Record labels are out of date. They did not follow the music's progression from selling CDs to broadcasting songs to promoting concert tickets and merchandise. The labels were meant to help artists generate albums, fame and money. But now, anyone can register and nobody will buy it. So, today, it requires being a technology company, combining analytics with hyper-targeted advertising. And the old labels do not have the engineering talent for that.
Last year, former president of Interscope Records, Steve Stoute, secretly raised $ 70 million from Google Alphabet's parent company, the prestigious venture capital firm Andreessen Horowitz and entertainment giant 20th Century Fox.
Today, his startup United Masters is emerging stealthily.
United Masters is ready to offer musicians an alternative to operating record companies. He produces and distributes music on the Internet, and splits the royalties at 50/50 while the artist retains the rights to the main recordings. United Masters then reinvests all the analyzes, identifies the listeners, creates a CRM tool for the artists and helps them to target their best fans with targeted advertisements for tickets and merch.
Stoute explains that the plan is to "Watch music as a game." You monetize the game to all the most committed people. I wanted to bring this theory and think about music. "These are the whales, these super fans, where the musicians earn a lot of money. And finally, someone has created a way to run ads for what artists sell to people who have listened to their album 50 times for cheap.
The world 's biggest rap fan, Ben Horowitz, is so attracted by the idea that he joins the United Masters' board of directors. And it's Larry Page himself who pushed Alphabet to direct the $ 70 million Series A. People do not know that Larry was a drummer. He has a deep sensitivity for the artist, "says Stoute.The page was stunned that the artists could not follow the fans who bring the most money and retarget them.While Page worked with David Drummond, the leader of Google Dev, a former radio DJ, to give United Masters all he needed.
The company is now actively recruiting technological talents in the areas of products, design and engineering. and his first wave of independent musicians. United Masters focuses first on emerging artists who want to be digital natives in the way they run their businesses. But eventallyually, he could sign established artists who want the flexibility and control of their original recordings.
Educating artists on another path could be the biggest challenge of United Masters. Many musicians still think that streaming is the enemy, cannabilizing their album sales, rather than as the inevitable progression of music distribution that can serve as marketing for their group as a brand. But once the artists see that they are not very different from Nike and that their songs are like commercials, they realize that they need help so that the listeners turn their passion into purchase.
"It is very important that the work of an artist is a great artist" concludes Stoute. "The infrastructure that surrounds them should help them get more money at effective rates, do not own their masters and take them from them."