Artist Services Platform Stem Launches Concierge Member Service Stem Direct
Without a record label, independent artists are often tasked with the tedious but essential minutiae of managing self-distribution, collecting royalties from across multiple platforms, accounting, and performing general administrative tasks. Artist services platform Stem makes all of that a little bit easier for unsigned artists. "From day one we decided to focus on independent artists and making it easy to share revenue on a song," says Milana Rabkin, co-founder and CEO of the five-year-old company. In its earliest days, the Los Angeles-based startup was a distribution platform: Artists uploaded a track along with its revenue splits, constituents and their email addresses, and Stem took care of the rest, organizing billing information and making sure each creator got paid per share every month. After that first step, an account would be created for the artist, along with a dashboard tracking how much money they were making, and where it was coming from.
Eventually, Stem opened it up beyond invite-only, recruiting other types of audio creators and filmmakers. As their membership grew, Rabkin and Kristin Graziani, vp artist relations, noticed that there was a new kind of artist outside of the typical signed/unsigned paradigm. "One of the biggest opportunties we saw as we looked at the market is artists who have established teams or managers behind them providing label services for them," Rabkin tells Billboard. "A lot of these people don't need the creative services labels offer. We feel like that segment of users is underserved, and want to hone in on that type of user, and build the tools to serve them best." One need only look at the number of offerings for unsigned artists, from Spotify's direct licensing deals with artists to the proliferation of digital distributors, to see those trends shaping the music industry at large.
For these artist-management teams, Stem has launched a new capability specifically geared towards their needs, called Stem Direct. Billed as a "concierge member service" to support the platform's "top talent," Stem Direct provides users with an account representative that they can call, text or email about anything -- be it big-picture brainstorming or small last-minute changes -- at any time. This individual will also be able to help with pitching content to streaming services and sharing access to new features, and offer in-depth quarterly business reviews, strategic playlisting advice, and data-informed recommendations along with next steps.
"One of the features we built a year and a half ago is a document called 'draft mode' for multiple people to interact with," explains Rabkin. "Sometimes the manager's assistant has the artwork, the lawyer has the split information, and all of that gets coordinated via email. With 'draft mode,' we noticed that information was input as soon as it was created weeks before the song is actually released, which facilitated the capture of it. Once that information is gathered, because we facilitate fee splits, we've created an incentive mechanism to have those conversations upfront." (Graziani points out that typically financial data and metadata are kept separate.)
Starting July 1, Stem will up its fee to 10 percent from 5 percent; current users will continue to pay 5 percent on existing content distributed by Stem and a discounted rate of 8 percent for new releases. According to a press release, the fee hike is the result of comprehensive market research and conversations with artists and managers to understand their needs and how much they would pay to have them met. Stem Direct found a marketplace overflowing with high-volume, minimal-support distribution companies, or labels that pair their high-touch services with higher fees and contractual obligations. "With our new fee structure, Stem Direct aims to fill the gap in the market by providing a fair offering with flexible terms," reads the release. Stem Direct will help creators who don't qualify for the new service transition to TuneCore or another provider of their choice.
Lost Kids label co-founders Brent Faiyaz and Ty Baisden (who doubles as Faiyaz's manager) used Stem to power their label and Faiyaz's 2017 debut album, Sonder Son. They added all of the album collaborators -- producers, engineers, featured artists, even those who worked on promoting and marketing the music -- as shareholders of the LP's revenue. The engineer who mixed the record did it for a lower fee because he received 3 percent of the songs he worked on; the radio promoter received 10 percent as a shareholder on "Gang Over Luv"; and the A&R/marketing individual received 3 percent. "The indie business can be more sustainable than major label business when you have great infrastructural systems like Stem," Baisden tells Billboard.
Find out more about Stem Direct here.