There are 4 revenue streams related to an artist business.  They are outlined below with a brief description:

1. Touring – Income made from performing live shows
2. Merchandise – Income made from the sale of merch items other than albums
3. Recordings – Income from recorded music (master licenses, album sales (/artist royalties), etc)
4. Songs – Publishing – Income from written songs (mechanical royalties, sync license, etc)

Now that you have this simple list, look at your career and do 2 things:

1. Determine your primary revenue stream.  If you have money coming in the door, analyze the amounts in each category above to see which channel generates the most money.  This is your primary revenue driver.
2. Go with the momentum.  Focus your attention on the stream that brings you the most income – something is going right there.  It’s easiest to build a business by going with the momentum and then focus on building up other revenue streams behind it.

We learned this lesson the hard way.  One artist we worked with years ago had a big publishing deal but we put all of our energy into trying to create (from the ground up) a live show and a live album while the lucrative publishing deal got none of our attention.  Of course, looking back now it seems so obvious but at the time as young managers we just didn’t get it.  We hadn’t yet developed this simple principle.  Don’t make the same mistake!

Now every artist business we analyze, we first determine their primary revenue driver and then we build a plan around this.  I’d encourage you to look at your business in the same way.  See if your business is pushing each artist in the direction of momentum and if not, adjust accordingly.

We first read about the idea of sustainable values this morning in a NY Times article by Thomas Friedman.  Perhaps you’ve heard of this idea before.  Here is the quote from this article:

Dov Seidman, the C.E.O. of LRN, which helps companies build ethical cultures, likes to talk about two kinds of values: “situational values” and “sustainable values.” Leaders, companies or individuals guided by situational values do whatever the situation will allow, no matter the wider interests of their communities. A banker who writes a mortgage for someone he knows can’t make the payments over time is acting on situational values, saying: “I’ll be gone when the bill comes due.”

People inspired by sustainable values act just the opposite, saying: “I will never be gone. I will always be here. Therefore, I must behave in ways that sustain — my employees, my customers, my suppliers, my environment, my country and my future generations.”

Humans have been making music since 7000 BC (reference).  The creation of music doesn’t have much of a value judgment to it – an artist either creates it or doesn’t.  However, in the business surrounding music we have the opportunity to make these value decisions all the time.  It is good to remind ourselves why we are in this industry in the first place.  If you are reading this then most likely a love of music – the way it communicates and moves your soul – is the reason you got into this industry.  As music business people, our primary role is to serve our fellow humans by getting amazing music into their lives.  Next time you are faced with the opportunity to make a quick buck, consider how that decision relates to your core beliefs and the long-term career vision.  If the offer doesn’t fit,  ditch it.  You are in this for the long haul and it’s the long term that matters most.

Our main focus will be addressing issues as they relate to our specific philosophy on the industry.  This is our core and from this all of our business operations and thoughts flow.  Our intention with the blog is to offer:

1. Reading Recommendations – We will be recommending books on art, business and general philosophy
2. Business Tips and Recommendations – Ideas on systems, vendors, products and more.
3. Business ideas and thoughts
4. Thoughts on the evolution of the industry and how it relates to the artist
5. Interviews with managers and artists about how they created a career for themselves and how it ties into our ideas.