Corporate Sponsorship: Funding Music
So I was watching Dragon’s Den last night on television.
Dragon’s Den is a show where a panel of very successful business people get pitched to by various wannabe entrepreneurs. Typically the pitches are aimed at raising relatively small amounts of cash in return for a stake in the company. The show is highly amusing in that the business heads will really go to town in probing the pitch in order to determine the strength of the proposal, that’s good entertainment as well as educational, anyone looking at starting a business would do well to watch this for the type of questions which are vital to be asked for any business.
Anyway, last night’s show was particularly interesting as one of the pitches was from a band, who accepted an offer from Peter Jones in the order £75k ($150K) for a 30% state in the bands profit, based on two albums.
Now £75k is not much money in the grand scale of things and a 30% stake is an enormous slice of the bands pie, the potential long-term value could be staggering.
Two things spring to mind for me.
1. Will we start to see more of this type of corporate sponsorship for funding artists/bands. Given that the traditional model of funding is slowly eroding. Could be fantastic revenues for investors if they find a product (BAND) that set hearts on fire.
2. What would this mean for music integrity when the band could be involved in product placement?
Feargal Sharkey (CEO British Music Rights) states “It still takes money and expertise to produce, manufacture and promote a musical recording, which means somewhere along the line, someone has to make an investment – either a label, a brand, the artist themselves or a benefactor like Peter Jones.”
What are your thoughts?
July 22nd, 2008 at 3:46 am
Feargal Sharkey (CEO British Music Rights) states “It still takes money and expertise to produce, manufacture and promote a musical recording, which means somewhere along the line, someone has to make an investment – either a label, a brand, the artist themselves or a benefactor like Peter Jones.”
There’s the rub, that statement sums up the problem of the independent artist, and the real problem for the industry. The industry has the power to make or ignore an artist, but the artist, by comparison, is relatively powerless. To ensure a return on their investment, the industry picks which horses to back..and the banality factor is very frequent, prevelant as a result..that is the real prolem..the public does not get what it wants and needs, just what is told to want and need, but knows no better..
New, different talent is frequently ignored..the industry is stagnating, from the inside..record sales, are on average declining, and the industry, unthinkingly oblivious to all that, goes for the wrong targets to blame for the demise of the record industry..
That, I fear, is the overall reason for the wailing and nashing of teeth in the industry…
It’s a personal view, but, having thought about it long and hard, it works for me…
July 24th, 2008 at 8:45 pm
I think George has hit most of it on the head.
Of course you could argue that corporations are only doing what labels did in the past but that would be a blinkered view IMHO as the similarities are mostly (although not entirely) fiscal and not ideological.
As you mention, a 30% stake for a relatively minor £75k investment does not look like a good deal in anything other than the immediate short term - a record label may take a similar percentage but a label could easily spend that on the recording of an album before things like PR, radio plugging, band expenses etc etc are paid for - in this situation I think the band have been blinded by the relatively small pot of (fools) gold at the end of the televisual rainbow.
The, frankly disgusting, idea of product placement in music started some time ago although thankfully it has not really taken off….yet. However the fact that large ’super brands’ such as Starbucks are running labels and releasing work from notable artists (McCartney, Carly Simon, Sonic Youth) does not bode well for the future of mass released music.
‘Branding’ for me is where advertising has gone past its logical usefulness - I’m not that old but when I was a kid the only thing you branded was livestock.
I’m sure you’ve already read it (and it is a decade out of date) but Naomi Klein’s ‘No Logo’ is a fascinating read on the subject of the tip from advertising to branding (as well as the inevitable ethical questions about sweatshops etc etc)
To digress slightly……
Speaking as a musician I feel that the key (digital revolution etc) we thought would free us from our shackles has in fact locked us into a cage…and our captors are no longer people who package music to the masses, they are people who package ‘lifestyle’ to the brain-dead and the spiritually bankrupt. Not a great swap.
It would certainly be interesting if cars/clothes could be replicated perfectly for anyone with an internet connection without the designers getting any recompense - music has touched more people (in a positive manner at least) than any of these other forms.
At least we can’t download weapons!
In the words of B*Witched, c’est la vie…..