I’ve been running my own business since 2007. I decided to start working for myself because I was tired of working for other people. It was really that simple. I didn’t want to have a set schedule and a boss, so I figured out a way to work on my own terms. It wasn’t easy. I had a lot of ups and downs in the beginning, but I did it and now, eight years later, I have both a thriving business and a satisfying music career that together provide a very comfortable lifestyle.
In many ways, being a musician and being an entrepreneur are very similar endeavors. Being a musician, essentially, is a form of entrepreneurship. If you’re doing things like making music and selling it yourself, booking your own shows, managing your own youtube channel, running your own website and so on, you are an entrepreneur. Even something like giving music lessons as an independent contractor, is a form of entrepreneurship. This is what I did, for seven years, prior to launching my own internet business in 2007. I think my teaching experience is one of the reasons my transition to working completely for myself was fairly smooth. I already had the mindset of being my own boss and creating my own schedule. I just decided to take it a step further and cut out the middleman, like music store owners, store managers and so on.
Now don’t get me wrong. I don’t have anything against working for someone else. There is a time and place for most of us where this is absolutely necessary. You learn valuable business and social skills by working as a part of an organization. If anything, my experience working for myself has given me more respect for different bosses and people I’ve had to answer to over the years. Running a business and dealing with employees is stressful. It’s hard to understand the type of pressure business owners feel until you do it yourself.
I’ll never forget one interaction I had with the owner of one of the music schools I used to work at as the executive director. I felt like my boss was unfairly hard on myself and the other teachers that worked there. One day, my boss, Frank, was really pissed at one of the teachers that he caught watching youtube videos in between lessons. The thing is, we were all on a salary, as opposed to being paid only for lessons we gave. So we were technically employees, accountable to Frank, and had other duties beyond just giving music lessons. When Frank got angry and yelled at Spike, the teacher he caught “slacking off”, I told Frank to “relax and that he needed to chill out”. “Then you pay him goddammit”, Frank sternly replied.
I’ve often thought about this interaction over the years when dealing with the stress of dealing with my own employees and people that I’ve worked with. Managing people that you are paying to work for you is stressful. Being the person ultimately responsible for generating the money that you are providing to people to live their lives is stressful. It’s hard to comprehend just how stressful it is until you are the person in this position.
But despite all the stress of entrepreneurship and being self employed, I wouldn’t have it any other way. There’s stress and hard work regardless of what path you take in life. When you’re self employed, there’s still stress and challenges, but you can work when and where you choose, and on projects you choose. Any downside is more than offset by the degree of flexibility it provides in terms of how you live your life. At least that’s my take on it.
Why I think more musicians should consider going down this route
Here’s the thing. The music industry in 2016 is like the wild, wild west. No one quite has it all figured out and there really isn’t any formula or path that you can go down that will guarantee success with your music. You need to be extremely creative, passionate, flexible and hard working to succeed in the music business. You need to try different things, fail, try again and keep going until you figure out what works. In other words, you need to be an entrepreneur.
Although everything I’ve done over the last eight years to make money is in some way related to the music business, not everything I do is directly related to my own music. This used to bother me. I’m a musician I would say proudly when people asked me “what I do”. I still answer this way when I get asked this question. But the dichotomy of running a business and being a musician no longer feels incongruent to me. Everything I do business wise helps everything I do music wise and vice versa.
If I create a new course and interview a music industry expert like a supervisor or professional songwriter, that gives me valuable knowledge that I can take and directly apply to my own music career. Conversely, if I land a new licensing placement or publishing deal, that gives me more experience and credibility that I can bring back to the business side of things. It’s all connected and all related. The music-business connection is sort of like the mind-body connection. The mind follows the body and the body follows the mind. The same is true in music and business. Growth in either area positively affects the other.
For example, I have learned invaluable marketing and communication skills from running my business that I apply to marketing my own music and dealing with people on the business side of things. I'll be using a lot of the same principles that I use to market my products and courses when I release the digital version of my latest CD, Shooting Stars, coming out later this year.
Although the creative act of writing a song is very different from the business skills needed to successfully negotiate something like a licensing deal, you really need to know how to do both in order to succeed. Making music and writing music is really just one part of launching a music career. It’s an extremely important part, no doubt. But in 2016 it pays to understand the business part of the music business, since the days of labels developing artists from the ground up don’t really exist anymore.
The Freedom Of Entrepreneurship
In many ways, I was drawn to music for the same reason that I was drawn to entrepreneurship and the idea of being my own boss. I wanted to live a life of purpose, creativity and freedom. I wanted to be able to both express myself and live my life on my terms. Being a musician/entrepreneur has allowed me to do both. Although there are difficult challenges when it comes to running your own business and I’ve had some struggles along the way, for the most part, I truly enjoy everything I do. I love writing blog posts, doing podcasts, creating courses, doing webinars and working with other musicians. I enjoy these things almost as much as I do writing music.
What Doesn’t Kill You Makes You Stronger
Learning new skills also forces you to grow. If there’s one thing I’ve learned over the last eight years, it’s that I can figure things out. I have an enormous amount of confidence in my own inner resourcefulness and stick-to-it-iveness that I simply didn’t have before I became a full blown entrepreneur. This sense of confidence has come as a direct result of learning to deal with the challenges of running my business. This inner sense of knowing I will figure things out, gives me a great degree of calm. It’s taken me a long time to get here, but it’s one of the very tangible rewards of entrepreneurship. I know that I’m not directly dependent on other people to provide for myself. Of course, I still interact with and work with a large group of people, but I don’t have to directly answer to or report to anyone like I did as an employee.
Do You Have What It Takes?
Becoming an entrepreneur isn’t for everyone. I realize that some people either don’t have the right temperament, or simply don’t have the desire to do their own thing. But if you’re a musician and you’re taking the DIY approach to your music career, you already are an entrepreneur, whether you intend to be or not. As Derek Sivers, the founder of CD Baby says, “The skills needed to make a living as a musician are the exact same skills required to be a successful entrepreneur. Musicians don’t realize that they are already entrepreneurs!”
In the next couple weeks, I’m going to be giving out a series of free lessons, including more in depth blogs, video and audio lessons and more, all related to what I’ve learned over the last eight years of running my own successful internet business. Although not specifically related to making money with your music, all of the information can be applied to anything you choose to sell online, including music.
If this topic is interesting to you and you want to learn more about internet marketing and internet business, sign up for my free training below. I will only send this to people who join this email list, since I realize this isn’t a topic all my readers will be interested in.
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The music industry is broken. There’s really no other way to put it. By most measurable accounts, the music industry is much worse off than it was just a decade ago. CD sales are down 84% from where they were ten years ago and although streaming numbers are up, digital sales are also down, and streaming revenue doesn’t seem to be substantial enough yet to support most artists.
Of course, the music industry might be a lot smaller than it was in the recent past, but it’s still a huge industry with a lot of money being generated. In fact, music sales in the US alone, when streaming is taken into account, is still over 7 billion dollars a year. Globally, the music business is a 25 billion dollar a year business. Although revenue from CD sales is down dramatically, there is still an enormous amount of music being consumed through new distribution channels.
But no matter how you look at the numbers, it’s hard to deny that it’s much more difficult than it was in the not too distant past for most musicians. Payments and revenue for artists are down, pretty much across the board. Record sales are down and are just a fraction of what they used to be. Licensing sync fees and performance royalties are also down in most cases. We all know how hard it is to generate substantial revenue from streaming services.
Most of the time, in order for musicians to even have a shot at getting their music heard, they have to make deals with a series of intermediaries, such as record labels, publishers, music libraries and music distributors. These deals are often complex, multifaceted, involving multiple parties, in deals that tend to be inefficient and painfully slow. It often takes months or years to get fully paid for transactions, if they happen at all.
Take licensing for example, if I license my music in TV today, I won’t receive performance royalties from anywhere between six and nine months from today, assuming all the paperwork is properly filed. Of course between now and then, I’ll still have bills to pay and expenses that I must meet. Collecting money owed from mechanical royalties and music that is aired on the radio is an equally slow and inefficient process.
This system of getting our music heard and distributed is and “old school” system that’s more than 100 years old. It’s been around since the rise of radio broadcasting in the 1920s. It’s an archaic and increasingly obsolete system that was created long before the advent of the internet which has completely transformed the music industry and how consumers find and consume music.
Listeners Have Never Made It Better – It’s A Utopia For Music Fans!
Ironically, while it’s probably never been a worse time for music creators, I think it’s fair to say, that it’s never been a better time for music lovers and people who listen to music. While the music creators themselves are struggling more than ever, at the same time, there’s easier access to a wider supply of music than there ever has been for music fans. For the most part, finding most music is a simple mouse click away. There are a myriad of free or low cost options for consuming music. From Youtube to Vevo, Spotify Or Tidal, Pandora and so on, there’s no shortage of ways to listen to and discover new music. It’s a utopia for music lovers.
The problem is, that while the music industry has been changing and evolving, the money being generated by the new forms of media that distribute music, isn’t substantial enough to make music a viable career path for most artists. The money that is being generated is also painfully slow to reach the actual music creators. This makes it even harder for musicians who are trying to create sustainable careers in the music business, which is challenging enough even without these obstacles.
How To Make It Better For Music Creators – Enter The Blockchain
This is where the blockhain comes in…
I first heard about blockchain technology in a conversation I had with Scott Kirby from Music Revolt.org last year on my podcast. During the podcast, Scott and I talked about some of the many problems and challenges facing the music industry currently and different ideas we had about how the industry could improve.
One of the possibilities Scott brought up in our conversation was blockchain technology. To be honest, when Scott told me about the Blockchain originally, I was a bit perplexed. I sort of got the concept. I was vaguely familiar with bitcoin, the cryptocurrency that utilizes blockchain technology to create a digital currency that can be used to buy and sell things online. But even though the idea intrigued me, I didn’t fully grasp the idea and how it could be applied to the music industry.
As I kept hearing more and more about the concept of blockchain technology and its potential application in the music industry, I decided to dive in deep to the subject and really try and wrap my head around it. I started watching youtube videos about it, I started reading industry articles about the technology and I started talking to people who are working in the business that are proponents of the technology.
One of the things that really excites me about the music industry right now is the fact that it’s so broken. That might sound like a strange thing to say, but think about it, the music industry is in such a state of profound disrepair that the only direction we can really go is up. All industries evolve and change, and my intuition and sense is that the music industry is ripe for a revolution of sorts. The technology exists right now to solve many of the issues that are plaguing the music industry.
Before I try and explain how blockchain technology works, let’s look at some of the areas proponents of the technology say it has the ability to address.
According To Industry Experts, Blockchain technology has the capability to:
Vinay Gupta, release coordinator and general strategist for Ethereum, a leader in blockchain technology, had this to say about the blockchain….. “the blockchain is inevitable.. it isn’t a simple convenience, it’s necessary to create a level playing field to ensure the system is fair to everybody, wherever they are in the world… the block is here to stay, I think.”
What is the blockchain?
Ok, so what exactly is the “blockchain”? I’m fairly computer and tech savvy, but I have to admit that explaining what the blockchain is and how it works is a little complex.
Bas Grasmeyer, from Hypebot, explains it better than I could…
‘The blockchain is the distributed database model underlying cryptocurrencies like Bitcoin and Ethereum. It takes peer-to-peer technology to data records. Instead of having all data on one computer, it lives on the computers of everyone who participates in the database. You can only write to it: this means that if you want to change data into the database, you declare what the new info is, but the old version remains in the system, so that the change is transparent. A bit like with ledgers.”
Huh? It’s a little confusing and technical. Here’s a visual that makes it a little easier to understand:
I admit, fully understanding the technology is a little difficult. But don’t worry too much about how it works. Just understand that the technology exists right now and it can potentially do two main things for the industry. It’s sort of like understanding how the internet works. Do you really understand the internet and the computer coding behind it? Me neither, but I know I enjoy using it.
The blockchain technology will do two main things:
The first is that it will record a permanent record of who did what on each song,” sort of like what IMDB does for films, but using blockchain technology. This will allow every contributor to a track, co-writers, producers, vocalists and so on to get credited for their part and get paid instantly for agreed upon percentages based on contribution.
This will happen via what our known as “smart contracts”. Which will be the blockchain’s second main contribution to the music industry. Gupta explains that a smart contract is “basically a tiny little program that has fixed instructions about how to move money… you store it permanently on a blockchain, and when payments come in, it says ‘we’ve received some money, this much goes to the taxman, this much goes to the contributor, this much goes to our studio…”
Imagine licensing one of your songs and everyone involved with the song’s creation and publishing getting paid for the sync fee instantly. This is what smart contracts will be able to do. Money moves instantly in the digital age, so why shouldn’t it work this way in the music industry? Why do things have to move through such slow and inefficient channels? They really don’t have to and the blockchain could potentially resolve this issue.
There is a lot left to work out about when and how the blockchain technology will be implemented in the music industry. There are industry standards to sort out and be agreed upon. I’m sure there will be complex industry negotiations and meetings with the major players in the industry that are interested in retaining control of as many of their assets as possible. I’m sure many will resist the technology, while at the same time, others will embrace it and celebrate it.
Like all great revolutions, there will be people resisting change. But like Victor Hugo, the French philosopher said, “there is nothing more powerful than an idea whose time has come”. I believe this idea and technology will simply be too powerful to stop.
There are several new companies emerging as we speak that are attempting to address the problems the music industry is facing and pave a new way forward utilizing blockchain technology.
Here are a few companies to keep your eyes on that will be utilizing blockchain technology:
Ujo Music - http://ujomusic.com/
Peer Tracks - http://peertracks.com/
Bittunes - http://www.bittunes.org/
I will be keeping my eye on this issue as much as possible and will be bringing guests in this space on my podcast in the near future to dissect this technology and its implications for the music industry even more. I think it’s important as musicians and artists be acutely aware of where the industry is headed. Our careers and livelihood depend on it.
For now, know this. Change is coming.
The blog of musician and thinker of deep thoughts, Aaron Davison.