Music, Money and the Power of the Many

Wednesday, 07 January 2009 12:58

Written by Liz Bolshaw

If you are one of the estimated ten million unsigned music artists hoping to get the attention of a record label, you might as well buy a lottery ticket. If you are a record label hoping to break a new act, you do the equivalent of buying a lottery ticket every time you sign someone new. You need to ensure sales of 100,000 records to break even and statistically you’re so likely to fail. The industry spends four billion dollars discovering new artists, and the failure rate is crippling. If it wasn’t for some lucrative back catalogues all the labels would be bust. Reports of the ill health of the music industry are many and varied, but probably not much exaggerated. If it’s not being hit by illicit downloads, it’s struggling with a rising cost base.

So what to do? Wait for an entrepreneur to turn the music business model on its head.

Drummer Slicethepie turns every fan into a record label tycoon, able through the democratic process of crowd-finance to get the act an album. The brain behind Slicethepie is no hip music exec. Not a sign of a wedge heel, leather jacket, or interesting facial topiary about him – just a regular guy meeting in regular Starbucks in regular Piccadilly. His own musical tastes say it all, “I like Coldplay and Laura Marling.” His route to here is typically circuitous. Above the language student din and Polish baristas shouting out their orders, David Courtier-Dutton quickly ran through his career. It was a bit like playing Mornington Crescent – corporate finance, law, Infobank, property development – Goodge Street, Slicethepie! But as anyone knows, there is no sat nav to entrepreneurial success: the stranger the route, the better.

Courtier-Dutton’s advantage is to be able to see the music industry with the simplicity of an outsider: “Music is all about the artists and the fans. Everything else is in between.”

How it Works

Wannabe artists upload three tracks to The Scout Room where amateur critics listen anonymously and rate the music, getting paid 3p per review. The really good critics (that is the ones whose ratings consistently chime with the majority) get star status and earn a bit more for their reviews, and believe me once you start listening you want to be up there with the best. Artists who score in the top two per cent (so getting ratings of 6.94 or above) move to The Showcase. They then have two weeks to get aggregated funds of £15,000 to finance their album. Minimum pledges are £5 and there are thousands of site users now pledging their fivers, but you can put in a thousand quid if you want. Fans get a copy of the finished album and their share of the Contract that gives them ongoing interest in the album sales. The greater your investment, the greater your share of the sales.

The numbers support what is a developing trend in music – that of the niche interest artist. You don’t have to have mass appeal to make it on Slicethepie, just a loyal, committed fan base.

For those who fancy themselves as record label execs, you can also trade Contracts as in a regular stock exchange, betting on future sales. This investment side of the offering is an interesting one that I suspect will gain momentum as Slicethepie matures.

Slicethepie deposes the enthroned music kings and the power of the few and places the power back in the hands of a meritocracy of fans. It will be interesting to see how long it takes for Sony and EMI and the rest to come to Slicethepie for their A&R talent. Not that long, I suspect.

Competition

The household name is Amsterdam-based sellaband but, as Courtier-Dutton is quick to point out, their model works in a different way. More recently Bandstocks has launched with investment from Steve Pankhurst, co-founder of Friends Reunited, with a model similar to sellaband, but interestingly there is no substantive US-based company exploring the space.

Graphico, the starry digital media agency, has created the online application for Slicethepie and Courtier-Dutton has attracted a range of savvy investors to back him.

To me, there is something hugely hopeful about Slicethepie’s model. It opens up an industry to regular Joes and allows us all to be the equivalent of Italian Renaissance patrons, supporting young artists on their journey, always with the chance that they might, just might, be the next Michelangelo. And if not, you still have a nice warm feeling and a legit album that’s cost you a fiver.

The last word goes to Courtier-Dutton: “We’re not in the music industry. Why would you want to be in something that is essentially broken? We’re just a platform. We have no say in who succeeds.”

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