Zeros Don’t Weigh Anything

Creator Access Meets The Ownership Economy

There’s a creative arc unfolding in direct-to-fan tools that looks poised to unlock a new medium of connection between Creator and fan, particularly in music. Perhaps the largest subset of global influencers, iconic musicians carry [arguably] the greatest benefits from these advancements.

But when we talk about “owning” an audience, who really has the ownership, and where is value dispersed?

There’s an incredible wellspring of new startups looking to reinvent distribution in the name of the artist, particularly around web3 platforms. These tools should unlock new forms of monetization while rotating some of the commerce power, formerly reserved for large aggregators, over toward the artists (and their communities if we do this right). At the heart of virtually every newco or would-be platform is one thing: access.

Even the most successful artists, and those closest to their communities at scale (ex: Swifties), make a great trade-off. They capture new revenues and connections through an aggregator or platform (helpful) for cash, while giving up “enterprise” ownership to the platform. 10 years ago this made a lot of sense, because (pre-social) influencers couldn’t effectively connect with their audiences. To wit, the largest influencers now carry global 9-figure audiences, BUT they don’t have 1:1 connection with their fandom. On social media, that’s given to TikTok and Instagram, for streaming that’s given to Spotify or Apple, for live that’s given to LiveNation, et al. These stars literally drive social platforms and distributors, yet they don’t know who follows them, attends their performances, nor streams their music.

The candy of connection granted the biggest stars with $100mm annual purses. Large indeed. But the platforms behind them are valued in the hundreds of billions if not trillions. The artists remain cash flow contractors leaving billions in captive value on the table. Historical periods of distribution change, like new tech, provided for a re-allocation of capital and labor. Hold this thought.

Back to access. Digital property rights and distribution power are two key facets unlocked by still nascent web3 tech. On the digital property rights side, the holy grail of royalties, and the narrative behind distributing them to fans (or other investors), has morphed into what is more plausible (for now): access.

NFTs as collectibles for a song sound snappy, but access and privileges of any sort is where the ideas get creative. The idea of having a new channel or medium for exchange is a flattening of distribution, but the question remains, what is being distributed? What do fans want? What will fans value? And as we think about ownership, what is more valuable and to whom? The actual instrument held by a fan, or the pipe it creates to share value between Creator and fan? This brings us back to ownership.

Let’s assume an artist has 1,000 special digital assets (NFTs or whatever else may come). They can produce one-time sales by offering these out to fans. The ongoing value of said assets will come from whatever the artist continues to supply to these items. Just like any other distribution channel, this takes ongoing work and production, or the item itself will struggle to carry value beyond a collectible (a model in itself). This moves us to the distribution side. If the item itself, the NFT for instance, is a portal for current forms of exchange (social, events, status, commerce, or data, etc.), then the value is in the pipe, not the item itself, per se.

Regardless, we are back to a world where artists have a medium of exchange provided by another platform (the aggregator model). Good, if not great, but the enterprise value won’t flow to the artist. And recall, enterprise values are worth 5, or 10, or 30x (or more) than the cash flows, depending on the growth arc, market size, and timing.

Is this the real transition to the ownership economy, at scale? There’s an argument to be made that Creators, some of which earn upwards of $100mm a year, should have greater command over their market value. Where they can turn that $100mm into SEVERAL billion, all while keeping ownership and control.

Sounds crazy? Just remember where they are capturing distribution ownership from: some of the largest, most profitable, most successful companies in the world, valued in the TRILLIONS. That’s some potential meaty re-allocation to come. And remember, zeros don’t weigh anything.