Our partner RootNote recently interviewed our CEO, John Funge, to understand how The Music Fund compares to other music funding models. Here is what John had to say:
“There are quite a few financing companies just in the music space, including a few distributors. Each of these companies has their own way of making money (add-on fees, different interest rates, etc.), but all are based on predictions of future earnings. Another important point is that they all involve the artist taking on debt. That means the artist is on the hook to pay back every penny they borrowed, plus additional fees or interest, no matter how accurate the company’s prediction ends up being.
We are the only company that stands behind our predictions. If we are wrong about our prediction, and we don't recoup the investment during the term, we take the loss, not the artist. That’s right, the artist owes us nothing. This is not easy to do for a one-off deal or at scale.
When considering a deal, many artists have questioned us about the accuracy of the company’s income predictions. But our suggestion is to ask what happens if the prediction is wrong? How much money would the artist owe or not see coming in? What would their monthly income look like?”
Learn more in the full article by RootNote here.