Boutique consultancy and
Outpost Partners helps music businesses navigate a complex landscape by supporting corporate development, strategic finance and leadership. We focus on operational excellence and long term growth.
Our Perspectives:
Career Artists vs. Music Creators
Warner Music’s Top 5 Artist Share
Source: Music Business Worldwide
Music Creator Tam 2022, Global
Source: Midia Research
“A decade ago, our top five artists generated over 15% of our (…) revenue. In 2022, they generated just over 5%.”
© Stephen Cooper; Former CEO & Chairman of Warner Music Group
The traditional Music Industry talks about signed or unsigned Artists, we differentiate between Career Artists, who are focused on making a living off of music, and Music Creators, who enjoy music for recreational purposes and usually have full time jobs.
While it is easier than ever to make and release music, it is becoming harder than ever to have a career, become famous and live off of your music. Therefore industry power structures focus on existing superstars or artists who are about to break into the mainstream.
For Music Creators music making is recreational, they want to have fun and enjoy the process for the best possible experience. New technology (AI, mobile etc.) creates quality results fast, opening the door for millions of users to jump on board.
Music Business vs Venture Capital
“The reality is that there have been very few large exits in the music industry over the past 10 to 15 years.”
© Alderbrook Companies
There are four different types of investments targets: entertainment technology startups, music tech startups, music rights businesses and catalog acquisitions. The main differences are the returns and the expectations investors have.
Catalogs are understood as a safe commodity, topping $12bn in acquisitions in the last 10 years. Today they are harder to grow and take longer. New labels are long term investments opportunities if they can develop partnerships and direct to consumer products.
Venture backed technology companies promise a high return on investment that music tech startups can’t deliver on as the music tech market is too small. Therefore venture capital hardly fits music rights businesses or music tech startups.
Catalogue Acquisition Landscape
Source: Royalty Exchange
PE / VC Backed Music Exits Since 2010
Source: Leveling Up
Creative Founders vs. Startup Entrepreneurs
Positioning of creative founders
Source: Outpost Partners
Agency vs. Brand Model
Source: Outpost Partners
“A creative man is motivated by the desire to achieve, not by the desire to beat others.”
© Ayn Rand
Founders with creative skills usually follow an intrinsic motivation when building a product – they create or curate content, art or products strongly tailored to their preferences and needs, rather than trying to leverage an opportunity in the market.
Once these products find their audience and start to grow, they face a different challenge: set up corporate structures and systems that support and nurture growth, without undermining or interfering with their product, community or audience.
To build long term brands, these founders walk a thin line between cultural integrity and recognition, and commercial success and exploitation. We dedicate ourselves to those founders, their companies and their challenges.
Partners:
“Practicing your craft in expert fashion is noble, honorable, and satisfying. And I’ll generally take a stand-up mercenary who takes pride in his professionalism over an artist any day.”
© Anthony Bourdain