Over the last fifteen years, since the advent of the worldwide web, there has been a revolution in the world of finance. More money is being raised online today than ever before from crowds of like-minded investors, consumers, and communities of fans, especially in the creative arts. The phenomenon is global and has all the hallmarks of a higher growth early stage industry, with newer sites making the difference in the last couple of years. Kickstarter and Indiegogo, for instance, have taken over much business from ArtistShare, the first ever music fan funded site started more than ten years ago.
… Here are various possible scenarios for the music industry with equity crowdfunding.
First, a management or production company could solicit funds online and use the cash to sign up artists or maintain a roster of talent. It would bring more money into the business, but it could also make the production of music depend less on the manifestation of a creator’s will, for production houses tend to be less about the artist themselves than the needs of music in the marketplace. The US record label system, for all its faults, allows an individuality of expression that the current crop of Japanese production houses, for example, do not.