Crowdfunding has evolved into a major platform for musicians’ financial income over the past five years or so. In 2013, the industry generated more than $5.1 billion worldwide. For the music industry it has become increasingly common for bands, both small-time and globally successful, have turned to this medium to ask their fans for a financial donation towards more often than not, new music.
There are both pros and cons to crowdfunding. When the system works it can be incredibly beneficial to both parties; the band and more importantly the fans who choose to donate their hard earned cash to projects they believe in. Bands like Protest The Hero, Chimaira, Obituary and Bloodshot Dawn have successfully utilised the business model to produce new records for their dedicated followers. That is the biggest positive aspect for crowdfunding – it gives music fans an incentive to see new music from their favourite bands.
However, there is a big issue with this business plan. The issue with crowdfunding is the risk of the end product not becoming reality, when bands fall short of the set target and therefore prior donations are rendered meaningless. For example, Of Machines’ attempt at raising donations via crowdfunding for a final EP collapsed after claims that the band’s lead singer, Dylan Anderson, stole the money raised via this method. The end result is that the final EP will not see the light of day.
This just highlights the dangers of this business plan – there is a huge amount of risk for those who donate via crowdfunding websites. When the end product doesn’t become a reality it is just a financial loss for the loyal fans who have contributed their hard earned money it just feels like a slap in the face. And that will always be the issue with this business plan.