From remote working to the gig economy, technology has allowed workers more autonomy over their professional lives.
This impact is especially evident in the music industry, when before if you didn’t have a record label contract you couldn’t make it. Now, independent artists are retaining ownership of their masters and intellectual property.
“If you don’t own, you can’t create generational wealth — you have to have an asset to pass down creating value for your next generation,” Steve Stoute, CEO and founder of UnitedMasters and Translation, said at Yahoo Finance’s All Markets Summit (video above). “If you sign a record deal, you have this short-term financial gain of the money, but you give away ownership rights to your name and likeness, so you have nothing to pass down.”
The issue of ownership is not limited to the music industry, but also show business and entrepreneurs in this new gig economy. At CultureCon NYC, Lena Waithe talked about how creatives give away intellectual property, missing out on the opportunity to create generational wealth.
“When Prince talked about being an independent artist, nobody really understood what he went through. He was ahead of his time and a visionary in understanding the music business,” Stoute said. “He changed his name to ‘the artist formerly known as Prince’ to get out of his contract. As music has gone to digital distribution, and Instagram has become the new MTV, with Apple Music and Spotify the new record store, the value of a record company has absolutely diminished.”
The concept of ownership is applicable to social media influencers, gamers, college athletes, and gig workers. The pandemic spawned the Great Resignation where workers re-evaluated their career goals and professional trajectories, seeking independence from the demands of a 9-to-5 job.
“Even if you work at a company, you want equity,” Stoute said. “If you are a creator, you definitely want to retain the value of the intellectual property that you created. These next generation of creators are entrepreneurs and through UnitedMasters we connect independent artists directly to the distribution platforms.”
In the beginning of hip-hop, the industry glamorized having jewelry or wearing designer clothes, material possessions that didn’t necessarily have equity as an asset. Now there is a shift in understanding the power of branding and ownership.
“UnitedMasters is an interface, so artists can distribute music through us and they retain the rights,” Stoute said. “On top of that, we also provide brand services through Translation, a marketplace where brands and artists connect.”
In today’s digital age, everyone is their own brand that can be monetized for revenue. Stoute’s transition into advertising and branding came while working on the Men in Black soundtrack.
“The [Men in Black] glasses not only sold more than the album, but we were a big reason why the glasses were selling, but we got no credit for it at the record company,” Stoute said. “If we can create culture and somebody else monetizes it, I’d much rather be on the side that monetizes it. I knew that music creates cultural moments that then creates contagious consumer behavior. So, I left the record business, learned the advertising business, and later started Translation in 2004.”
Jazz, R&B, blues, and hip-hop have always moved culture and fashion. However, when events like George Floyd’s death negatively impact groups that create culture, there seems to be little response from corporations beyond a statement or a black square on social media.
“A black square means nothing. That’s not commitment. What are you going to do about the infrastructure in your hiring process and your board?” Stoute asked. “What about your marketing campaigns — how inclusive are they? You should want your board and your marketing to reflect society because you become a much better business when you have diverse thoughts at the table.”
Ronda is a personal finance senior reporter for Yahoo Money and attorney with experience in law, insurance, education, and government.