Crowdsourcing
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We have more than 10,000 artists using Sellaband. I would say that only 5% are doing it with a lot of commitment and motivation and only 1% of those that are committed are using it for any kind of live event or tour.
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– Michael Bogatzki, Sellaband ‘give’ for two other significant reasons: Firstly, community – being part of a community and wanting your artist/musician/ project/company etc to succeed. And secondly, investing in a person to establish a connection with them – to feel part of their life and their success. This, combined with the decline in the traditional music business, probably explains why crowdfunding has become so overwhelmingly popular with musicians.
Critics of the Concept The movement is not without its naysayers, however, and the use of such mechanisms are subject to various legal constraints in certain territories. Online selling is controlled by distant selling laws in the UK, meaning that any transaction has to be accompanied with exact notification of when the goods will be delivered. If this isn’t made clear, a statutory 30-day period applies. In the case of a musician recording, manufacturing and shipping a record, it’s widely known that the time frame can change, often at the drop of a hat. Adhering to these rules to raise upfront investment can no doubt be a bind and might explain why some crowdfunding projects have collapsed amid bad press. Meanwhile, some industry experts believe that sending your closest fans off to a third-party crowdfunding website makes for bad business. Erik Nielsen, artist manager and industry consultant for acts including Marillion and James Blunt, notes with concern that, “The people who are looking to raise the money are driving fans away from their own identities, brand and websites over to what is, for all intents and purposes, an e-commerce platform. A very complex and intricate one, yes,
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The people who are looking to raise the money are driving fans away from their own identities, brand and websites over to what is, for all intents and purposes, an e-commerce platform.
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– Erik Nielsen, Wingnut Music
20 | IQ Magazine July 2013
but still just a piece of software.” Regardless of such qualms, thousands upon thousands of acts are using the likes of Kickstarter, PledgeMusic, Sellaband, RocketHub and ArtistShare to raise money and awareness. Tellingly, most are using these platforms to raise money for physical product. It is still rare to see an act using a crowdfunding site to raise money for any kind of tour or live event, but thanks to the success in funding record projects, the tide is shifting. Michael Bogatzki, managing director of Sellaband, the largest crowdfunding platform for musicians in Germany, sheds some light on how many of their users are raising money for gigs or tours. “Our registration tells us we have more than 10,000 artists using Sellaband. I would say that only 5% are doing it with a lot of commitment and motivation and only 1% of those that are committed are using it for any kind of live event or tour,” he remarks. “The majority use the platform to produce albums, singles, videos, or fund marketing and promotion.” Indeed, the live music business has not been disrupted by crowdfunding in the same way as the recorded music business has by any stretch. Glaringly obvious is the fact that asking fans for capital to go on tour is equivalent to them purchasing a concert ticket. But there are also other issues: if the tour is cancelled, who is liable if all your fans are the investors? Are the true costs of a tour too much to bear? And is the live music business, as it stands, still vital to an act if they want to progress and succeed? The Agency Group’s Ed Stringfellow believes that the experience and knowledge of those working in the business is hard to beat. “Sites like these can’t tell artists where to route tours or tell them where the most important places are to play,” he cautions. The occasions when crowdfunding helps fund or support a tour or event are growing, however. For example, the Torontobased, 14-piece Lemon Bucket Orkestra (self-described as a “Balkan-Klezmer-Gypsy-Punk-Super-Party-Band”) used RocketHub to raise funds for a tour of their musical homeland: Hungary, Romania, Slovakia and the Czech Republic. The band raised their target amount of $15,000 (€11,300) by offering a range of incentives from downloads to the offer of playing at a dinner party for 45 minutes. Another good example is Wild Shore Festival for New Music, which aims to bring new chamber music, composed by Alaskans who now live in New York, to the communities in Kachemak Bay, Alaska. So far they have raised $6,000 (€4,500) on RocketHub – money that would otherwise be hard to come by. In both these cases the musical genres are limited in their reach to a mainstream audience and the events are very localised – these certainly aren’t US or UK/EU tours.
Lessons in Live The relationship between crowdfunding and live music is probably equivalent to a teenage couple flirting down the disco – unlike the recorded music business and crowdfunding, there is no marriage on the table, or indeed, potential divorce