Fan-funded music

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Fan-funded music is crowdfunding for 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 a business model for crowdfunding. Fans are typically given rewards based on their monetary contributions.

Contents

Notable platforms

WebsiteYear
of
Launch		Notes
ArtistShare 2000First crowdfunding site for music
Indiegogo 2008Disburses funds immediately
Kickstarter 2009Takes 5% flat fee, Stripe takes additional 3-5%
Patreon 2013Enables fans to support and engage with artists and creators
PledgeMusic 2009Can donate profits to charity. International.
RocketHub 2010Takes 8% total funds accumulated. No screening process.
Sellaband 2006Currency in €. Partners with SoundCloud.

Additional information

ArtistShare
ArtistShare is documented as being the first fan-funded website for music. [3] The service lets musicians fund their projects utilizing a "fan-funding" model. In exchange for funding on a particular project, contributors receive various benefits. 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. [4]

Indiegogo
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. [5] 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. [6]

Kickstarter
Often described as the most successful and well-known crowd funding platform, Kickstarter has been featured on CNN, The New York Times , Time , BBC and Wired . 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 minimum goal of funds to raise. If the goal is not reached 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%.

PledgeMusic
PledgeMusic was 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 by people in the music industry 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% fee. [7] PledgeMusic operates on two types of artist campaigns, direct-to-fan and pre-order campaigns. 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. [8]

RocketHub
RocketHub is an established crowd funding platform open to anyone including musicians. Project holders on RocketHub have the option to keep raised proceeds even if the fundraising pledge was not successful. RocketHub 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. [9]

Sellaband
Sellaband was a crowd funding platform that allowed registered artists to use a direct-to-fan approach to finance albums or concerts. [10] 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. [11]

Cases of note

Marillion

The British rock band Marillion are considered to be one of the first artists to have truly harnessed 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. [12] They have also been described by The Guardian music journalist Alexis Petridis as "the undisputed pioneers" of the fan-funded music model, [13] 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". [12] Pre-sales well exceeded their 5,000-unit target (reaching about 12,000 pre-sales total). [14] Marillion have 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 . [13]

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 30 April 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. [15] By comparison, the average successful project on Kickstarter at the time raised about $5,000. [16]

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. [17] 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. [18] 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. [19]

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. [20]

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. [21] 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. [22] In 2001, The Guardian 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)." [23]

Some claim that artists overestimate the cost of recording an album and dishonestly solicit more money than they need via fan-funding. [24] 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. [25] Artists must invest much 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."[ citation needed ] 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." [26]

Running fan-funded campaigns cost bands a large sum of money. They must pay for video production for the video that every campaign has,[ citation needed ] 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. [27] 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. [28]

See also

Related Research Articles

Marillion Neo-progressive rock group from the UK

Marillion are a British rock band, formed in Aylesbury, Buckinghamshire, in 1979. They emerged from the post-punk music scene in Britain and existed as a bridge between the styles of punk rock and classic progressive rock, becoming the most commercially successful neo-progressive rock band of the 1980s.

The threshold pledge or fund and release system is a way of making a fundraising pledge as a group of individuals, often involving charitable goals or financing the provision of a public good. An amount of money is set as the goal or threshold to reach for the specified purpose and interested individuals will pitch in, but the money at first either remains with the pledgers or is held in escrow.

ArtistShare is the internet's first commercial crowdfunding website. It also operates as a record label and business model for artists which enables them to fund their projects by allowing the general public to directly finance, watch the creative process, and in most cases gain access to extra material from an artist. According to Bloomberg News, the company's chief executive officer, Brian Camelio, founded ArtistShare in 2000 with the idea that fans would finance production costs for albums sold only on the Internet and Artists also would enjoy much more favourable contract terms. ArtistShare was described in 2005 as a "completely new business model for creative artists" which "benefits both the artist and the fans by financing new and original artistic projects while building a strong and loyal fan base".

Electric Eel Shock

Electric Eel Shock (EES) are a three-piece garage rock band, formed in Tokyo in 1994. They first toured the United States in 1999.

Sellaband was a music website that allowed artists to raise the money from their fans and the SellaBand community in order to record a professional album. Sellaband used the mechanisms of crowdfunding and was to be seen as a Direct-to-Fan/fan-funded music platform utilising a Threshold Pledge System / Provision Point Mechanism. It was set up by Johan Vosmeijer, Pim Betist, and Dagmar Heijmans in August 2006. Its offices used to be located in Amsterdam, Netherlands, but it was originally incorporated in Bocholt, Germany.

Julia Nunes American musician

Julia Nunes is an American singer-songwriter from Fairport, New York. Her career has progressed online through her videos of pop songs on YouTube, in which she sings harmony with herself and plays acoustic instruments, primarily the ukulele, guitar, melodica, and piano.

Kickstarter US-based crowdfunding platform

Kickstarter is an American public benefit corporation based in Brooklyn, New York, that maintains a global crowdfunding platform focused on creativity. The company's stated mission is to "help bring creative projects to life". As of July 2021, Kickstarter has received nearly $6 billion in pledges from 20 million backers to fund 205,000 projects, such as films, music, stage shows, comics, journalism, video games, technology, publishing, and food-related projects.

PledgeMusic was an online direct-to-fan music platform, launched in August 2009. It was started to facilitate musicians looking to pre-sell, market, and distribute projects; such as recordings and concerts. It bore similarities to other artist payment platforms as ArtistShare, Kickstarter, Indiegogo, Patreon, RocketHub and Sellaband.

Language Room is an American indie/alternative rock band based in Austin, Texas. Its members are Todd Sapio, Scott Graham, Matt Graham, and Sean Hill (drums). In 2014 the band changed its name to KIONA.

RocketHub was an online crowdfunding platform launched in 2010, its first use was September 1, 2009. Based in New York City, its users—including musicians, entrepreneurs, scientists, game developers, philanthropists, filmmakers, photographers, theatre producers/directors, writers, and fashion designers,—posted fundraising campaigns to it to raise funds and awareness for projects and endeavors. Operating in over 190 different countries, RocketHub was once considered one of America's largest crowdfunding platforms.

Indiegogo American crowdfunding website

Indiegogo is an American crowdfunding website founded in 2008 by Danae Ringelmann, Slava Rubin, and Eric Schell. Its headquarters are in San Francisco, California. The site is one of the first sites to offer crowd funding. Indiegogo allows people to solicit funds for an idea, charity, or start-up business. Indiegogo charges a 5% fee on contributions. This charge is in addition to Stripe credit card processing charges of 3% + $0.30 per transaction. Fifteen million people visit the site each month.

Zequs.com is an online crowd funding platform that operates in an 'All or Nothing' method for individuals or groups to raise funds for creative projects. The site utilises social networks, with the use of social media, to help promote current projects. There are no restrictions from where those looking for funding are based. The head office is located in Queens Club, London.

<i>Theatre Is Evil</i> 2012 studio album by Amanda Palmer & The Grand Theft Orchestra

Theatre Is Evil is the second studio album by Amanda Palmer, and first with her band The Grand Theft Orchestra. It was released on September 7, 2012 in Australia, on September 10, 2012 in the United Kingdom and Europe, and September 11, 2012 in the United States and Canada. The album has been released by Palmer's own record label, 8 Ft. Records, with distribution handled by Cooking Vinyl in the UK and Europe, and Alliance Entertainment in the US.

Video game development has typically been funded by large publishing companies or are alternatively paid for mostly by the developers themselves as independent titles. Other funding may come from government incentives or from private funding.

InvestedIn is a crowd funding website for fund raising projects and charity events such as walkathons and celebrity cause-based campaigns. InvestedIn is also a technology provider offering a white label crowdfunding platform for commercial and non-profit use.

Experiment, formerly called Microryza, is a US website for crowdfunding science-based research projects. Researchers can post their research projects to solicit pledges. Experiment works on the all-or-nothing funding model. The backers are only charged if the research projects reach their funding target during a set time frame. In February 2014, the site changed its name from Microryza to Experiment.com.

Crowdfunding is the practice of funding a project or venture by raising small amounts of money from a large number of people, in modern times typically via the Internet. Crowdfunding is a form of crowdsourcing and alternative finance. In 2015, over US$34 billion were raised worldwide by crowdfunding.

MusicBee is a crowdfunding platform focused on independent music based in Hong Kong. The company stated its mission as to gather resources and help bring independent music projects into life, providing musicians with dreams and opportunities. MusicBee has reportedly received $2 million funding over 15 music project within one year.

<i>Mimicry and Memories</i> 2015 studio album by Electric Six

Mimicry and Memories is a compilation album by Electric Six. Disc one, Mimicry, is composed of cover songs. Disc two, Memories, consists of demos, B-sides and rarities. It was funded through a Kickstarter campaign and self-released directly to the campaign's backers.

References

  1. ↑ Van Buskirk, Eliot (10 March 2008). "SlicethePie Unleashes Its First Fan-Funded Album". Wired .
  2. ↑ Chaney, D. (2010). "What future for fan-funded labels in the music recording industry? The cases of MyMajorCompany and ArtistShare". International Journal of Arts Management. 12 (2): 44-48.
  3. ↑ "Can You Spare a Quarter? Crowdfunding Sites Turn Fans into Patrons of the Arts". Wharton Innovation and Entrepreneurship. 8 December 2010. Retrieved 20 November 2012.
  4. ↑ "About Us". ArtistShare. Retrieved 20 November 2012.
  5. ↑ "Learn More". Indiegogo. Retrieved 16 June 2012.
  6. ↑ Needleman, Sarah (1 November 2011). "When 'Friending' Becomes a Source of Start-Up Funds". The Wall Street Journal. Retrieved 5 December 2011.
  7. ↑ "about". PledgeMusic. Retrieved 27 November 2012.
  8. ↑ "FAQ". PledgeMusic. Retrieved 26 November 2012.
  9. ↑ Ostrow, Jonathan (16 August 2010). "Musician's guide to Fan-Funded Music". Music Think Tank. Retrieved 27 November 2012.
  10. ↑ "How it Works -- Artists". Sellaband. Archived from the original on 16 January 2013. Retrieved 27 November 2012.
  11. ↑ "Join SellaBand". SellaBand. Archived from the original on 23 October 2012. Retrieved 30 November 2012.
  12. 1 2 Masters, Tim (11 May 2001). "Marillion fans to the rescue". BBC News.
  13. 1 2 Petridis, Alexis (18 April 2008). "This song was brought to you by ..." The Guardian . Retrieved 16 June 2015.
  14. ↑ The Marillion story and what we can all learn from it - Music 4.5 Archived 9 November 2012 at the Wayback Machine
  15. ↑ "Amanda Palmer: The new Record, Art Book, and Tour". Kickstarter.
  16. ↑ Sisario, Ben (5 June 2012). "Amanda Palmer Takes Connecting With Her Fans to a New Level". The New York Times.
  17. ↑ "Ellis Paul". Ellis Paul. 9 July 2008.
  18. ↑ "Musicians and fans join together to get albums made". The Boston Globe .
  19. ↑ "Ellis Paul". Ellis Paul. 26 September 2012.
  20. ↑ "Wanna Go VIP? Electric Eel Shock'll show you the way..." DrownedInSound. Archived from the original on 18 October 2012. Retrieved 30 November 2012.
  21. ↑ Lindvall, Helienne (21 January 2010). "Behind the music: The fan-funded model that led to a major record deal". The Guardian. London.
  22. ↑ "How fan-funding is changing the face of music finance". BBC News. 12 July 2012.
  23. ↑ Gareth McLean (13 August 2001). "In the realm of pretences". The Guardian. UK.
  24. ↑ "An Argument Against Fan Funding". Music Think Tank.
  25. ↑ "The Problem With Fan-Funded Music". NME .
  26. ↑ Sofge, Erik (18 August 2012). "The Good, the Bad and the Crowdfunded". The Wall Street Journal.
  27. ↑ "How Much Does Crowd Funding Cost Musicians?". NPR. 23 November 2012.
  28. ↑ "Music Clout". musicclout.com.
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