While the big labels get afraid of the fundamental changes the Internet and the general technological development causes them, there are some fresh ideas upcoming to revolutionize the music business enabling promising artists to get enough money to release their own album. Pim Betist
, co-founder of sellaband.com
, explains how anybody can become a micro-investor and fund new talents. Very frankly, Pim provides us with insights about the business model behind, which also entailed some criticisms.
The idea sounds simple, find 5.000 believers who buy one or more shares for $10 each. Once you reached $50.000 you will be the lucky one to get you album produced. The success of sellaband is impressing, 14 artists already reached the required $50.000 and have their albums produced, 12 more artists are funded and are on the way of album production. As sellaband takes an transaction fee for any money purchased and gets the interests of the stored money which is waiting to hit the $50.000 you can get an idea about the profitability of that business model. That also caught the attention of investors and that is maybe why sellabend got its $5 Million funding by Prime Technology Ventures for expanding in the US.
So it is no surprise, that there are lots of competitors on the market which also want to have a peace of the cake: forMyBand
is a German variation of the same idea, at slicethepie
the single investments start at $5. Justaloud.com
have a different approach but also enable independent music and artists to fame, both are based in Germany.
A similar concept but for independent films offers indie maverick
Also established bands use their fans to receive a pre-financing. The veteran U.K. progressive rock band Marillion
could raise $725.000 by selling deluxe versions and gifts related to their new album like going to the studio with them and participating in the recording. That might also be a very cost-effective sales channel
for the musicians because as their audience pays in advance they will save a lot of money for marketing and distribution.
The interview with Pim Betist, co-foounder of sellaband.com, was realized at PICNIC08, where creative minds from all over the world came together to share ideas and thoughts. It took place in Amsterdam, Netherlands from September 24th to 26th 2008.