Songbook has a fairly simple USP.
It lets fans crowdfund an artist’s next album, EP or single; in turn, it gives them a cut of the master/publishing rights, from which they earn royalties from three to 25 years.
It’s an interesting, yet somewhat unusual proposition.
While most crowdfunding platforms offer rewards in the form of early releases or access to concert tickets or exclusive merchandise, Songbook enables fans to become ‘real players’ in the music industry.
“Existing crowdfunding, for me, feels a little charitable / desperate, plus the hassle of posting out physical rewards is a hardship artists don’t want or need,” argues the company’s founder and CEO Chris Read.
He insists however, that his London-based startup is not ‘trying to disrupt the market’.
“Songbook is very much a commercial deal – not charity or a desperate move.”
Chris Read, Songbook
“We are an investment platform solving the two main problems artists and labels have,” explains Read. “[A] lack of cash and sustained promotion – whilst making music exciting again for music fans.
“Why sustained promotion? In the long-tail earnings model streaming has created artists need long-tail promotion. Vested fans can do this. A three month marketing burst is no longer sufficient and labels simply do not have the resource to execute sustained promotion.”
He adds: “Songbook is very much a commercial deal – not charity or a desperate move. Songbook / music journalists write the campaign piece and there is no cringey piece to camera from the artist.”
The company’s first successful campaign was for an artist called Albert Gold to record three covers – Under The Westway by Blur, London Calling by The Clash and Fix You by Coldplay. A resultant record will be released via Fierce Panda Records soon.
The campaign took investment from 33 fans, who will earn recording rights income on these three songs for seven years post-release.
Read, the founder of another music biz company, The Composers.tv, explains that the idea for Songbook came about because he works with ad agencies in the UK and a few in the US and gets sent a lot of music from artists who don’t have the money or resource of getting their music noticed.
“Songbook could help these guys,” he says. “I also think music fans want something more from music today.
“Hitting play on your phone isn’t enough, but being a ‘real player’ in the music industry – investing to promoting to earning royalties, to me – is.”
“We’re a very attractive funding and promotional option for all parties to use.”
In addition to Chris Read, the Songbook team consists of Chairman Keith Harris OBE Phil Sellick (CTIO, Virgin Media), CFO Ray O’Malley (ex Price Waterhouse Cooper) andSir John Hegarty, who is tasked with helping to build the brand, media partnerships and later stage funding.
Although crowdfunding has obviously proved to be a popular option with the Artist Direct market, Read explains that he foresees the company working with labels and publishers as much as with artists directly.
“We’re a very attractive funding and promotional option for all parties to use,” he says.
“We want to evolve it and work with labels (Fierce Panda & Pussyfoot currently) and publishers as well as artists direct. We are a very attractive funding option to these guys not a direct competitor.”
By now you’re probably wondering how the splits work between fan, artist and songbook.
Read says that it differs depending on the campaign, but right now Songbook is offering deals ranging from 10% to 30% with a duration of 3 to 25 years.
“So, for example if an artist is looking to raise £3,000 for 30% of the recording rights for 10 years – if 30 people invest £100 into a £3,000 raise they will all receive royalty income of 1% of the recording rights for 10 years,” explains Read. “Our minimum invest is £10. We can cap the maximum amount.”
He adds that Songbook would prefer not to have one person investing the full amount in each project, because you wouldn’t get the potential “promotional reach hundreds if not thousands of fans could deliver”.
Songbook’s CEO says that the company is “flexible” on the maximum percentage of rights revenue that an artist can receive – for example, it could be 100% of publishing and 60% for recordings, or 80% publishing and 80% recording rights.
For Songbook’s cut, the startup currently draws from two revenue streams: 10% of the crowdfunding raise and between 10-20% of the rights revenue.
“Plus, and this is really important, continues Read, “We invest, not advance.
“Therefore the artist earns their percentage from the first stream, sync or sale, not after the sum of the advance has been repaid. [This approach is] great for cash flow for cash strapped labels and managers.”Music Business Worldwide