Taishi Fukuyama on the Vinyl Record Business, Music Streaming and Next Steps for Qrates
Taishi Fukuyama is the co-founder and CMO of vinyl services marketplace Qrates — a platform designed for artists to easily access vinyl creation, financing, and distribution of vinyl records.
With services covering all facets of record production, plus artist and customer support, design, artwork, storage, digital downloads, and distribution, Qrates has a production model suited to every level of artist.
Qrates also provides artists the chance to crowdfund vinyl — as few as 100 units — with no upfront fees.
We had the pleasure to catch up with Fukuyama for a quick discussion about the state of the vinyl business, streaming and what’s next.
Platform & Stream: What was the jumping-off point to start Qrates?
Taishi Fukuyama: First off, my co-founders and I are all passionate about two things: vinyl and making a positive impact for artists. We’ve all had careers in music and tech in various capacities, so we sat down and looked at what was growing in the music industry and where we could use our passion for music and tech experience to make the biggest impact.
Vinyl was the obvious choice — it was the only music format besides streaming that was growing back when we were pre-launch, but the process of pressing records is stacked against independent artists and labels. We created Qrates to help them break through the logjam.
Platform & Stream: Since the launch in 2015, what has been the experience like building and developing the business? Any specific roadblocks along the way? Surprises (good or bad)?
Taishi Fukuyama: I think we’ve hit more than our fair share of roadblocks, but our passion keeps us going! Beyond the usual startup challenges of attracting new talent and raising capital, we are a Japan-based tech company that does most of its business in other countries. We’ve also experienced quite a few unprecedented events in the world — from the COVID-19 pandemic to Brexit to raw material shortages and inflated labor costs.
Despite all that, we’ve had our biggest growth years yet in 2020 and 2021, and it’s all thanks to our incredible team and the investors and organizations we’ve been lucky enough to work with along the way.
Platform & Stream: When we talk about the physical format and vinyl and where we are currently in the long and exciting ‘story’, what’s around the corner for lovers of vinyl records, as well as the indie artists who can take advantage of the format?
Taishi Fukuyama: On the surface, the vinyl story is great!
The upward spike continued even with the entire world stuck indoors, and now it’s once again the dominant physical format over CDs. This is masking a huge problem though — a lack of resources to press vinyl. We only have so many record plants and so many raw materials, which means the biggest artists and companies get first dibs at the limited resources and independents get shut out.
What fun would it be if you go to a record store, and you only see a small fraction of the catalog that could be pressed to vinyl? That’s a reality no one really wants.
So with Qrates, we have worked out proprietary deals with several pressing plants that allow us to prioritize independent releases with as small of a run as 100 copies. That said, I’m hopeful that we will see more investment in vinyl infrastructure over the next few years so the market can continue growing unfettered.
Platform & Stream: Switching to digital, what are your thoughts on the overall business of ‘music streaming?’
Taishi Fukuyama: Streaming is a positive development, which you might not expect to hear from someone who’s advocating for vinyl.
It’s great for discoverability. Plus, we need to understand the reality, which is that streaming is the dominant format for music consumption.
If you don’t put your music there, you’re only doing yourself a disservice.
However, it’s also important to remember that the medium plays a role in the message. When your music lives in contextual playlists based on moods or activities like cooking or running, the listener is not going to be as engaged with it as they would be with vinyl, where they are forced to look at your artwork, listen to your entire body of work, and even physically get up to flip the record halfway through.
It’s important for artists to be aware of this distinction.
Platform & Stream: What’s next for Qrates? Where is the business this time next year?
Taishi Fukuyama: Because the vinyl manufacturing situation is so congested right now, we’re invested in acquiring more means of pressing vinyl so we can pass that along to independent artists and labels. Currently, our projects take about 10–14 weeks to be pressed and shipped.
That’s a great turnaround compared to what others are offering, but it’s still far from our ideal.
Our goal is to bring our lead times down to 4–8 weeks. In the meantime, we are also investigating other forms of physical music with the hope to give independents even more options when it comes to creating tangible products for their fans.
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