s determined to build this future until it becomes the present.
Recently, I talked to Panay about the founding story of Berklee ICE, several of the current initiatives that are underway, and his vision for the future of the music business. This interview segment has been edited for length and clarity.
Kyle Bylin: The news story about Berklee’s Institute for Creative Entrepreneurship broke in January 2014. That means you’ve been the managing director of Berklee ICE for just over a year now. Let’s start out this interview by talking about how this project came to be. When did the conversation with Berklee about this effort begin, and how did it evolve?
Panos Panay: I've been friends with Roger Brown, the president of Berklee College of Music, for the last ten years. He was on my board of directors at my company, Sonicbids. I was chair of the Advisory Board at Berklee College of Music for about seven years.
Throughout that time, we were talking a lot about the evolving landscape of the music business and, ultimately, what role Berklee was playing in preparing its graduates for a transition into and participation in a landscape that was and is dramatically different from the one that I found 20 years ago.
So the idea—the inspiration—of the Institute for Creative Entrepreneurship came from Roger. After we started talking, he approached me about the possibility of coming here to found and run it. After giving it a lot of consideration, I got excited at the prospect of playing this role. So that’s how Berklee ICE came to be.
MIT MEDIA LAB
Kyle Bylin: When did you start to see the potential of building an MIT Media Lab for the music industry?
Panos Panay: Certainly, after I came here and began to get exposed to both the students within Berklee as well as the role that Berklee plays—it goes beyond just merely producing performers. We have 12 majors here, including such diverse areas as music production and engineering, music therapy, and sound design.
So the idea of building an MIT Media Lab grew with my knowledge of Berklee, coupled with my own experience in the music space or in the broader entertainment space. I feel the music industry has been disrupted perhaps more than any other industry, yet there’s been very little appetite or interest from the music industry to reach outside of its confines for inspiration.
There’s been very little courage, I feel, from within the music industry—there’s little evidence of a desire to ask the big questions and then leverage a partnership of industry, academia, and government to come up with answers. That sort of gave me the inspiration behind it. My being located about a mile from the MIT Media Lab and having been there many, many times undoubtedly played a role in this ambition.
But I feel that there is a vacuum on the creative side with respect to a research center, something that, again, brings different people of different backgrounds and different disciplines together to envision a different future or a better future.
So that’s when I got inspired to embark on this.
Kyle Bylin: I like the idea of a research center, because there isn’t a lot of original research happening around the music industry. There is a handful of influential academics who are diving into this space, but as a whole, in-depth studies of the music industry, the music consumer, shifts in listening behavior, and startup trends have not been pursued.
Panos Panay: For me, not being an academic, I see research as not just being an academic exercise. I see research as being a means to understanding something, asking the difficult questions, looking at answers from different angles but then hopefully embarking on something tangible—something that begins to architect what the future is. Looking at even the definition of an entrepreneur, people often think that entrepreneurs are people who predict the future, but my stance is that entrepreneurs are people who simply create the future.
So you cannot be talking about an institute for entrepreneurship unless you do two things: thoughtfully understand the past, dive into understanding better the different forces at play with respect to the movement of a particular industry, and then dare to ask the questions and envision the future there could be within the space.
From an institute standpoint, we have both a practical objective—to inspire and cultivate the entrepreneurial thinking among our students, faculty, and alumni—as well as an idealistic hope of being able to initiate a disruptive effect. We envision a different future for the industry than what popular media may have us believing that the space is doomed for. Being an eternal optimist, I believe that you can always create a better future than you have right now. That’s what we aspire to do.
THE STARTUP LAB
Kyle Bylin: One of the venues that you’re currently using to explore this idea is a course that you have called “The Startup Lab.” Can you give me an overview of what “The Startup Lab” course is and the kind of work that students are doing in it?
Panos Panay: The Startup Lab is inspired by a course that I saw at the Stanford d.school called “Launch Pad.” The course is really developed around a principle called “design thinking” that a firm called IDEO has pioneered. Think of design thinking as effectively the fundamental philosophy that you can apply the principles of design to just about any problem. That means that you start first and foremost with understanding the user—understanding the customer. It’s not about worrying first about whether something is viable or feasible. First, you have to understand what is desirable, and then you start working toward the other two.
The idea of the Startup Lab is simply to get students to develop their ideas by applying these principles—which, by the way, you often find even within the creation of music. You prototype something, you put it out there, you get feedback, you iterate, and you just do it again and again and again until you “perfect” it. So the idea of the class is to get students to work on ideas that they have. Some of them may be as simple as their band; others may be as aspirational as launching a new music therapy product. We hope to give them some structure and to develop the sort of behaviors and mindset that they need to be able to take these ideas and make them a reality.
I co-teach the course with Ken Zolot from MIT. Part of what we’re trying to do is awaken and inspire the students by bringing different folks together in that room. The course also has students from all Berklee majors, unlike most classes, which are very major-specific. We teach the course at IDEO’s offices so students get to experience a lot of these themes that come from the creator’s mouth. We don’t expect that the default mode of the course and these ideas is success. As a matter of fact, we want students to embrace failure and course correction as parts of the process. A lot of them, by the end of the semester, will emerge with completely different ideas than what they had coming in.
Kyle Bylin: You touched on one of my favorite subjects, which is that when you’re building a music consumer product, you have to think about who the user is, and by the user, I mean the music listener. Sometimes, I think startup founders mistake themselves, as passionate music fans, for the users of the product and predict that the rest of the market will feel like they do about their products. The likelihood is that they don’t, right? They’re not as fanatical or passionate about music. How do you encourage your students to learn about who music listeners are more broadly and ask questions about how they consume music today—not necessarily how they think they’ll consume music tomorrow?
Panos Panay: First, I'll clarify that the institute’s aspiration is not to just launch a bunch of music startups. Having been the founder of one, I'll tell you I’m not sure that the world needs a whole lot more. The world needs startups with an understanding of what the customer needs rather than clever ideas about what they think the customer needs. Look, the only way to understand people is to develop empathy for them. The only way you develop empathy for them is if you spend time with them and experience their lives—to accomplish this, you have to be curious and do a lot less talking and a lot more listening and observing.
I come at it from the standpoint that musicians are primed to be good listeners and good observers because that’s what makes a good musician to begin with: listening to the environment around you, listening to the metaphorical chord changes around you, and then adjusting and correcting accordingly. The way that we tell our students this and the way that we inspire them to go and do these things is by getting them out there. This is the reason why we don’t teach the class at the college—we get the students outside of their comfort zone and the bubble of an academic environment.
MUSIC STARTUP LANDSCAPE
Kyle Bylin: You could say a lot of things about the current state of music startups. You could say, “The streaming market is fairly crowded.” You could say, “The DIY musician app vertical is fairly crowded. You could say, “We’re now seeing a lot of consolidation, we’re seeing a lot of acquisitions, and we’re also seeing a lot of shutdowns.” How do you personally describe the current music startup landscape to your students?
Panos Panay: Again, our ambition is not to get students to launch a bunch of music startups. Our ambition is to get students to look at music as a catalyst for innovation, which is a paradigm that can be applied in any field. Innovation could be evidenced through performing, through starting a music startup, or through catalyzing social change by helping child soldiers in Uganda reintegrate into society. True, by the way. This is an example of an actual music project here.
But to answer your question, I think it’s fantastic that there’s an over-cluttering of music startups in the different sectors that you talked about. Because I believe that competition—and I believe that even excess capital flows into a certain sector—ultimately leads to innovation and to the creation of standards and the creation of a different future.
And you see this throughout history. Having been around long enough, I experienced the early wave of Internet mania. I experienced the wave of excessive investment in broadband infrastructure. If you read about the excessive investment in railroads—if you look at the history of business—every bubble was definitely followed by a burst. But every burst was followed by ultimately the creation and the survival and of an ecosystem that drove the world forward.
So for me, looking at it from the streaming side of things, I think that this competition, this over-investment, this oversupply will ultimately lead to the emergence of one or two major players that will be better than everybody else. They’ll be forced to be better than everybody else because people have options, because they have competitions. And “better” means more than just surviving and dominating.
“Better” means that they devise an effective business model, deliver music in the right way, and satisfy customer needs, so that five years from now we can say, “Huh, so this is the future that we were hoping to get. Boy, did we get the right one.”
BERKLEE ICE RESEARCH
Kyle Bylin: Moving along in this conversation, I know research projects are also something that students engage in at Berklee ICE. I believe you spent some of the last year laying the groundwork for partnerships with outside academic institutions and music companies. Can you tell me about some of the kinds of research projects that are being conducted at Berklee ICE right now?
Panos Panay: The first one we’ve embarked on is done under the Rethink Music umbrella. Rethink is an event that Berklee has had for a while. It is now not only part of the institute but envisioned as a conduit for, as the name of the event says, envisioning where the music industry can go. So the first project that we’ve embarked on is called the Fair Music Project. We’re doing it in conjunction with the Harvard Berkman Center over at Harvard Law. And it’s sponsored by Kobalt Music, even though it doesn’t have any stake in the outcome; it’s simply the underwriter of the research.
But we’re really looking at the flows of money from consumer to content creator. We’re trying to understand why there are so many intermediaries in this exchange and why there is so much obfuscation and lack of transparency in how that money flows and who takes what and who takes how much. Our ambitions for this project are not just to have a better understanding of the existing state of affairs, which, frankly, is something that most people don’t even understand, not even the creators themselves.
We also ask the big question: if we were building this system today—if we were building this industry today with the tools we have today, with the technology we have today, with the consumers that we have today—what would it look like? How would that money flow? What role would technology play? What role would a standard play? What role would emerging crypto currencies like Bitcoin play? We want to be asking the big questions.
We’re not always sure we’re going to come up with answers, but we think that if we attempt to define the questions we should be asking, then we’ll end up with some interesting insights and, hopefully, inspiration for where the industry can go. Ideally, this would result in something tangible rather than yet another boring academic white paper that five people read.
THE FUTURE OF MUSIC
Kyle Bylin: So that is one of my favorite questions, which is what does the future that we’re trying to build look like? And if we were to start building today with the services and tools that are available, and this newfound knowledge, how would we build it differently?
Panos Panay: Oh, man. My job is not so much to tell you right now what the future is because I'm still thinking about what questions we should be asking about what that future is. What I do know is what it’s not. And I'll tell you a couple things that are in my head: 1) I do not believe that the future of music is one where all music consumed is free, and 2) I also don’t believe that consumers are not willing to pay for music. I believe that the way that they used to pay for music has changed and will surely change in the future. But I, for one, don’t buy that the future of music is one where music is offered to everyone for free and that creators can’t make any money. I don’t believe that.
Music is too important to our society. Music is too highly valued by mankind. I just don’t buy that we’re not willing to pay for it. To get people to pay for anything, whether it’s a cup of coffee, a bottle of expensive water, a primetime show on one of the cable channels, or music, you have to create an experience. Currently, that experience is not being offered to the user.
For those of us who grew up in another era, our experience of music involved physically going to a store and flipping through album covers and LPs, touching them and spinning them. That whole process contributed to our enjoyment of music. It wasn’t just what we heard. It was also the process of discovery that was part of that overall experience—not just finding the artist, but also finding out more about the artist.
So what I know in terms of the future of music is that if you create those experiences—and I don't know what they are, yet—people will be willing to pay for them.
Kyle Bylin: How do you cultivate an entrepreneurial mindset among students that encourages them to invent their own places in this ever-changing job market?
Panos Panay: Well, I think you said it right there. For me, it’s not about helping people get jobs—it’s about helping people create their jobs. That is what this mindset is. This is not just true of the music space. Frankly, I think it’s true in the broader job environment, in general. I think to excel today, you have to apply this entrepreneurial mindset to whatever you're doing. What does this mindset mean?
Well, it’s building a good network, for example. It’s being proactive. It’s approaching yourself as never quite the finished product—you're always evolving. It’s about developing empathy with your “customer.” Who is that? Do you understand that customer? Do you have a methodology that you're using to understand that customer? It’s about being resourceful and making the most with what you have around you. It’s about leveraging your own talents to create something bigger and better than the individual parts that comprise you.
These are some of the things that I feel make successful entrepreneurs.
The Upward Spiral Podcast
Kyle Bylin is a user researcher at SoundHound and author of Promised Land: Youth Culture, Disruptive Startups, and the Social Music Revolution. His email.