NYU Keynote: Music, Streaming, and Second-Order Effects

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I had the pleasure of being the keynote speaker at New York University’s Annual Alumni Event for its music business department. Big thanks to Larry Miller, a professor and director of the program, for inviting me. It was a free-flowing conversation focused on how technology is reshaping the music industry from top-to-bottom. We’re well into the streaming era now, but some of the second-order effects are barely starting to ripple — particularly the oversaturation of content. It’s easier and cheaper than ever to release music, which explains how tens of thousands of new songs are uploaded to Spotify on a daily basis.On one hand, this has ushered in a golden era of independent artists making a career without the backing of a label. On the other hand, value is increasingly accruing to the superstar artists. Most of these superstars were “grandfathered” into this new era as they were already household names before streaming took off. Reaching that same superstar status is harder and harder for new artists due to the industry’s oversaturation. Larry and I dove deeper into the issue during our conversation. Students also hit me with Q&A about burning topics such as ChatGPT, botted streaming numbers, and much more. Here’s what you can expect to hear on this episode: [2:02] Introduction from Larry Miller [5:09] Superstar artists like Taylor Swift and Drake shining brighter than ever[10:22] Too many hits, not enough superstars[17:23] How Curren$y “niched down” to break through[24:18] Tradeoffs of going independent or the major label route[26:47] Industry takeaways from Spotify and YouTube’s billions playlists[30:32] YouTube’s competitive advantage over Spotify[34:09] Evolving Trapital’s own business model[39:43] Music’s bot problem in streaming and ticketing[42:07] Is the music superstar dead?[44:19] Picking a platform(s) as a new artist[46:24] How oversaturated music landscape impacts listeners[49:03] Is New York drill music the next wave?[50:48] Pros and cons of AI musicTrapital’s first-ever Cultural Report for 2022: https://trapital.co/culture-report/Listen: Apple Podcasts | Spotify | SoundCloud | Stitcher | Overcast | Amazon | Google Podcasts | Pocket Casts | RSSHost: Dan Runcie, @RuncieDan, trapital.co  Enjoy this podcast? Rate and review the podcast here! ratethispodcast.com/trapital Trapital is home for the business of music, media and culture. Learn more by reading Trapital’s free memo.TRANSCRIPTION[00:00:00] Dan Runcie: Both Spotify and YouTube generated a tremendous amount of revenue for the music industry. I believe Spotify had last shared that they generated 7 billion for the industry. YouTube generates six or seven, I think it's 6 billion. The last thing that I had seen them put in. So that is a sign. Okay, great. You know, you tie that back into the numbers you shared before. You can do a little bit of backwards math to see how much of that is responsible for the overall industry with where it is now. So you see that, and then you also know that like anything else, the most popular songs drive most of that revenue. So you can kind of get a good idea to be like, okay, what are the songs that are driving? The music industry right now. [00:00:46] Dan Runcie: Hey, welcome to the podcast. I'm your host and the founder of Dan Ruey. This podcast is your place to gain insights from the executives in music, media, entertainment, and more who are taking hip hop culture to the next level. [00:01:04] (Intro) Dan Runcie: This episode is a fun one. We're sharing the audio from a talk that I recently gave at NYU. I was the keynote speaker at an event there for several hundred alumni and students. For the music business program, it starts off with a 10 minute talk by me where I'm giving an overview on the lay of the land with where things lay right now with streaming and music and social media, and how artists are doing their best to navigate all of the noise that's happening right now. And then it pivots into a conversation. Which is a fireside chat with me and Larry Miller, who's the head of the music program at N Y U, and we talk even more about what certain artists are doing, right? We talked about Currensy, who I recently had on the podcast a couple months ago. We also talk a little bit about me and Trapital and building this and where I see things going in the future. Really fun conversation. I really enjoyed doing this event and I hope you enjoyed this. Here it goes. [00:02:02] Larry Miller: Dan Runcie is the founder of Trapital. Trapital has become an amazing media platform and the quality and amount of content, really insightful content that Dan cranks out as remarkable. It's just remarkable. What it's about is the people who are taking hip hop and culture to the next level. That includes the artists who are becoming moguls, leaders who are reaching new heights and fans inspired by hip hop's growing influence. Dan, when he'd school, and I suppose even, you know, business school. This media company Trapital, because he wanted to see a change. The hip hop execs that he looked up to were becoming really successful business leaders, but he felt that they rarely got the coverage that they deserved. And he wanted to do something about it. So he launched Trapital in March of 2018, and the business has grown ever since. Tens of thousands of influential people read Trapital's weekly memos and listen to the Trapital Podcast every week to stay ahead of the latest trends. Trapital's been featured pretty much everywhere. Places like The New York Times and the Wall Street Journal, and the BBC and N P R,  C N B C and lots of other places are turning to Dan for insights on the business of hip hop. Dan's recent coverage has focused on lots of things. He's focused on the surprising differences between Spotify's and YouTube's. Billion stream playlists. Just looking at the ones that have done a billion on each platform. There are actually some pretty interesting differences between those two platforms. He's done significant work on how a venture capital fund from a 16 Z, Andreas and Horowitz invest money that is raised exclusively from black leaders in entertainment, sports, and business. He's done a report on the so-called decline in the influence of hip hop culture. He's done work on the future of ticketing. He's done a lot on DIY careers in hip hop, and done some really insightful reporting around Joe Kelli's amazing new book, Rap Capital, the Rise and Reign of Atlanta's hip hop culture, which if you haven't read it, get it. Dan got his MBA from a school in the Midwest, I think it's called Michigan, and he lives in San Francisco with his wife, and small child, daughter. Please give a warm NYU music biz welcome to Dan Runcie.[00:05:09] Dan Runcie: Larry, thank you to the entire faculty, alumni for having me. It's an honor to be here. And I guess to start things off, because she's been brought up a few times, Taylor Swift has been a topic I know a lot of you thought about. So just outta curiosity, how many of you tried to buy Taylor Swift tickets this week? Okay, a few hands. Keep those hands up if you actually got Taylor Swift tickets this week. Okay? All right. Well, people will have to follow up with you all after to figure out exactly how you did that, but I think that's an interesting place to start with so much of what's happening right now in the music industry, because Ticketmaster, as most of you know, the whole entire app and the site crash because of the high demand. Ticketmaster put out this blog post and they said that they had five times the amount of hits compared to the Super Bowl, compared to other high days worth of events for this concert alone for Taylor Swift, and she's someone that's been on tour before. She's someone that has done plenty of things in music, but to see this kind of demand is pretty surprising. But she also broke a bunch of records with the album that she just put out a couple weeks ago, Midnights, and it's made me think about something we've talked a lot about recently, in Trapital. Something we've done a lot of research on. Right now there is so much music coming. I see, I think a few of you probably saw that music business Worldwide article, Spotify releases it. A hundred thousand songs a day get uploaded to that service. Most of those songs don't get listened to, to be clear, but a hundred thousand songs a day is still something else. And then as Larry had mentioned as well, Live Nation and a lot of these other event promoters and ticketing companies are having their biggest quarters and biggest years. And artists like Taylor are probably going to be having record years. And on the flip side, you also look at someone like Drake. Him and 21 Savage recently just put out their album, Her Loss. I think Drake gave one week's notice on this album, fourth highest streaming week that an album has ever had, which is pretty impressive. I know that Drake's a superstar, but still, even his past albums before this had plenty of buildup before where if you think about what he did with Scorpion or even the long buildup for an album like Certified Lover Boy. But the fact that Drake can announce on short notice is pretty surprising because if you think about where things are in music, you have more artists than ever that wanna tour. You have more artists than ever that are releasing music, but it's the superstar artists that are still the ones that people are gravitating more towards and they're the ones that are still getting most of the profits. But on the other side of the spectrum, things are getting a little bit tougher because Larry mentioned it a little bit earlier, but a lot of artists are struggling to make toward profitable, especially post pandemic the way that things are right now. Inflation costs are rising. It's costing so much more from freight costs to be able to travel with an entire production set from city to city, hotel airfare. So certain artists are selling out their tours or selling out their concert tickets, but they still aren't able to generate profit unless they increase the ticket prices. But even if you do that to a certain extent, the customers are going to push back. I'm sure a lot of people have seen all the complaints that people have had about how high the prices are, all these hidden fees. So there's a little bit of a squeeze there. And I think what we're seeing now is something that we've seen happen in the media, something that we've seen happen in music, but the fact that the barriers to entry have made music more easy to access, and now that we're in a post pandemic world, more people wanna be outside than ever. It's a lot of the artists at the top that are doing extremely well. But on the other side of the spectrum, while you do have some folks struggling, there are artists who are doing extremely well on the independent side of things. These are artists oftentimes that are owning their masters. These are artists that own their publishing rights as well. And because they've been able to keep a low cost and they've been able to essentially build from the ground up and continue to do it almost the way that a CEO in the music industry will be building up their business. They've been able to build pretty successful businesses too, in many ways. Leveraging the power of the internet because whether it's through SoundCloud or using YouTube or any of these other platforms, they can use their content or they can use their content to be able to drive awareness to their music. And then with that, they can then build up their audience and ultimately, Do that more successfully than they might have otherwise if they were to join one of the major record labels. So it's in this interesting piece because a lot of those artists feel like they have to make a decision, and Larry and I are gonna talk a little bit about one of them in a bit, but it's making artists, and I think many people in the music industry kind of pause because of the amount of content that's coming out, because of the amount of music that's coming out, it's a little bit harder to be able to pierce through. How many of you remember about a month ago, there was a billboard article that came out that said too many hits, not enough superstars, there was named something around that. Does that ring a bell? Okay. I've seen a few folks nod their heads there, and there were a few quotes in that article that stuck out to me because you had a lot of folks that are A & R or other executives in the industry that would say, we're doing all the things that they're telling us to do. We’re doing all the TikTok campaigns, we're doing the same press runs, we are creating the content, we're putting it out there. But even if we do all those things, We still can't guarantee that an artist that we think is going to be successful can get there, and that's because at the end of the day, the record labels and the artists themselves don't have control over the TikTok algorithms. They don't have control over the Instagram feeds to be able to tell what specifically is going to rise to the top and how you can break through another piece from that same article that stuck out to me. How many are you familiar with Steve? Okay. Pretty familiar. And it stuck out because there was a recent concert that he did and he was singing his song at the concert. The audience, the voices, got quiet once it got past that TikTok moment of the song. And if you're an artist, you're putting everything into your album. Of course you know that your fans are probably gonna sing harder to the hit songs under the singles. But because through the TikTok piece. I mean, it's just a reminder of how things are coming and where things are going. Even the concept of a one hit wonder I think has changed quite a bit because back when a lot of us probably were growing up, even if an artist was a one hit wonder, you still probably knew something about that artist. I mean, we can go back years ago, but even someone like Lou Bega who had that song, Mambo Number Five, or even someone like Trinidad James who had all gold everything, you still remember the videos, if you saw them walking down the street, you could probably recognize them. Or I've still been to, you know, a few events where I've seen some of these folks at. But now a one hit wonder could have just a song that you may hear a bit often, but you're recognizing it from some meme that someone else did on their TikTok video or someone else did. So you're engaging a bit more with the viral hit itself than the actual person that's making the music. So it's making things a lot tougher for a lot of artists who I think are the majority of them, wanna be successful, wanna be known and wanna get a few looks. But that middle ground of just wanting to be able to feel like you have that moderate place, you're kind of in the middle of the industry. It's getting a little bit harder to continue to have that being viable because now as I mentioned, you're starting to see a bit of this path where you have the superstars who are just getting more and more recognition as there's more and more options than ever. Or the independent artists who, even though the economics work in their favor, even though they may be able to do even better financially than some artists who may get more exposure than them, they may not be getting looked at the same, as some of their peers are. So it's a very interesting place for the industry. I think with that, it presents a ton of opportunity, but I also think that for certain artists, especially hip hop artists, there's a little bit of a mindset shift in terms of how am I releasing music? What is it that I wanna release? Because I think for a while it seemed like there was a blueprint that generally most people do. You put your music out, maybe you have a following on social media, you share that. You share a little bit of your personality. Hopefully a good manager can come to you if you find one or vice versa. If you do well, you're able to break through. Then maybe a major record label can find you. There was a bit of a general path, but now you're starting to see more and more of that split, and it's making artists in a lot of ways, think a bit sooner about what that decision is when you're still figuring out where it is and where you honestly wanna be. Do you wanna try to become the next Taylor Swift or the next Drake, or do you wanna try to do this a bit more yourself and have a bit more control over what you do? Because the thing is, even things like that, like becoming the next Drake or becoming the next Taylor Swift, have plenty of nuance part of other things that people have been talking about is how much harder it is for a newer artist to be able to hit the same levels. The fact that, you know, we're still referencing whether it's your Adele's or Beyonce's or Taylor Swifts, or Drake's, a lot of these artists have been famous years before TikTok was ever a thing. They still had a lot of that monocultural benefit of when they blew up, they were the thing, and they were able to benefit from that and have a lot of exposure. So now any of the platforms they had, it's all gravy. Now it's all added. They can use that to their advantage, but you are now trying to rise up and do that same thing, it's harder. Even someone like Olivia Rodrigo. Any fans of Olivia Rodrigo? So she is someone who I think Driver's License in a lot of ways for some people felt like the song blew up overnight and it did extremely successful, as did her album. But she was a Disney kid. She had been famous for years before leading up to that. So even that isn't quite at that same level. So it's a very interesting time in the industry. It's been a really great time to working the work we're doing at Trapital specifically to understand what this means. We're talking to a lot of different artists. We're talking to a lot of their managers, and really just making sure that we can share the best stories that we can about what's working, what's not, and highlighting those things. Cuz I think at the end of the day, you wanna find a way for artists to be successful. You wanna find a way for the people that are trying to build companies in the space to be successful, but it's very important to with the way things are trending right now, and a lot of people are saying, oh, it's oversaturated. Oh, we hope that we can eventually get back to a place that is less saturated. I don't think that's happening. The cat's out of the box at this point. If anything, there's gonna be more and more exposure more and more platforms. You look at how quickly TikTok grew to be a platform that has 1 billion monthly active users at this rate. There could be another platform that hasn't even grown yet that by 2026 could be that big. That's just how big things are from a connectivity perspective. So you never know what things could look like, but I think for where things are heading in the music industry there, it's a really fascinating time and even there's a lot of the established superstars that have done extremely well. There's still a ton of potential opportunity. I'll pause there cuz I know that Larry and I can talk a little bit more about that. But it is such a unique time and I think it's probably a good time for us to continue having the conversation because one of the people I do wanna talk to you about is Currency, who is an artist there. So we can do that in a moment, but yeah.[00:17:23] Larry Miller: A New Orleans hip hop artist who's got a lot going, you guys know Currensy. Woo woo. So what's the deal and what made this especially noteworthy for you?[00:17:36] Dan Runcie: So Currensy is someone who I had interviewed about a month ago and it was a pleasure to have him on as a guest on a podcast. I talked to him and his long-time business manager and partner Musa, and Currensy is someone who has been through each aspect of the music industry and I think in capsules a lot of what we've been talking about here. He first got exposure about 20 years ago. He was signed to Masterpiece No Limit label, and of course there's the whole New Orleans connection there. He ended up leaving New No Limit, and then he eventually signed on with Cash, Money and Young Money specifically under Lil Wayne. The thing is though, he actually ended up leaving cash money right around the 2007-2008 timeframe, which was a bit unique because that was the time that Drake and Nicki Minaj ended up joining them as well. And that label went on a pretty high trajectory after that. So some of the young money fans may often be like, oh, what could have happened? Right. But I actually think it was probably the best thing for Currensy because he realized that he was speaking to a slightly different audience, and specifically he knew that there were certain things that he was gonna be able to share with them that would resonate. That probably may not make sense trying to be on the next Lil Wayne mixtape or trying to be on the next Young Money collection or whatever it is. So he's been able to continue his career since, but he has a bit more of an interesting model where you see artists like him, NBA Young Boys, another one, but these artists are releasing albums every other month or releasing mixtapes every other month on streaming. And it's one of these things whenever people talk about that, it often becomes a bit of this question, where is this quality that's being put out? Or is this just quantity? And I think it's a very real thing. I mean, as someone that grew up enjoying a lot of music, even the artists that are successful now, from a personal fan perspective, you know? Yeah. It means something that, yes, you know, Beyonce drops Renaissance. We haven't heard her do a solo album since 2016, and she did one this summer. Okay. I'm listening. Same thing with Adele when she had hers, but I think that for Currensy, I'm not in, I may not be in that fan base demographic specifically, but the people that are following him on a regular basis love him. So he is focused on his true fans, he's found them. And by being able to do that, ultimately these people are gonna wanna hear from you on a more regular basis. Even if it isn't your best stuff, it's what they're gonna want to hear and it speaks to the flexibility that is offered now with streaming because before, just with how much it cost to release an album, yeah, it made perfect sense why you would wait and wanna save your best stuff for it. But if an artist wants to have the model where they wanna release frequency frequently and drop as often as they can, they can do that. And the platforms give them the flexibility. And someone like Currensy, the way he put it to me was, you know, there's certain artists that are gonna get 80 million streams a day. They're more popular than I am, but they don't drop as often as I do. And I'm gonna get my 80 million streams as well, even if I'm putting out much more music than they are. And for a lot of artists, they're still recording the same amount of music. They're just shit picking the best ones to pick for the album versus someone like Currensy's like, no, let me share most of it and share it with the fans. So it's very interesting to hear that. And then specifically since then, he's been able to take a lot of that money. He is solely focused, for the most part on tours. Really doesn't do too many festivals because he doesn't feel like that is where his true fans are. So leaning even more so into the true fan piece, been able to build up and create a few different nightclubs and places like that in New Orleans. He has an apparel company, Jet Life, so it's been a really interesting model for someone to leverage the tools that are available. And even though he may not speak to me or you specifically, he has his people. That to me shows the power of artists being able to focus on their niche and being able to build from there.[00:21:38] Larry Miller: How broad do you think this, you know, phenomenon is? I mean, you made a point a couple of minutes ago that it's only gonna get bigger. There's only going to be more of this. And I think that the inference for the incumbents for, you know, the majors in particular is that they need to, you know, continue to, you know, innovate and unbundle the thing that they do and be really good and, and competitive at it. You know, the leverage seems to be moving overwhelmingly toward the side of the individual music creator. You seeing more of that?[00:22:16] Dan Runcie: I think there's nuance there, and it's something I've thought a lot about because on one hand you do see the overall revenue share numbers, where the share of at least recorded music revenue from independent artists is continuing to grow, and I believe now it's over 30% and has continued to grow year over year, the past couple of years. On the other side of it though, if you're looking at the top artists on the Spotify charts or the top artists on any of these other charts, it's still mostly signed artists that are there. Those signed artists may not necessarily, let's see, be as many new names. Like it's gonna be harder for someone to dominate the entire list the way that Taylor or Drake do when they release an album. But most of the ones that are still there are still the signed folks. So I do feel like a lot of at least for the folks on the record label specifically and the people that are working there or the people that are working at publishing companies, they still are working with the majority of the most popular artists. I know there was a quote recently from Steven Cooper from Warner Music Group and he said, our record label is less dependent on superstars than it has been in the past. And I think there's a lot of truth to that just because you can see who's being signed to wear, you can see how many stars they've been able to develop ever since. And even though there may be less big names that they may have had. There's still a higher likelihood that a big name is gonna come from them than it would be from, you know, an independent group, from an independent artist. I would say, especially at the top level. Mm-hmm. I would say. Yeah.[00:23:51] Larry Miller: Right. And so for an individual artist, they may need to go through a, you know, calculation that evolves over a period of time about whether they have the ambition. and the drive to become Drake or Taylor Swift, or if they can make, you know, just as much or maybe more on a probability adjusted basis doing it for themselves. [00:24:18] Dan Runcie: Yeah, I do think that. If you're an artist and you wanna shoot for the stars, I think that even though there's a ton more platforms and there's many other tools out there that are making it easier for you to own your masters and own the rights to everything that you have, even the artists that have ended their deals, they're much more likely to resign with the major record labels or resign with the publishing companies, but having you know better terms than they did before. You've seen that with the weekend, and you've seen that with a few of the artists, specifically, a lot of the ones signed to Republic Records, they've, you know, de-risk themselves essentially as assets so they're able to get better terms. And they may have gotten on that first deal many years ago, but I do think that that means a few things, right? That means that those artists themselves that are already established, they're more likely to wanna stay there. But I do think for the newer artists, there's still plenty of opportunity because there are still a number of companies that wanna be able to partner with them and help them build. Right. You were just referencing Downtown and one of their key tenants of their mission is, let's help you become a superstar where you can continue to own the assets that you have. And there's a tremendous team there that has a tremendous amount of backing and tools to be able to make that happen. So I think things like that are really, really interesting. I think we'll have to continue to see how it plays out to see if we can see someone that can continue to go that route without ever having to given it up. Cuz I think right now you've seen a lot of folks were traded in at least, you know, some ownership for their rights early on. But then once they got enough leverage, they were able to get them back, which I think is powerful and in their own right. But have we seen it the other way where they started off owning everything and they've continued to own throughout their career? I think naturally there's any type of trade off you have to do when you have a business partnership. So part of that comes with the territory. But with so much flexibility and so many more options, it's gonna be interesting to watch. And that's one thing I'm interested in.[00:26:23] Larry Miller: You just mentioned the charts a minute ago, and I know that you just did a pretty deep dive on a comparison, of the billion stream or billion view charts that YouTube and Spotify separately came out with, that revealed some sort of interesting, you know, nuanced insights about what is similar but different about those platforms. What did you find? [00:26:47] Dan Runcie: Yeah, and I guess first for a little bit of context there, one of the drivers for this analysis was because, both Spotify and YouTube generated a tremendous amount of revenue for the music industry. I believe Spotify had last shared that they generated 7 billion for the industry. YouTube generates six or seven, I think it's 6 billion. The last thing that I had seen them put in, so, that is a sign. Okay, great. You know, you tie that back into the numbers you shared before. You can do a little bit of backwards math to see how much of that is responsible for the overall industry with where it is now. So you see that, and then you also know that like anything else, the most popular songs drive most of that revenue. So you can kind of get a good idea to be like, okay, what are the songs that are driving The music industry right now, and if you're looking at those two platforms specifically, a lot of similarities because I think some songs are hits regardless of the platform, but a lot of differences too. I think there are a few things that stuck out. Spotify specifically is a bit more leaned, at least as of right now. It's a bit more skewed towards English speaking music. I think that's just given where it's got a lot of exposure. In the earlier years, Spotify, a Swedish company, had a lot of exposure specifically in Western Europe, and then we're seeing it now with a bit more of a saturated market now in North America, but YouTube has been much more international. As a, you know, result. And in many ways, as a compliment, it was a free service and a lot of times it was able to reach and help and make sure that people could upload and reach people all across the world. And I think with that, we've seen a lot more artists from Latin America that have been able to excel quite far on spot on YouTube's list specifically. And we may not see them as high on Spotify's list. So that's something that was definitely a bit unique. With Spotify specifically, it aligns a bit more towards radio hits in general because you think about music itself, it is a very flexible type of thing that people wanna consume. You can listen to something on Spotify while you're at a friend's party. You can listen to it while you're, you know, on, on yourself, demand. You're hearing music on the radio, the grocery store. There's so many ways where the same song can resonate in a way that watching the music video, it's a little. Right, like it's a much more active thing. You're gonna probably wanna sit here and have this more visual engagement and experience with it. So with that, it highlights a few things. One, YouTube is probably gonna be a bit more aligned to what someone may actively choose to wanna listen to. So there's some insights there. But YouTube's also a bit specific because. The platform is a bit more driven by memes and things like that, that probably just don't get as much notoriety or become as relevant as they would be on Spotify. Like for instance, are you all familiar with the song?, Nelly and Kelly Rowland, Dilemma. So there's this iconic scene in that music video where Kelly is texting someone and she's using Microsoft Excel to text the person . And it's bizarre because it's something that probably didn't get that much, you know, attention at the time it came out. But now that people can rewind and look at stuff, it's fascinating. So things like that, you know, just don't translate the same way.[00:30:15] Larry Miller: What about the community building and just the community-esque  interaction that has been natively part of YouTube for really quite a long time now that is still kind of blacking at Spotify? Is that a factor?[00:30:32] Dan Runcie: I think so. And I'm glad you brought that up because I think YouTube's power in a lot of ways is, you can look at the comment section of a lot of these songs, and it's almost like a trip down memory lane, especially for some of these songs that you may not have visited in a little bit of time. And artists can see the name of their fan, they can interact with them, they can find a way to be able to try to build a bit of a community there. You can't necessarily do that on the same platform on Spotify. I think in a lot of ways, Spotify and maybe some of the other digital streaming providers from a strategic perspective didn't necessarily give artists the option to be able to see who their fans were, because I think in some ways that data has so much value, right? Spotify may share it as a flex every now and then through Spotify wrapped and things like that, where you can be like, oh, I'm in the 0.4% of Travis Scott fans. You know, I guess I listen to, you know, whatever song too often. But besides that, you don't really have that. But think about the power that an artist could have if they could do that themselves on YouTube. Even though you don't get that data, you can still see some familiar people. You can, you know, find some way to connect or go off platform if you can. And that creates the ability to build a niche. And I think in some ways it helps you have the algorithm just work in your favor, right? Like I think YouTube just being based in general off of, you know, it's the second biggest search engine, so you're leveraging everything from Google's power to be able to help power that. It just helps you as an artist be able to connect directly.So someone I mentioned earlier, NBA young boy. The way that he's used YouTube has been pretty fascinating because he releases his music first on that platform and he's someone that's releasing music every time. And the way that he's been so focused on it, it's almost similar to someone like, do you all know who Mr. Beast is? The YouTuber? Yeah. I heard a few laughs there, but it's almost a bit of a similar mentality to that where he understands that this is his audience. He sees what's working in the algorithm  may continue to serve them, and because of the success from YouTube, he's been able to translate that to other platforms. So I do think that that's a platform, and I think there's a few of them, but artists being able to find a platform that allows them to connect with fans, and especially if fans in their niche or in their base happen to be there. It can be really powerfu.[00:33:04] Larry Miller: I want to remind you that we're gonna have a couple of minutes for questions from you and you know, please figure out what you'd like to ask Dan. And I'm not sure exactly where we're gonna have a mic set up, but I know it's gonna be somewhere. It's walking around the back of the room right now. But first I have another question. When we were talking earlier, we had talked a little bit about the shift in capital business model and that where you had started out as a subscription based business and now that it is, you know, entirely sponsorship driven and that one of the things that that has afforded you is the ability to help build deal flow as the result of the subject matter and the segment of the business that you're in as an angel investor. And I wonder if you can say more about that, about what your experience has been and what your aspirations are. [00:34:09] Dan Runcie: Yeah. No, thanks for asking that for me. Going back a little bit. When I initially started Trapital, the thought was to have this as a paid subscription service model where I would have a free piece that went out every week, and then if you wanted to have additional pieces written, and it would be specifically for the people that were most interested, and it would be $10 a month or a hundred dollars a year, and I did that a little under a year and things were working and I mean, things were growing. I took a step back because I felt like what was most effective for me and what was most effective for the type of things I'm doing was I wanted as many people as possible to be able to be able to either read or listen to the stuff that we're sharing because I felt like this wasn't like I was writing about tech or finance where there were plenty of people that had been writing about this, but there was something that, you know, you were gonna get like a trade secret or some insights from me that you wouldn't necessarily get elsewhere like you had shared in the intro in the beginning. I largely wanted to start this to be able to elevate and hopefully change the discussion so that when people talk about whether it's the business leaders and the strategic moves that are happening, your names like your Rihannas and your Jay-Z's can be mentioned in, you know, in the same breaths as your Jack Dorsey's or your Jack Welch's or other people like that. There are successful people in this industry that are doing this, and being able to highlight that was effective. So the more that I could broaden who could have access to it and who could read it, the more that that would be possible. And I felt that there was opportunity from a sponsorship perspective, from other companies in this space, or even tangentially outside of the space that wanted to align with this type of content and the type of people that were reading it, that I knew that not only could it match the revenue that was coming in from the subscription, it could likely be even larger. And with that, the more people it reaches, the more that it helps everything else grow. And one of the things that it's afforded me is the ability to not just be able to, you know, write and share insights about the strategy of what's happening, not just from the artist level, but from the companies that are in the space and technology, where a lot of them started to reach out to me and wanted to get my advice on, hey, this is what we're building. What do you think of X, Y, and Z? But what that specifically offered then was leading to the next conversation where, hey, we're gonna be raising. And we would love to have you on as an investor specifically because we think you have the insights and we think that you could be a value add to what we're building. And you know, after I think, you know, a few of those conversations, that's where I say, you know, this is something that can be taken more seriously because the insights are here and the spaces here are obvious. And I think that it became more and more clear that I could use this as an opportunity to, you know, back and support a lot of the companies in the space, specifically the ones that were aligned with the way that I had seen clearly what was working and what wasn't. So it's afforded me the opportunity to make angel investments in several of these companies and something that I'll continue to do through the work that I do here. And I think having a podcast, having a newsletter has been a great way to do that. And ultimately just continuing to, not just me, but other folks on the team with their help as well, to make sure that the content and the insights that we're sharing is as helpful as possible. Cuz at the end of the day, this is research that we wanna be able to make it reach as many people as possible that are interested. And then with that, knowing that it's not just the content and the insights that are helpful, but actually being able to provide, you know, financial backing and support to the companies in this space that can help, you know, make it, you know, as strong as it can be, not just for them, but for the other companies. I mean, it's a space that has had so much innovation and I think one of the things that's been a bit frustrating to see at particular points is that a lot of the newer companies in this space have had a PR, and had a pattern of asking for forgiveness instead of permission from the music industry. Yeah. To be able to use the rights of a lot of the songs, to be able to have a lot of the partnerships that they should have in place. And it doesn't have to be that way. I think there are great people out there that are building companies the right way. They're having the conversations early on and being able to help be part of that movement has been really fascinating and inspiring to see as well.[00:38:44] Larry Miller: Great. Thanks for sharing that, Dan. Let's go to your questions. I know that some of you have questions for Dan. If you do have one, there's an open mic in the middle of the floor and we'll give you a moment. Step right up. There is a questioner.[00:39:00] Audience 1: Hey, how are you doing? I just have a quick question. I'm really curious on how you feel about just botting in the industry in general, because I feel like when you were talking about the YouTube charts compared to Spotify, there could be some discrepancies in the data just because it's a lot easier to bot on YouTube versus Spotify you can get flagged. So I'm just kind of curious to know what your thoughts are around those charts. You know how accurate the data is and also what you think about that in general. Because I feel like, especially in hip hop too, it's really prevalent and it's definitely a lot about getting the numbers and stuff like that. And a lot of my clients have, you know, similar thoughts about that. So I'm just curious to know what your thoughts are on the morality of that. Is it worth it? Is it not? All those things. So yeah. Thank you.[00:39:43] Dan Runcie: Yep. Great question. I think I'll take it in two parts cuz I think there's issues with bots on streaming sites that are issues with bots on the ticketing side too. As you know, a lot of people have probably experienced it, but on the streaming side of it, it's something that I've looked at and thought it's frustrating and it's wrong because a lot of people are just gaming the system because I think that the technology has improved where a lot of things like streaming farms and things like that have been able to, it's become a little bit easier to be able to figure out like what to ignore, what not to include from a data perspective, where I think a lot of that's been ignored. But I think a few people, I don't know if anyone saw, but there was this video going around about how I don't know if it's true a hundred percent or not, but like Travis Scott's team, like gaming the system to be able to, you know what I'm referring to? Like, to be able to help boost the sales for Astro World. And it's one of these things where, okay, you could, if I'm taking a step back, directionally speaking, do I still think that he would've been as popular as he is without that happening? I still do. I mean, I think that there were so many things treading in that direction, but did that help? I'm sure it did. You know, so I still do think that it is something that is directionally, it can still give you a pretty clear idea over what's accurate and what's not. I think it's really hard to pierce through the top and be there consistently if it's purely driven by bots. But I do think that more likely than those things come to the surface in some way. Whether it's an artist that is streaming or they have tons of  social media followers, but then when it becomes time to try to sell a concert ticket, The tickets can't sell, and then that artist then has to downgrade a venue or they have to cancel the show because of things like that. These things always find a way to come to head. So I do think that in some cases, some type of retribution does often happen for artists specifically with streaming, just to get other questions in. I won't go into the ticketing piece of it. I think we all know how, you know, you know, horrible that that can be, but yeah.[00:41:52] Larry Miller: Do we have another question? Oh, good. Hi. Welcome back.[00:41:57] Audience 2: Who decided this way of asking questions? This is really weird. Hi Dan. Is the superstar dead? And if so, is that necessarily a bad thing? [00:42:07] Dan Runcie: Good question. I don't think superstars are dead, but I do think the definition of what we describe them as has shifted and it continues to shift over time. Right, because. Let's say we go back to the sixties or even, let's take a step back. Even if you go back to the nineties and say, okay, our superstar's dead. No one is as big as Beatlemania was before people would say, you're right. No one's as big as Beatlemania, but Whitney Houston and Mariah Carey are still very popular as our Boys 2 Men are whoever else. And I think that's kind of shifted now to someone being like, okay, well our superstar's dead. Can someone be as big as Beyonce? They may not necessarily be as big as Beyonce in that same type of way, but I mean, Billie Eilish had a pretty good year. I think even though I think she came out in the late 2010s, she still had her, you know, big moment 2019. I think we're also seeing, I think if anything, the biggest superstar potential now, just given the way that things have expanded, is on the international side too. You look at what Bad Bunny’s doing. I mean, that is a superstar at every definition. The fact that a non-US album or a non-English speaking album has been on the top of the billboard list for almost the entire year is incredible and the billboard is really just capturing what's happening in the US. So imagine if that was a worldwide list. So, yeah, so I think it shifts in that way where I think, you know, 20 years from now, people will be saying, oh, is so-and-so, you know, or a superstar's dead because no one will be as Bad Bunny be as big as Bad Bunny. So I think it continues to evolve.[00:43:48] Larry Miller: Great. Hi, Max.[00:43:50] Audience 3: Hi. How's it going everybody? First off, I just want to say, I can't believe you started this speaking about Currensy. I'm a huge fan of his and he has a lot of unique ways of releasing music. And so my question is, if you're a burgeoning new artist who's trying to get as many listens as possible, would you suggest trying to move forward in platforms that are really big right now? Or finding platforms that are emerging, trying to develop a fan base there where there's less competition?[00:44:19] Dan Runcie: I think it's a mix, but I think, and maybe instead of the last piece of it in terms of finding platforms that are emerging, I think it's more so finding a platform that may seem less quote unquote sexy. But is that gonna be more so where your fans are where your folks like to be. Like for instance, I think a platform like Audio Mac has been doing pretty well over the past couple of years, and they may not get the same level of headlines that Spotify is, but if you are an artist that has a strong following in West Africa or in other parts of Africa, and you know that Audio Mac is one of the leading streaming platforms there. And then that's gonna work out tremendously in your advantage. And I don't know if I necessarily consider them like newer emerging, but I think it works out there. But on the other side of it too, still having exposure o on your Spotifys and your YouTubes and your Apple musics is still good as well because you want to, you don't know when that moment may be that you, for lack of a better word, like breakthrough and have that hit. And when you do, you wanna be able to still have something in those other places. Even if you had your home base on, you know, one of the platforms that may not get as much exposure but for the people you're trying to reach may be the best thing.[00:45:38] Larry Miller: What do you got?[00:45:40] Audience 4:  Hey. So, in a conversation of superstars, you know, you talked about the notion, the billboard, headline, you know, too many hits starting up superstars. The platformization of music where it is right now. Maybe it's a little bit harder for superstars to kind of come up and cut through the noise, but the potential, like you mentioned, to be a superstar is never any bigger in that sort of way. You mentioned the implications on, you know, from like the label side of things, from the other side of things a bit. In your opinion, what are the implications from a music consumption standpoint? You know, the average listener, people that listen to music in terms of the implications for music discovery, how music is in people's lifestyles and the way that it is now with platforms and just the superstar conversation as a whole?[00:46:24] Dan Runcie: Yeah, I thought about this a few ways because I think that one of the things that we're missing a bit because of the way things are now, is that someone can have a song that is topping the charts, but it's not the way that it was maybe like 10, 20 years ago where, oh, if the song is the number one song in the country, oh, like I heard it on the way to the grocery store and then I heard it on the radio and then my friend was probably playing it when I went over their house in the afternoon. No, it's more likely to be that the super fans of this song have been like, you know, streaming the hell out of it and they just have been going nonstop and I may not even know who that person is. So a bit of that water aspect isn't necessarily there as much from a fan perspective. I think the other piece of it is the algorithm of the streaming services double down on this more because at least when I log into Spotify or if I log into one of the streaming services, I'm more likely to see the songs that I've been listening to before. I'm more likely to get some type of daily mix that is based on what I've been listening to before. It's harder for me to be able to see. If I actually wanna see, okay, what are the new top hits? Like I have to search for that to some extent and go out of the algorithmic feed. That's already been tailored to me. So I think it makes it harder for me to go search for those things. And in some ways, the platforms kind of design it that way because they're like, okay, if they know that I am Rihanna fan. They're more likely to want to share with me more Rihanna songs I haven't listened to than assuming that I'm gonna like whoever may be the rising artist right now. So I think it makes it tougher from that perspective. And I think a bit of that shared community isn't, isn't there as much. So I think from a fan perspective, I've kind of had a bit of a double-edged sword because while I think part of what attracted me to so much music and memories is being able to have those shared experiences with people as opposed to now it's like, you may have like these super fandom experiences, but it's with these people that may not necessarily be in your direct area, but you're all connecting online in this way that you may not have.[00:48:33] Larry Miller: Okay, good. I think we have time for, well, let's ask this question and see how we're doing for time. Go ahead.[00:48:39] Dan Runcie: Maybe you could do like a rapid round, we could get through.[00:48:41] Audience 5:  Just really quick then, what are your thoughts on like NYC Drill? I know artists like Dio Sama are huge. Just on the data side like TikTok and YouTube, so what are your thoughts on it? Sort of, cuz I'm a little skeptical on it going really mass. Like, cuz we're really super focused on NYC. Just how big can Drill really get? [00:49:03] Dan Runcie: Well, I think we've seen, you know, the growth and exposure in the Midwest specifically. I think so you've definitely seen it there. I think you've seen artists kind of having their own moment, whether it's someone like Ice Spice, who I think has blown up pretty recently. But I also think that moments of it hurt, right? I think it really would've been cool to see someone like Pop Smoke be able to have the moment and the rise that I think he was going to have. But even that, I think it's kind of interesting the way you phrased the question, because I think even for something like Drill music, there's probably certain people that, like the concept of Drill music, don't like to reach them in the same way. But if you're in it, you probably already think that it's overexposed to some extent, which I think kind of speaks to this like broader dynamic that we're in, where if you're in something, it can feel like if you're in that niche and you're focus, and I know it may sound awkward to call Drill music niche in that way, but if you're in that group, then yeah, it can seem like, oh wow, this thing has been going on for a while, and now it feels like it's everywhere. But if you don't really tap into Drill like that, someone could be like, oh, what's this thing? So I think that's something I keep in mind with it as well. Like there's still so much more exposure out there. So I don't necessarily have those concerns for Drill music. If anything, I think we'll probably see other regions, especially in the US, continue to adopt it more the way that we've seen New York and the Midwest, specifically Chicago.[00:50:26] Larry Miller: Let's go to what I think is gonna be a final question. Go ahead.[00:50:30] Audience 6: Okay. I just had a question about your thoughts and involvement in like A.I involvement in the music industry. You know, just like in terms of the recording side.  perhaps may potentially be in the Live side of the music industry as well. I don't know if there's any applications for that? But just your thoughts on that.[00:50:48] Dan Runcie: I'll keep this quick. It's funny, I was talking to someone about this earlier today. A.I and anything based on like GPT Three in general is fascinating because I do think it can be addictive for artists, but I feel like I can already see the headaches that are there with so many things, right? Because if it's based off existing content, and of course those content owners are rightfully gonna have certain issues about who's basing these A.I lyrics or songs off of things. I do think, though, that for certain artists it can be fascinating. I don't think it'll get to the point where someone could have like a song that they actually wanna release at a top level that is created by A.I. At least not now. The technology isn't there, but could it help with an artist that is having writer's block about a particular thing? I think it was interesting. There's a conversation. Bruce Springsteen was on an Interview and he was saying how like for him with A.I. he's looking at it as something where, you know, he's like, I've had months where I just didn't write cuz I essentially had writer's block. I just couldn't think of something to be able to put out there. But could A.I. just help jog my memory and even as someone that I am not a songwriter or a musician, but as a writer, I've been seeing these tools and the things they can do, and just being able to plus, you know, sign and then them being able to generate some thoughts, or at least a potential outline of, okay, what could this topic look like? It does at least help jog the memory in the way that reading an article or something like that can be such a fascinating space. I know we're over time, but yeah. Fascinating space. [00:52:31] Larry Miller: Thank you. We're gonna have to leave this here for now, but you can hang out for a while and chat with everybody as we run through the rest of our program and maybe even a little bit afterward. And so let's thank Dan for a really thoughtful discussion.[00:52:50] Dan Runcie: If you enjoyed this podcast, go ahead and share it with a friend. Copy the link, text it to a friend, post it in your group chat. Post it in your Slack groups. Wherever you and your people talk, spread the word. That's how capital continues to grow and continues to reach the right people. And while you're at it, if you use Apple Podcast, go ahead. Rate the podcast, give it a high rating, and leave a review. Tell people why you like the podcast. That helps more people. Discover the show. Thank you in advance. Talk to you next week.