Being an artist doesn’t have to mean starving
As long as there have been entertainers, there have been starving artists. It’s an age-old phenomenon. Stories of content creators getting screwed out of earnings are legend in the entertainment industry. It’s not just the so-called “little guys,” either — successful label and studio-backed musicians, writers and performers all feel the pain of an opaque, old-fashioned financial and rights-management system that makes it difficult for all involved to understand, much less collect, their fair compensation.
This problem has only become more pronounced in the past decade. Developments in production tools and distribution platforms like YouTube, Soundcloud, Spotify, and Hulu have liberated content production from major labels and studios, creating an independent, self-publishing creative class. This is great news for artists and their fans. Unfortunately, the downside is that it’s now exponentially harder for content creators to track where their content is placed, how it’s being used and what usage fees they’re owed. Each file or piece of content might have its own set of contributors and royalty splits, while each platform might have its own accounting and payment systems. Add in the trend toward collaboration and it’s clear that spreadsheets and paper documents are no longer sufficient to manage this process. To survive in this business, content creators need to be accountants as well as artists.
And what few outside the business realize is that it’s not just creators who feel this pain. Tracking and distributing payments to all stakeholders of a given work (down to a single file, track, or snippet of video) comes at an incredible cost to labels, managers, and distributors as well — the industry, if you will — both in terms of overhead as well as reputational damage. The traditional model simply doesn’t fit today’s creative landscape and robs the all involved of the ability to create freely.
Enter Stem, a platform designed to improve the business of being an artist.
Stem is a smart contract, content distribution, and payment processing platform wrapped in a user-friendly app and dashboard that simplifies the process of managing and registering content ownership information. Rather than having artists or managers track and reconcile each payment using paper documents and spreadsheets, the platform does all the back-end work, automatically generating smart contracts that memorialize agreements between rights holders and simplifying the future disbursement of payments to those parties.
For the first time, all parties involved in creating and distributing a given work can enjoy real-time clarity about content performance, consumption, and earnings. The result? Artists, managers, and the like have more freedom to do what they do best — create, perform, promote, and engage with fans, rather than scouring through legal documents, receipts, and excel spreadsheets playing detective (or worse, simply leaving money on the table.) It’s a solution that will serve not just musicians, but also video stars, writers, dancers, comedians, and all other manner of creators distributing their work digitally.
It’s hard to think of a better team to tackle this complex issue, which requires intimate knowledge of the challenges that content creators face, as well as a complicated technical solution, elegant design, and an effective end user experience. LA-based founders Milana Rabkin, Tim Luckow, and Jovin Cronin-Wilesmith are respectively one of the first Digital Media Agents at United Talent Agency, a musician-turned-entrepreneur who previously founded an independent music label, and a talented designer with years of experience building digital products for musicians. Together they bring the full complement of industry and creator perspectives, key relationships with all stakeholders around this issue, and, critically, the motivation borne from having encountered the pain of rights management and the payment status quo first hand.
It’s also hard to think of a better time for this service to emerge. The entertainment industry is facing an explosion in the number of creators, business models, and distribution platforms. Together these trends have expand both the sources and endpoints for payments across this landscape.
The issue is so painfully obvious that the distribution platforms and labels are now showing an eagerness to address the rights management challenge. Many have begun offering unprecedented access via APIs and portals that provide usage and revenue reporting. The platforms themselves are enabling trusted content owners to more easily collect and manage this data. But the industry has yet to bring these disparate systems together in a single, elegant workflow. This is where Stem really shines.
For all of these reasons, I am thrilled to announce that Upfront is leading Stem’s $4.5 million funding, in partnership with great investors like Mark Cuban, Vayner Capital, Ludlow Ventures, and Shervin Pishevar, among others. The fact that we also have the support of industry insiders like Scooter Braun, Bradford Cobb and Three Six Zero Group, who collectively represent some of the world’s top recording artists (includingJustin Bieber, Kanye West, Katy Perry, Calvin Harris and Deadmau5) speaks volumes about the magnitude of the problem and opportunity.
Stem is currently in closed beta with a plan to launch publicly later this year. Early customers include artists such as Moxie Raia, currently opening for Justin Bieber’s Purpose World Tour; Grammy award winning songwriter Anna Wise, who has collaborated extensively with Kendrick Lamar and is releasing her debut album; and Lexy Panterra, whose YouTube dance videos trend worldwide.
When I met Stem’s team, it was clear that this could be the moment for an impartial party to enter this space and introduce a true end user brand that stands for trust and clarity in the business of entertainment. I believe that this company will give our future creators a chance to do their best work, and get paid for it properly. I am extremely excited to be working with Milana, Tim and Jovin, and eager to see the impact they can have on this age-old issue.
It’s time for starving artists to be a thing of the past. As Stem likes to say, “Mo Money, No Problems.”
