Trailers, Garages & Cottages: The Sheer Music Publishing Story (Part III)
by Sheldon Rocha Leal
In the previous chapter of this three-part series, David Alexander departed from Tequila Records and teamed up with Damon Forbes and Mark Connor at Sheer Music and Sound. Recognising an unmet need within the company, he proposed a partnership to establish a publishing division tailored to their needs. This new venture became known as Sheer Music Publishing (SMP). Eventually Forbes and Connor left the company, leaving David as the sole owner of the three entities. With this consolidation, Alexander aimed to reposition the company for maximum exposure, global reach, and increased income generation, benefiting all involved stakeholders.
David achieved this by speaking at numerous local and international conferences, where contributed his knowledge of the South African Music business, especially within the realm of publishing. He also offered his services by sitting on various bodies and councils, positioning himself as a thought leader and expert in the field. This unlocked opportunities throughout African and later the world. These experiences facilitated numerous deals and negotiations, which not only introduced African creators to the global stage but also created opportunities for international companies in Africa. Consequently, this boosted income generation for all parties concerned.
In this next iteration of the Sheer Music story and that of its creator, the doors of the world open up for local creators and for the founder himself, putting Africa and especially South Africa on the world Music map. Ironically, David was opening these doors long before the world even noticed. Today Africa is the fastest growing Music market in the world and within Africa, South Africa is the fastest growing Music economy on the continent. This is what makes David Alexander such a genius and leader in his field. His ability to spot an opportunity and being able to monetise and fully explore those gaps is a talent not many people possess and something David has mastered. But without further ado, let’s conclude this trilogy which I like to call “Trailers, Garages & Cottages, the Sheer Music Publishing Story”.
With the advent of the DIY musician on the horizon David Alexander’s business needed to pivot once more. This was the fourth juncture in his career, a time that defined what would happen going forward and which decisions needed to be made for the future of himself and his business. The DIY musician is a new phenomenon in the Music industry: a group of independent musicians, who write, produce and perform their own songs, but additionally self-promote, market, distribute and retail. This sector of the Music business is becoming a larger component of the industry. As a result, Indies (Independent Recording Labels), are also taking over a greater share of the Music industry pie. As of 2022 Indies account for 34.6% of the recorded Music sector, whilst majors occupy the remaining 65.4%.
According to the IFPI streaming now accounts for 67% of total recorded Music income, with the sector increasing in value to over $28billion in 2023, growth of 10.2% on 2022’s results. This is a far cry from the industry’s lofty highs in 1999 when the world’s recorded Music industry was valued at $39billion, according to Forbes Magazine. The ensuing Napster Crises, however, resulted in a devaluation of the Music industry to about $15billion by 2016. There has been an upswing in recorded Music revenues in the last 5 years owing to the streaming revolution, ushered in by platforms such as Apple Music, Spotify and Deezer. Although higher than the 2016 valuation, based on inflation, the recorded industry should be valued at approximately $60billion related to the 1999 industry evaluation. Although the number is not as great as the 1999 numbers, at least there’s growth in the business and a move in the right direction.
In a meeting with Jake Wisely, former Chief Publishing Officer of the Concord Group, whilst attending the MUSExpo in Los Angeles, David was enlightened to the fact that Music royalties are an uncorrelated investment. This means that in a broad basket of investments, Music, as an asset class, tends to maintain its value, no matter the economic thunderstorm weathered in other investment markets. As a consequence, Sheer began to acquire a large number of songs that belonged to songwriters that were deceased or no longer active. Furthermore, David wanted to conduct more business on the African continent, but certain factors hindered his progress in this regard (cost of travel and the need to be physically present when songwriters signed deals).
This motivated him to investigate a link with Downtown Music Publishing (DMP). The link was providential as the company own an asset called Songtrust, catering to the DIY Musician. David felt this could trigger a move from physical to digital, which he foresaw as a possible solution to breaking and formalising the African Music market. A meeting was, therefore, brokered with Justin Kalifowitz (founder of DMP), who showed a great interest in investing in the South African market, often seen as a gateway for investors into Africa. The African market is often considered an underexplored territory, with great future untapped potential. A deal was concluded and SMP landed up administering the rights for DMP in South Africa.
The truth is, however, is that it seems Justin had bigger ideas and David was in it to win it, seeing the vine and opportunity to pivot both his own career and that of his company, SMP to the next branch. David welcomed the idea of being seated around a literal table of Music industry equals, people with whom he could share and bounce ideas. In this way, he could pivot once more, with the intention of ushering exponential growth, reflecting on the fact that developments in the industry in the last 20 years had been unprecedented in Music history. In 2017 at MIDEM, discussions commenced for the acquisition of SMP. The long-term vision for DMP, however, was not to go into publishing at all, but rather other explorations.
DMP rather wanted to rather leverage the intellectual property and expertise acquired from the SMP acquisition and David Alexander about the African Music Market to break into this under-explored territory. This was knowledge that had been curated and honed for a period of 30 years by David and SMP and a valuable asset to DMP. Downtown wanted to move away from publishing as a standalone business and move into servicing the industry as a non-Competitor going after the DIY Music market. They wanted to get into the business of offering young and up-and-coming artists both publishing and label services. In a move some may say was a means to secure the trust of young indie artists, who are ordinarily skeptical of big corporations, majors and multi-nationals, the company sold their publishing interests to Concord Music.
The sale, which took place in 2021 was valued at about $400million and sent a message to the DIY market that DMP was committed to developing and supporting this new generation of Music maker/creator. Two months later David Alexander, pivoted for the fifth time, being elevated to the role of Senior Vice President of New Markets for Downtown Music Holdings (DMH). His mandate was to develop Music markets in Asia, Africa and Latin America, with a focus on all verticals within the business of Music, bringing David’s story full circle. Although the move may seem to contradict his initial strategic positioning of placing himself as close to the creative source as possible and away from the volatile recorded Music industry, it’s not.
The move that resulted in the creation of SMP and now aligning himself with DMH is still congruent with his overall vision and strategy. The difference now is that the content/Music creator is also the artist and performer of the content, therefore, making his latest move congruent with his “at source” philosophy. SMP still operates within DMH, remaining one of the company’s three publishing wings. More recently David has become involved in global CMO (collective management organisation) relations developing an international strategy for DMH in this sphere of the industry. In 2022 David Alexander was named one of the top music executives of the world on the Billboard Magazine International Power Players list. Who knows what’s in store for this visionary and renowned record executive, but it seems his stock keeps on rising, as it should. Hard work deserves well deserved rewards.
When people look back on the 1990s and 2000s many will wonder how recording executives survived the turmoil the industry faced at this time, especially in South Africa. It was a time in the South African Music business which saw the deregulation of radio stations, change in our musical identity post-Apartheid and near collapse of the Music industry post-Napster. Furthermore, we saw an evolution in Music consumption from physical Music, to downloads, NFTs and now streaming, as well as the emergence of the DIY musician. These developments were exponential and propelled the industry into a new reality, forcing the business to move faster than it ever did in the 40 years preceding this Music revolution. The disruption was equivalent to the French Revolution, but in Music, with musicians, creators and audiences deciding to take their industry back, by force. This catapulted the industry into a downward spiral, from which it now seems to be recovering.
The business model employed by David Alexander at SMP is one from which many Music industry hopefuls can learn. Keeping one’s ear to the ground, watching trends, forecasting, strategic placement, remaining as close to the creative source as possible, identifying a gap in the market and knowing when to pivot. Additionally, building relationships and nurturing those relationships so that the connections made can assist one in pivoting to the next phase of ones career. These are all lessons taught and employed by this oracle of South African Music business, and used effectively to make SMP the biggest independent publisher in Africa. This strategic pivoting skill was also successfully employed by the various leaders of the companies with which David has been associated over the years: Jason at Tequila, Damon and Mark at Sheer and Justin at Downtown. I guess its the formula to success in any business, but especially the Music business.
Alexander has arisen from the decades long Music industry challenges, bigger and brighter with every disruption. This is the sign of a truly remarkable man, South African Music institution and beacon of hope for the vernacular Music idiom in the country and continent. Using all his accumulated knowledge he will soon employ the strategies he has learnt to make a bigger impact on world Music markets. History will remember Alexander as one of the Music industry’s greatest and most visionary leaders and entrepreneurs. He is an individual who has achieved seemingly unattainable highs and who has a lot more to achieve in his career. He will eventually take his rightful place next to some of South Africa’s greatest record executives, people like David Gresham, Eric Gallo, Harvey Roberts, Mark Rosin, Benjy Mudie and Ivor Harburger. Here’s to many more years of Music creation, monetisation and advocacy.
