Billboard Brings You 10 Indie Innovators Who Are Taking Risks And Reaping The Rewards
TOM WINDISH
When Tom Windish formed the Windish Agency in 2004 in Chicago after years with the Billions Corp., he was seeking independence and the freedom to sign whichever acts he was interested in.
Now there are 150 acts on the Windish roster, booked by Windish and four other agents. The overwhelming majority of these acts are indie bands, including Aphex Twin, Chromeo, Hot Chip, Justice, Jose Gonzalez and Low. Windish has built a rep for beating the bushes and finding buyers and venues under the radar of many, if not most, agents.
In the live indie/underground world, there are challenges Windish doesn't necessarily see as challenges. "I don't expect any of my bands to be played on commercial radio, ever," he says. "In a lot of ways I think that's kind of a blessing. These people are independent, they don't need to worry about making a radio station happy or playing a certain radio show. We work with all sorts of venues, all over North America, from the places where people play like the Fillmore and the Bowery Ballroom, to some unique places like the Guggenheim Museum or the Getty Museum."
Windish cites Matthew Dear, Chromeo, RJD2, Girl Talk, the Books, Jamie Lidell, Earlimart, El Guincho and Peanut Butter Wolf as bands that have benefited from playing alternative spaces. But he adds that availability is "a big issue" in these venues.
"They don't do many events that incorporate music [so] production, i.e., technical specs, is usually lower quality than a venue like Bowery Ballroom," he says, noting that fans respond well to unusual venues. "People like going to museums and unique spaces. They can see art and see a new musician at the same time."
DIANA REYES
Regional Mexican singer Diana Reyes is not the first major Latin artist to do things independently. But in recent years, no other woman—or man, for that matter—has achieved independence so successfully in the Latin sphere after splitting with her label.
Reyes sings duranguense music—the danceable blend of traditional banda and electronic instruments—and is known as much for her raspy vocals as for her washboard abs and the accordion tattoo that graces her navel. Now, she can also be found wearing a business suit.
Reyes was originally signed to Musimex, an indie licensed via Universal Music Latino; her past three releases nudged the 100,000 sales mark, according to Nielsen SoundScan. But frustrated at not seeing royalty figures, Reyes decided to go solo last year. In partnership with former Universal executives Gabriel Fregoso and Enrique Ortiz, she dug into her own pocketbook and launched DBC records. Distributed through indie Select-O-Hits, DBC houses marketing, promotion, pressing and production under one roof and works in partnership with Reyes' concert promoters. (Reyes plays an average of three shows per weekend.) Its structure allows DBC to quickly turn around albums and ancillary merchandise, like calendars and dolls. DBC also develops other acts, including El Trono de Mexico, which hit the top 10 of Billboard's Top Latin Albums chart earlier this year.
"I'm obviously new at this," Reyes said at a business panel during this year's Billboard Latin Music Conference. "But everyone is involved in an artist's career today, and in this case, my albums come out under a label I'm also a part of. So, we're all focused on one thing."
Her DBC debut, "Insatisfecha," has moved 26,000 copies in the United States since its April release, according to Nielsen SoundScan. —Leila Cobo
BEATPORT
In the old days of dance music retail, DJs paid upwards of $6 for a domestically produced 12-inch and $10 or more for a more exclusive import. Today, Beatport—the download site started by a group of friends in Denver that is credited with singlehandedly saving the dance music business—employs a tiered pricing structure. The site charges $1.49 for back catalog content, $1.99 for new releases and classics and $2.49 for exclusives. All content is available in 320kbps MP3 format, as well as 192kbps M4A for an extra $1. Its customer base, estimated at 70% professional DJs and 30% casual fans, bears the higher costs gladly.
"Old-school DJs have memories of paying a lot of money for vinyl singles, only to play one single track on the release. Beatport is cost-effective when you consider quality, selection and the ability to buy the tracks that really interest you as a DJ," founder/CEO Jonas Tempel says. "Any DJ who is committed to his or her craft is constantly looking for new music to add to their sets. Customers accept that stores like Beatport need to charge slightly higher prices to do what we do."
The formula is definitely working. While the site is keeping mum about most of its numbers, Beatport has grown from three to 46 servers in its four years, hosts more than 8,000 labels and recently launched Beatsource, a similar site for hip-hop DJs.
—Kerri Mason
TOPSPIN
Just a few blocks west of the sprawling office buildings housing Yahoo, Universal Music and Sony BMG Music Entertainment in Santa Monica, Calif., a new company is setting up shop in decidedly more modest accommodations.
At first glance, one could confuse the small office for a rehearsal space. There's not one, but two drum kits, a dual turntable hooked up to massive speakers next to metal album storage cases and guitars resting upright on various stands. But then the hints of a real business appear—a recently assembled conference table and poly-con file cabinets waiting to be filled and a rectangular table supporting six workstations where developers in various stages of scruffiness are buried in their work.
This is the new home of Topspin, a company just emerging from stealth mode that could only exist in today's uncertain, chaotic music industry. Its first product, until now kept a closely guarded secret, is what's called the Topspin Manager—a turnkey suite of technologies and services that provides all the content management and customer relationship tools artists need to distribute and market music directly to fans.
"We've been going through a period of technology-driven innovation that has disrupted the music industry's business models, but the new model to replace it hasn't appeared yet," co-founder/chairman Peter Gotcher says. As CEO of Digidesign, Gotcher led the creation of the ProTools computer software that revolutionized how music is recorded and produced.
He and the rest of the Topspin team—which includes former Yahoo Music GM Ian Rogers as CEO and former MusicMatch product strategy executive Shamal Ranasinghe as chief product officer—believe that new model is a vastly decentralized one where artists mainstream and niche can directly engage with fans without the help of a label, if given the right tools.
Such tools include:
• A content management system that hosts and organizes artists' music, photos, videos and other media, along with a rights management interface that lets them determine how their content is made available. That includes a commerce engine that facilitates all sales and fulfills all orders, as well as the ability to set prices and usage rules. (E.g., some songs might be given away, streamed indefinitely, expire after a set period of time or be made available only to fan club members.)
• A fan management system that collects and organizes information like e-mail, location, age, birth date and sales history, as well as data on how many times a fan streams music from Topspin-enabled Web sites, shares music with other friends and what other artists they listen to.
• A product creation tool that lets artists develop special offers from their content, such as premium membership subscriptions, bundled ticket/track products or special e-mail offers—basically any way artists want to offer their catalog to their fans.
• A reporting feature that tracks all of the aforementioned tools in granular detail, such as site visits, song streams and downloads with the associated user detail behind each and all of it available in customized charts.
These are the full spectrum of tools the Topspin Manager provides, in return for a percentage of all revenue made via the platform. And unlike services offering similar tools, such as ReverbNation or Tagworld, Topspin is not marketing itself as a customer-branded service. It's a completely business-to-business offer, meaning artists can incorporate the platform into any Web site or social-networking page.
The desired result is to empower what Rogers calls the "middle class" of artists—those either past their commercial prime or too new to enjoy the marketing support of a major label.
"We're helping artists build their brand through a technology platform," he says. "We want to focus on the technology, demand generation and marketing."
For instance, an artist the company declined to name is planning to use Topspin to give away a new track from an upcoming album to fans in return for their e-mail address. That artist also plans to sell a number of singles in digital and physical formats, as well as the full album, a number of bundled products at various prices, PDFs, lyrics and more, all using Topspin's technology but via his own Web site and social-networking widgets.
Others like David Byrne, Jubilee and the Dandy Warhols are using Topspin to offer fans a subscription package with a host of content either exclusively or before wider release for around $20.
Individually, none of these ideas are in any way new. Radiohead and Nine Inch Nails have popularized the direct-to-fan download model as well as the format bundle. Former Throwing Muses frontwoman Kristin Hersh and L7's Donita Sparks established CASH Music as an attempt at a subscription model. But what's revolutionary about Topspin is how it aggregates all the tools needed to pursue any of these strategies into one easy-to-use platform, which the founders hope will inspire other artists and their managers to attempt the same in greater numbers.
"Look at all the established artists going direct to fan, or talk to managers, and the trend is trying to go away from the traditional label model," Gotcher says. "If you have professional management and any access to capital, do a 360 deal with yourself. It's all about optimizing multiple revenue streams and keeping as much as possible from them."
Gotcher first conceived the Topspin idea seven years ago as a potential extension of what was then MusicMatch, but sat on it because he didn't feel the market was ready for such as step.
"One of the lessons you learn as an investor is that being early is just as bad as being wrong," he says.
Since then, several important milestones have occurred to pave the way. The increase in broadband Internet penetration led to fans consuming more media online. Social networks created an easy outlet for artists to engage with fans directly. Music discovery began moving from radio to online channels like Internet radio and MP3 blogs. And album sales began their ongoing downward spiral.
At the same time, technology like ProTools made it easier for almost anyone to record music without a major studio or producer. This led to a surge in new content emerging at a time when labels, struggling from the decline of the CD market, began focusing more narrowly on instant hits and either dropping artists that were not carrying their weight or never signing others that didn't have the potential for blockbuster sales.
Just as ProTools brought the process of recording music out of the expensive studios and into the garage, Topspin hopes to take the marketing process away from the labels and into the hands of artists and managers.
"All the marketing done by majors is broad-brush marketing, not very focused or tailored to the specific customer," Gotcher says. "There are a lot of industries that do that well, but the music industry is not one of them."
Yet all of this is only phase one. Topspin has a grander goal in mind—not just managing artists' existing fans, but using the platform to help them find new ones. The company is keeping mum on exactly how it plans to do that, only pointing to an eventual rollout of new services at year's end or early in 2009. But based on conversations with the founders, it's clear the strategy is to leverage the fan bases of different Topspin artists so that one can drive traffic to the other.
"If you sound like Elvis Costello, how do we get you in front of Elvis Costello fans?" Rogers asks. "Those are the kinds of things we'll be addressing."
To do this effectively, a critical mass of artists would have to adopt the Topspin platform in order for it to share recommendations among them, and that's a big gamble. But if the company's founders are right about the music industry's future, Topspin is well-positioned to capitalize on it.
"The revolutionary thing for me is creating a new market out of the artists who have sort of been below the radar in the past," Rogers says. "It's a good thing for culture in general when this happens."
So perhaps it's only fitting that the TopSpin offices lay just a bit further west than those of the established old guard, just that much closer to the ocean's edge. Perhaps an artist-controlled future is the manifest destiny of the music industry. And if that's true, then the secret to achieving it may just lie somewhere in the boxes still being unpacked at this small startup's new digs. —Ayala Ben-Yehuda
MATT & KIM
Dance punk duo Matt & Kim might have sold only 6,000 copies of its self-titled 2006 Iheartcomix release, according to Nielsen SoundScan, but its music has been featured in a flurry of ads ranging from Virgin Mobile in Canada to the trailer for the DVD release of Academy Award-winning film "Juno." Additionally, a two-page print campaign from Converse made by New York agency Anomaly uses a picture of the two, and, on top of their current campaign, Matt & Kim have a red Converse shoe scheduled to debut this fall.
Besides the placements they've scored, Matt & Kim set themselves apart by being tour monsters with a ferocious live show. "Some bands are great live but their music doesn't synch well, [while] others have great music for synchs but don't have a great live show and die-hard fans out there. M&K is the full package. They have a huge following as well as lots of fans in the synch community," says Sanne Hagelsten, founder/head of Zync in New York.
When reached while putting the final touches on their next album and preparing for an upcoming tour sponsored by Vice magazine and Colt 45, Matt Johnson says, "We're sort of raping the purity, but if you look at the audience, is it bad to have brands on the wall?"
Band manager Kevin Patrick says the duo has managed to participate in the commercial culture yet retain its indie patina because "there was never any plan to avoid or embrace branding, it just happened. Kim [Schifino] always says, 'I would never align myself with a company that made or did something that I don't use in my everyday life.' If it's something they use, they're happy to talk about it and be involved in it." —Kamau High
LAST GANG
Last Gang Records is less a label than it is a music business depot. The Toronto-based company has its hands in publishing, licensing,multiformat releases, management and legal, pushing forward-thinking, progressive dance and alternative acts.
Its vertical approach to releasing music has a lot to do with co-founder Chris Taylor, who was a pro musician until he was 30 and decided instead to become an entertainment lawyer. After shopping Canadian rock act Metric without any takers, he and partner Don Tarlton released the band's "Old World Underground, Where Are You Now?" in 2003 through Last Gang. Then came efforts from Death From Above 1979, MSTRKRFT and Chromeo, all of which achieved international notoriety.
With investment from Canadian music publisher ole, Last Gang has experienced plenty of success in the international licensing sector, particularly with its newest crown jewel, dance/experimental duo Crystal Castles. That group has also benefited from Last Gang's emphasis on vinyl. When Crystal Castles signed to Last Gang in May 2007, there had already been a handful of vinyl singles circulating through labels like Merok in the United Kingdom and Young Cubs in the United States. Rather than suppressing the singles, Last Gang teamed with the other labels to keep interest boiling until the release of a full-length album this year. Similarly, MSTRKRFT issued a 12-inch single to select specialty shops to tide over fans while the group finalized licensing deals with Modular (United Kingdom) and PIAS (Europe).
"Since the launch of the label in 2003, we've used vinyl as a marketing tool and as a 'thank you' to the music nerds who love this stuff, since most of our records start in this community," Taylor says. Though most production runs of vinyl (with help from U.S. distributor Fontana) sit around the 1,000 mark, he says some worldwide runs can exceed 5,000. —Katie Hasty
PENNYWISE
Take one venerable punk band, add a pioneering social networking site, throw cash from a text messaging service in to the mix and what do you get? Quite possibly the most successful monetization of free music to date.
Pennywise initially went to MySpace Records because it wanted to utilize the site’s networking functions, according to guitarist Fletcher Dragge. But when label GM J Scavo threw out the idea of giving away the band’s new album for free with support coming from mobile billing and music delivery service Textango, Pennywise jumped at the chance to try something new.
To date, 630,000 people have signed up with Textango to receive a promo code to download the record, and 400,000 of them actually did so. That’s the same number of people who purchased the band’s highest-selling record, “Full Circle,” released in 1997. The new album has also yielded the band’s highest-charting single, “The Western World,” which peaked at No. 22 on Billboard’s Modern Rock chart.
According to Scavo, the band has seen its live show guarantees rise by 20%, and “merch has gotten a boost, too.” Scavo adds that Textango was pleased with the number of new subscribers it signed up, and even the band’s former label, Epitaph, gave its blessing. “Epitaph realized this was a great opportunity for us,” Dragge says. “It worked out for everyone.” —Cortney Harding
IAN MONTONE
In the year-end issue of this magazine, we predicted that the Shins would sign to a major label now that their contract with Sub Pop had expired. But the band’s manager, Ian Montone, has a different plan. “We anticipate that James Mercer and the Shins will self-release their next record through James’ label called Aural Apothecary,” he says. “The goal would be to own our masters and, in addition to the marketing tools we have at our own disposal, team up with a label partner that will assist with additional marketing, radio and various costs. The deal will be more of a P&D deal than a traditional record deal. That partner could very well remain Sub Pop, who have done a remarkable job with the band and have a great staff of people who really love music. All of this is being determined. The first goal is to make the record and see where that takes us.”
If anyone can make this happen, it’s Montone, a former music lawyer and the man behind the Raconteurs and White Stripes deals, where the bands own their masters and strike short-term deals with label partners around the world. Montone is the first to admit that his model isn’t for everyone. “It requires a bit more work and responsibility, but when all is said and done, you know that you are in control of your career,” he says. “This isn’t perfect for every artist. But for artists that are willing to take on the extra responsibility, it can make sense.” —Cortney Harding
WIND-UP
In a mobile space that proves generally hostile to the independent world, Wind-up Records has succeeded brilliantly.
It is the only independent label in the United States to have a licensing and billing relationship directly with a major operator in Verizon Wireless. It also enjoys a deep marketing relationship with other mobile operators like AT&T Mobility and Sprint.
Wind-up has achieved this rarefied position by focusing on a small roster of mainstream hits and exploiting them with targeted marketing campaigns. While Wind-up doesn’t have the massive catalogs that major labels do, such acts as Evanescence, Finger Eleven and Seether have achieved the same level of popular success as their major-label counterparts.
As a result, Wind-up COO Jim Cooperman says that while the company may not be a major label, it tries to act like one and uses its smaller size as a weapon.
“We are competing with the majors day in and day out,” he says. “Because we only have 20 acts on our roster and 10 releases in a given year, we’re able to focus at a great level of granularity with regard to marketing.”
The company is currently negotiating about 30 digital deals and has completed more than 100 in all, and additional mobile surprises are on the way.
“In some respects [the majors] have bigger departments and more people, but the reality is that they’re also managing many more relationships than we are,” Cooperman says. “Because we’re independent, we can think a bit outside the box.” —Antony Bruno
FOOL'S GOLD
Thanks to acts like Kid Sister, independent label Fool’s Gold is making inroads in monetizing hipster-hyped music. The label was co-founded in April 2007 by DJ Nick Catchdubs and Kanye West’s DJ, A-Trak, and has since grown to a roster of 15 artists whose active touring habits are perfect for keeping the party going.
Sensing a void in the marketplace, A-Trak and Catchdubs were at first simply looking to distribute music they’d heard in their electro-hip-hop-pop club circuit. Inspired by boutique labels like Nervous and Sleeping Bag, they began releasing singles and EPs digitally and on vinyl.
The duo utilized the music A-Trak crafted with his girlfriend, MC Kid Sister, for their first release. Dropping in May 2007, Kid Sister’s “Control” got off to a slow start and has shifted only 5,000 copies in the United States, according to Nielsen SoundScan. But later that month, West remixed and added the track “Pro Nails” to his highly popular mixtape “Can’t Tell Me Nothing,” igniting the buzz.
With a potential hit on its hands, Fool’s Gold pooled its resources and hired Rob Fleischer, creator of MTV’s reality-based sitcom “Rob & Big,” to shoot a “Pro Nails” video. MTV eventually added the clip in December, and its popularity helped secuhttp://cms.vnuemedia.net/iw-cc/command/iw.group.formspub.save_valid_formre Kid Sister a deal with Downtown Records.
Of late, the label has been routinely approached by companies like Scion, T-Mobile and Red Bull to build branding partnerships like A-Trak’s new Nike “Running Man” mixtape.
“It sounds so improbable, because the label is run by two guys with laptops,” Catchdubs says. "But it just seemed like the natural thing to do.” —Hillary Crosley
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