Fan-funded music

ArtistShare
ArtistShare is documented as being the first fan-funded website for music.[3] The service lets musicians fund their projects utilizing a "fan-funding" model. In exchange for funding on a particular project, contributors receive various benefits. ArtistShare emphasizes on their website that for each project, the artist is in no way required to relinquish ownership of copyright, as this model is not a work made for hire.[4]

Indiegogo
Indiegogo is a crowd funding portal that allows users to create a page for their funding campaign, set up an account with PayPal, make a list of "perks" for different levels of donation, then create a social media-based publicity effort. Users publicize the projects themselves through Facebook, Twitter and similar platforms. The site takes a 4% fee for successful campaigns. For campaigns that fail to raise their target amount, users have the option of either refunding all money to their contributors at no charge or keeping all money raised minus a 9% fee.[5] Unlike similar sites such as Kickstarter, Indiegogo disburses the funds immediately, when the contributions are collected through the user's PayPal accounts. Indiegogo also offers direct credit card payment acceptance through their own portal. Those funds are disbursed up to two weeks after the conclusion of a campaign.[6]

Kickstarter
Often described as the most successful and well-known crowd funding platform, Kickstarter has been featured on CNN, The New York Times, Time, BBC and Wired. Kickstarter is a crowd funding website that has successfully funded everything from films, games, and music to art, design, and technology. Project creators choose a deadline and a minimum goal of funds to raise. If the goal is not reached by the deadline, no funds are collected. The platform is open to backers from anywhere in the world and to creators from the US or the UK. Kickstarter takes a 5% fee and Amazon.com takes an additional 3%.

PledgeMusic
PledgeMusic was an international crowd funding platform geared specifically toward musicians. Users (pledgers) receive exclusive content in exchange for their contributions to artists fundraising campaigns. PledgeMusic does not retain any ownership or rights to any music created through the platform. Funding transactions occur only after a goal is successfully met. The site is staffed by people in the music industry and maintains partnerships with major players in the digital and physical music spheres allowing for numerous options to help record, produce, manufacture, market, and distribute artist's music, merchandise, and tickets. The site charges a 15% fee.[7] PledgeMusic operates on two types of artist campaigns, direct-to-fan and pre-order campaigns. In a pre-order campaign, fans are charged immediately upon pledging. This type of campaign is designed for labels and artists who have already completed a recording, and are looking for a strategic way to pre-sell and market it.[8]

RocketHub
RocketHub is an established crowd funding platform open to anyone including musicians. Project holders on RocketHub have the option to keep raised proceeds even if the fundraising pledge was not successful. RocketHub is a completely open platform, meaning that anyone can create a fan-funding campaign and there is no screening process before the project goes live. The site takes an 8% commission off successful projects.[9]

Sellaband
Sellaband was a crowd funding platform that allowed registered artists to use a direct-to-fan approach to finance albums or concerts.[10] Artists will pledge an amount, the minimum funding target being €3000, and the maximum funding target, €250,000. Artists may also choose if they want to integrate a revenue sharing option into their funding. The minimum incentive is a download.[11]

Corite
Corite collects five percent of the funding fee provided to an artist, and then another five percent of the royalties that are paid by streaming services.[12] The company has raised $6.9m from investors.

The British rock band Marillion are considered to be one of the first artists to have truly harnessed the power of the Internet as a means of music distribution and direct contact with fans, which began with setting up a website in 1996 and raising $60,000 to help finance a 1997 North American tour.[13] They have also been described by The Guardian music journalist Alexis Petridis as "the undisputed pioneers" of the fan-funded music model,[14] beginning with the distribution of their 2001 release Anoraknophobia. Amidst a dissolving relationship with their record label and management team, the band calculated that they would need 5,000 fans to order the album to finance the project. However, they needed the money up-front, before the record was released. They turned to their mailing list and asked fans to pre-order the album in what was later described by the BBC as "a unique funding campaign".[13] Pre-sales exceeded their 5,000-unit target, reaching about 12,000 pre-sales total.[15] Marillion have since released several other albums based on a fan-funded model, receiving a £360,000 advance for their 15th studio album Happiness Is the Road.[14]

Unofficially dubbed the "queen" of Kickstarter, Amanda Palmer is an example of one of the most successful fan-funded music campaigns of all time. On 30 April 2012, Palmer ran a campaign on Kickstarter, with a goal of $100,000 to fund her newest studio album, Theatre Is Evil. By the end of May 2012, Palmer had amassed almost $1.2 million, ultimately receiving donations from nearly 25,000 individuals.[16] By comparison, the average successful project on Kickstarter at the time raised about $5,000.[17]

Boston-based singer/songwriter Ellis Paul is another important case study in the field of fan-funded music. His 2010 release, The Day After Everything Changed, was funded completely by fan donations. Instead of using a traditional crowd-funding platform, he adapted the online merchandise platform Nimbit to his own fan-funding scheme. Paul set up a tiered donation hierarchy, ranging from the $15 Street Busker level, up to the $10,000 Woody Guthrie level.[18] Fans received different perks based on the tier at which they donated. The project proved to be highly successful, with total donations exceeding $100,000.[19] Paul is putting his fan-funding to the test again; he is currently in the midst of fan-funding a new studio album set to release sometime in 2013.[20]

Tokyo-based garage metal band Electric Eel Shock is another group that has seen some success in the way of fan-funded music. In 2004 they offered a "Samurai 100" package, which gave fans the opportunity to secure "guest list for life" status. The package cost £100 and the band raised £10,000 by selling 100 such packages.[21]