Noah Dinkin and Spencer Richardson didn’t need day jobs. The two friends already had full-time gigs lined up when they graduated from New York University’s Stern School Of Business in 2006. But they were looking for some kind of a side project, a hobby that could, as Richardson says, fulfill “some of our entrepreneurial desire.” They started kicking around ideas and trying to pinpoint an area of business in chaos, something where there was information that was “very disparate and factured” that they could fix. They found a match in the music industry.
Dinkin and Richardson identified the difficulties artists face in trying to communicate effectively with fans across social networks and through emails. Their solution was FanBridge, a fan relationship management service that helps artists to manage their electronic interactions with their fans. The brains behind the operation talked with CMJ about why the music industry was the perfect place to get innovative, Facebook vs. Myspace and how email addresses are more valuable than Twitter followers.
What drew you to start an entrepreneurial project in the music industry?
Spencer Richardson: We realized there was massive chaos in terms of the music space. So we thought, OK, massive chaos equals massive opportunity. We started thinking about the problem in the ecosystem: How was content being created? How was it being consumed? I think we saw more dollars going in than ever before, more content being created by more diverse of an audience than ever before. And yet there was kind of this black hole of where cash was going, and the industry seemed to be depicting piracy as on the rise, kind of falling apart and yet, more people were engaging and consuming music. There were a lot of people paying attention to the artists, trying to come up with products and services around them but, really, no one helping facilitate the communication and interaction and data between the artists and their audiences, their fans.
So we thought, “We’ve got 600 dollars. What can we go do to solve the artist/fan relationship problem?” We decided on, “OK, well we could get a server, and we can basically send emails.” So really what we started out as in the very beginning, back in late 2006, was kind of a constant contact for bands where we offered just a very price competitive and affordable way to add email, put up signup forms on your Myspace, which was very big at the time, on your website, collect more emails and then, ultimately, send standard HTML email blasts. You could target by geography; you could create groups. We got a very early product out and into the market that just took off. It was really one where we were talking with artist friends of ours; they were talking with people subsequently. We had a lot of growth through word-of-mouth where people were saying, “Oh you’ve kind of solved an early version of this email headache,” which was largely just getting everything into one database and being able to send nice-looking blasts out. And this was still like a hobby, so we were working nights and weekends pretty much every Sunday from 10 a.m. to 2 a.m., and maybe we’d have dinner, and if we did really well, maybe we went to a movie. But it was a long year that we worked on it. The first version of the site was ugly and barely worked, but it was such a pain point that people started using it and people started paying us to use the platform.
How do artists sign up with FanBridge? Do they come to you with their own fan email lists already?
Noah Dinkin: Anyone can just go to the website and just sign up themselves. We’ve always been big believers in the self-service model. People come in with a list, whether it’s from another email provider, or they tried to use Outlook or Gmail or Hotmail. Some people come in with nothing. But in every case, people want to grow their list. The first step is giving them signup forms, whether they’re flash or HTML, or now we have iPad and iPhone apps, to help put those widgets on their Myspace page, the website, Facebook, to collect more fans onto their list.
We started in the day of, “I have 2 million friends on Myspace, what do I need their email addresses for?” Over time, people really learned the value of owning that direct relationship that starts with the email. Twitter is really good for some things, and having a huge number of Twitter followers is valuable, same with Facebook friends and “likes,” but the email is really the most valuable, direct channel that there is to your fans.
At the start of 2011, FanBridge acquired damntheradio, which is a product that allows users to manage their media-rich Facebook pages. Do you think that Facebook has overtaken Myspace as the music social network?
Spencer: I would say no, not yet. The Myspace situation taught a lot of people that you can’t rely entirely on social networks that really own your information and you don’t have access to it. When you play by their rules, then you really do play by their rules. We do see people moving over from Myspace to Facebook, and I think that’s part of the reason we acquired damntheradio. We wanted to have bets being made as a company where we saw traction happening. At the same time, the conversation is changing because I think people are seeing the value of Facebook within music as identifying a different set of needs than what Myspace was really about. My gut would say that a lot of companies, including ours, are trying to work with Facebook to create a content-rich, viral-friendly environment where music can thrive. But at the same time, it’s really not the de facto either. Content is flying across all sorts of networks and all sorts of channels, and I think that’s why we want to kind of operate in a way where Facebook is complementary, but it’s not really the destination of music on the web.