What To Expect in the Future

As I finish my Master’s degree in Entertainment Business, I can’t help but think about the future of the industry, and what lies ahead. Apple is perfecting this cloud music system, which is a new attempt to end digital piracy. This is the music industry’s answer to the massacre of peer-to-peer sites, having people pay a monthly fee for all the music fans can get their hands on. While it is quite revolutionary for Apple and consumers to have access to the Big Four’s music catalogs, one can’t help but wonder what is the catch? What are the limits? Do we really have access to any song we could so desire?

While Apple works on the kinks and bugs of acquiring the Big Four’s and the smaller independent publishers’ catalogs, some say the music publishing industry itself is next to break apart. A system that has been working since its creation is now said to be falling to pieces. We have arguments that music performers should receive royalties like songwriters and producers (see "Should Performers Have Rights?"). We have companies that are about to go belly-up, making the competition want to buy them out. We even have record labels saying that they will cut out ASCAP, BMI, SESAC, and SOCAN, and collect their on performance royalties. All in all, the music industry is a mess.

Who knows where things could be in a few years? In the next few years, the Big Four could be the Big Three if EMI does fold in. But EMI is also the company looking to collect their own performance royalties from radio and other venues. The future of the industry could be on its way to a crashing point. Or, it could be on a blindside upturn. The real point of this post is that no one knows the future, but we can all do our part to change it. The real question is this, you see the problem, how will you and your music company be the solution? What do you have to offer a music industry that may be on its last leg? And more importantly, how drastically will your business plan change if the music industry does get the major over haul it needs?

These are questions only you can answer. The only advice I can give you is to keep your eyes open at all times…

...and Stay Tuned…

Using Other People's Money

The Stay Tuned blog would like to continue to focus on the overall business aspects of starting your music business. Today, we would like to focus on the most important part: getting money. We talked previously about what to include in your business plan to get money. Now we will tell you how to use the internet to help you obtain finances to start you music company. There are websites out there that offer tools and services to help entrepreneurs get their business ventures off the ground. Let's have a look at some of these sites and opportunities.

One website, the CDVCA, offer funds and investments to "businesses in economically distressed areas" within the United States and also internationally. The Community Development Venture Capital Alliance (CDVCA) look for mission-driven business opportunities that will be beneficial to people of low-wealth homes and communities, while working to earn solid financial returns.

According to their website, "CDVC funds are looking to invest in companies with strong management, good ideas, impressive growth potential, and the promise of high financial returns. They also focus on the number and quality of jobs that will be created and the impact their investments will have on low-income communities." They are looking to see how your music company will help create jobs and benefit the families in your community. The website also offers more information on obtaining venture capital and what it is. They have links to articles and commentaries posted in the New York Times.

Another good site is the Association for Enterprise Opportunity (AEO) website. The AEO represents and serves the small, typically underserved, entrepreneurs in the United States. According to their website, the AEO's mission is to support the development of strong and effective U.S. microenterprise initiatives to assist underserved entrepreneurs in starting, stabilizing, and expanding businesses.

AEO itself does not handle the financing, but has several funding companies and "microenterprise development organizations" that it has partnered with. The website has a search feature for entrepreneurs to find the nearest funding specialist to help them get their business venture off of the ground.

In partnering with the AEO, they can offer:

• Platform to showcase your organization's impact and innovation through our new website, revitalized working groups and other exciting opportunities
• Access to valuable services and products from a growing national network of partners
• Networking with peers, potential partners and funders
• Collaboration on tailored marketing and business development initiatives for our members
• Effective voice in Washington on critical policy matters
• Support in identifying and filling critical training needs for your organization
• Opportunity to shape and participate in AEO agenda and initiatives

And these are not the only sites out there to help you. There are many sites that offer help, tools, and services to meet your needs of getting your label or music business from idea to reality. Continue on your research path and find the resources best for you and your vision, and what you hope to accomplish with your venture.

Until the next blog, Stay Tuned.

Putting the Business in Music Business Part II

This week, the Stay Tuned blog is still focusing on overall business, and how to get that business on the right track. Most entrepreneurs know this starts with a business plan. A company without a plan, has no direction. The business plan is your vision in the form of words. This is how you get your vision and dream to other people.

In the first "Putting the Business in Music Business" post, we talked about Growthink and its founders Jay Turo and Dave Lavinsky. Turo and Lavinsky have mentioned important things that investors are looking for in business plans. The most important aspect of any business plan is research. While investors want to know how they will make back their money, and what makes you stand out from everyone else. But your overall plan should show that you have done the necessary research. This research includes research of your industry, your audience/target market, and your competition.

Lavinsky and Turo additionally mention investing in yourself and taking risks. We believe these go hand-in-hand. If you can prove that you have a service or product that is different, you should believe in yourself enough to invest in it. You should always be willing to better yourself and your craft. In music, that means singing lessons, even if you think you are great at singing; or piano lessons, even if you can figure out any tune playing on the radio.

Research and investing in yourself are the key aspects prospective investors want to see in your business plan. If that's want they want, why aren't you giving it to them?

Besides these things, the most important section of your business plan includes the Industry Analysis, the Marketing Plan, and also the Competition section. These sections show the most in terms of your research and what sets your business apart in the industry. If you come off as if you don't know much about the industry or the companies already in it, you may already lose the investor.

Take time to get to know the industry you want to break into and where you fit in. Research prevents you from trying an approach another company has tried and failed; or shows you how to capitalize on your competitions mistakes. Also, find yourself so caught up in your work and planning that you forget to show exactly who you are and express yourself.

Until next time, Stay Tuned.

Putting the Business in Music Business

CqE and the Stay Tuned blog is venturing outside just the realm of music to talk about business itself. I am sure most readers want to end the constant working for someone else and would rather work for themselves. Who wouldn’t want to make their own rules?

Well in even in the path of working for yourself, there are some rules you have to follow to get there and to be considered successful. This path may start with your dream and idea. The navigation is your business plan. Having a tangible idea on paper helps other people see where you are going, and in turn provides you with the best chance of getting funding. In the world of entrepreneurs, everyone knows it is good to work with OPM – “other people’s money”.

There are many wonderful resources that can help you start and finish your business plan. One such resource is that of Growthink, a company that helps entrepreneurs get their ideas on paper in order to get help with startup costs. Dave Lavinsky and Jay Turo are the founders of Growthink, and have helped Growthink emerge as a premier strategic advisory and investment banking firms focused on entrepreneurship.

Lavinsky has helped many entrepreneurs and companies prepare for grow and success in the business market. He has an MBA from UCLA’s Anderson School of Management, with a Bachelor’s degree from the University of Virginia. He himself has started many successful ventures and contributes to Growthink’s informational blog, seen here.

Turo has helped to advise many growing, middle marker, and corporate clients in his time at Growthink. These include Infospace, Samsung, Porsche, and also Paramount Pictures. Turo is currently active in angel investing, and also contributes to Growthink’s blog. He holds an MBA from the Anderson School of Management at UCLA as well, and a Bachelor’s degree from Stanford University.

According to the blog, there are several lessons one can learn from Lavinsky and Turo and what investors want to see in the entrepreneur as well as in the business plan.

® DO YOUR RESEARCH – Information is everywhere. That means investors want you to collect some to tell why your venture is better than any other venture in your market.

® INVEST IN YOURSELF – How do you expect anyone else to support or believe in what you are doing, if you can’t prove you are doing so? Investors don’t mind helping or supporting a business if they see proof that the entrepreneur has tried to make it work other ways.

® TAKE RISKS – Exactly what is it that makes you stand out? If you are doing something that is commonplace, or has already been done, what are you bringing that’s new? According to Lavinsky, “every great person in history was an entrepreneur. They tried something new. They took a risk. They overcame odds. They persevered. And, at the end of the day, they made it happen.” This includes people like Milton Hershey (Hershey Chocolate Company), Clara Barton (the American Red Cross), Jim Henson (founder of the Muppets), and Walt Disney.

While there are more points to take away from the Growthink blog, I think the biggest point is, take it from someone who has done it before. We can dream all day, but our business plan should take form from an established formula. This is why people write autobiographies. Whether it is Dave Lavinsky, Jay Turo, Barack Obama, Quincy Jones, Russell Simmons, or Rick Pitino, there is something that they did that worked.

Will you be the next breakout story?

Stay Tuned.

You can check out Jay Turo, Dave Lavinsky, and Growthink at their website or @Growthink

_____________________

-Bios found on the Growthink website

-Additional information on Growthink blog posts

A Walk on the Digital Wildside

There are so many avenues you can go to promote and market yourself. This is especially true in the digital realm. In another post, we talked about Product and Artist Management. The key is developing your identity and getting that across to your fans/consumers.

There is a band that takes digital marketing to the next level, and it makes for an interesting result. The England native alternative band Gorillaz has almost eliminated the physical presence of humans by itself being a virtual band. Gorillaz has made itself known to the world with its four band members, Stu “2D” Pot, Murdoc Niccals, Russel Hobbs, and Japanese guitarist, Noodle.

The band, which was created by Damon Albarn and Jamie Hewlett, is tangibly made up of the music and various contributions from different musicians over the years. The main contributor has been Albarn, the voice of 2D in the band, and Hewlett, who is the illustrator. The outlandish cartoon band members have been perfect for digital marketing as it is easy to feature them almost anywhere in visual media, and the music speaks for itself.

In promoting their 3^rd album, Plastic Beach, Gorillaz released several cartoon shorts as well as playing out the story in their music videos about Murdoc kidnapping 2D and taking him to this island called Plastic Beach, to record for this new album. The story continues to play out piquing fans’ interest in what is going on with the band members. The way Gorillaz tells their story has led to them gain fans and album sales.

Gorillaz has since put out iTunes exclusive music, iPad apps, had their songs featured in commercials (Icebreakers) and video games (Guitar Hero 5, Rock Band). The Gorillaz website features a game based around the Plastic Beach album called “Escape to Plastic Beach”, which was also the name of their first world tour. Gorillaz is also working with a new technology for their tour using holograms, giving them a realistic and life-like appearance while on stage. This technology was used at the 2005 MTV Europe Music Awards and also at the 2006 Grammy Awards, featuring Madonna.

Gorillaz has used digital marketing to their advantage by making themselves a virtual band. This is digital marketing at its finest. What will you use to brand yourself and put yourself out to the masses? In marketing there are four people: Creators, Innovators, Imitators, and Spectators. Creators use their own ideas to their advantage. Innovators take someone else's idea and build on it, or make it special in their own way. Imitators obviously take a proven formula someone else created and stick to it. Spectators take it all in, yet put nothing out.

Which “-ator” are you? Stay Tuned.

For more on Gorillaz, check out their Facebook, Twitter, YouTube, Wiki, or their own website.

the Digital Divide

With so many innovations like iPads and eReaders, it is obvious we are embracing a digital format. The best way for entertainers like musicians to succeed in this new technological atmosphere, they have to adapt their marketing efforts to include digital media. This is the major record labels are having troubles with P2P sites and other forms of digital media.

The advancement of technology and the internet have giving record label another problem: independent musicians don’t need them. There are now sites and software that give the power to the artist and cut out the “middle-man” of the label. An artist can easily promote their product(s) through social media like Twitter, Facebook, or MySpace and sell it through sites like iTunes, Amazon, or CDBaby. Therefore keeping them in touch with the most important people of all: consumers.

For those that are still vying for that coveted recording contract, there are plenty of stories where someone has gotten signed from current social media. Hip Hop artist Soulja Boy Tell ‘Em gained his fame and contract from exposing people to his music through P2P sites. Current Bad Boy Entertainment artist Cassie found herself a contract by being discovered by writer/producer Ryan Leslie from MySpace. And let’s not forget pop star Justin Bieber, whose YouTube videos were viewed by the right people and provided him with a contract.

Digital marketing has changed the landscape of the music industry. Besides taking the D-I-Y approach, or attempting to get heard/seen by the right key people, there are many major signed recording artists who are taking it upon themselves to still use social media and other sites to promote and keep in touch with fans. In older days, the best way for fan interaction was at official autograph sessions or backstage after a concert. Now artists can interact from their cell phones with a tweet or status post.

An artist or record label would be silly not to take advantage of popular trends. If it is popular, this is where most of your fans and consumers will come from. Right now, things like Twitter, YouTube, UStream, Facebook, and Skype are popular among the people. In order to put yourself at the best advantage, you have to put yourself on the same level as the audience you want. Sales 101 has always been “the customer is always right.”

As you think about marketing your music and media, remember to take advantage of trends and fads as much as you can. The internet is an unlimited resource for digital marketing and getting the exposure you desire. Also consider internet radio sites like Jango who put your music out alongside the major artist. This is much easier than getting your music on a terrestrial radio station. Learn to use your resources to get you where you need.

Stay Tuned.

Where is Your Music Going?

I meet a lot of starving artists and aspiring musicians who seem to have a one track mind about the music business. Many people want to spend their time in the studio recording music so that they can perform to either release a cd or get found/signed by a major label. While this is a very realistic dream in today’s world of instant signees, this won’t make you much money, or even give you that much longevity. There are plenty of artists who get signed by record labels whose projects never see the light of day. The reality is getting a contract is not all that difficult now and days. What is hard is getting the label behind your project enough to promote and release it to the nation and the world.

Even if you do get released, what is your focus? An album on a major label? Placement on a Billboard chart? A Grammy nomination/award? A grand international artist? A lifetime achievement award in your genre? The question you really must ask yourself, is what makes you different or better the top artists in other genres as well as your own?

Is your music worthy to top the charts with Katy Perry, Beyonce, Lady Gaga, B.O.B., or even Jay-Z?

The focus of this post is not to criticize you or your music, but to strengthen your focus on your music and where it is going. It is good to have aspirations to sell out shows and perform worldwide. But how does your music do when you are not in the room?

One of the biggest apps in the Android and iPhone App Store is Shazam, which tells the user what song is playing when they can’t identify the song or artist. The key to this app and this situation is song placement. Your music should go further than just sitting on a cd or digital MP3. It should be broadcast all over.

Think about your favorite tv show. Who sings the song for the intro? Why isn’t your song on the intro of a show? When Remy Zero decided to record “Save Me”, did they know that CW show “Smallville” would allow it to be broadcast into viewers’ homes for over 9 years straight?

Speaking of hip hop artist B.O.B., he has had numerous Grammy nominations from his Atlantic Record debut “B.o.B Presents: the Adventures of Bobby Ray”, and has recently added a song placement credit to the new game "Crysis 2". He has had numerous placements in commercials and tv shows for his singles “Magic”, “Airplanes”, and “Nothing on You”.

When you think about where to go with your music, go beyond getting your music on radio. Your music should be in video games (think about the Madden franchise), tv shows, live shows (like the music pro wrestlers come out to), film, commercials, and other places. One of your singles can be the theme for a PPV, movie, tv show, product, or a big event. Who knows? It may be another avenue to you getting your contract and international exposure…only now you have leverage.

Stay Tuned.