The Vinyl Revival is Real, and not Ignored

The Vinyl Revival is not such a new concept. Vinyl took a pretty brutal beating starting in the 80’s and continued through the early 2000’s, given the particularly active evolution of the sound recording medium. From, cassettes to the compact CD and the Sony Walkman, to the digital revolution, the iPod and iTunes, the Vinyl medium was all but eliminated from our culture. It makes sense; vinyl is much bigger, bulkier, more expensive than the current forms of listening to music, and harder to purchase. In terms of most practicality measures, Vinyl doesn’t stand much of a chance.

However, clearly practicality is not everything. Starting in 2006, renewed interest has been instilled in Vinyl and sales have been growing year over year. In fact, in 2015 Vinyl still shows good promise. It is currently the fastest growing music segment. According to RIAA’s 2015 mid-year stats, it has experienced a staggering 52.1% growth in just one year. Even digital streaming barely grew half as fast. Even more incredibly, Vinyl sales are actually larger than revenue from ad-supported streaming (which includes Spotify, Youtube, Vevo, etc) by a good margin (221.8 versus 162.7 million dollars).

Whatever the reasons are that Vinyl has been making a comeback, whether it be cultural importance, heightened sound quality, more meaningful start to finish experience, gift giving potential for friends and loved ones, or just the fact that it is a good-looking physical and material product, it is clear that investor capital will once again flow towards it.

In fact, recently, a number of startups have emerged to take advantage of the Vinyl revival. Probably the most notable of the bunch is a company called “Vinyl Me, Please”. Here is the website below.

Vinyl Me Please Website

Basically, it is a subscription service starting at $23 per month that delivers one vinyl album to your doorstep every month. This general business model is not new to the start-up space and is known broadly as a”subscription box”. Industries such as beauty, coffee, and books have successfully implemented this same idea.

To augment the experience of receiving the album, Vinyl Me, Please record deliveries come in a sort of bundle with other add-ins. For instance, the company gives a special cocktail recipe and an album-inspired 12″ x 12″ art print to compliment the album of the month.

The company has a team of experts picking the albums which takes the difficulty out of picking albums for the customer. The curators do a good job picking albums that are vintage, historic, as well as newly released. Although many consumers enjoy the process of purchasing Vinyl’s at a record shop, there are many more who get overwhelmed by the choices available and frustrated with the hassle involved and would rather have a curated process. Also, the fact that the Vinyl is delivered to the doorstep makes it feel as though it is a gift.

Granted, Vinyl sales growth will likely bottom out much before streaming does, however, this company and other similar ones have been successful, and with each new years’ growth in Vinyl sales and interest, comes new innovative companies hoping to share the fruits of the “new” Vinyl industry.

 

Bringing Honesty to Artists BEFORE the Record Drops

So there’s been a pretty big problem in the music industry that has been largely ignored for a long time. Its a problem for big name musicians and small alike: Musicians don’t know if people like their songs before they put them out. Sure, you can ask friends, family, and co-workers, but the reality is that most people don’t tell the truth. Nobody wants to say they don’t like something someone has created to that person’s face. It just doesn’t feel right. Not only that, but even if you finally find someone who is honest with you, they are only just one person. Conclusion’s shouldn’t be drawn from a single data point. So essentially, musicians only find out about the appeal of their song after they release it. And still, even if they find that people don’t like it enough to download, buy, or stream it, they won’t find out what people don’t like about it. This fundamental problem with the creative industry on its way to being solved because of a new company called Audiokite.

Audiokite has just recently won the 2015 SF Music Tech Startup Innovators Challenge. The idea is simple – Audiokite gathers music fans from around the United States into their network, of which they have over 15,000 now. Musicians pay a small fee, about $35 per hundred listeners to have their music distributed across the Audiokite network. The fans then rate the song on a 1-10 scale on a variety of factors relating to the songs appeal. There is also subjective written feedback from listeners. The data is compiled and sent as a report to the musician.

Audiokite reports are very thorough and users rate the song on a variety of factors. These are a couple examples of the data that artists get.

The company is also able to further analyze the data by segmenting their users. They have demographic information such as age and gender, but they also segment by taste in genre. So if you only want to test your electro pop song on people who listen to electro-pop, you can.

This is an example of the written comment section:

“I really enjoyed the vocal performance, specifically the sound of the singer’s voice, and I liked the melody. However, the lyrics aren’t very meaningful or clever in my opinion. I think the song would be good if you kept it mostly the same but changed some of the lyrics. Also, I’m not a fan of the sound of the synth. I would prefer more guitar soloish stuff instead.”

Here is another:

“This track was alright. The producer needs to watch the levels of the bass and instrument track with the vocals on the lead in the track. What sounds like the snare drum makes it a bit hard to clearly hear his lyrics from time to time. Also, watch the feedback background singers sound blown out.”

As you can see, the feedback is honest and constructive, which is what makes the service a real benefit to artists. This means they can improve their songs and make them more commercially viable before release. This means that their tracks will be much more likely to succeed. Not only this, but through the reports, artists can figure out which tracks are the “singles” and which are the supporting tracks on the album. This simple decision can save loads of marketing dollars for labels and artists alike.

Lastly, Audiokite is using their data for additional artist benefits. Because they know what ratings the submitted songs receive, they can filter the better tracks to the top. They use this information to create opportunities for the artists. Top rated artists are offered the option from a number of partner companies to receive free promotion, distribution, and education. Further, the tracks get access to top industry influencers such as labels, radio stations, publishers, and music supervisors. This is very exciting because it promotes success based on pure merit, rather than any other factor.

This company definitely shows a lot of promise for artists and the music industry in general. It’s also just a ton of fun to use! Theres good reason in won the SF Music Tech Startup Challenge.

Audiokite Website

A Bright New Future for the Business of Live Event Planning

The new music startup I am discussing this week is a company in the live music space called Gigstarter. The live music experience has certainly changed drastically with the advancement of technology, introduction of social media, and shift of consumer tastes towards more visual demands of the entertainer. Despite this, the economics behind the live music industry hasn’t changed in years. Gigstarter hopes to be that change. Put very simply, currently when artists go on tour the booking agent will contact venues and book shows far in advance, and then a promoter will market the show and try to sell as many tickets as possible. Thus it is largely a guessing game as to what the most profitable venue is. Gigstarter’s idea is basically to reverse engineer the process. Namely, they will sell tickets and measure demand from fans before the show is booked, and only when they are sure they will make enough money they book the venue. Gigstarter’s idea is so simple that it seems painfully obvious, however it is clearly not given how long the industry has traditionally operated. Here is a video that helps explain what they are all about:

The benefits to the artist are numerous. First of all, basically all of the financial risk of touring is taken away. Usually, when a show is booked, the promoter and the artist don’t know if the costs of the show and marketing will be recouped by ticket sales. In general, the promoter will take the brunt of this loss, but the artist obviously has a main interest in getting many tickets sold as well. With Gigstarter, the venue is not booked until sales are made, and more importantly until the best venue is chosen. The way that Gigstarter is able to do this is through the social media channels of the artist. It is all about targeting and finding the artist’s fans and literally asking them where they want the show to be, rather than telling them where it is and hoping they’ll be happy about it. The locations with top support will be picked and sold ahead to those fans, and only if the target sales figure is met will the show actually be booked. This is basically the equivalent model to Kickstarter (which must be where Gigstarter got its name from). Kickstarter crowdsources money for projects of many kinds, and will not actually do project until the target funding number is raised. If it is not, everyone gets there money back fair and square and nobody wins, but nobody loses. This genius business model that skyrocketed Kickstarter to the top of the startup world is the same reason Gigstarter has so much promise.

And not just risk-reduction is a benefit. It is also very effective in increasing fan engagement. In the Gigstarter model, fans are engaged from the beginning, and given power in the decision making of the tour. They almost function as a tour manager of sorts. This is a very exciting proposition for superfans, who are always looking for ways to get more personal with the artist, which in turn will get them more involved in the artist social media, and also likely cause them to be willing to pay higher prices for the tickets (the figure presented was that Gigmaster ticket sales are on average 33% higher than traditional sales).

Lastly, and very simply, Gigmaster takes out the middleman. The promoter is no longer necessary, because the show is already sold if the artist chooses to book a gig. Not only this, but because the tickets are sold direct to fans through the Gigstarter website, ticket fees are reduced. All of this allows the artist and their team to keep a larger part of the pie.

This is the first time in a while that the current industry structure of live music is legitimately threatened, however it seems if it does in fact change, it will certainly be for the better.

http://gigstarter.com/

Leave It To Us

In the music industry as of the last decade or so, emerging internet and digital technology has created an almost paradoxical situation for artists. Sites like youtube, Spotify, Pandora, and countless others are providing a fair and equitable way for new artists to allow their music to be heard by almost anyone around the world. Music production technology has allowed the “average joe” to produce high quality mixes in their bedroom. So you would think that all those young and very talented artists and musicians would finally be able to make a success for themselves in the industry? Actually its far from the truth. Because of this access to new distribution channels and production technology, the market has become severely flooded with budding musicians and artists all trying to make a name for themselves. There are thousands upon thousands of musicians with new music posted on soundcloud, music blogs, Spotify, and the like every day, and although it is technically available to be listened to, it is getting harder and harder to push through the crowd to be noticed, talent or no talent. Not only this, but the major record labels are signing less talent every year. Last year, for example, Atlantic only signed 2 new acts. This is devastating to new musicians aspiring to be stars, because the major labels still own access to the top charts. They have the money, marketing teams, distribution network, and relationships to successfully break through the clutter, and push their artists to the top.

This is why companies like Tradiio are so exiting.

Tradiio is a very innovative company opening up the doors to many interesting opportunities. They are basically a virtual stock market for emerging artists. In the app, users are given an initial amount of coins for free, and from there they prudently “invest” these coins in artists and musicians on the app that they believe should be more recognized. They now own “stock” in the artist and if the artist gets pushed up to the top of the app list via other investors, you can cash out your higher value stock for unique rewards and prizes like VIP access to shows, and special merchandising from your artist. Although this just seems like nothing more than a fun game for consumers to play, it is actually a major step toward more equitable exposure in the music industry for emerging artists. Tradiio creates a well organized platform for the common people (who are the end consumers for music) to act as A&R for a record labels, and aligns incentives so that there is a reason for them to work hard to do it.

It is long been observed in the social sciences that the collective knowledge of the masses is greater than that of a few expert individuals. The phenomenon is called the “wisdom of the crowds”, and applies to Tradiio’s model. With many participants each putting in their own “two cents”, collectively they will be more accurate at choosing the best talent in the marketplace than any of the individual A&R scouts. Making music discovery a way to make money might be the best way to give musicians the chance to actually be heard. For now, the company uses only virtual coins, but their goal is eventually to use real money, (after legal issues are sorted out) and it will be very exciting to see how it plays out when they do.

It’s Time for Music to Catch up With Now

The tech startup revolution has been going on for quite some time now, with new small companies popping up in the thousands every month. Many industries have been fully revolutionized by this tech wave, including transportation, healthcare, travel, and business. However, the music industry revolution is just in its infancy. That is because for a long time it was afraid to change. It’s a very concentrated industry, with a few big players at the top calling all the shots. Money was easy to come by for them, and the system ran smoothly, so change was naturally resisted.

Most notably, when Napster came out with an incredible new technology that opened up doors to innovation in the music consumption space with peer to peer file-sharing, the music industry’s reaction was to sue and destroy, rather than acquire and exploit. If they had been proactive and opportunistic about this new technology rather than reactive and pessimistic, the music industry might have been in a much more profitable place now.

Even after this blunder more than a decade ago, the industry has been criticized as often being behind the times. However, finally in the past few years (and possibly out of desperation), we are seeing signs that the industry is ready to get behind the tech movement, and support change. In the past two years, more than three music-focused tech/startup accelerators have begun operations, including Project Music2112 Inc, and SMASHD labs.

This will turn out to be very healthy for the music industry, as it is in transition and has been struggling to find a stable new revenue generation plan. A great way to accelerate this process is by attracting entrepreneurial skill and venture capital funding.

Here is an example of one of the new tech companies helping to revolutionize the industry:

The startup harnesses the idea of “collaborative consumption”, essentially Uber for music production. You can use the platform to find talented instrumentalists, singers, producers, and engineers from around the globe to help take your music projects to the next level. This puts more power into the hands of the creators and artists, further moving the industry downstream as technology advances. This is just one of the many new promising companies ready to make a splash in the music space.