A NEW WAY FOR ARTISTS TO TRACK THEIR PAY
LAST YEAR, MILANA RABKIN LEWIS, co-founder and CEO of distribution company and payment platform Stem, was among those who read a series of frustrated tweets from rapper Meek
Mill. “I haven’t got paid from music, and I don’t know how much labels make off of me!” Mill wrote. “How much have you spent on me as an artist? How much have you made off me as an artist?”
“Why can’t he know that?” Rabkin Lewis asks. The problem has frustrated her since she was an agent at UTA and saw “just how messy the whole process” of royalty accounting was. “We were working with major artists who realized they had no visibility into when they were going to get paid and how unrecouped they were,” she recalls.
Part of the reason she started Stem in 2015 was to provide artists with more transparency. Now Stem is debuting Royalty Services, which aims to distill labyrinthine Excel spreadsheets into digestible dashboards and will be available to labels outside of Stem’s distribution network. (The major labels also have their own versions of a dashboard, as does distributor DistroKid; sources say Stem’s is easier to use.) Users can view summaries of overall costs, earnings and recoupment status. They can drill down into more granular data — to determine which streaming platform or song is generating the most money, for example — with a click. And the process of linking bank accounts and sending money to partners is straightforward.
“It’s easy to see which song is doing the most each month on which platform, how much you’re making, when you will recoup,” says Rabkin Lewis. Stem chief product officer Brendan Kao calls the new dashboard “the next step in our mission to improve financial clarity for the entire music industry,” including labels and artists.
Another company hoping to inject more transparency into an industry known for opacity is CreateSafe, which made a Record Deal Simulator freely available online so artists can input their advance, recording and marketing costs to get a rough estimate of how many streams they need to generate to recoup their deal.
If anything, royalty accounting has only become more complicated in today’s digital environment. Artists often release more music with more partners than in the past and work with more producers. And revenue comes from multiple streaming services, as well as platforms like TikTok and Twitch. “We’re also seeing this trend of the admin and the responsibility of paying people out going more downstream,” Rabkin Lewis adds. “Motown pays out Quality Control, for example, but there are so many layers of people that need to get paid after that,” from artists to producers to engineers, and “often the people downstream from the major have no software.”
Quality Control has started using Stem’s technology, as has Fool’s Gold. Rabkin Lewis says she hopes to have 50 clients by the middle of 2023.
Justin Blau, best known as DJ-producer 3LAU, is the founder of Blume Music, one of the first labels that signed on to use Royalty Services. “We used to hire an accounting firm,” Blau says. “We’d send them everything, they’d send paperwork back, and then we’d send payments manually to each rights holder.” This system was “inefficient,” he continues, to the point that it was “just obnoxious.” He was quick to sign up for Stem’s new product. Adds Blau: “A lot of artists have been waiting for this.”