 you're gonna see all these headlines that are like streaming is saving the music industry. The music industry is breaking out of its slump and reaching new all-time highs in terms of annual revenue. I'm sure labels are gonna use these types of figures, these types of headlines to paint a narrative. So they're gonna look to all the rising TikTok stars and say like sign with us. The music industry is going up. We can help you get your catalog sold in the future. We can help you get your streaming numbers up. This is where all the money is. That's not necessarily the case. What's up, what's up, what's up? I'm Brandon Manchin. I'm Cory. And we are back with another episode of No Labels, Necessary Podcast. You can catch us every Tuesday, every Thursday on YouTube, Spotify, Apple Music, wherever you stream your podcast here at the intersection of creativity and currency. This is No Labels podcast. And as you know, we love to have people who represent the No Labels necessary mindset. And boy does this guy right here represent No Labels. These are people who do it different, think different. Welcome Circa founder of Indiepreneur. Who's that creative, creative juice and just all around like Indie advocate. Appreciate you having, appreciate you coming on, bro. It's so good to be on guys. I'm such a huge fan of what y'all do and that, you know, so enamored that you asked me to come on. Thank you so much. Stop it, stop it. It's been a long time coming, man. I've seen the comments that you made just basically, you know, guys sliding us and like, well, I ain't doing that. Hey, man, you know, we gotta establish our process. Man, I don't know if you saw the early episodes, a lot of audio issues and things like that. You know what I mean? You don't bring people on until we know what we do. Yeah, you did one episode, you did like this one sort of like, like interstitial where you were like, hey, I'm sorry for the quality. We're making some changes. And I was like, I didn't think there was any wrong with watching the whole time. Conscious y'all, y'all know how it is. Artists, they're talking about your stuff. But hey, we got a lot of dope topics that we're going to talk about with circle. One of the major ideas is the music industry is going to zero, shrinking. Also want to talk about making money today. It's something that he's done very well with music. A lot of different hacks and ways, digitally especially. And also when you should start selling to make money and what that looks like today versus yesterday. All right, but starting here, the music industry is going to zero. I'm gonna just let you rock circle. I want you to talk on it. And then I'm gonna bring up some specific points, but I want you to explain the overall idea of why you think the music industry is going to zero. For sure. Well, so one being is that like, do I think it's actually gonna go to zero? Maybe not. That's like a bit of like an incendiary headline. Why, there's an acento maybe. Yeah, yeah, exactly. But like the point being is that we hear so often if you read musicbusinessnews.com or whatever, you're gonna see all these headlines that are like streaming is saving the music industry. The music industry is breaking out of its slump from the Napster era and reaching new all-time highs in terms of annual revenue. And I made a video a little while back that to kind of illustrate that like, that is true if you're not that market literate, if you're not like very intensely into finance and like sort of macroeconomics. Because in 1999, the music industry had a peak of like, I think 21.6 billion or something like that. And then over the last few years, we've been climbing above that. And you would think, okay, we had this big hit with the internet where the music industry wasn't prepared and they didn't do the right things. You can read a great book called Appetite for Self Destruction, if you wanna learn more about sort of how the music industry really screwed up in the Napster era. But as a result, they went from like 21.6 billion down, down, down, down, down. And everyone thought the music industry was never gonna resuscitate. And so over the past few years with streaming and all that, we've been reaching these new all-time highs and everyone's excited about it and everyone's talking about how the music industry is back, baby. But if you look at, if you look at, so like the music industry, it's annual revenue is really a fraction. The number they're giving you is a fraction. It's the music industry's annual revenue over dollars. And so if you're not tracking the actual weakness of the dollar or you're not tracking the amount of dollars out there in the system, you might be inclined to think while we're reaching these new all-time highs. But if you look at the actual supply of dollars, that has increased by 40% over the last half a decade. And so really, you can adjust these numbers to say, okay, given that there's so many more dollars in the system, how much in 1999 dollars when you account for inflation are we actually at now? And you'll find that we're actually still at the lows of the trough. We haven't actually been climbing up. We've actually just been staying sort of stagnant a little bit down from our lows ever since the Fed started printing like crazy amounts of money with 0% interest rates and stuff like that. So the idea that the music industry is climbing back out of its trough and it's reaching new all-time highs, it's not actually true. We're actually, when you account for inflation, we're actually at all time lows of the last 20 years. So a couple of things, just to simplify it, right? Inflation, I'm gonna use that one because everybody's pretty common with inflation, right? So partially because of inflation, right? We might be making more dollars as an industry as a whole, but technically there's lower value, right? Yeah, it's worth less cartons of milk. Exactly, exactly, right? What was the number in 1999 and then what was the number last year? I just can't remember the latest number. So the 1999 peak was right between 20 and 30 billion on this chart, so let's call it like 25 bill, right? And then currently we're at around like 28 billion for last year. But when you adjust for inflation, we're under 10 billion. In 1999 dollars. And I can actually, I'll send you guys this chart so you can use it. You can go out on the screen for sure. And I mean, going from 20 billion, I mean, well, you know, 25 billion to 28 billion over 20 years is actually horrible in the first place, right? Not great. Not great gains. But yeah, then you throw in adjusting for inflation and the fact that we've been losing is pretty crazy. So what does that mean for artists? Yeah, history as a whole, right? And I don't think people think about the industry as a whole, but when your industry is shrinking, what does that mean for you as an individual? Yeah, so I think that like the all the narrative that comes with these headlines, like the narrative that we believe that like, oh, streaming has counteracted the problems we faced in 1999 or 2000. Sure, it was a problem that music became a digital file type and now could be distributed at zero cost infinitely. That's a problem, but no more problem because Spotify has solved it all. You know, that's just not the case. And so I think if you were to presume that like, oh, the music industry has become once again a good field to be in, it's a growth industry. It's just going to keep going up. You know, I don't know if that's necessarily the presumption you should make as an artist. And, you know, labels are, I'm sure labels are going to use these types of figures, these types of headlines to paint a narrative when they're looking to capture value. So they're going to look to all the rising TikTok stars and say like, sign with us, you know, the music industry is going up. We can help you get your catalog sold in the future, we can help you get your streaming numbers up. This is where all the money is. That's not necessarily the case. And most people with a large audience, I think would be better thinking of themselves as influencers than musicians, because at least they'd be trying to sell some products and make some money. Right, man. Hey, that's why we're so heavy on content. We've always been heavy on content. Just understanding that. I think the way I simplify it, right, is because you got all the numbers, man. So a circuit comes with the genius, the great journal of research. The data. I go off of a few sets of data, generally speaking, when I don't have time to research and it starts like this, right? We look at Spotify. You've mentioned that Spotify is impossible to profitable. It's no secret, right? And I think they said they reported a profit in a couple of years or whatever. But like overall, we know we're not like really making money, right? So we could complain so much on the artist's end. Yo, y'all aren't paying us. But then when you look at the fact that the company that you think is robbing you also isn't making money, you have to go a little bit deeper than just thinking that we're being wronged, right? I know like if you stay in that adversarial relationship, it can blind you up the bigger picture that, yo, something's going on period. Even the person robbing me isn't making money. Then what is going on? Like what move should I make? And I think one thing that you just said was, right? Looking at yourself as an influencer and totally, and I think we can differentiate that in a second. And then the other side of that is if you are an artist, on the independent side, we've gotten all this accessibility distribution that has happened over the last 15, maybe 20 years because of social media and these independent distributors, right? I think the problem that occurs is people don't notice that the music industry is shrinking in your words because the distribution has spread out. So if I'm used to getting zero dollars, you have all these people who are used to getting nothing now making $50,000 and $30,000 and a $50,000 for the first time, you don't notice that the pie is smaller because as far as you individually are concerned, the pie is bigger. That's where the good news is, is that year over year, for the last seven years, if you take that pie and you divvy it up into independent artists and major label artists, the independent artist share is growing. Despite there being less money overall, we're getting more of that money for indie artists than ever before. And when I say the pie, I'm talking entirely about revenue from recorded music. So that's royalties that is licensing, it's full transfer and sale of rights, it's rights associated with intellectual property, musical works. It doesn't include your merch, your touring, all of that stuff. So it's important to note because when we say the music industry, we're talking entirely about the money made from intellectual property. So some artists and managers are just waiting for lucky moments when the ones who are killing it have systems to consistently take artists to another level over and over again. And if you wanna see what that looks like, we just did a collab where we not only show the system that we use, that's resulted in Billboard hit, some of the biggest viral moments on TikTok, Instagram and YouTube. But also we got J.R. McKee to break down how he took an artist from zero to one of the biggest hit songs of 2022 and getting a Grammy in January of 2023. This is recent stuff, not old tactics. If you wanna check it out, go to www.brandmannetwork.com slash Grammy. Don't forget the www. Because J.R. gets into the details of looking at the data, decisions that got made, how much content got created and how they adjusted the content over time for different parts of the campaign. This is real behind the curtains type of stuff. So again, go to www.brandmannetwork.com slash Grammy. If you wanna check this out and apply it to yourself, back to the video. Which brings me to something though, but I wanna hold that to the end so not to distract this man. We got the influencer aspect of things, right? When you say an influencer, we actually literally just talked about this, maybe an episode or a clip or two ago, right? The fact that music is not all of the things that people think the music industry is, right? We literally just talked about touring. Technically it's not the music industry, right? So using the influencer umbrella, I think we can even broaden it and more clearly explain to the audience why one, artists should look beyond music, but also how some of the things that they're already thinking or I mean, are about doing actually aren't in the music industry and that'll probably help people understand the opportunity even though the industry is shrinking. So can you give us your thoughts on an artist being influencer today versus yesterday? Yeah, I think a guy who's been definitely circling the drain in your guys' world and we're all big fans, it's LaRussell. And what an absolute genius. And if you look at all of his activities, I would say that very, very small portion of LaRussell's revenue is, you could actually attribute to this number of music industry annual revenue because when he sells way above margin, the rights to a portion of his streaming totals or he sells an NFT of an album, how much of that actually gets credited back? Probably only just the royalty allocation. So if I'm selling a 20, if I get $2,500 for an album, you're still looking at the same amount going towards the music industry's annual revenue as if I had sold the $5 album. It's the royalties because the premium that he's able to charge on that is based entirely off of non-musical stuff. And so the key being that like, if you look at someone in the, we take on a lot of legacy artists who have like tens of millions of followers. And it's like, if I'm a marketer, like an e-commerce marketer, where I help new e-commerce brands, makeup, t-shirts, whatever, build up their revenue, I'm looking at your socials and I'm determining what's the captive audience here and how much should this business be making? There are e-commerce brands of 500,000 followers who are making well over $10 million annual revenue. But if you see an artist with 500,000 followers, the presumption is not that they're making $10 million. And so that's real, like our agency wouldn't exist if that weren't the case. We're entirely an arbitrage of how much the music industry expects a following to generate in terms of dollars and how much we as marketers know that that should be the case if we're doing proper extraction of that value. So really it's like the music industry is very poor, very terrible at turning attention into dollars as evidenced by the fact that this music industry annual revenue, if you look at the music industry's annual revenue, I did this with Bard the other day on Google, the new Google AI as I was like, give me a bunch of industries that are below 30 billion annual revenue but above 20 billion. And you'll find that like personal laundry services make more annual than the entire global recorded music industry. It's a joke, because you look like there's so much outsized influence, right? Like the music industry is the cultural mainstay of the whole world. Like everyone knows these people but the music industry is terrible at value extraction from that outsized attention. So I think that's the big thing that artists should really pay attention to is like, how much should you be making per 100,000 eyeballs? It's probably way more than the music industry is able to make. That goes back to our conversation about not encouraging our people to be artists. I remember I said, the probability is already so low and then the industry so bad at monetizing. Yeah. That's a whole another conversation though. Yeah, even like we talk about LaRussel being a good example of that like he said, like he's really just taking influencer community building strategies and applying it to the music world. And it's so revolutionary in music but in like all the other credit ventures are like, yeah, y'all are just now doing this. Like you just realized that he's doing community building events. It's crazy. Is the audacity to actually sell stuff? Yeah, exactly. Well, here's the thing. I won. Well, so I think the beauty of doing things well over the long term actually work out from a business standpoint, right? But you can not be thinking about it from a business sense. But you know, hey, this is good. This is good for my community. This is good for long term. And when you start breaking things down, you say, oh, snap. From a numbers basis, this actually maps out like LaRussel providing his music as something that his fans can invest in, right? Well, when I zoom out and think about it it's not just, oh wow, this is amazing. Like this is a really cool thing to build a relationship, that's cool. And I'm sure he's not thinking about it maybe to the extent that I'm about to explain but if we think about music as a loss leader, right? Which pretty much has been the approach for years even in many of the better times of music it's been looked at that way. All right, so that should tell us something and things are getting worse per se. So it's still a loss leader. Well, if I know this is my loss leader, why do I not give it to my fans, right? Have them have a stronger relationship and now it's almost like a break even product, right? Yeah. You own my music and now you want me to win but it's even better because as a business I sell you one thing and now I have your attention and your data so I can sell you something else. However, here I'm the business but then I'm selling you something that I'm already not gonna really profit that much off of in the first place and now you're a part of the business so you're gonna be encouraged to buy more stuff because it's helping yourself so I really don't even have to sell you strongly, right? So it's a really cool relationship that again I don't think it's like super thought out where I'm only doing this because I want to establish this relationship but effectively it does which is why that long-term thinking in so many ways for those who are willing to dug it out and do the unscalable things end up winning long-term. Yeah, you said loss leader, right? And for those of you out there who are like, don't know is that like at the grocery store the thing that the grocery store makes the least money on is milk and eggs. Historically up until last year eggs were very cheap but because of all the money printing they've exploded in terms of price but you know eggs and milk where are they located in the grocery store? Back. Like the back, right? You enter in the front left they're in the back right and you have to walk through all these other products in order to go get them. And so you're filling up your cart as you go and there's these big display stands because if you only walk out with milk and eggs they're not gonna make any money barely it's not even worth having you in the store which is why they are constantly trying to get you to fill up the cart on the way. And we use this to explain a lot of different things a great analogy for like a lots of different things in digital business. But ultimately to say that like if music is your loss leader it's what gets them there but most musicians stop there. They're like, we're just gonna give away milk and eggs just give it away, give it away, give it away and at some point a more capable business person will turn us into a grocery store. And it's like, no, you should be grocery store from day one. And so that's always been our argument. Now, currently I would say that like artists are very scared to sell. And I think it's important for artists to like when you guys say, you know your music is a business and you are a business as an artist. What that means is that businesses interact with people who are not the business customers through transactions, right? The point like the communication medium from business to customer is transactions. It's not like, here's some free stuff. Here's some more free stuff. Here's some more free stuff. Here's some more free stuff. Go review or like add us to a playlist like that's not it's actual dollars exchange for value. And artists are very poor at thinking of themselves in that way. So much so that like if they make any offer they feel like they're like the scum of the earth or something like that. And it's like, dude, you're a business. So like most of what you do should be communicating with customers through offers and transactions. Yeah, see, and I think we're in a time where all roles have led to this, right? So you're alluding to artists selling earlier on but even if you look at all the other messaging around this and where the industry is, that is what you're supposed to do when you think about it because one fans have been primed to wanna support artists. They're more aware of what artists are going through and they want direct access. So the marketplace is primed for that type of relationship, right? And then on the other end, we say labels don't wanna invest in an artist who doesn't have a fan base, who doesn't have who's not popping already. And then how do people summarize it? Artists wanna really invest, no, labels want to invest in small businesses instead of a startup artist that's just more of an idea and establish that. Well, if you're a small business, you don't just have a lot of people coming in the store to do something, you know what I'm saying? Yeah, yeah. Like really to pull that all together is just reminding yourself that music is only a part of the revenue stream for an artist and it always has been, right? We've always seen it, known this, but when we stay in the idea and theme of music, we tend not to think about the touring, the, I mean, brand deals, the people who become actors and actresses, like there's so many different ways. You're really just a personality and the title that they put on you is just based on how you decided to monetize and brand yourself. But politician, right? A Will Smith, Dwayne de Rock Johnson, like, oh, wrestler, but then he gets into all these movies, right? Like it's just a well-known figure and you decide how you wanna monetize it. That's it. Yeah, 100%. I think like when you decide I'm in the music industry, I'm an artist and I monetize through music alone, streaming royalties for the most part. You're basically saying I wanna be institutionally impoverished. I wanna make the least amount of money per ounce of effort I put in that I possibly can't. Like there's no other industry that's like, you think of the laundry services industry had Drake followings that they'd be making as, you know, just slightly more in the music industry? No, like it's an audience problem. Music industry has the opposite problem. And so yeah, I would 100% agree that like you, the more you think of yourself as an artist that monetizes entirely through music, the more trouble you're going to have. And really I wanna make the point that like the music, like record labels as much as I despise record labels, they're not bad at this. They just exclusively choose to do it for the shiniest, prettiest, most popular artists that they can find. So if you go look up on the internet, you can look at trademark registrations. When I register for a trademark, like say I register circa as a trademark, I have to list all of the industries I plan to enter with that trademark. So online, you can see all of my plans for what to do with the circa brand. You can go look up the Justin Bieber trademark registration. You'll find keychains, perfumes, you know, action figures, every possible field of monetization that they could do with the Justin Bieber brand, they registered for from day one, okay? So they knew the money is gonna come from the lipsticks and then little action figurines, you know? But they don't do that with someone who might have a million following, you know, 500,000 following. They don't see it as worth it. And maybe it's not for them. But just to say that like the captains, the titans of this industry, they are not stupid. They just sort of don't care if you flounder in obscurity and poverty as someone with a 500K following because it's just not worth it. So yeah. But they're not stupid. They deploy their intelligence selectively. Yeah, yeah, I'd say so. I think for them, it doesn't matter because there's a thousand artists. They have a thousand artists with 500K, a million, two million, they don't care. They're the person that's gonna pay for all of those is the Justin Bieber. So they're mostly worried and exclusively focused on that. But, you know, that's of no comfort to the person who is one of those thousand, right? That sucks for them. And so, you know, I try to make the point that like you're your only you, for them, you're a thousand use. They don't care. And so you're going to put outsized attention, outsized focus, outsized, you know, massive action into making you work. They won't. So keep that in mind. What do you say to artists who don't like that idea, right? Because you're alluding to something that artists have not liked for a minute. They've expressed, I just want to be an artist, right? I don't want to sell all these other things. And you basically said, and we agree that the money's gonna come from all this other stuff. It's gonna be pretty tough, at least very tough to just do music solely and live very well that way. Yeah, I mean, some of my best friends are artists who are living off of their Spotify check. And it's more than enough to pay their bills. They can reinvest some back in and they haven't yet tapped merch or anything like that or touring. So they're just an artist on Spotify with the large following. To get there, it took, I mean, this one kid I'm thinking of in particular, he innovated a model for building playlists on Spotify and populating them with Facebook. In fact, Larussell caught a tip off of his friend who caught a tip off of him, who caught a tip off of me about Facebook ads around this era. So they're very, very cool intersection of stories. But basically he took Facebook ads and was like, I can blow up Spotify playlist with this. I can put bigger artists, artists I admire, and then myself. And I can make it seem as if there's this company promoting these playlists just to grow a playlist following and sell playlist slots, but really I'm behind it and I'm putting myself in good company, so to speak. He did that. He now has like, when we started off, probably when he started doing this, he had like 200K to 300K monthly listeners. He had been doing playlist strategies before. Now he's at like a million and he's doing great. And his Spotify check pays all of his bills. I would say that's not the majority case, but I don't wanna sit here and tell you it's impossible. Like the economy is such right now that you can make an all right living off of that. If you're single, you have no kids and you work extremely hard for five years to get to a point where that Spotify checks paying your bills. I would say it's making it harder on yourself to do so and you're incredibly unlikely to do so. And there's always the risk that Spotify craters tomorrow because all the companies like Spotify in this economic environment are cratering, so. The Spotify check paying bills is nice, right? However, when it paying your bills and then you wanna continue to grow, like how do you maintain these numbers, right? There's constant effort that has to be put out and I think that's where the struggle is about paying bills, but it's like, okay, well, how do I continue to grow my business? How fast can I reinvest in my business if this is all I have, right? And all right life, like he's saying, well, do I have a wife or kids? Or like, what does my life look like? Cause some people have all version of all right is not other people's version, right? So, and I think that's the difficulty that it comes down to is just like, and I, if there are those special people where they have a certain lifestyle and they don't want more about all most musicians I run into still want more and they wanna reach a certain point, I just don't find it to be realistic. I think if I find it to be realistic to say, hey, how can I get this as high of a number as possible, of course, but even in most of those situations, unless I want to limit how fast I grow and how much I grow, I'm going to really again use this as some type of overhead loss leader and I need to flip and make most of my money somewhere else. Yeah, like the individual I'm talking about is an incredibly rare individual and is young and is okay with having roommates. So there's all these factors that go into it's okay for him, you know? Yeah, so period of time, right? You took, you talk about a period of time when that Facebook tip, right? Was more effective than probably it is now, right? 100%. Yes, he's no longer building Spotify playlist with Facebook ads. Yeah. Right, a lot of times when we follow these figures, just like with Russ, right? Like, well, his era of SoundCloud, by the time you find out about him, a lot of those technological loopholes have, you know, gone over cultural moments, right? Like SoundCloud was a cultural moment. Yes, cultural moments, exactly. So you have to take the framework, the idea that it occurred, but usually the route to get to that point is gonna be different. Yeah, I definitely want to avoid sitting here and telling people like, you cannot make a comfortable living off of Spotify alone. Like there are people out there for whom that's gonna be true. Yes. The broad majority of people, it will not be true. And I'm exclusively worried about those people. Because yeah, it's definitely tough. And if you don't, like this kid's particularly hip in terms of musical genres and styles, right? It's not, you know, like he has the right music for it to work in the streaming era with Playlist and all that. And it's not everybody. It's a very slim minority of people, so. Well, there's another, like, yeah, because we kind of touched on community. You brought up Love Russell earlier and this is just in my mind because somebody made a comment on a video that we did in multiple comments. But this one. What's it mean? I mean, your guy's comments all the time. Not you, not you. Not you, not you, not you. There was somebody alluding to the fact that he had a ceiling. I think the video was maybe about him making $150,000 and someone was like, well, yeah, he's not gonna be able to do that again or they're talking about the lack of scale of building his model, right? And here's my issue. It's like, bro, you have to do the work. The unscalable part is a part of the work. Things become more scalable as you get more resources. Everybody's starting off thinking, acting as if they're a multimillion or even billion dollar company thinking that everything has to be super scalable. Everything has to be super optimized. It's usually gonna be those actions that occur that allow you to get to the point where you can think a little bit more like that. So we take these surface level business understandings and try to apply it like we really know we're talking about. So this is the way I'm trying to rise it, right? I'll just leave it as I wanna hear your thoughts on it, especially for an artist, but those unscalable actions, community building type of actions, especially, they will scale your culture and your brand, right? Though other actions where you're trying to scale your business totally different, but the more you scale your brand, et cetera, if you're good at monetizing, the better the business will be long-term. Yeah, so first of all, not even your average marketing professional or even like CMO at a company has any idea what the hell they're talking about when they say the word scalable, okay? It's just an incredibly common. So Ryan Dice, who's the head of digital marketer, gave a keynote speech two years ago at their Trafficking Conversion Summit. He led off the thing by saying, we need to stop saying that's not scalable. He said that the quickest way to kill a great idea before it even gets started is to say that's not scalable. And he made this big point about how they did, they had all these initiatives over the last two years that produce outsized returns and they're not scalable ideas. We're gonna talk to every customer who signs up for our $95 a month product. We're going to do all of these podcast things that have no direct monetization. Like there's all these different things that the average person would say is not scalable. You cannot do it at a million units per, but it doesn't matter because, you know, how do I say this? Another good analogy is like, when you buy a stock, right? You have unlimited upside potential. The stock could go from $100 to a million dollars. When you short a stock, which is betting that it will go down, they say, yeah, but your upside potential is only 2x. It could only go to zero. You can only make 100% of your investment back. Whereas if I'm going long on a stock, it can go to a million. And it's like, yeah, but it's not gonna. And even if it did, you would sell it 2x. So this argument that like going short on it is only gonna give you 100% returns. It's like, you don't get 100% returns on any of your investments. So it doesn't matter. And so this whole scalable thing is like presuming that we're gonna go to a million units. Chances are we're not going to. So what can we do locally that's actually gonna make it a positive impact? So I'd say that like the Russell's model not being scalable, it's like, okay, he did this unscalable thing for three years straight. What can he now do because he did that? And is that scalable? Yeah, exactly. I think the part of it left out a lot of the time aspect because you said it with the streaming revenue, right? Like most artists that I know that are profitable purely through streaming, it took them at least like four or five years to do it. And then I was like, you talk about like, hey, artists are okay with doing like four or five years of music work, like releasing music, maybe doing shows and things like that. So build up is really small check in the future versus like you could spend maybe half of that time and possibly come out with a five X pin. Cause we made the point of like, no, the Russell doesn't stream as well as a lot of artists in the industry, but he makes more money than a lot of artists in the industry because of exactly what you guys just talked about. So I look at it like, where is, where's the value of the effort best spent? You know what I'm saying? Like, I don't remember who the guy said to us, but it might be like Alex. Some of you always said, right? Like if I told you, yo, you can make a million dollars tomorrow, but you can make $10 million in 10 years. Which one would you take? You know what I'm saying? And most people make the million tomorrow over the 10 million and 10, you know what I'm saying? And I see it a lot with the artist community. Like, I want the immediate check today, which is the streaming revenue. Although I could make 300,000 in two years when if I just focus on talking to everybody in my discord or whatever that community building stuff looks like. Yeah. So an anecdote is that this gentleman on our agency, Andy Hunter, he has a band called As December Falls. Over the last five years, they've sold out a different tour every year and just grown the cap and the amount of dates as they go. And they did it all with Facebook ads and like ticketing funnels. Just selling directly to people who have no idea who they are and they all come to the shows. And now they're at a point where they're getting festival billings and they're able to have those kinds of agreements cause they just have such a strong track record of selling tickets that they can get booked more impressive places. And he told me that they were on bills with people. Like he was like, we don't have the clout. We don't have like Spotify clout. We don't have press clout. And all these artists that we're playing with that we're billing with do. And he's like, we want to try to get some of that. And then he did the festival. I talked to him afterwards and he's like, we're in the green room with bands who are like the media darlings in our genre right now. And they're on benefits. In the UK benefits is like welfare. He said they get like $600 to $1,000 a month from the label and they're on benefits. And it's like, he's making money. He has a whole business. You know, like he probably makes the most per fan out of anyone on that bill. And this includes people like Green Day and some 41 are on that bill. So yeah, it's really, it is, it's outsized returns for the amount of effort. The key thing that we've been doing over the last year with artists working one-on-one, before we had this thing called the free push shipping and handling funnel. It's a concept in marketing that like everyone knows it's not ours, we didn't invent it. We just ported it over from direct response marketing to music. And it's like, we're gonna give away this loss leader item. And there's another important point about loss leaders is like the reason you ever come up with a loss leader is because you already have a product that it leads to. You're not just in the business of making loss leaders. You're just a loom, yeah. So like the product of the first, how you're gonna make money off of it is first and then you come up with the loss leader. But yeah, so the loss leader in this case is a free CD. And all the arguments come out of like people don't listen to CDs anymore. And you know, no one cares and they don't know who you are. And it's like, okay, but it works somehow. Still, I don't know how. I don't have any logical reason for why because I don't think people have CD players, but they're offering a free CD. The ad is just like a master cut of their most exciting content. And it's just like, you know, we've allocated this budget to give away these CDs. You just pay shipping and handling. And the shipping and handling in some cases will cover the cost of printing the CD, but not always. That's not necessarily the goal, but ultimately you should roughly break even plus ad costs. But the key is that it's a loss leader. So when you go to check out for the free CD, you put in your credit card information to pay for the shipping and handling. And then now we've crossed the bridge of putting in your credit card information, which like doing this is the hardest thing to do in online business, right? Getting them to, okay, I'm gonna pull it out and type in the numbers and stuff. Once you're past that, there's no friction to adding additional items to their cart. And so once they've checked out, they will offer an additional CD from their catalog or like a merch item to go along with it. So they'll choose different follow up items. And once you're there, it's a one click to add it to your cart and then it processes. So all the frictions behind them and they can just add items as much as the customer feels comfortable or wants to get. And so relatively unknown artists are taking their ad spend and for every dollar put into this ad campaign in this marketing funnel, they're getting three, four, five, six dollars back. They're making like 600% immediate return on their investment. And so- Magic, especially for an artist. Right, and it's like, it's not a new strategy. This thing's like 10 years old, right? This type of funnel, it's old and people are used to it. And it's people don't listen to CDs and all the arguments are there for why this shouldn't work. And yet for artists of the most obscure genres, you know, who don't have a big following is just working. And it's like, you could be making money now, man. Why do you want to just keep producing loss leader after loss leader for five years to then sign up with a label and be on benefits? Like I thought like it sucks. And I find that that works, especially for artists in more obscure genres because it's hard for people to find you. It's that the over consumed, popular trendy genres have a little bit more trouble converting like that. But for those artists who are struggling and like, man, this path doesn't, like all the stuff that you're doing, I'm not streaming as well. If you're not streaming as well outside of you having bad music, ironically, it could be an indicator if there's still like hardcore fans and you know your genre is a thing, you probably should focus even more so and just going straight to merch monetization. Not merch, but like product monetization because it's there. And they really appreciate it even more so because it's harder to find you. Yeah, yeah. And there's less out there for them. So when they see it, they're like, oh, this is me. You know, like, they're like, no way. Totally, totally agree. And what I love about, you know, like I see you guys as having been disordinately early to what was coming with TikTok. Okay, so I saw you guys like talking about TikTok when, you know, we exist in a space, there's music marketery, people all up and down TikTok right now, there's thousands now. It's way more than when we started. And they're all recommending different stuff and a lot of it is TikTok driven today but you guys like really went out there when it wasn't safe necessarily yet to do so and saying like, this is it, right? And what you guys are able to do with your content strategies is because we're, you know, within the artists we're using Facebook ads to get the traffic, the eyeballs on the offer and then people take the offer. So when people take the offer, that's conversion. The Facebook ads, that's traffic. In this case, paid traffic. And you guys are masters at generating free traffic through content. So when you couple that with the conversion part which is an offer, like, hey man, the thing about like artists I think need to realize is like an offers and you can say no to offers but if you're not making them, no one can say yes. So like, just make, what's the worst that could happen? People just don't take it, you know? So that's the conversion part, make an offer, make an offer and no harm, no foul if they don't want to take it but if they do take it, now you're making money. So if you can delineate everything to just traffic and conversion, the goal is get your traffic for less, get your conversion to be worth more. The conversion of a Spotify listener is like 40 cents max per month, right? Like, it's unlikely for you to get a whole lot of juice out of that conversion. So try to raise the average value of each conversion and typically that's done by introducing products. You can, I mean, you can go so far as to have like, I've never seen an artist do this but like you can sign up with a company and promote their product and get, you know, a ref link and make money for every sale that they make, right? So it's like, even if you don't have a product you could be making more per conversion than sending them off to Spotify, I would say. So hopefully that's the change we see where indie artists are able to make even more of a premium off of the attention they generate than they ever have. I think it'll get there because I think like to Sean's point like we're so used to seeing like the cool mainstream artists kind of control the monetization narrative and like we see so many of them struggling. I think like you said earlier that any artist market is growing so much that now there's a wider pool of artists that know the game. And, you know, there are more obscure artists today who have the chance to be successful outside of that because of everything we just said, right? Like, hey, I know that being a mainstream darling isn't for me, but I can still make 200K a year. You know what I'm saying? If I just go do these other things that those artists aren't even willing to do. You know what I'm saying? Like they're not even willing to put in the pudding. And they're that bare middle class on those more obscure genres is probably going to be better in proportion because one, like Serka said, they're excited to see you. There's like an identity aspect of it. You represent me. But then if you're a lower class popular niche artists, right? Like if you're in that niche, not just a struggling but your fan base is being trained to not pay for shit. Yeah. Right? Yeah. There's a key concept in business that you guys probably heard before is that if I sell time management and productivity help, maybe I can make, you know, I have some potential to make, right? Like I can make like a thousand dollars per a thousand people I get in front of. If I sell time management and productivity services for salespeople, now I can make $2,000 because the audience is smaller, they have more specific needs. If I can sell time management and productivity help for salespeople who sell direct to business, it goes up. Direct to business in the manufacturing industry, it goes up. Direct to business in manufacturing children's toys. Okay, now I'm at the high because you know I deal exclusively with you. I don't deal with all these other types of, I deal with the exact problems you face. And so niching down tends to grow your premium that you can charge, same concept in genres, right? If there's only five of you and this person really likes that type of music, your premium goes up, you know? People are more willing to spend. 100%, 100%. Man, are there any thoughts that you wanna leave us with today, Sarka? Yeah, just to say that like we're gonna really, crazy time in the music industry right now where it's easy to get fooled. And it's easier than ever before to make a living off of being an artist. But there's lots of, there's more traps than ever before that you can fall into. And I just say that like, if you're really serious about being a full-time artist, really consider, especially what these guys are telling you and how you can actually have a product to offer. It's like, once you have a product to offer, at least you can make the offer to the people that you get in front of. And if they take it, great. Like now you're making money as a business and you can scale that up infinitely as you get cheaper sources of traffic and higher premium forms of conversion. So. We gotta remember though. Yeah. So you learn what scale means, right? Yeah. Yeah. Yeah. By the way, I mean, I think you know I started in tech. I feel like I remember when I can track the word scale and scalability became more popular. It actually, if you go like pre-2010, it really wasn't all that popular. As tech became, tech and entrepreneurship kinda got paired together and Mark Zuckerbergs, all that world started to become more sexy. Everybody else started adopting this scalability content, a scalability concept because it's so popular in that tech culture and investing. And all of that was exploitation and overdone as well, right? Like artists, there's a lot of young founders who got exploited like artists have in many ways. But like that was not a term and the world was doing just fine. Not worried about scalability. People don't think about the other side of scalability, which is like, okay, scalability is constrained by total addressable market. Yes. And it's also constrained by in any way, if this thing in any way would exclude someone from that total addressable market, it's less scalable than if it was inclusive. So the most scalable thing in the world is also by nature, the most bland, generic, unexciting thing in the world. Just because it can scale doesn't mean it's going to. It's not everything. Don't engineer everything to be the most scalable. Otherwise you're going to be selling cartons of milk. That's why you also said, or the point that you just made about the blandness is actually why it's so hard to make something completely scalable from ground zero because it's so bland and boring, how can you even implement somebody to become a customer, right? Yeah. And the less scalable something is the higher you actually can get away with charging for it. So it's not every, the scalable concept is not everything. Don't worry about it. Yep, don't worry. All right, so appreciate you coming on, Sarka. Where is the best place for people to follow you? You can check, we're on all socials, but probably, you know, where we put out the most content is our podcast, which is also on our YouTube channel. So check us out at full stack creative on YouTube. We put out videos and podcasts, and hopefully we get to have you guys on the podcast in the very near future. Because we're such huge fans of everything you guys do over at Enterprise. Appreciate it. Appreciate it, y'all. Follow and check that out. This is yet another episode of No Label's Necessary Podcast. I am Brian Manchin. I'm Corey, and we out. Peace.