Published 10 months ago • 5 min read


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Hey! It was great to see a bunch of you in Nashville this week during Music Biz. But after being on the road for the past month, I’m looking forward to relaxing for a little bit.

Today’s Trapital episode is with Steve Stoute. It’s his third time on the podcast and this is the best one we’ve done. We talked about how UnitedMasters and Translation work alongside each other, Brent Faiyaz’ new deal with UM, record labels, streaming, and more. Here are a few highlights from our chat.

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competitive advantages in music

UnitedMasters’ edge in music distribution is the value-add opportunities it offers artists. It’s not just about getting their music onto streaming services and playlists. It’s the sync placements in NBA 2K, brand partnerships with various companies, and more. This aligns with Steve Stoute’s marketing background and his ad agency, Translation.

Music distribution is crowded. And since the sole act of putting on song onto a digital streaming provider is commoditized, each service needs its lane.

Steve didn’t quite call UnitedMasters’ edge a “moat,” but our discussion got me thinking:

does any company in the music industry have a real economic moat?

There’s a case to make for both Apple and YouTube. Their music streaming platforms sit under large corporations, which offer cost advantages. Music (and content more broadly) help them acquire customers for their core products.

Their music streaming businesses still have P+Ls to manage, but the stakes aren’t the same as a standalone streamer. It’s one of the reasons why streaming services under large corporations have been quicker to raise monthly prices. They are relatively less sensitive about how the additional revenue gets split.

But despite their advantages, Spotify is the dominant player in the space, with over 500 million monthly active users. It’s where most industry leaders check to monitor the performance of a song. The service is synonymous with our current generation of music.

Ticketmaster does have a moat in ticketing, but venues, even the larger ones, still have a choice in which company to partner with. The Washington Commanders’ FedEx Field recently signed with SeatGeek as its ticketing partner. There’s more competition in ticketing (and live entertainment overall) than the general public may believe.

Record labels’ market share is shrinking with the rise of independent artists. We’ve yet to see an independent artist become a megastar, headlining-the-Super-Bowl level artist, but deals like R&B artist Brent Faiyaz’s new UnitedMasters deal are a step in that direction.

You can listen to my full episode with Steve or read below for more highlights.

competing for deals

Last week, R&B artist Brent Faiyaz teamed up with UnitedMasters to continue his independent journey. I heard from a source that the deal is likely in the $30 – $35 million range. That same source said that Faiyaz was offered a contract from Interscope that included masters reversion, but he turned that down.

Masters reversion has been more common for the “de-risked” stars that labels want to continue working with. Drake, Taylor Swift, and Olivia Rodrigo signed similar deals with the majors. It helps record labels participate on the upside, maintain market share, and give artists back ownership of their assets at a certain point. But the revenue that labels collect during the initial period is still quite valuable.

Brent currently has over 20 million Spotify monthly listeners, which puts him at ~260th overall. That’s higher than most independent artists and higher than a lot of signed artists. It’s been nearly ten years since Brent released his debut Black Child EP, and he is today. He has that OutKast Edge in him.

But since UnitedMasters won’t own Brent’s assets, the economics must work on both sides. Let’s run some rough numbers.

Spotify’s 2023 Loud and Clear report says that 470 artists’ catalogs generate at least $2 million annually on the platform, and 130 artists’ catalogs generate over $5 million. Since Brent is the 260th most listened to on the service, let’s assume he’s at $2.5 million annually. Since Spotify accounts for roughly 25% of all recorded music and publishing revenue, that would mean his music will generate $10 million this year.

Brent Faiyaz is at UM’s Partner level, a white-glove service for top talent. Let’s also assume he has an 80 – 20 royalty split with UnitedMasters (80% to Brent, 20% to UnitedMasters). UM would get $2 million annually from his music revenue alone, plus any revenue from future brand deals or other opportunities.

If Brent’s career continues to grow at the same rate it has the past 3-5 years, then he can recoup his advance soon. There’s risk in any deal, but Faiyaz’ sustained and consistent growth is a great sign. He’s more reliable than the flash-in-the-pan, viral TikTok stars who dominate the discussion around new artist discovery.

what’s hype, and what’s real?

Let’s be honest. As fascinating as new technology is, following the latest trend can be exhausting. From blockchain to the creator economy to web3 to AI, separating the real from the fake can be a full-time job.

It’s easy to play Monday morning quarterback, play to the results, and laugh at the billions lost on trends that didn’t pan out, but these guesses are more complicated in the moment.

FOMO is one hell of an economic driver.

Steve and I talked a lot about this at length. The challenge today is that companies make the mistake of buildingtechnology in search of a solution. Technology is most successful if it has use cases beyond its enthusiast echo chambers.

If you enjoyed these highlights, you’ll enjoy the rest of the episode with Steve. We also talked about:

  • how NIL deals are like the independent music business
  • building both Translation and UnitedMasters at once
  • brand dollars shifting from institutions to creators

Listen to our full conversation here:

Hope you enjoyed this memo. If so, please share. Forward this email to someone who should read it. Text it to a friend. Drop the link in the group chat.

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coming soon from Trapital

Podcast: Will Page! He’s back. This was a full episode on the state of the industry: Why it’s a $40 billion industry (and likely even bigger), streaming, live, and a whole lot more. Drops next week!

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Dan Runcie

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