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Validating new business model for a label company .. help me

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Validating new business model for a label company .. help me

Postby femuc » Wed Feb 14, 2018 9:26 am

hey guys,
im currently evaluating a new/different business model for a label company and I need your support and opinion.

first of all my knowledge in the music industry is not that good, so please bare with me and support me.

the idea is to start a label company that uses fan base to select talents through fans financial support.

this means, my label company will have a platform where talents can make profiles and try to market themselves. our team will boost market some exceptional talents. and not fans will look through the profiles and find talents which they love, trust and wanna invest on.

lets say fans financed one talent, then the label company will use the money to make an album and portion of the album profit goes back the shareholders(fans) who financed the album and the rest goes to the singer, publisher, ...

the problem I see in the music industry is that label companies are in charge to make a decision whether this or that talent is worth adopting and they always think if the risk involved since if the talent turns out to be a bust then they loose a lot of money. what I am doing is reducing this risk by making the decision in the hands of the fans and not the label company. if the fans are gonna invest their money, then they will make sure that they choose the best talents out there.

this way, the label company operation is paid for in advance and all the revenues are pure profits.

tell me what do you guys think. what am I missing. is this even a problem im solving.

thanks a lot.
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Re: Validating new business model for a label company .. help me

Postby Hugh Robjohns » Wed Feb 14, 2018 10:01 am

It's a good scam er… scheme (sorry)… :lol:

I'll be interested to read the views of others...

H
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Re: Validating new business model for a label company .. help me

Postby ken long » Wed Feb 14, 2018 10:14 am

femuc wrote:hey guys,
im currently evaluating a new/different business model for a label company and I need your support and opinion.

first of all my knowledge in the music industry is not that good, so please bare with me and support me.

Alarm bells.

the idea is to start a label company that uses fan base to select talents through fans financial support.

So, like Q crates.

this means, my label company will have a platform where talents can make profiles and try to market themselves. our team will boost market some exceptional talents. and not fans will look through the profiles and find talents which they love, trust and wanna invest on.

...aaaand let me guess... thsi platform is Twitter / Facebook / Instagram

lets say fans financed one talent, then the label company will use the money to make an album and portion of the album profit goes back the shareholders(fans) who financed the album and the rest goes to the singer, publisher, ...

So yes. Very much like Q crates.

the problem I see in the music industry is that label companies are in charge to make a decision whether this or that talent is worth adopting and they always think if the risk involved since if the talent turns out to be a bust then they loose a lot of money. what I am doing is reducing this risk by making the decision in the hands of the fans and not the label company. if the fans are gonna invest their money, then they will make sure that they choose the best talents out there.

It's up to the labels to take risks. That's what they do. Losses incurred from one dud artist are hopefully recouped ten fold with the star artist.

this way, the label company operation is paid for in advance and all the revenues are pure profits.

You can do this with pre-orders anyway.

tell me what do you guys think. what am I missing. is this even a problem im solving.

Should work.
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Re: Validating new business model for a label company .. help me

Postby femuc » Wed Feb 14, 2018 10:49 am

this means, my label company will have a platform where talents can make profiles and try to market themselves. our team will boost market some exceptional talents. and not fans will look through the profiles and find talents which they love, trust and wanna invest on.

...aaaand let me guess... thsi platform is Twitter / Facebook / Instagram

you are right, but this would then be a focused platform on this target group

lets say fans financed one talent, then the label company will use the money to make an album and portion of the album profit goes back the shareholders(fans) who financed the album and the rest goes to the singer, publisher, ...

So yes. Very much like Q crates.

I like how you broke down my article !! what is Q crates? can you share more info? links?
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Re: Validating new business model for a label company .. help me

Postby ken long » Wed Feb 14, 2018 12:08 pm

femuc wrote:
this means, my label company will have a platform where talents can make profiles and try to market themselves. our team will boost market some exceptional talents. and not fans will look through the profiles and find talents which they love, trust and wanna invest on.

...aaaand let me guess... thsi platform is Twitter / Facebook / Instagram

you are right, but this would then be a focused platform on this target group

lets say fans financed one talent, then the label company will use the money to make an album and portion of the album profit goes back the shareholders(fans) who financed the album and the rest goes to the singer, publisher, ...

So yes. Very much like Q crates.

I like how you broke down my article !! what is Q crates? can you share more info? links?

https://qrates.com/
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Re: Validating new business model for a label company .. help me

Postby The Red Bladder » Mon Feb 19, 2018 2:45 pm

http://www.ifpi.org/downloads/GMR2017.pdf

Streaming? - yes.

CDs? - no!

Label - if you have the money (£Xm and more) to bankroll a 360 contract with a hot artist, maybe. Otherwise, leave well alone!
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Re: Validating new business model for a label company .. help me

Postby CS70 » Mon Feb 19, 2018 5:09 pm

Well nobody can say with absolute certainty how something will go, but the chances aint big, or at least you need to fill some big holes.

First, you are shifting risk, and as carrying risk is the primary role of a company such as a label, a label which doesn’t loses a lot of its role and business sense. You still have the curation, but that’s your biggest hole: the hard stuff to find nowadays is not talent or good productions, but attention. Starting from scratch, attracting fans to your channels is just as hard as attracting them to any other music oulet. The noise level is very high. What you need is a tremendous amount of luck, or some serious marketing muscle, just to get trhu to a potential fan base whichin turn may provide significant funding to your bands. Universal is not Universal because it has the best music, but because over the decades ha accumulated a marketing and financial wherewithal that allows it to get attention.Finally, there’s not much difference from what you describek and vanilla crowfunding.. why artist and potential fans would need you when they can generate their own crowfunding easily?

That said, every buisness starts with a bit of luck (someone wanting to purchase something you can produce), so no harm in trying. I mean, people went thru the .com era and still a few years later invested heavily in stuff like soundcloud, so everthing’s possible..
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