Sunday, January 5, 2020

Molly Neuman: 'Songtrust is a low-risk, creator-focused offer'

Songtrust's Molly Neuman
Songtrust, the global royalty collection platform owned by US independent music company Downtown Music Holdings, has had a stellar year 2019 with milestone growth. During the year, Songtrust grew the total number of songs it represents to over two million and the songwriters and producers affiliated to the platform to 300,000.

  The company does not disclose details of its financial results, except to say that it has grown its overall collections by nearly 250% year-on-year and "significantly increased" the amount of royalties paid to its clients, thanks in part to an expanded global reach. Songtrust is now able to collect royalties from more than 150 countries and territories and has over fifty direct affiliations with collection societies around the world.

  Creators using the platform for global royalty collection include Jeremy Zucker, Tessa Violet, Craig Finn of the Hold Steady, and writers who have written or co-written songs for Billie Eilish, J. Cole, Anderson.Paak, Meek Mill, among others.

  The company also acts as the administration partner for the repertoire of works represented by companies such as sister company Downtown Music Publishing, Sub Pop Publishing, ZJS Music Publishing (Average Joes Entertainment), Merge Music Publishing, Symphonic Publishing, Passé Publishing, in addition to business partnerships with distributors like CD Baby, DashGo, Audiomack, Tracklib, and Symphonic Distribution.
  This year was also one of leadership transition as Joe Conyers, who co-founded Songtrust with Downtown CEO Justin Kalifowitz, relinquished day-to-day management duties at Songtrust to focus on strategy at Downtown Holdings. As a result, Molly Neuman, who had been Global Head of Business Development for the past two years, was promoted to President.

Neuman has had a long career in the music business, with positions within independent music companies (Lookout Records), as well as digital services (eMusic, Rhapsody, Kickstarter). She also ran A2IM, the organisation representing independent music companies in the US. She joined Songtrust two years ago and is now in charge of the company's global business. 

  Neuman spoke to Emmanuel Legrand as the year was closing and reflected on her journey so far.
What's is Songtrust about?
Molly Neuman: It's a platform that makes available the revenues that songwriters and creators are earning through our direct affiliation with the collection's network that historically had not been available. Traditionally music publishers focused on the top 1%. The industry was driven by large advances and by copyright acquisition. What we are making available is access to those royalties generated that are rightfully earned by these creators, without taking any ownership percentage and without long-term deals. So it's a different way of thinking about publishing entirely.

What's your remuneration model?
Our standard deal is $100 to access the network of collection societies and then 15% on royalties that are earned.

If you collect $5 or $5m you will still take your 15%?

What led you to become the President of Songtrust?
I built my career being aligned with independent music primarily. I started as a drummer and transitioned to the music industry, working with Lookout Records in the early 1990s. From a label I went to management and then to eMusic, and then to A2IM. So my journey has been meandering to a degree but it feels that it is aligned with my core values when I started, which were about independence. Making the independent network as strong and as vibrant as possible has been what I have been able to carry through throughout my career journey. Two years ago, after leaving Kickstarter – which was also very much aligned with my mission in that I was trying to bring the music industry to the creative community at Kickstarter – I got to know Justin [Kalifowitz] who is our CEO, and some of the non-business initiatives that he was championing, such as his initiative for tax credit for studios and companies creating music in New York, and Sound Thinking which is bringing education specifically around music for woman and students in New York public schools. I found someone I share a lot of personal values with. With what they had been building at Songtrust, which is to try to address the lack of access to publishing royalties for individual creators, I felt this was very much the right opportunity for me. I have been here for two years. I have been leading the sales, marketing and business development team, and we've been very successful. We made a lot of progress, and we've been able to grow our client base by over 100%, our royalties collected by 250%. We know that there a plenty of opportunities to grow the business. I have the confidence of Justin and Joe [Conyers], the co-founders, to lead Songtrust into the next phase of our company and I am really excited about that.

What's the next development phase for Songtrust?
At the moment we are very much focused on publishing administration. We are affiliated to 50 societies [around the world], and we are collecting the digital income from all the services. A tremendous amount of our clients are extremely successful on digital platforms and no so much on TV and radio performances, so making sure that the digital income is collected precisely is a big mission for us. That's our main focus: make sure that we continue to improve the technology, the efficiencies that we offer, the registrations and the payments of royalties. We need to make sure that we are marketing ourselves properly so that people understand that there is more available than just recording royalties, and that we are a low-risk, creator-focused offer that really empowers them. We don't do the creative side like putting creators together to collaborate, we don't represent their works for sync usages, because we find that managing expectations on that front can be very challenging. We prefer to focus on being the best in class on royalty administration and be excellent partners with the network that we operate with. What we are aiming to do with SACEM, with PRS for Music, BMI, ASCAP and all the other societies is to work with them because we represent so many copyrights that we want to do it in a way that makes sure that we get everything that our clients are owed but not overburdening them.

What are your goals at Songtrust?
Growth! We are set up for growth. Our plan is to grow the flow of royalties we collect for our clients and to continue to build a healthy business.

How do see the whole business of collective management of rights? Is it going in the right direction?
We have to respect the fact that many societies have been in business for over a hundred years and they have adapted to the needs of the industry and some of those request a lot of investments. They have to make progress with efficiencies and a lot of societies are demonstrating that. Everyone knows there are challenges with pools of royalties unmatched and we have to deal with that. We are trying to be a good actor in that way when we are doing the registrations, entering the ISWCs as well as the ISRCs. Some societies do not manage that piece yet. We are trying to make sure that they get as much data as possible while they build their new systems. There are more openness to the changes and we are trying to encourage that.

In between Kickstarter, A2IM and now Songtrust, you've been dealing mostly with independent music companies and creators. Is it a good time to be an independent these days?
Individual creators and small businesses are being able to access the market and build from their core business with efficient products like ours. That simply was not possible. Back in the days we had many creators that were even affiliated with a PRO. An important part of what we are doing is supporting independents and offering them access for their artists to a complete royalty picture. In many cases they are managing the master side and this is an opportunity to represent the full royalty streams for masters and publishing. It's an exciting thing and this area is growing significantly.

Any challenges in the marketplace?
In the US, there are some contentious issues about [mechanical] rate setting that I hope will be resolved soon. The appeal of the Copyright Royalty Board rates setting by digital platforms is disappointing, but having worked at record companies and with digital platforms, I know that people approach these issues through the lenses of their own interests. But I do hope that these issues are resolved because publishing is already at a disadvantage compared to recording with regards to royalty revenues, so any improvement in the royalties generated by compositions would be welcome. The rates set by the CRB in 2018 was great news and we had a lot to celebrate, but the appeal has been disappointing and challenging. Services are important partners at the same time so we know that we will get to a positive result eventually. And I hope that's relatively soon.

Is the creation of the Mechanical Licensing Collective in the US a good thing?
I think so. There are models around the globe for mechanical collectives and the fact that the US hasn't had that yet is a little bit funny. We see it as resetting the overall picture and we also see it as a way to validate the complete publishing picture that we provide and make our efficiencies available for global collections. We think it is a positive evolution. What I would say is that there has been more discussions about publishing and royalties in the past few years than in my whole career. Many of our conversations with early-career songwriters and rights holders are about the fundamentals of royalty collection. While there are still many open questions, there is more understanding, more discussions being generated around the whole picture and that is very positive.

Regarding Kickstarter, the crowd-funding model has taken a bit of a hit with what happened with Pledge Music. Is the model broken or that was just a hiccup?
Pledge had a different model than Kickstarter, fundamentally, which was to their advantage initially but at the end of the day was what created the challenges. With Kickstarter the risk is significantly less. Failure to deliver a project at Kickstarter was a very small percentage. And if you think of it as an investment scheme, it is a pretty healthy ratio. It's disappointing to see what happened, because there are many artists and creators that ran projects and they did not happen. And it is painful to see a company that had great potential not meet that. But there is a lot to learn from things that are not successful. At Kickstarter I always believed that what we were doing had a strengthening opportunity for the overall eco-system.

You are one of the very few women President of a music company. Does is feel kind of lonely up there? How can the industry make more room for women in top executive positions?
One of the things I believe in is that in many different times of my life, there were opportunities and encouragements. These are sort of the basic fundamental pillars of how I like to live my life. When you open the doors of opportunities and you encourage that, things can be surprising and results can be incredibly powerful. My journey has been a perfect example of that. The confidence that Joe and Justin and our executive team have put in me to lead our organisation mean that there are set skills that I have. If you look at my career over the years, it does add up. I think that one thing that executive teams and leadership in trade organisations and in music companies can do is identify areas not just for women but for many other dimensions for which we need to see more balance. A little bit of accountability and transparency is needed. The more that we make inventories in what our teams look like, the more we can aspire and commit to measurements of improvement. If we are able to say that our company has X amount of diversity, we would aspire to improve the situation and commit to that. You can always understand what the challenge is and meeting it. That's where I hope our industry improves. And I think it can!