You have a pretty good fan base; people who see you play live every week and who always ask when you will have a recording that they can buy. If only you had the money to make that next CD.
The Traditional Recording Industry
Record companies do it this way: they "find" you (probably after years of you telling them about you). Then they decide that they are willing to make an investment in you. They are taking a business gamble. They believe that you will make music that is attractive to a certain number of people and will generate a certain amount of revenue. So they provide funding and equipment for you to make that music. They're banking on the fact that they'll sell CDs - more CDs than the cost of the funding and the equipment. And because they win some and lose some, they make sure that they get a good cut when they win. At the most the artists get about 15% of the revenues from sales - 85% to the recording company, 15% to you. And that's how it has worked for years and years....
Of course, lately, it's actually gotten harder to grab the attention of these recording companies. If they had $500,000 to invest before, they might have spread that out over 10 bands or more. Now they put it all into one basket. So they need to look for very mainstream artists. Anyone with a small niche sound, well, they're out of luck. And that's how it's gone for years.....
The Old Fashioned Way - Patronage
Say you're Wolfgang Amadeus Mozart. You have a pretty good fan base - royalty and friends of royalty. And you have performed a few gigs around town that gave people a taste of what your music sounds like. So the royals support you and they want to hear more. What happens? Well, they give you money and resources to write your little ditty. You get all the perks. Good seats at restaurants. A stipend to ensure you have fresh fruit and veg. And all the musos you can shake a stick at. You're on cloud 9. When you're done, you get gigs all over the country and you perform over and over and over again. Like a record. J What does the royalty get - live performances of great music. What do you get - the opportunity to live off of what you do - making music.
This relationship is called "patronage." And what you might not know is that you can use it today. Of course you either have to have a great relationship with someone really rich - like a queen - or you have to have enough fans (modern day patrons) who want to hear your CD and are willing to pay for it. You want to find patrons. And when you find enough of them, well.... You can raise the money to fund the development before you even play a note. Here's how it works....
Say you have about 100 people you know would buy your CD. They all really like your work and, sight unseen, would be willing to shell out $20 bucks for a CD. That's $2,000. But your budget to produce what you want to produce is $50,000. How are you going to get the money?
Enter the Internet
The Internet, with all of the grief it's getting right now because it enables people to share music without paying for it, may just also be the funding partner that smaller niche artists need. Here's the new scenario....
You set up a website with a few words from you, perhaps a sample of your lyrics, maybe a few words about your vision for the CD, maybe you throw on some samples of your previous work or some demos of the songs you want to develop. And with a finished product in mind, you overtly ask people to pay for a CD now that they will get later.
And you offer them another perk - the opportunity to virtually participate in the process of recording. While your website is generating funds, you do your artistic thing. And you post photographs of recording sessions, post diary entries of what's happened, even post samples of what you recorded so that your patrons can see how their money is being used. They feel involved.
A side benefit of this to your fans is that you expose them to what their money actually buys. They may finally realise that their $20 investment doesn't really buy a physical disc with bits and bytes. Some people just don't understand why CDs cost $20 when they can just copy one in less than 5 minutes on their home machine for less than a dollar. By sharing with them the intricate elements of artistic creation (selecting an arrangement, finding musicians, improving equipment, etc) you are exposing them to the real value of their purchase.
There are software programs out in the world already that help you do this sort of thing. They handle everything like online payments, customer (patron) databases, and website content. There are also modifications of this idea out there - software and business arrangements that make online micro payments (transactions less than, say, $2.00) economical. You can sell one song at a time and never produce a CD at all.
The Result
The goal of course is to make more money than your costs (including paying you). So if by using the power of the Internet, you will market to millions of people instead of only your immediate fan base, you can see that this would likely increase your sales. And if your project is interesting to a small portion of that market (therefore unlikely to get record label funding - well, you can see how it would work well for a niche artist with a good reputation and a well-presented idea.... Theoretically, you can turn the old formula on its head. Instead of the artist getting about 15% of the revenue from a record company, the artist can get 85% of the revenue - the other 15% going towards the software. Pay for costs and keep the change.
So if you're wondering how to fund your next CD and don't want to (or can't) fund it yourself - think a bit out of the box. The ideas are out there.... You have choices. Get out there!
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* This article was written based on a 3 part series on National Public Radio in the US. You can listen to that series and see other links by clicking here http://www.npr.org/templates/story/story.php?storyId=391823.
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