Interviews — September 6, 2013 at 10:45 am

You Pledge, They Deliver: PledgeMusic

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In 2009, Benji Rogers was a struggling UK musician who thought there had to be a better way to interact with fans. Four years later, he’s got Slash campaigning on PledgeMusic’s website, the company Rogers started such a short time ago. As Rogers is quick to point out, PledgeMusic differs itself from popular crowdsourcing websites like Kickstarter because it allows musicians to interact directly with fans. It also doesn’t set public financial targets.

As a result, musicians around the world are flocking to get involved with PledgeMusic. Veteran artists like Ben Folds Five, The Libertines, The Subways and Luscious Jackson are among the many acts who have created incentives and exclusive content for fans. And, as many as thirty acts have gotten major label recording deals and had chart success due to their involvement on the website.

During a recent stop in Tokyo, where he is exploring the idea of opening an Asian office (PledgeMusic offices already exist in London, New York, Boston, Los Angeles, Germany, Canada, and Australia), Rogers talked about how the company got its start, where it’s headed and how it may just transform the music industry as we know it. 

Benji Rogers, Pledge Music

 

Scott Murphy: You started PledgeMusic in 2009. What was the thinking behind it?

Benji Rogers: I was a musician myself. I come from a family of managers. As a musician I was doing okay, and what I noticed was that fans wanted more than what I was making. Also, having been a roadie and toured for many years with larger bands, I saw the same thing. I was lying in bed and was thinking of what had happened in life. I thought of this concept of how to have fans be a part of not just the release of music, but the making of it as well. I had the idea, got together with some friends in February of 2009 and we launched the company in July of 2009.

 

What was the immediate response?

It was kind of funny. We launched it with my own band two hours early by accident and then we decided that it had to be a tool for the entire industry. Tina Dico was one of the first artists who got involved as she wanted to launch a soundtrack for a Danish film. It was incredibly successful and that got us interest from the press

We hired Malcolm Dunbar who was an ex-label person. He was the catalyst who brought it into the realm of the music industry. There were multiple crowdsourcing platforms which focused on investing or raising money. There were also consumer platforms. We wanted to sit between them and have artists involving fans in the making of the album and not just the music dissemination.

Quickly, what started to happen was we had one to two campaigns launched by artists a month, then a week and now it’s two to three campaigns a day.

An artist by the name of Ginger Wildheart has been one of our most successful, as he went to #1 in the UK at one point. He launched his third campaign last night, it’s already profitable and it’s not even recorded yet. It’s fusing crowdsourcing with the best bits of direct to consumer.

 

Did you have a hard time convincing people about the site?

No…basically, once the first few campaigns worked, people saw the potential. The hardest nut to crack is the music industry itself. They were like “Why do we need this?” In the last year and a half to two years, it’s become a new platform. Fans are coming to find new bands or artists they love, and they are driving us to get new artists for them.

According to one survey, Nielsen identified that there’s US$2.6 billion left on the table because fans can’t buy and experience music in the way of their choosing. That’s per year in the U.S.

What this shows is that the fans are speaking loud and clear. They want a digital download of an album before it comes out and want to be offered access to the process while it’s being recorded.

The labels, artists and managers that we work with have learned that fans will spend much more if they can be a part of it. The average fan spends $55 in the U.S.

The caliber of people who want to get involved with PledgeMusic now is really quite outstanding. The existing people who I work with are some of the most incredible people I’ve worked in my life.

There’s consistent buzz and amazement as if we found the keys. The record labels that we work with are open to this type of fan/artist collaboration. It’s a paradigm shift. It’s what the fans want. Before, labels viewed their customers as retail. If you view them as fans, you can offer them a better experience.

It’s a whole new level of engagement and money to the table.

 

What sets it apart from something like Kickstarter?

Crowdfunding in general is a simple concept. It’s “Give me 35,000 dollars and I will do something.” There are various issues with that. If you don’t raise that amount you can look foolish. Raise too much and you look greedy. It’s give money and I go do.

It’s the wrong tool for music. What we did early on was hid the financial targets. You’re still able to hit the targets, but you’re not publically showing what you’re worth. All that distinguishes itself is what’s on the table, what’s on offer.

An artist like Slash isn’t raising money. They’re using it to leverage the community and give their fans a better experience. Ben Folds wasn’t raising money. One of the key pieces of technology that we built is that our pledge is only updates. Those are like private Tumblr blogs. If for example you pledged on Mike from Soul Coughing, and I’m Facebook friends with you, I can follow Mike’s campaign on Facebook. 22 percent of pledges comes from links on a friend’s Timeline. 37 percent of our income comes from pledges of more than US$250. It’s a significant part of a band’s income.

Another differentiation is that crowdfunding campaigns only last 30 or 60 days. Ours last for months. The artists have more time to promote and have more social campaigns around it.

We want it to be about the campaign and the music itself. We usually exceed the pledge target by 30 percent. The campaigns that fail tend to be smaller acts who don’t have much of a fan base. We have an algorithm that predicts what acts can raise based on their social engagement.

We’ve become good at predicting this, though there are some ways in which it gets skewed.

 

What is the charity element involved with this?

When artists are using PledgeMusic as a pre-sale mechanism, once their campaign hits 100 percent, they’ll donate a percentage to a charity of their choice.

When I did the first ever pledge with my own act, I gave a percentage to Amnesty International. It changes the mindset of all involved. It’s the right thing to do, personally speaking and with the amounts being raised, it’s something that should happen. Artists have specific causes that they want to work with and this is a great way to do so.

It’s my belief that it would be hard to pirate an album that’s being made by an artist that they are pledging for and that there’s a charity involved.

The charity aspect is something that we do push, and about 99 percent of the artists are doing it.

 

What are your plans for Asia?

I went to Music Matters in Singapore this year in May. It was to kind of see if this concept would be embraced. All of the feedback was that yes, it would be embraced here. Ben Folds launched around then. He has a big Japanese following. A fan launched a link on how to pledge in Japanese and within two hours fans were pledging. Even though it’s hard to pledge for Japanese people, they were spending about US$88 a fan.

It’s essentially almost the same as the U.S. market. It looks like it will be viable and I’m out here to gauge interest. It looks promising for us.

The level of fandom here is quite unique and it will be beneficial to the artists.

There are all kinds of complexities and payment systems, and I think we’ll have basic translations and ways to deploy it.

We want to tread carefully and get it right.

 

Aside from Japan, what about the rest of Asia?

We’ve had a lot of interest: China, Singapore, India. For me, it’s about executing the strategy really well, one piece at a time. Each market will have its own unique needs. The reception has been phenomenal. If you told me four years ago that I would be in Japan, I wouldn’t have believed it. It’s an exciting time.

What happened in America could just happen faster in Japan.

 

How can Asian acts be involved?

If they sign up on the platform and get in touch with us, they can write campaigns in their own language. We can translate them and go from there. One of our first campaigns was in Danish, and there’s no word for pledge in Danish. It was interesting. Our developers and team are very tenacious.

There’s nothing to stop artists from signing up and running campaigns.

 

How many employees does PledgeMusic currently have?

We’ll have 40 employees by mid-September, with offices in Los Angeles, Boston, New York, London, Germany Canada, and we’ll have Australia…and touch wood, Tokyo.

 

Can you be a label?

There are a few initiatives that could bring a label into play. People can run labels better than we can. Our main focus is on the platform and content.

 

Let’s take some case studies of artists on PledgeMusic: Zee Avi?

It was great. She was on Brushfire Records and her manager wanted to do something with touring. That was our first rubbing of shoulders with Brushfire. That was a great campaign. She’s engaging and a lot of fun. She had a good time with it.

 

The Lumineers?

They came in to do an unusual project. They were fantastic and now they’re larger than life. We still see them.

 

Rachael Yamagata?

That was an amazing campaign. I’ve been a fan for a long time and when we finally got her on the phone and agreed, that was a great day for us. She mentioned us from the stage all the time. We were thrilled to work with her. Her team was hitting refresh on the page to see the pledges going up.

Her album was finished and she was involving fans on how she would release it. She had videos from the studios. She really engaged fans in the making of that new album.

 

Slash?

Ginger Wildheart was on tour with Slash and so his management was talking to Slash’s manager. Slash and his team have been gracious and engaged. He did a Q&A with pledgers and it’s going really well. I still pinch myself that the guitarist from Guns’n’Roses is on our page!

Slash, Pledge Music

 

Ben Folds?

Ben Folds was the most incredible and he did some innovative things. He wanted a way for fans to get involved when he was playing live. He told them to email a certain address and we were sending back a link to a brand new song and a pre-order for the album. Fans were pledging in real time. He asked them to give him the middle finger. He took a picture and he’d get fans a copy of the photo the next day. He pushed PledgeMusic to new heights.

 

Who sets the pledges?

We have some guidelines. If an artist wants to work with us, we build a skeleton campaign. We’ll guide them and let them know what they can do. It’s up to the artist to come in and put their personalized touch to it.

With Zee Avi, it’s expensive to ship ukuleles from NYC to Jakarta, so you have to build in those price points. Our team does a lot of work on the backend so our artists don’t lose money.

We just launched a campaign with Gemma Hayes. She wanted to have a different type of auction and organized a reverse auction for her campaign. We let her know that there’s a lot of prospecting involved.

 

Where does the money go?

We don’t reveal many of those numbers. We have investors who have come into a various times but we’re privately owned. We have a high spending fan base and the average spend is $55, $60 in Canada for example, and we launch two to three albums every day.

 

Have there been complaints at all?

Sometimes there are complaints when the fans don’t read what’s promised or if the artists and the label don’t convey what’s going on. As long as fans are told, you can allay those fears.

The only other complaint we’ve had is that they want more releases. A 20 year old kid came up to me and said “You’ve ruined CD buying for me. Once you see how good it can be, everything else fades in comparison.” That’s one of my proudest moments. We’re giving artists a platform.

We do get emails where people say ‘There’s a band we love. Can you get them on PledgeMusic? These are artists like Rihanna, Coldplay and superstars of that caliber.

 

Do you go to those types of artists?

Yes, absolutely. Quite a few of the recommendations are happening. I’ve met with every label at most of the majors, and a lot of them are saying that it’s just not the right time, not that they don’t need it. Slash is a good example. It’s revolutionary.

We’ve been lumped in with crowdfunding companies, and our job is to re-message how we operate so that some of those huge bands can come in and be part of this eco-system which is PledgeMusic. A lot of it has to do with sharing this information. It’s a challenge but there’s a huge will by both the artists and ourselves to do it. It’s still pretty new and we need to keep working with everybody.

Everyone we’ve worked with has been happy with the results. It’s a win-win situation. The artist connects with fans, the label gets more time to market and a technology that isn’t at their internal disposal, the fan gets a better experience and the charity gets a check.

 

You’ve received a lot of awards and acclaim so far. Do you have a favorite accolade?

I was very flattered to be in Billboard’s “40 under 40” issue, but it’s a complete team effort. I’m so proud for all of us. The PledgeMusic team makes me look good and makes the company look good. But when managers email us and say “You’re the future of music”, that’s the best feeling in the world. It’s why I get up in the morning.

 

What’s the future look like for PledgeMusic?

I believe and what I’m working towards is that this amazing way of doing things is going to become normal. There’s not one album, not one box set, not one EP that isn’t going to be augmented in some shape by pledgers and the team that helps to deploy it. The second an artist walks into a studio, a fan can become involved.

We can end this passive dissemination of music and get into this last untapped barrier of how the music gets to people. I always say that artists are a lot more interesting when they are making music, and a lot less interesting when they sell it.

PledgeMusic is designed to create a sustainable ecosystem for everyone in the chain. Create an experience that is as good as it can be and it’s a win-win situation for everyone. The future is that this becomes normal globally.

 

And how do the charities feel?

Some engage with us well. Some are very happy that the check shows up. Other charities are resource-strapped so we’re trying to take some of the lifting off their shoulder. I want to do more in that area, but it’s a very time-consuming issue.

We’ve hired someone to get more charities involved. It needs more attention and that’s one of my goals for the near future.

 

Thank you.

Thank you!

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