Forget iTunes & Pandora: Gideen Offers Bands A New Way to Make Money Online

Online marketing for music has been one of the most hyped up things in the past few years. It seems simple, right? You release a song online. Promote it through some savvy Facebook marketing or YouTube videos.

Then, suddenly, you’re Viral.

As most bands know, the reality is different. You can drop $50 “boosting” a Facebook post for $0 in return. YouTube channels become haunted houses of cobwebs and shakily filmed videos of you playing in an empty bar. And streaming stations have destroyed a mid-market brand of listener and both Spotify and Pandora pay musicians terribly.

In the pursuit of precious exposure, musicians are leaving revenue far, far behind.

I haven’t yet come across a reliable way for bands to make (decent) money online… but I think I might have found one on the horizon. Gideen is a start-up, an online music platform that taps the best of every world to create what CEO Heiko Schmidt calls “a 3.0 music business model,” which casts aside the $1 song completely.

Fueled by fans, musicians, advertisers, artists of all stripes and a lot of songs, Gideen is hoping to revolutionize traditional licensing and revenue models in the music industry. Right now, the company is hosting an IndieGoGo campaign to fund it all.

Here’s what Schmidt had to say about Gideen, music marketing and the music industry in general:

1. What inspired you to start Gideen?

Throughout my 25 years in the music business – running record labels, music publishing companies and managing artists, producers and songwriters – people have always approached me with great songs and music.

Every time they asked the same question: Do you have a match for this song? It could be an artist who is looking for songs for his next album, or a film music supervisor searching for the next big blockbuster movie. Amazing music, and well produced. For some of them, I could get results within my network, but for most of them I could not.

Truth is, even super successful songwriters and music producers are writing/producing hundreds of songs with only one or two of them finding a home.Why is that? It is not the song or production quality. Most of the time it is just lack of network to get the song matched and delivered to the right opportunity.

And there is another level: Lack of a marketing budget. There are many songs/tracks on an artist’s album, and the record label might decide to promote a different song as a single, or the marketing campaign has failed or was underfunded, and the music ends up going nowhere.

Lack of network, lack of marketing funds, and a lot of other factors not related to the song/music quality don’t make a song or recording less attractive, but in the existing primary music market reality, it comes down to basically 2 points: If you have a great song and music production you need a vast network and even more luck – lots of luck.

Until now, there was no platform or business model developed to change this pattern and provide a marketplace for all these great songs and music tracks – and that’s exactly what Gideen is doing now.

2. How long has the platform been in the making?

The basic idea was born in 2007, and then further developed in various stages. It is not a simple venture, there are many different business models and motivational drivers involved, legal aspects in different countries and a lot of tech-related questions we’ve had to find answers for.

3. What made you choose crowd-sourcing as the way to launch the business?

Running a crowdsourced fundraising campaign is like grassroots promotion. It gives every business a chance to reach out to their target group(s), fine tune the communication tools and approach, and learn from the feedback. It is also a good discipline to develop and showcase the marketing and sales creativity within your startup team before proper funding arrives.

Now, creating something of value and getting customers with nearly no money is a challenge that calls for strong motivation, focus, creativity and passion. Those are exactly the attributes that professional investors want to see and experience about your business.

Last but not least, it is also a very good way to derisk the business case for professional investors by producing concrete results on various levels including sales.

Check out the IndieGoGo Campaign here

4. Is Gideen also backed by investors?

Gideen is backed by angel investors for nearly $200,000 (USD). We are in the middle of raising an ‘A Series Round’ to increase functionality of the software and ramp up marketing.

5. How do you offer independent musicians a way to make revenue that’s different from traditional streaming or indie platforms such as ReverbNation or Bandcamp?

There are many great platforms out there offering various services to musicians, but we are not a service. We are a 360 Record Label/MusicPublishing/Rights Management company.

When a song/music recording is uploaded to us, we become real partners and start investing to match this song/track with more than 100 million daily monetization opportunities worldwide. We also find co-investors for each song/track, who will promote the track with their personal and professional network.

This is a new way of “crowdsourced marketing investments” if you like, but the key is to collect all related music revenues worldwide with “streaming” being just one out of more than 10 we are collecting on an international scale.

Gideen is an innovation leader in the international collection of music-related royalties, and in addition to our other innovations, this marks a huge difference between us and other platforms out there.

6. When people invest in a song’s future music revenue, how do they split revenue streams with the artist?

1/3 is for the music uploader, 1/3 for the promoter/investor and 1/3 for Gideen.

7. Does the artist get paid that initial investment up-front?

Technically and legally, there is no upfront financial investment for the artist. If a promoter signs up for a specific track/song, he has to pay an admin and collection fee to Gideen, covering at least a small portion of our costs to coordinate promotion and marketing, distribute the music to all platforms, collect and account for all related royalties across multiple countries.

Since he has paid something to sign up, he is invested and will do everything he can to promote the track. That’s his sweat equity investment.

The main result of this is that the music uploader, Gideen and the promoter all have aligned interests to push the music/song as much as possible with all 3 parties splitting revenues. These revenues are not in existence when the uploader first partners with Gideen for this song/track, so there is no financial value the artist/uploader would have to give up.

Once revenues are generated, everyone who has partnered on this song/track get’s his Royalty Income accounted for and then redeems the respective amount from his electronic royalty account at Gideen.com.

8. Could Gideen accurately be called a crowdsourcing platform for individual songs, with the incentive for backers being the future music revenue from parties that license an individual song, and the incentive for the musicians being to make more than, say, $1 from a song when someone buys it?

Gideen is song/track-centered, and everyone who makes music can upload/partner with us on this specific song/track. We can call this crowdsourced, but this is not different from how record labels and music publishers source their content all the time. What’s new is that Gideen is crowdsourcing marketing investments in the song/track, with the related promoters helping the song/track go from zero to significant revenues.

This only works if the economic interests between the music maker, the music marketer (Gideen) and the promoter/investor are 100% aligned and professionally managed.

The new 3.0 music business model is not about the $1 song anymore. Most artists these days are gifting songs away just for email addresses. The 3.0 business model is about creating tracks and collecting many different revenue types internationally for each track/song.

And 3.0 is also partnering with people who are willing to promote the music and companies like Gideen who can manage these processes in many countries throughout the world.

9. I noticed that there’s pretty granular demographic information about different songs available for license. Does the artist input that information? How are songs and bands organized on the Gideen platform?

Most music makers have written/produced a song for a specific goal or target group, and that’s the info we are asking for during the upload process.

But let’s face it, we live in a world of very shattered target groups and most of the time people just like a song, regardless of whether it’s called a country song or rock song. Music arrangements are mixing multiple styles and DJs are remixing them with samples, etc. 

We believe that music makers have very good gut feelings about who would like their music and if their music is better played at a party, on a romantic dinner night or at a wedding. So we trust the judgment of the creative who has made and uploaded the music.

10. How do bands get noticed on Gideen after uploading music?

The same way they do in the first market place: the consumer discovers the song/music first. If they really like it, they will ask who did it.

On Gideen’s website, every user can click on the background information containing the song lyrics, band info, who made the record, where, when, etc., anything the music uploader has decided to provide during the upload process. And there is a button that points users to the portfolio of the specific uploader, e.g. the band.

But more importantly, your music is automatically uploaded to YouTube (as video file) and a corresponding link on Facebook is also created and sent to you.

You can then promote these links within your network. The more people that like your track, the higher your track shows up in one of our global music charts. These are “real time charts,” so you can see the impact of your promotion activities after refreshing your web browser – in real time.

If you can make it to the Top 200, your music becomes very visible across many domestic and international platforms and your chances of getting licensed and promoted increases greatly.

In order to always stay on top of your portfolio and how every song is doing, Gideen notifies uploaders via email if there is any activity, e.g. – a Top 200 chart entry, or their track was licensed, or a promoter has started working the track. Then, they can log into their profile, and on the profile page they can see their uploaded music portfolio song-by-song with visual indicators that lead them to those songs with activity.

11. Who are the target audiences who will be using the platform the most?

Generally speaking, everyone who makes, loves or wants to use music.

One out of eight people are making music today, that would be 900 million worldwide, the “music makers.” Everyone of them can market his music with Gideen to make money.

That being said, we do have several specific target groups. By the numbers, we believe the largest group of people are amateur film and video makers, who want to license music rather than using music illegally.

For instance, on Google/YouTube, there are 72,000 videos uploaded per minute, which means more than 100 million per day, and more than 3 billion per month. Because music licensing is so complex, takes a long time and needs a great deal of knowledge, Gideen’s very simple licensing model, with licensing times under 2 minutes, will provide the perfect solution.

The second largest target group is people who love music and want to invest in and promote a song. There are also smaller, but very important, groups of top-level professionals in the advertisement, film and media industries who will use our service because it is very simple, quick, and they are incentivized by sharing into the future music income streams of the song.

11. Any ideas for partnerships in the near future with other music platforms, record labels or venues?

We have many, and we are open-minded to anyone who can help. This is the creation of a new secondary marketplace. A place that doesn’t exist at the moment. A place that will generate significant revenues for everyone who makes music, needs music and loves music.

Helping to develop this marketplace is good for everyone: copyright societies will collect more royalties because there will be a legit mass music licensing market they can track.

Any record label or music publisher who has a large catalog needs this market to uplift the song and track values of the “non performers” in their catalogs.

Anyone who makes music can help and partner with us, because we are helping each other to make money together. And there are music gear makers and retailers who will also benefit from a secondary music market because there will be more customers coming in and buying things – because now there is a marketplace for everyone who makes music.

To sum it up, we are open to every co-op that will help to grow this marketplace.

12. What are the biggest mistakes you think musicians make when they first upload their music online?

I’m not sure, but I believe most of the time their expectations don’t match the reality. Having a song listed doesn’t mean it will sell.

Just about 99% of all 23 million digital tracks on iTunes are selling less than 1,000 copies, streaming royalties are growing, but still in an early stage and related income/track is very low. The general trend is a “winner-takes-all” market, where the top 200 are making more and all others will earn less.

There are multiple underlying reasons for this, but this is nothing we can change in the primary and hit-driven music market that we know today.

If you are a creative and you bet that a specific single song/music track will become a hit and make all your dreams come true, the chances you will survive in the 3.0 music industry are very slim.

Now, if you think about 50 songs, 100 songs, 200 songs, and earning money with each of them – this will do 2 things for you: a) your chances of having one big hit out of the 200 made are much greater and b) you can make a living from your music. And don’t forget, making music is fun. You’re not in it for the money anyway, right?

13. Does Gideen consolidate all licensing fees from different songs? For example, if a filmmaker buys the rights to use a song and Pandora also pays the artist a license fee, do those both travel through Gideen? Or is Gideen primarily dealing with licensing from people who purchase the rights via the Gideen platform? 

Gideen is a 360 Rights Management company. If a music maker is uploading a song/track to us that means we are the exclusive marketer for this song worldwide, independent from royalty type or source.

That is the only business model promoters/investors will accept and get motivated about. But the question is good for another reason: If you have songs that are making significant revenues already on streaming platforms or wherever, don’t upload these tracks to Gideen.

Our business model is made to create value, not going after the value you have already created.

14. Album sales and now digital downloads are plummeting. Streaming is often said to be the future of music listening. What do you think the future of music revenue is?

Very bright. According to the IFPI, music use is up 400% since 2000.

We just have to find ways to democratize the processes of making music, marketing music and using music. That’s what Gideen is doing.

15. In an online world saturated by free music and countless artists vying for attention, what do you think is most important for bands when it comes to promotion?

Understanding the basic economics or what are you up against:

  • One out of eight people are making music, that’s 900 million worldwide.
  • 130 million music tracks are registered with Gracenote, competing for attention.
  • 20 million new tracks are produced every year.

There are three basic questions you should ask yourself if you want to make music for living:

1. Who will seed-finance my career? (Find a personal sponsor.)

2. Who can finance my marketing and promotion? (Find investors and brands to help you.)

3. How can I make enough money until I’m successful? (There are many ways, including having a normal job, of course – but Gideen can and will help you with making money from your music.)

16. Anything else to add?

Gideen was created to add and share a value. When you as music maker decide to use Gideen’s opportunities for your music to make money, you’ll enter an exclusive contract for this specific recording and song.

The music is then available for our marketplace and ready to be promoted. If there has been no activity on your song, you may check your licensing price points, which you can change at any time to make your track more attractive for licensees.

If you’ve tried everything and your track/song still hasn’t found a promoter, is not in one of our Global Music Charts Top 200, and has had no licensing activity, you can always delete your track from your portfolio and there is no further obligation for you.

In other words, joining the Gideen community is a win-win, you have nothing to lose.

Want to learn more about Gideen? Fund the IndieGoGo campaign here!

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