Musician As Entrepreneur
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MUSICIAN AS ENTREPRENEUR, BAND AS BUSINESS
ArtistsHouseMusic.org 2013 Artists House Music
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Musician asEntrepreneur
CALLS TO ACTION
FileforanLLCforyourband FileforanLLCforyouPublishingCompany Writeaplanforyourbusinessdescribingwhatyou
willbedoingin1to2yearsandhowyouwillac-complishthegoalsyouset
Why You Are An Entrepreneur With Big AdvantagesInthisSectionyouwillhearfromsevenmusicindustryprofessionalsdiscussingwhymusiciansareentrepreneursandsmallbusinesses.
Mostpeoplewhowanttostartabusinessthinkofaproductorservicethattheycanprovideormakeandsell.Itsallabouttheproduct,whyitsneeded,whatitdoestomakepeoplesliveseasierorbetter,whatgapdoesitfill,andwhyitssocool.
Themusicianhassimilartraitstoanentrepreneurbutmusiciansandartistsdonotthinkofthemselvesasentrepreneurs.Anentrepreneurcreates,builds,sharesandsellsaproductorserviceforwhichheorshehasabsoluteconviction.Anentrepreneurbelievesthatwhattheydomattersbutiftheycantsellit,iftheycantconvinceothersofitsnecessity,theyknowthatthereissomethingwrongwiththeirstrategyortheirproduct
Why You Are a Businesss 3
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WHY YOU ARE A BUSINESS
andtheyadjusttheirstrategyorproductaccordingly.
Makingmoneyfromwhatyoudoisntsellingout;itisanindicationthatotherpeoplevaluewhatyoudo.Beingpaiddoesntmeanthatyouvecompromisedyourmusic.Itmeansthatyouarelivingyourvaluesandstayingtruetowhatyoubelieveandthatyouhavefoundawaytomonetizeyourpassion.Itmeansthatyouareauthentic,genuine,trustworthy,respectedandthatyouaremakingmeaningthatisworthyoftheattentionofotherpeople.Itmeansthatyourvaluesareaalignedwiththeirvaluesinsuchawayastocreaterelationshipsandconversations.Suchabeautifulrealityisunworthyofcynicismanddoubt.Itis,ontheotherhand,mostworthyofenhancement,continuity,nourishmentandsustainability.
Musiciansaresmallbusinessesonthehoof.Smallbusinessisthebackboneofoureconomyandentertainmentisthenumberoneexportofthiscountry,forbetterorworse.Roughlydefined,thecreativeindustriesofthiscountryaccountforalmostathirdoftheGDP.Theculturaleconomyisaneconomicforceineverycommunityinthiscountry.Youareanessentialmemberofthatculturalcommunity.
ThewordentrepreneurcomesfromtheFrenchwordentreprenmeaningtoundertake.Andgoingbackfurther,fromtheLatinintermeaningbetweenoramongandtheverbpenderemeaningtotake.AnentrepreneurissomeonewhoDOESsomething,whoundertakes,whotakesaction.
Musiciansarenaturallyentrepreneurial;theyhavethesametraitsthatwenormallyascribetoanentrepreneur:
Wantstoworkforthemselvesanddoesnotwanttoworkforsomeoneelse
CancommunicatehisorherideasHasoriginalideasandarecreativepeople
Isnotafraidtotakerisksbutdoeseverythingpossibletomitigatethem
Artists House Articles:
TheImportanceOfSettingGoalsAndTrackingProgressForEntrepreneurs
TheSharedCharacteristicsofEntrepreneurs
WhyItsAGreatTimeToBeAMusicIndustryEntrepreneur
Artists House Editors guides:
EditorsGuide:Entrepreneurship
EntrepreneurshipforEducators
StartingYourOwnIndependentLabel
Artists House Keyword Searches:
Entrepreneurship MusicIndustryToday IndependentLabels Partnership Organizations Mentor Finance Networking Motivation
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Seesopportunityandtakesit
Understandstheconstantneedforinnovationandimprovement
Isaproblemsolver,acandoperson,acloser
Overcomesadversityanddoesnttakenoforananswer
Hastheself-confidencetofightforwhattheybelieve
Ithinkmusiciansandartistshavethesesamequalities.Foranadditionalperspectiveonthisidea,seeGeorgeHowardsarticleonArtistsHouse,TheSharedCharacteristicsofEntrepreneurs
Musicianshaveanothermajoradvantagethattheytakeforgranted:theyunderstandthemethodologyofimprovingeveryday.Itscallpracticing.TheycanfocusforhoursatatimeonimprovingtheirskillsandabilitiesontheirinstrumentswithoutconsultingFacebook,withoutsurfingthenet,andwithoutTweetingeverydetailoftheirotherwisefascinatinglives.The12year-oldguitarplayerwillsitonthecornerofhisbedandpracticeStairwaytoHeavenuntilhegetsit,skippingfoodandtextingifhehasto.Nothinggetsinthewayofadeterminedmusician.
Thethirdmajoradvantageofmusiciansandartistsisthattheycanmakewealthouttheirimaginations.Thisisaphenomenalability.
Doyouwritesongs?Doyoumakesoundrecordings,videos?Doyouwritestoriesormethodbooks,doyoutakephotographsorproduceothervisualworks?Federalcopyrightstatutesprotecttheseandothercreativeworks.Thesestatutesprovideyouwithexclusivelegalandbusinessrightsthatyoucanmonetize,asyouwilllearnasthecoursegoeson.Allofthesepursuitsandrightsthatattachtothemmakebusinesses.
Assoonasyoumakeyoursongtangible(itcantbejustanideainyourhead),whetheryouwriteitonanapkinorrecordittoyouriPhone,acopyrightiscreatedandsixexclusiverightsattach.(Registrationdoesnotmakecopyright,theactofcreating
YouTube Links:
EricaOlsensvideosforVirtualStrategistaboutbusinessplanningareshort,tothepoint,andpackedwithgoodinformation.Hereisalistofwhatyouwillfindatthatlink:
SWOTanalysis:Howtoperformone
HowtowriteaMissionStatement
HowtowriteaValuesStatement
HowtowriteaVisionStatementthatinspires
Thesecrettostrategicplanning
ChoosingyourStrategicObjectives
Howtoperformcustomersegmentation
HowtodevelopCompetitiveAdvantage
CommonPitfallsinStrategicPlanning
HowtosetSMARTgoals
Howtodevelopkeyperformanceindicators
Howtodevelopactionplansforyourbusiness
Strategicplanningwithabalancedscorecard
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aprotectedworkcreatesthecopyright.Youregisteryourcopyrighttocreateremedies,aswewilldiscuss.)
Twooftheseexclusiverightsaretherighttocopyandtherighttodistribute,thatis,toreproduceandshare.Ifyouhavetheexclusiverightstocopyanddistributeyoursong,amongotherthings,whatdoesthatmakeyou?
Itmakesyouamusicpublisher.YouhavethesamerightsofUniversalMusic.Youmaynothavethesameresourcesandthesamereachbutyouhavethesamerights.OnlyYOUhavetherighttomakecopiesofyourworkandtodistributeit.Thatswhyyouareabusinesswhetheryouwanttobeornot,whetheryoulikeitornot.Acreativepersonisbasicallyinthepublishingbusinessbecausealloftherightsthatattachtotheircreativeworkhavetodowithmakingthemavailabletothepublic.
Thepointis,thecreativeactofcomposingamelodyorwritingalyricmakesyouasmallbusiness.Itwasntaboxyoucheckedoraformyoufilledout.Ithappenedtoyouautomaticallyandwithoutyourpermission.Youronlychoiceatthatpointiswhetheryouaregoingtorunyourbusinesseffectivelyornot.Thedefaultsettingisornot.
Youhavethetraitsofanentrepreneur,youcanimproveandinnovateeveryday,andyoucanmakewealthoutofyourimagination,sowhatareyoumissing?Youremissingtheunderstandingthatyourcreativeworkmakesyouabusinessandthatyouareresponsibleforit.Youdonotunderstandbusiness.Youthinkeconomicsisforgeeksandmoneyisnotthemeasureofart.Youthinkthatmakingmusicmakesyoufreebutofwhat,fromwhat?Youhavenoideathatyouarefarmorefreethanyouthink.
Iheardafemalerapartistsayonetime:youdidntknowtillItoldyounowItoldyounowyouknow.
Inotherwords,nowthatyouknow,itsonyou.ThatsthewayIfeelaboutmusiciansandartists:onceithasbeenexplainedtothemthattheyhavealloftheseopportunitiesandrightsthat
Books:
TheArtoftheStart,GuyKawasaki
TheProfitableArtist,PeterKolb
FromGoodtoGreat,JimCollins
BusinessModelGeneration,AlexanderOsterwalder,YvesPigneur
PickFour,SethGodin
TheCluetrainManifesto,RickLevine,ChristopherLocke,DocSearls,DavidWeinberger
TheLeanStartup,EricRies
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makethemabusiness,itsonthemtomonetizethoserights,torunthebusinessesthattheserightscreateinawaythatcreatessustainability,thatmakesitpossibletomakealivingfromdoingwhattheylove,fromwhattheycareaboutthemost,fromwhatgivestheirlivesmeaning.
Thisabilitytocare,tofollowyourbliss,tousemethodtoimproveandinnovate,appliestoanyotherundertakingyoumightchooseinthefuture.Andengagingincreativethoughtandcreativeworkwillnotonlygiveyourlifemeaningandpurpose,itwillmakeyouabetterperson,amoregivingandsharingperson,abettercitizen,abetterparent,abetteranything.
Thiscourseisdesignedtohelpyourunthebusinessesyourworkscreateinamoreeffectiveandsustainableway.Youwillhearfrommanyexperts,youwillheardiscussionsofeverymajoraspectofthecreativeenterprise,andyouwillunderstandandtakespecificstepstoaccomplishyourdailyactionplans,yourmonthlytacticsandyourlong-termstrategies.
Theonlywaytofindoutifyoucanhaveacareerinthecreativeartsistoengageinit.Asongwriterwritessongs,aperformerperforms,apainterpaints.Itisnotamystery.Andyouwillhavetoreadbooksandaskquestionsandengageyourfansifyouwanttohaveacareersellingthemstuff.
Disciplineisntamatterofchoosingbetweenthingsyoudontwanttodoandyoudowanttodo.Itisamatterofchoosingamongthethingsyouarecapableofdoingandwanttodo.Ifyouwanttogetreallygoodatsomething,tobeonething,likeamusician,youllneedtofocusalmostexclusivelyonthat.Thatincludessharingwhatyoudowithmorepeople.
Thecircleofcreativityisnotcompleteuntilyoushareyourworkandthatactionrequiresvariouscreativeskillsetsthatresultincopyrightsinmostifnotalloftheeightcategoriesofcreativeworkprotectedbyfederalcopyrightstatutes.
Beingacreativeartistisamatterofself-definition:whoareyou?Whodoyouwanttobe?Whatdoyoureallycareabout,what
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doyoulove?Afteryoubegintoanswerthesequestionsandyouworkashardasyoucantomaketheanswerscometrue,thenperhapsyouwillbefortunatetofindsomeonetosharethatlifewith,inwhicheventyouwillmostcertainlylivehappilyeveryafter.
Makemusic,makemeaning,makemoney.
Business EntitiesAsMaggieLangepointsoutinhervideoclip,onceyoudecidethatyourbandoryourmusicisworkingandyouwanttobemoreformalaboutitsorganization,youllneedtoconsidertwothings:thecorporatestructureofyourbusiness(es)andtheagreementthatgovernshowabandoperates.
Thereareseveralwaystoorganizeyourbusiness:soleproprietorship,apartnership,asub-chapterScorporation,alimitedliabilitycompany(LLC),oracorporation(Inc.).Oneofthereasonsthatyouorganizeanentitythatisseparatefromyourselfistoinsulateyourselffrompersonalliabilityfortheactionsandconsequencesofyourbusiness.
TheeasiestandcheapestwayofdoingthisistofileforaLLCwiththeSecretaryofStateofwhateverstateinwhichyoulive.Itsusuallyadownloadableformanditsahundredbucksorso.Fillitout,paythefee,andthestatewillsendyouwithacertificatethatrecognizesyourcompanyasanindependententity.ThesemeansthatyoucanopenabankaccountinthenameoftheLLCandthatanyliabilitythatattachestotheactionsundertakenbytheLLC(yourband,forexample)isconfinedtotheassetsofthatentityandexcludeyourownpersonalassets.
InLouisiana,whereIlive,intheabsenceofanyofficialdocumentrelatingtoyourband,thestatewillconsideryou,bydefault,ageneralpartnership.Thisisnotnecessarilythebestresultforyou.IfyouareabandandyoutakemoneyforplayingagigyouwillbedeemedbyLouisianatobeageneralpartnershipintheabsenceofanoperatingagreementforyourLLCorcorporation.
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Thatmeansthatiftheresanaccident,everyoneinthebandwillbepersonallyliableforanydamagessufferedbytheinjuredparty.Italsomeansthatifoneofthememberswantstoleaveorisaskedtoleave,theyhavetobeboughtout.Theyareentitledtoapercentageoftheassetsoftheband.Soiftherearefivepeopleintheband,theneachmemberisentitledto20%oftheassetsoftheband(andisequallyresponsibleforanydebt,bytheway).
Thiscouldgettrickyandcouldresultinthebandhavingtoraisethemoneytobuyoutthememberofthegroupwhosbeenaskedtoleave.Whatareyougoingtodo,sellthePAorthevan?No,youdontwanttodothat.ThatswhyyouneedanoperatingagreementforyourLLCand/orabandagreementamongthebandmembers.
Inanoperatingagreementorbandagreementyoucansetforthwhatittakestogetridofsomebody,whattheyareentitledto,theconsequencesofthedeathofoneofthemembers,whatpercentagevoteyouneedtobuyorsellequipment,whoownsthenameoftheband,howthesongsaresplitup,etc.
Anotherconsideration:ifyouwanttocreateabusinessentityforyourpublishingcompanyyoushouldenrollwithASCAPorBMIbeforeyoufileforyourLLC,mostlybecauseASCAPorBMIwillnotletyouuseacompanynamethatsomeoneelseisalreadyusing.WhenyousignupforASCAPorBMIyouaresigningupasawriterANDapublisherandtheywillaskyouforthreepossiblenamesforyourcompany.
AfteryouhavefixedthenameofyourpublishingcompanywithASCAPorBMI,THENyouregisterforyourLLC,andifIwereyou,IdregisterthecopyrightsinthenameoftheLLC.YouwouldneedasongwritersagreementwiththatLLCbecauseyourpublishingcompanycannotpublishyoursongsunlessyouassignyourrightstoitINWRITING.WelltalkmoreaboutthisinthePublishingsectionofthecourse.
ThepointisyoushouldregisteryourpublishingcompanywithASCAPBEFOREyouregisteritwiththestate.Ifyouregister
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withthestatefirst,youmayendupbeingrejectedbyASCAP(orBMI)becausesomeoneelseisalreadyusingthatname.ThisisnttheworstthingthatcouldhappenbutitwillmeanthatyourpublishingcompanyisnotpartofyourLLCunlessittransfersitsrightsinthesongstothatLLC,inwriting.
Itsimportanttorememberthatforpurposesofthelaw,yourLLCandyouasapersonaretwoseparatepeople.OnereasonyoumightwanttomakeyourpublishingcompanyanLLCis,again,toinsulateyourselfpersonallyfromanyliabilityfortheactionsoftheLLC.
Youcantdoallthiswithoutalawyerunlessyoureverycareful,verydiligent,andfullyinformed.Besttoconsultalawyer.Mostlawyerswillseeyouforaninitialmeetingatnocosttoyousothatheorshecangetanideaofwhatyouneedandforyoutogetanideaofwhatitwouldcost.Anybusiness-orientedlawyercouldhelpyouwithyourLLCfilingandwiththecreationofanoperatingagreement,butonceyougetintospecificcopyrightandmusicbusinessissues,youshouldlookforalawyerwithexperienceandknowledgeintheentertainmentbusiness.
Business PlanningThisisadeepwellandbusinessplanscanbe50-100pageslong.Butstartfromwhereyouare.Thinkintermsofstrategy(wheredoyouseeyourselfinafewyears),tactics(howdoyouimplementyourstrategyoveraperiodofmonths)andnextactions(howdoyouaccomplishyourgoalsinaperiodofdaysorweeks).IliketothinkofthisasStrategicObjectives,TacticalGoals,andActionPlans.EricaOlsenvideosonYouTubeareparticularlyinstructiveinrespectofthesematters.BesuretowatchhervideoonSMARTgoals:Specific,Measurable,Attainable,Realistic,andTimely.
Forexample,letssayyouareplaying3gigsamonthto50to75people,youvesoldafewhundredCDsandmaybeevenafewhundredt-shirts,youhaveamailinglistof300people,youhave200Twitterfollowersand200Facebookfriends,andmaybeyou
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writeafewsongsamonth.
Letsstaythatinayearortwoyouwouldliketodoubleortriplethosenumbers.Thatwouldbeyourstrategic,long-termobjective.Yourtacticswouldbetheshort-termgoalsthatyouwouldsettoachievethoselonger-termobjectives.Thesearethingsyoucanaccomplisheachquarteroreachmonth.So,howdoyouincreaseyournumberofgigs?Whatwouldbeyourgoalsfordoingthat?Writingaplanallowsyoutothinkthroughtheissues,toorganizeyourefforts,toalignallofyoureffortstoaccomplishyourgoals.
Howwouldyougoaboutincreasingthenumberofgigsyouplay?Howaboutimprovingyourshowandmarketingitmoreeffectivelyanddoingeverythingpossibletomakeitamemorableevent?Soyourgoalwouldbe:get150peopletoyourlocalshows(upfrom75).Youwouldthenmakealistoftheactionsthatwouldberequiredtoaccomplishthat.Whenyoucandraw150peopleinyourlocalcommunity(NOTincludingyourfamilyandclosestfriends)youcanexpandinconcentriccirclesfromwhereyoulive.
Drawacircleonthemap,halfthediameterofwhichisdeterminedbythenumberofmilesyoucandrivetoandfromagiginoneday(youcantaffordhotels).Thenyoulookintothevenuesandcollegesinallofthosecitiesandtownsandyoumakealistandyoucontactthem.Makealistofthebandsyoucouldopenfororwhoplayinclubsthatyouwouldwanttoplayandconnectwiththem.Maybetheycanopenforyouinyourhometownandyouopenforthemintheirs.Shareaudiences,sharedata,makefriends.
Youllhavetoromancethetalentbuyerswithyourwebsite,yourSoundCloud,yourelectronicpresskit,etc.YoumighteventakeascoutingtriptothenextclosestcityandintroduceyourselftotheclubsandthetalentbuyersandgivethemyourCDandpresskit.YoucouldtrytogetyourFacebookfriendsinthosecitiestocometoyourgig.Theseareallsubjectsofyouractionplans.
Youractionplansareveryspecificandcouldbequitenumerous.Itsreallyjustagroupofto-dolistsconnectedtogoals.Thatis,
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howareyougoingtoaccomplishthegoal?Ithinkofactionplansaswhat,why,expectedoutcomes,whosresponsible,whenaretheygoingtoaccomplishtheaction,andhowmuchmoneywillitcost.Andthereshouldbemetricsinvolved,somemeasurementofhowyouknowyouareaccomplishingwhatyousetouttoaccomplish.Actionplansaccomplishgoals;goalsaccomplishstrategy.
Thinkofitasaroadtrip.Ifyoudontknowyourdestinationthanyourejustdrivingaroundwithnoplacetogo.ButifyouknowthatyouwanttogotoSeattleandyouliveinAtlanta,youknowyoucantakemanydifferentroutestogettoSeattle,somemoredirectthanothers.YoucouldactuallygoeastbutitwouldtakeyoualongtimetogettoSeattle,anditwouldrequireaboat.
Ifyoureaband,itsimportantthateachpersoninthebandbeheadedinthesamedirection,thattheywantthesamething,otherwiseyourejustabunchofguysorgirlswhoarehavingfunplayingmusic.Ifoneofthememberswantstogotograduateschoolandanotherwantstogetmarriedandanotherhasafundaygig,allofyouarenotgoingtomakeittoSeattle.
Andgiveeveryoneinthebandspecificresponsibilities,specificjobs.Everyoneshouldhavespecificactionplanstoaccomplishforthebandtomoveforward,toaccomplishitsgoals.Thebandisabusinessandsomeonehastodotheworkofthebusiness.Forexample,onepersonbooksthegigs,onepersondoesthemarketing,onedealswiththesoundguyandvenuestaff,onecountsthemoney,onetakescareoftravelarrangements,onedealswiththeguestlist,onetakescareofthemerch,etc.
Therearemanybooks,scoresofbusinessschools,dozensofmusicindustryprograms,amultitudeofYouTubevideos,anever-increasingnumberoffreeandcheaponlinecoursesonbusinessplanningandentrepreneurship.Thedisciplinesofbusiness,donewellcreatetheartofbusiness.Applytheartofbusinesstothebusinessofyourart.Andlikeyourart,youwanttoconstantlyimprove,trydifferentthings,takesomechances,makeplans,dothework,communicateeffectively,knowyourmarket,andmakecoolstuff.Youwanttobeabletokeepdoing
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whatyouloveandthatmeansyouhavetomakemoneyfromit.ApplyingbestbusinesspracticestoyourartisthemosteffectivewayIknowtomakethathappen.
Goodluck!
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PARTICIPANTSNAME TITLE CLIPTITLE TOPICS TIME
1.DaveStewart
RecordProducer;Songwriter;MemberoftheEurythmics,LosAngeles,CA
ArtandCommerce
Art/Commercedivide;ifwantotherstolovewhatyoudoyouhavetoentermarketplace;commercecanleadtocompromise,sticktoyourownvision
2:19
2.JayCooper
Chair,EntertainmentPractice,GreenbergTraurig,LosAngeles,CA
LearnYourBusiness
Musiciansneedtounderstandtheirbusiness,howtheygetpaid
:41
3.GeorgeHoward
COO,Norton,LLC;AssociateProfessoratBerkleeSchoolofMusic,BostonMA;Musician;Producer;Educator;Attorney;Author
Strategy Entrepreneurship;mission,vision,values;strategy;measurablegoalsandactions,reducevariance,beaninformedperson,maximizeassets
5:44
4.MaggieLange
EntertainmentAttorney,ofCounsel,PerkinsSmith&Cohen;AssistantProfessor,BerkleeCollegeofMusic,Boston,MA
Entity;BandAgreement
Bandagreements,trademarkthenameofyourband,howisthemoneydivided,arethesongwritersroyaltiessplit?Whatistheformofyourbusinessentity,partnership,LLC,Inc.
3:22
5.JerryGoolsby
Professor,MBAProgramDirector,CollegeofBusiness;Hilton-BaldridgeEminentScholarofMusicIndustryStudies,LoyolaUniversity,NewOrleans,LA
BusinessPlan Bandasbusiness,ithelpstohaveaplanthatdealswithgoals,whodoeswhat,timelines,andvariousothercomponents
1:58
6.DaveNeupert
CEO,M80Services,LosAngeles,CA FailureIsNotAnOption
Failureisnotanoption;lookfortheholeinthemarket,itsalifestyle,astateofmind,allconsuming
2:20
7.JimEllis RecordProducer;Songwriter;Composer;Musician,Atlanta,GA
YouAreABusiness
Thinkofyourselfasatinybusiness;whatyoudoandwhopaysforit,haveyourquicksellrap,dontlooklikejustwokeup,ifyoureaplayer,whohiresplayers,youhavetobeintowin
2:10
TOTALTIMETOTALCLIPS
18:377