301 – Investing in Music – with Justin Longo

What if there was an easier way for your fans, friends, and family to invest in your music? What if you could diversify your revenue streams to make your music career more sustainable and profitable? In this episode of The New Music Industry Podcast, David passes the mic with MariNation founder & CEO and friend, Justin Longo. Tune in to discover how MariNation is evolving to meet changing demands. Download the PDF Transcription Podcast Highlights: 00:17 – Returning guest, Justin Longo of MariNation 00:33 – MariNation’s new direction 02:01 – On diversifying revenue opportunities 04:17 – The Music Entrepreneur Triangle 06:34 – Music Entrepreneur HQ’s lens 08:01 – Why do people invest in music and who does it benefit? 09:34 – The constantly changing music industry climate 11:35 – What MariNation is aiming for 13:41 – What has Justin learned from pivoting his venture? 17:13 – Sunk cost fallacy and finding your path 19:39 – Paradoxes in success 21:19 – What tools and resources did Justin rely on while pivoting? 23:41 – Know thyself 35:40 – Elite Players: All Access Pass 37:26 – Closing thoughts Sponsors: Productivity, Performance & Profits Blackbook: The first of its kind – David’s new premium book covering productivity for artists, featuring content from Music Entrepreneur HQ, his personal blog, his many books, and even Start Your Year the Right Way, which is included in its entirety. Be fully unleashed in accomplishing your dreams and desires! Transcription: David: Today I'm chatting with a return guest, the founder of MariNation, Justin Longo. You can hear our previous conversation in episode 243 of the podcast. It's great to connect with you again. Justin. How are you? Justin: I'm excellent, David. Thanks for having me. David: Good to see you again. I know that MariNation has been evolving, and to use a bit of a buzzword, you've made a bit of a pivot recently, but your concept is still centered on music investing so that part hasn't changed. So, what has changed with your app and what do you see coming next? Justin: Yeah, so basically the first direction we were managing artists' money on their behalf, investing in index funds and the general stock market. So, obviously, we didn't pursue that. It was kind of more of an intuitive decision, but we've pivoted into this next direction where we allow fans and investors to invest in music, invest in artists as people, and benefit from their future earnings and future careers. So that's kind of the different direction that we took with it now. David: So, people can invest in pretty much anyone, right? Like Justin Bieber or Rihanna or whoever their favorite popular artist is. Justin: Eventually, that's the direction, right? We want to have the big A players. Obviously, they'd come on for different reasons. Other than like an indie artist or somebody just beginning, right? They would probably want to fund, projects, and studio time, and probably the A-list celebrities and big stars would want to do it more on a fan-to-fan, a fan-to-artist, like engagement, like connection. David: I would definitely think that with mainstream artists if they see that it's a viable opportunity, they would sign up for it. It's not like a super well-known fact, but you can start looking for all the revenue streams for producers, and people assume, “Okay, they're making music, right?” And that's true, but then oftentimes they'll have their own trademark plugin for a DAW, or they'll also have sample packs, or they also have beats. So, they're pretty well diversified. And it's really the same thing for musicians in the sense that people assume they just go out and perform and they make loads of money, right? Or they just release something on Spotify and it helps them make some royalties, which is true. But then you'd be surprised to find that Beyoncé plays the same bar mitzvahs and weddings and birthday parties that you play. And there are so many other opportunities, like music lessons. You could go to ArtistWorks and find that Paul Gilbert from Mr. Big and various other supergroups still teaches guitar. And I'm sure he gets paid a pretty penny, although it's hush-hush for the effort that he puts in. So, I could definitely see this. First, the attraction for the investor to be able to invest in their favorite artist, even if they are independent, but also mainstream. And I can also see potentially that if mainstream artists begin to see it as a viable opportunity, they will totally want to leverage it. Justin: That's a great point. And to your point where artists, they all have their own different niche, right? So, Beyoncé has her own style as opposed to Tom Petty, right? And they kind of based their secondary products upon their style and their given genre, right? So, Tom Petty may come out with a line of guitars whereas Beyoncé would come out with her new sneakers. We just did a content post on that. So, there's kind of like these different areas where the artist can thrive in the secondary products of their career if you will. Because the music is the primary one. So, it's a very interesting point to see the reasons why artists and investors would both want to be a part of something like this, but we're just going to continue to develop it for everybody and see where we land and where the traction picks up. David: Yeah, I wrote a post recently on The Music Entrepreneur Triangle, and this is like really the traditional model of how to become a music entrepreneur. And for most artists, it really starts with one thing and one thing only, like, you have to become known for something, right? So, Dr. Dre and Beyoncé, and all these other artists became known for rapping or singing. And maybe dancing is ancillary to the performance side of things. So, they became known as performers first. And then as their celebrity grew, and I'm using that term somewhat loosely because you can create a celebrity effect among your audience, even if it's small. And there's a lot of benefits to being perceived that way. The reason to focus on one thing and to do one thing is to become known for it to build your celebrity and people are irrational about celebrity. And so once you have that, then you're totally ready to diversify. There are still mishaps obviously. I think it was Neil Young that came out with the Pono, the high-fidelity MP3 player, or whatever. No one was interested in that, but it also had an unfortunate name. So maybe that played a role in that. Nevertheless, once you've attained celebrity, the diversification opportunities expand. Justin: I really enjoyed the terminology of music entrepreneur because entrepreneurs and musicians are one in the same, right? As a creator and a music artist, you're basically throwing a whole bunch of stuff at the wall, right? I think Russ is a prime example of this. He produced and made hundreds and hundreds of songs and just put his volume in and got his work out there. And not all of it went multi-platinum, right? But it's the volume and the work in the trials and tribulations and just getting all of these things out there. Seeing what works and what sticks and then doubling down on that sort of thing from a music perspective and then a business perspective, it's more or less the same thing, right? See what works and what sticks and double down on that.Share on X We don't necessarily know what's going to work ahead of time. You know, we do have some preconceived notions about the market and the fan base and that sort of thing, but at the initial outset of it, we don't necessarily know who or what. Or how much to charge for it or that sort of thing. We just kind of do it as we go along and learn in the progress of it all. David: Yeah, something I'm not even sure if I've ever explained or shared on the podcast is the fact that this podcast lives on a site called Music Entrepreneur HQ. The whole reason I started that, though, is because I saw a lot of opportunity in applying business principles I was learning in network marketing and Robert Kiyosaki and various resources I was plugged into at the time and applying them to my music career. And that's always been the lens of like, how do we help musicians? How do we help independent musicians create the life they love through Music? I'm happy for the overlap in audience [musicians and music entrepreneurs]. I don't have something like the Music Entrepreneur Club, which is obviously targeting people like us, people who are music entrepreneurs and doing stuff out there in the music business. But I'm happy for the overlap and I'm not telling anyone to go away, you know? keep listening if this stuff fascinates and intrigues you. But that is something I wanted to share is that it's always been through the lens of the independent artist. And how can we be artistically entrepreneurial? Justin: That's a great point. I believe Tim Ferriss said one time that a good business book is a good life book. A lot of the business lessons and values and teachings are also comparable to life in general and creative endeavors, being a music artist, being an author, you know, freelancer, whatever it is. A lot of these things are applicable to all areas of life. David: So, although you touched on it briefly, why do you think people will invest in music and whom does it benefit? Justin: It benefits both the investor and the artist. The artist at the initial process of it all will receive upfront money to fund projects, as I said earlier, and that sort of thing. And then the investor will receive the benefit of the future earnings on that money in the artist's career. The first part of your question though is why would somebody want to invest in music? Who would invest in music, right? And it's a great question and for a lot of reasons some fans love the artists.