The Artist as a Startup

By Chris Howard

The Problem

Being an artist is a lonely adventure sometimes. And whilst the ability for an artist to talk with another artist artistically is second nature to many, even the simplest of non-arty tasks can bamboozle the most creative of humans. It wasn’t always this way. Before the recorded music industry became the monster it is, artists would create teams to help their art thrive. They would lean on each others’ understanding of the world to get that art funded, created, and then pushed into the world in weird and wacky ways. Let’s take The Factory in New York, for example. Founded by the legendary artist Andy Warhol, The Factory was a derelict Manhattan property that could have easily been torn down and turned into highrise apartments. However Andy and co decided to ‘squat’ there and turn the entire building into an art installation. Inside lived various residents who regularly and unstoppably transformed the building – the way it looked, ‘spoke’, and felt – so that it felt somewhat ‘alive’. This created a magnet for the art created inside alongside helping the artists behind to to create some notoriety for themselves. This all happened without any established ‘industry’ and a meaningful component of The Factor was, of course, music.

During the late 70’s, the manufacturing revolution occurred. Most notably in the world of food, with mass-produced high-fructose corn syrup monosodium glutamate infused apples distributed to every American convenience store around, this desire to ‘mass produce’ fed into the soul of the artistic universe for the same reason – scale. The difficulty artists began facing was Language. You see, those who created the engine of mass production didn’t bother to translate their ways and means of generating scale into the language of art. This is a near identical parallel to the inability for food engineers to communicate with chefs, leading to the boom in mass-production food outlets and the decline in ‘real food’, or the boom in mass-produced pop music and the decline of ‘art’. This is of course a highly generalised and subjective opinion – but one many artists will likely resonate with.

For half a dozen generations, this communication and language problem compounded itself into what it is today: artists make art, grown ups get the art to the masses – and never the twain shall cooperate. As a result, aspiring artists of today either play by the rules written in a pre-internet era, or go-it-alone to sail the seas of music-industry gobbledegook in order to understand whether or not anyone has ever been affected by your art.

In this author’s opinion, that is a shameful state of affairs!

So, meet Alex Ellis – an incredibly artistic Americana-inspired music artist out to sea in an ocean of music-business ambiguity. Alex was offered a major label recording deal to release his first few tracks. However, when putting on his specs and pulling up his big-boy-business trousers, he read some of the fine print. Despite 99% of it totally incomprehensible, one key issue stuck out like a sore thumb. In The Deal, if Alex were to spend any of his advance to create music, distribute music, or market music, he had to purchase those services from the very label who loaned him the money – but at astronomical prices. Determined not to be yet another statistic where his art is owned by someone else and his ability to make music, his livelihood, in the hands of a loan-shark, Alex joined a newly formed artist collective called The Rattle.

Wouldn’t it be great if…

… you could get your art to your people in an entirely different way? One where you don’t need to learn the ins and outs of a 50 page publishing contract but instead can speak your own language to your own people? 

This was Alex’s new goal. 

Throughout Alex’s time at the Rattle, he was introduced to weird and wonderful new ways of thinking and communicating. From a talk about entrepreneurship from someone at the start of Zipcar, to an inspiring fireside chat with one of the inventors of the Quantum Computer – Alex realised that others in other industries have ‘cracked the code’ of bringing an invention to life, without that invention being owned by someone else from the beginning. In ‘business land’, this is called ‘founding a startup’.

A startup is simply a legal ‘thing’ that can own intellectual property (from inventions to pieces of art) and then ‘mess around’ with how those things reach the people who benefit from them before committing to any particular direction. Startups exist in any industry – from the utterly mundane, to the wildly creative. But all (good) startups have one thing in common – they invent original things that change the way people view their own situation.

A perfect example is Zipcar. Before Zipcar, people viewed owning a car as a necessity. More importantly, people’s behaviour around car ownership was justified by the need to get from a-to-b where public transport couldn’t. But Zipcar proved it was possible to have all the benefits of using a car, without actually owning a car. Zipcar, step by step, invention after invention, systematically modified people’s behaviour until owning a car went from a necessity to a luxury in major cities. It’s only once Zipcar proved it was capable of changing people’s behaviour did it ever consider selling its IP to someone else.

So why is this not the case with artists? Artists produce meaningful concepts and ‘things’ that modify people’s perceptions of their own situations. From the relatively benign ‘I want to feel happier’ to the immensely powerful ‘I now have an identity in myself’ – art too, step by step, creation after creation, systematically modifies someone’s behaviour around any given intention of the artist.

So, wouldn’t it be nice if an Artist could follow a similar path to the inventor of Zipcar?

That was the lightbulb moment for Alex.

How startups are funded

In the modern music industry – which is fairly similar to almost every other artistic industry – those with the money to fund a piece of art’s creation or distribution act in a very specific way. They typically attempt to understand which pieces of art the mass-market are likely to consume in the next few years, identify which artists create that ‘content’, and then loan those creators the funds to create it in exchange for the label owning the ultimate creation. They ultimately filter who to support based on the likelihood of having that loan at least repaid. 

This in and of itself seems fairly innocuous. However it is a feedback loop in culture. Those more likely to succeed commercially often create art that reflects the majority of society instead of altering the path of society. That is, by definition, ‘mainstream’. As a result, those mainstream pieces of art become the data points for future backers of art to compare against. The next ‘generation’ of backers are comparing against data from the previous ‘generation’ in order to improve upon their analysis. The result – often termed ‘self-organizing chaos economics’ – is that mainstream becomes more backable, and alternative becomes statistically less so. In other words, art no longer becomes a way to progress society, but a way to reflect the mainstream of society.

Startups are those organizations that aim to break that. They look for chaos economics – where a few simple rules feedback on themselves to create monopolies – and attempt to smash the living hell out of them. The term ‘disruption’ is over-used – however it is a poignant word in this context. Startups ‘disrupt’ the self-organising chaos economics to allow new – and hopefully more appropriate/ethical – simple set of rules to take over. The organization that successfully changes those rules often becomes an enormous company. Think Facebook, Uber, IBM, even Disney.  And there is a unique type of backer that funds these Startups – venture investors.

Behaving like a startup

Alex was introduced to this concept at The Rattle and immediately asked the question “can an Artist that aims to ‘disrupt’ be backable by a venture investor?”. And that is what he set out to do.

The first thing any good startup needs to prove is whether or not it can change someone’s behaviour. It is this changing of behavior that, when done at scale, ‘disrupts’ any self-organized system. Alex knew this to be the case, however he did not want to compromise his specific artistic vision simply to change behaviour for the sake of being a startup. That, therefore, meant his art was off the table as the means to change behaviour. But when an Artist considers themselves a Startup, there’s a lot more to creating a startup than simply making the art. Alex turned his attention to how an artist earns money. He knew he wanted to make a living out of performing live music. But the self-organized behaviour of the industry around live music – play to pubs, then 100 caps, then 500 caps, then 1000 caps etc etc – seemed ripe for disruption. If the behaviour of the fan is to ‘wait for an announcement, buy a ticket, go to a venue, watch a show, go home’ then what could you do differently that might disrupt that?

Alex pioneered the concept of a ‘live rehearsal’. It sounds simple and obvious – yet it’s anything but. Alex knew live music ‘sells’ entertainment. But what Alex wanted his live music to ‘sell’ was a story to tell the next day. Traditional shows just don’t do that. So Alex would invite his fans to come to his rehearsal – to pay in excess of $20, and bring their own beverages – to watch how he creates his art. There would be drama, great performance, unique interactions, intimate moments – but most importantly, a once-in-a-lifetime story to be told the next day that will never happen again. 

It proved wildly successful. Even though at that time Alex held around 5,000 known fans, the engagement from his fan base exceeded those of the more typical artist in his genre by orders of magnitude. It was clear Alex specifically was changing the behaviour of his audience. 

Asking for money

Finding investors is a topic far too big for this blog. But the essence of finding investors is all about creating the confidence you are able to sustain your change in behaviour to those looking to ‘put money aside’. 

In order to build that confidence, the most important aspect of Alex’s work was to continually demonstrate that the change in behaviour he has designed is happening to more and more people. In Alex’s case, that’s easy – put on more rehearsals. 

To encapsulate the story, Alex created something known as a Pitch Deck – it is a presentation that describes Alex’s mission, his unique abilities as an artist, and the behaviour he is uniquely capable of changing. After that, the pitch deck describes how that change in behaviour could in theory be turned into a way to generate an income that scales. There was a clear step by step high-level plan to go from where he was then to where he wanted to get to, and an ask for an amount of money that would get him there.

After around 50 conversations with just as many potential investors, Alex was successful and was able to gain a 6 figure investment right at the start of his career, instead of after he compromised his vision and art to a traditional backer. As a result he now has the financial freedom to spend that money in enhancing both his art, and his change in behaviour without having to map his path along the traditional self-organised model.

Alex became a funded startup. It was extraordinary.

Chris is the cofounder and CEO of The Rattle – a global collective of artists and technologists in counterculture. After a short tenure as a professor of technology at MIT and Harvard, Chris turned his passion to startups. Chris learned how to develop technology, art, and teams from concepts to thriving companies – becoming a familiar face in both the Boston and London Startup & Investor communities. Chris now focuses on supporting the underdog – helping them benefit from startup techniques in order for a new and progressive cultural ecosystem to thrive.