Fan-funded music

Fan-funded music

Fan-funded music is a type of crowd funding that specifically pertains to music.^[1] Often, fan-funded music occurs in conjunction with direct-to-fan marketing.^[2] Fans of music have the option to donate and collectively raise money with the goal of jump-starting the career of a given musical artist. The fan-funding of music occurs primarily through web-based services using one of two business models (see comparison of crowd funding services). Fans are typically given rewards based on their monetary contributions.

Platforms

List of Platforms (in alphabetical order)

For information on the KiA and AoN funding models, see funding models

Additional information

ArtisteConnect.com
Artiste Connect is a secure crowdfunding platform for underground artists to finance the production of their projects. Sample pledges may be a book, a film maker raising funds for a movie, a musician recording an album, an organization raising funds for a benefit cause, etc. When a user reaches 20% of their monetary goal, they will be asked to sign a written contract stating that Artiste Connect will be allowed to collect the funds raised on behalf of that user. This is subject to an administrative fee of 10% of the total amount of collected pledges. Artiste Connect will then move the project to a section of the site called "featured projects" to promote and increase visibility.^[3][4]

ArtistShare.com
ArtistShare is documented as being the first fan-funded website for music.^[5] The company is a website and record label for musicians, which allows them to fund their projects utilizing a “fan-funding” model. In exchange for fans’ funding on a particular project, ArtistShare offers first-hand access to the recording process, limited edition recordings, VIP access to events & recording sessions, and even credit listing on the final product. ArtistShare emphasizes on their website that for each project, the artist is in no way required to relinquish ownership of copyright, as this model is not a work made for hire.^[6]

Successes

ArtistShare's inaugural project was to fund Maria Schneider's 2004 album, "Concert in the Garden." This album was successfully funded and ended up winning the 2004 Grammy award for "Best Large Ensemble Jazz Album." Actor Rick Moranis used ArtistShare to fund his 2005 album "The Agoraphobic Cowboy" which received a 2006 Grammy award nomination for "Best Comedy Album."^[7] The release^[8] of jazz artist Gerald Clayton's 2009 album Two-Shade was funded^[9] through ArtistShare.

Bandtastic.me
Bandtastic.me is a crowdfunding portal that focuses on the funding of live music and tours. They are based in Mexico but plan on expanding to Guadalajara. As of November 2012, no information is given on their website if they intend to expand to the U.S. Their website is in Spanish. Chris M. Johnson of Venture beat describes BandTastic's approach, "A concert is proposed and voted on in Facebook, Bandtastic calculates the expected all-in cost of the concert, and if enough fans buy a ticket, it’s on. If not, customers’ money is returned and the concert doesn’t happen. Venues thus know they will have a full house, bands get paid, and fans get their music." Bandtastic then takes the role of the producer of the concert and covers promotion as well as the selling of merchandise.^[10]

CASHmusic.org
CASH Music is an open source tool that provides a portal of communication between users and creators to exchange creative perspectives and ideas. Songs featured on the site are released under the Creative Commons license to download or be remixed. The site offers subscriptions ranging from $10–30 per quarter to one-time payments of up to $5,000, each with corresponding benefits.^[11] This approach has been compared to similar initiatives by Radiohead^[11] and Jill Sobule.^[12]

CreaRock.es
CREA ROCK is the first platform known specialized in rock bands and artists, mainly for rock music, but not only. Founded in October 2012 by Rock Estatal magazine, which recently celebrated its tenth anniversary with this innovative proposal. Crea Rock is designed for rock bands that want to finance the launch of a new album, a videoclip or a tour, but also for other music professionals as recording studios, rehearsal rooms, designers...

GetCrw.com
Crw, originally Headliner, a first place finish Startup Weekend startup, is a platform that allows fans to create crowdfunding campaigns for their favorite growing artist, once the campaign has been completed successfully, artists play live events at one of the curated venues provided by Crw. ^[13]

Detour.Songkick.com
Songkick Detour is a unique service for fans to bring artists to their city. Artists registered with Songkick create a tour plan that includes dates but not locations, registered fans can then select a city and purchase a ticket. Once a city accumulates enough ticket sales to equal the pledge value set by the artist, the gig is successful and the fan is sent a ticket via e-mail. If a city does not reach the pledge goal, fans are not charged.^[14]

Feedthemuse.net
Feedthemuse.net is a Crowd funding website not limited to artists and musicians. Users create a profile where they can write a fundraising pitch and invite friends, family and fans to visit their page where they can make a donation. For amounts over $100, checks are distributed over a monthly basis in which Feedthemuse will deduct a 10% commission fee. The site offers tools, tutorials and phone support to support users and help them in reaching their goals.^[15]

Successes

Judah Kim of the band Stonethrow describes how his band used funds from a successful Feedthemuse account to purchase a plethora of merchandise items. Ada Ruiz, bass player of the group Red This Ever, praised Feedthemuse, saying that in the time the band went on tour, they accumulated two payout checks from Feedthemuse.^[16] Feedthemuse.net has a section of testimonials on their site which details some other successes.

Gigfunder.com
Gigfunder.comis a different breed of Crowd funding website with a central focus on raising money to fund concerts and tours. Using GigFunder, fans can create campaigns to bring artists all over the United States and support artists’ tours. In exchange, if a tour is successfully funded, fans will receive a wide range of awards from their favorite artists, such as tickets to shows or signed merchandise. These awards are specified by the artist and vary for every tour. GigFunder charges artists 7% of successful campaigns and PayPal takes an additional 3% for each transaction. A PayPal account is required in order to donate. Donations can be canceled at any time prior to a completed campaign.^[17][18]

Indiegogo.com
Indiegogo is a Crowd funding portal that allows users to create a page for their funding campaign, set up an account with PayPal, make a list of "perks" for different levels of donation, then create a social media-based publicity effort. Users publicize the projects themselves through Facebook, Twitter and similar platforms. The site takes a 4% fee for successful campaigns. For campaigns that fail to raise their target amount, users have the option of either refunding all money to their contributors at no charge or keeping all money raised minus a 9% fee.^[19] Unlike similar sites such as Kickstarter, Indiegogo disburses the funds immediately, when the contributions are collected through the user's PayPal accounts. Indiegogo also offers direct credit card payment acceptance through their own portal. Those funds are disbursed up to two weeks after the conclusion of a campaign.^[20]

Successes

According to The Wall Street Journal, as of October 2011 over 45,000 campaigns have been launched, raising "millions each month." (US).^[20] Indiegogo is also used by already-funded projects to create publicity or find distributors.

A few examples of campaigns on indiegogo, include "Lets Give Karen -The bus monitor- H Klein A Vacation!", which raised $703,833,^[21] Bug-A-Salt which raised $577,546^[22] and Let's Build a Goddamn Tesla Museum which raised $1.3 million.^[23]

Kickstarter.com
Often hailed as the most successful and well-known Crowd funding platform. Kickstarter has been featured on CNN, The New York Times, TIME magazine, BBC and Wired Magazine. Kickstarter is a Crowd funding website that has successfully funded everything from films, games, and music to art, design, and technology. Project creators choose a deadline and a goal minimum of funds to raise. If the chosen goal is not gathered by the deadline, no funds are collected. The platform is open to backers from anywhere in the world and to creators from the US or the UK. Kickstarter takes a 5% fee and Amazon.com takes an additional 3%. For more information, see Kickstarter.

Successes

While Kickstarter has seen its projects reach success in many fields, beyond just music, a small sampling of musicians that have been successful includes the following: Amanda Palmer's "Theatre is Evil"; Simon Joyner's "Ghosts"; and Jared Brickman's "One Hello World".^[24]

OurLabel.com
OurLabel provides a platform for musicians to connect with fans, fund new releases and carry projects through to completion. Artists keep their copyright and sign agreements for specific projects. Fans get the opportunity to be part of the project and receive a cut of the proceeds.^[25] Using Ourlabel, users get the opportunity to join artists' street teams and complete tasks set up by the artists for rewards.^[26]

PledgeMusic.com
PledgeMusic is an international Crowd funding platform geared specifically toward musicians. Users (Pledgers) receive exclusive content in exchange for their contributions to artists fundraising campaigns. PledgeMusic does not retain any ownership or rights to any music created through the platform. Funding transactions occur only after a goal is successfully met. The site is staffed my music industry moguls and maintains partnerships with major players in the digital and physical music spheres allowing for numerous options to help record, produce, manufacture, market, and distribute artist's music, merchandise, and tickets. The site charges a 15% flat fee.^[27] PledgeMusic operates on two types of artist campaigns, direct-to-fan and a Pre-order campaign. In a pre-order campaign, fans are charged immediately upon pledging. This type of campaign is designed for labels and artists who have already completed a recording, and are looking for a strategic way to pre-sell and market it.^[28]

Successes

Projects on Pledgemusic.com receive an 82% success rate.^[29] A list of major artists with successful Pledgemusic campaigns can be found on the Pledgemusic Wikipedia article.

Quermos.com.br
Quermos is a crowd funding service for musicians that focuses on funding their concerts on an individual basis. As of September 10, 2012 their service is limited to the Brazilian market but they plan on expanding to the U.S.^[30] Funding is accumulated by the pre-sale of tickets, or the sale of "refundable" tickets. Using Quermos!, artists pledge a concert and pre-sell tickets—once enough tickets are sold, the date of the show is confirmed and the proceeds of general ticket sales are then given back users who purchased pre-sale tickets. Those users then get to see the show for free.

RocketHub.com
Rocket Hub is an established crowd funding platform open to anyone including musicians. Project holders on Rocket Hub have the option to keep raised proceeds even if the fundraising pledge was not successful. Rocket Hub is a completely open platform, meaning that anyone can create a fan-funding campaign and there is no screening process before the project goes live. The site takes an 8% commission off successful projects.^[31]

Sellaband.com
Sellaband is a crowd funding platform that allows registered Artists to use a direct-to-fan approach to finance albums or concerts.^[32] Artists will pledge an amount, the minimum funding target being € 3000, and the maximum funding target, €250.000. Artists may also choose if they want to integrate a revenue sharing option into their funding. The minimum incentive is a download.^[33] Sellaband has been featured on CNN, The New York Times, Time, BBC News, Forbes and other media outlets. For more information see Sellaband

Successes

As of May 14, 2012 89 Artists have successfully funded their albums using Sellaband.^[34]

Artist Public Enemy raised $75,000 using Sellaband.

Show4Me.com
Show4Me is a crowdfunding platform specifically dedicated to music.^[35] The platform provides concert and show organizers, musicians, music producers, concert agencies, concert promoters and others involved in the music industry with an opportunity to raise necessary funding for concert organization, music and music video production. The platform has unique features focused on concert organization.^[36]

SonicAngel.com
Sonic Angel is a hybrid between a crowd funding platform and a record label. Fans who are members of the site along with artists, act as the label's A&R. Once an artist receives enough recognition from fans, Sonic Angel will sign that artist and supply them with the means to record an album which is then funded by the artists fans via direct-to-fan crowd funding.^[37] For more information and an extended explanation of Sonic Angel website.^[38]

Cases of Note

Marillion

The British rock band Marillion is considered one of the first artists to truly harness the power of the internet as a means of music distribution and direct contact with fans, which began with setting up a website in 1996 and raising $60,000 to help finance a 1997 North American tour.^[39] They have also been described by music journalist Alexis Petridis as "the undisputed pioneers" of the fan-funded music model,^[40] beginning with the distribution of their 2001 release Anoraknophobia. Amidst a dissolving relationship with their record label and management team, the band calculated that they would need 5,000 fans to order the album to finance the project. However, they needed the money up-front, before the record was released. They turned to their mailing list and asked fans to pre-order the album in what was later described by the BBC as "a unique funding campaign".^[39] Pre-sales well exceeded their 5,000-unit target (reaching about 12,000 pre-sales total).^[41] Marillion has since released several other albums based on a fan-funded model, receiving a £360,000 advance for their 15th studio album Happiness Is the Road.^[40]

Amanda Palmer

Unofficially dubbed the "queen" of Kickstarter, Amanda Palmer is an example of one of the most successful fan-funded music campaigns of all time. On April 30, 2012, Palmer ran a campaign on Kickstarter, with a goal of $100,000 to fund her newest studio album, Theatre Is Evil. By the end of May 2012, Palmer had amassed almost $1.2 million, ultimately receiving donations from nearly 25,000 individuals.^[42] By comparison, the average successful project on Kickstarter at the time raised about $5,000.^[43]

Ellis Paul

Boston-based singer/songwriter Ellis Paul is another important case study in the field of fan-funded music. His 2010 release, The Day After Everything Changed, was funded completely by fan donations. Instead of using a traditional crowd-funding platform, he adapted the online merchandise platform Nimbit to his own fan-funding scheme. Paul set up a tiered donation hierarchy, ranging from the $15 Street Busker level, up to the $10,000 Woody Guthrie level.^[44] Fans received different perks based on the tier at which they donated. The project proved to be highly successful, with total donations exceeding $100,000.^[45] Paul is putting his fan-funding to the test again; he is currently in the midst of fan-funding a new studio album set to release sometime in 2013.^[46]

Electric Eel Shock

Tokyo-based garage metal band Electric Eel Shock is another group that has seen some success in the way of fan-funded music. In 2004 they offered a "SAMURAI 100" package, which gave fans the opportunity to secure "guest list for life" status. The package cost £100 and the band raised £10,000 by selling 100 such packages.^[47] In 2008, Electric Eel Shock became the 23rd act globally to raise $50,000 on SellaBand, and the fastest group to do so at that point.^[48]

Other Fan-Funded Musicians

• Donita Sparks (L7)
• Exile Inside - Jakes Shillingford of My Life Story invited investment from fans to set up a fan-funded project which became Exile Inside.

Criticism

As a business practice, fan-funded music is not without its criticism. Fan-funded music has gained popularity in the past few years however, money raised through these platforms still is only estimated to make up 1% of the amount spent on albums and tours. Many bands start off with fan funding to finance their initial album but then get signed to a record label. Major labels are signing artists with successful fan funded campaigns using the campaigns as a filter before investing in them.^[49] Other, more well-known bands have used fan funding to distance themselves from their label contracts and manage their own music. There has yet to be a band that has used fan funding to fully finance their career.^[50] In 2001, journalist Gareth McLean was scathing of Marillion's pioneering efforts to continue their career without a label by dealing directly with their fans on the Internet, writing: "They have, they explained, decided to eschew the machinations of the record industry in order to be closer to the people. (One suspects that their decision occurred round about the time that the record industry decided to shun Marillion)."^[51]

Some claim that artists overestimate the cost of recording an album and dishonestly solicit more money than they need via fan-funding.^[52] With advancements in digital technology, recording equipment has become increasingly compact and more affordable. It is no longer a requirement for an artist to need a large recording studio that houses oversized equipment. This increase in accessibility that the everyday musician has today has made it possible for artists to record their own albums from their homes. Since there are no restrictions for what artists can ask for, it is not unheard of for artists to inflate the expected costs and then keep the extra money as profit.

Critics also point out that the fan-funded music model has turned bands into marketers and sales personnel. Artists must be able to develop personal marketing strategies in order to get the money to even begin working on their music.^[53] Artists must put lots of time and effort into creating a campaign that engages their fans and gets them to donate to their project. This can prove difficult for any artist to create a campaign that does not come off as "[a] shrill and desperate-modern-day pan-handling by entitled go-getters." While fan-funded platforms are accessible for any musician, they have become over-crowded with both artists and anyone with an idea. "For every legitimately exciting pitch there are dozens of musicians, filmmakers and designers pleading for funds to complete ill-conceived projects."^[54] With so many options fans become a victim of too many choices and choose not to donate to anyone.

Running fan-funded campaigns cost bands a large sum of money. They must pay for video production for the video that every campaign has, a producer and an engineer to mix and master their album, and fulfill all of the rewards promised to their fans as well as the shipping on them. Often the money made off these projects ends up going to paying the costs of running a successful fan funded campaign. For example, a large portion of the $1 million that Amanda Palmer raised went into funding her Kickstarter project itself.^[55] Artists such as Palmer have huge fan bases to appeal to for money, but for the average artist raising that kind of money isn't a reliable method.^[56]

Fan-funded music has become increasingly popular, but the platform is young and not fully developed. Fan-funded music has a long way to go before it can be used as a sole source of funding for an artist's career.

See also

• Crowd funding
• Comparison of crowd funding services
• Direct-to-Fan
• Freemium
• Free-to-play
• Kickstarter
• Open Music Model

References