Episode 89: What Music Creators Need To Know About Fintech

Money talks in music, but the language is changing—and fast. We dive into how fintech is rewiring artist funding, why streaming didn’t fix the economics, and how data has quietly turned songs and catalogues into investable assets with predictable cash flows. From real-world catalogue deals to creator-first banking tools, we unpack what’s happening on the finance rails beneath the industry and what it means for your next release, tour, or campaign.

We start by tracing the arc from the CD boom to the streaming era, highlighting the core problem: subscription prices set too low to sustain healthy payouts across the ecosystem. That’s where fintech steps in. Instead of judging artists by credit scores, new platforms evaluate streams, fan engagement, and merch velocity to underwrite advances and revenue-sharing deals. We explore the strategic upside of these options for independent and mid-tier artists, including how modest annual earnings can unlock funding when the underlying data is consistent.

Then we zoom in on catalogue financing and why investors are hungry for rights. Better analytics reduce risk, streaming creates durable income, and targeted marketing can lift revenue post-deal. We also address blockchain’s practical wins—smart contracts, automated splits, transparent ownership—beyond the hype cycles. Throughout, we keep labels in the conversation: their expertise and infrastructure remain valuable, while fintech expands choice, speed, and clarity for creators who need runway without surrendering their entire future.

If you’re weighing ownership against growth, or wondering how to use your data as leverage, this is your field guide to the new money map of music. Subscribe, share with a friend who’s planning their next release, and leave a review telling us what funding path you’d take and why.

Transcript

Why FinTech Matters Now

From CDs To Streaming’s Broken Math

What FinTech Actually Is

FinTech Enters Music

Artists’ Need For Funding

Catalogue Deals And Data Advantage

Creator Finance Beyond Banks

Blockchain, Smart Contracts, And Payouts

Why Catalogues Became Hot Assets

Streaming’s Predictable Cash Flows

SPEAKER_00 0:17

Hello, and welcome to the Music Business Buddy with me, Johnny Amos, podcasting out of Birmingham in England. I am the author of the book, The Music Business for Music Creators, available in hardback and paperback and ebook format. I'm also a music producer and songwriter. I am a consultant, an artist manager, and also a senior lecturer in both music business and music creation. Wherever you are and whatever you do, consider yourself welcome to this podcast and to a part of this community. My goal, everybody, is simple to try and educate and inspire music creators from anywhere in the world in their quest to achieving their goals by gaining a greater understanding of the business of music. Okay, in this week's episode, I am returning to a subject that I've looked at before, and that is fintech. So I was first alerted to this subject all the way back in episode 27 when I met the fantastic Keith Jopling, who is a music consultant, researcher, he does all sorts of different things, one of the most impressive minds in the UK music industry. He's a former global head of strategy at Spotify, and he alerted me to the subject of fintech and how it's changing the artist's funding model. Now, I followed that up in uh episode 28, kind of explaining a little bit about what fintech was. But don't worry, if you you're in a rush, right? If you don't want to jump back and find that episode, I thought I'd do another episode on it because that was over a year ago, right? And in the grand old scheme of things, in time, a year, you know, it's not that long. But in the music industry, a year is a really long time, isn't it? Right? With all the change that we witness, especially when it comes to finance and technology and where those two things intersect. So let me just zoom out and think about this objectively, right? So, decades ago in the 80s and the 90s, where the recorded music industry and music publishing were absolutely flourishing because consumers were buying physical product, it was a golden boom of economics, right, in the music industry. It made lots and lots and lots of money, and it hasn't really done so since in the same way, because when physical products stopped and things got digitized, it changed a lot of things. We know this, right? In fact, I did a recent episode on Napster and the history of Napster and what they're doing now, because that's something that really fascinated me. Because to me, there is a before and after in the music industry, and Napster Napster sits right on the middle of it. There was a before and after, right? So that's okay. I'm not here to moan about stuff, right? It is what it is. There are so many amazing opportunities in the music industry. In fact, I'll be as bold as to say it's probably better now than it's ever been for a whole multitude of reasons, and one of them is because of where things are headed in terms of funding for artists. Now, let's think about this, right? In the dawn of the digital download era, so we're talking about the Web 2 era, early 2000s, people started to not want to pay for music anymore. We know all about that. If you don't know all about that, that's okay. It just music sales stopped, right? In the Western world at least. Now, what happened after that is that people started to download music and then eventually streaming came in. And it kind of felt like streaming fixed things, but it didn't. I'm going to explain why and then explain what the solution is to it. So when streaming came in, it kind of audio streaming, I mean, well, visual streaming as well. You know, music makes a lot of its money from media, of course, as well. So when that all came in, um, it started to, in some ways, remunerate rights holders for their intellectual property, for their songs, for their recordings of their songs. Those are the two things I'm really talking about, right? Now, it only kind of went partially to partial recovery, let's say, because as we all know, and and I don't think I'm telling you anything new here, um, it's a rather broken economic system. It doesn't really make money in the same way that music used to make money. Because people, and and I think a lot of people moan about like Spotify don't pay enough, and I get that argument, but the problem, again, with that is that we don't pay enough, actually. That's really the problem. We don't pay enough. We pay like, you know,£10,$10, whatever a month for our streaming service. And it's not enough for it to go around. So there's a broken economic. If all of a sudden we started to pay£40,£50, um, then it might fix it. But people don't really want to do that. I don't want to do that, neither do you. That's okay. Um, so there is another way forward. Now, if we think about this again, quite objectively, streaming, video streaming has been around now for what, I don't know, what's 13, 14 years? And um, during that time, you know, we've we've we've kind of learnt about this broken economic system where it doesn't really pay out enough to rights holders. We know that. I'm not presenting anything new to you by telling you that. However, what it has done has created an immense amount of data, and that's data locked in culture, and music is culture. Now, there's a link point there between where that sits and where the fintech world comes in. So let's just dive into understanding what fintech is, and then we're gonna look at its role in the music industry. So let's just start off simply by explaining what fintech actually is. So fintech is a hybridized word, fin and tech, financial and technology. So those two words meet and they make a fintech, right? So fintech companies use software and apps and AI to make financial services. They make things faster, they make things cheaper, they make it more accessible. And instead of visiting, let's say, a bank branch and dealing with paperwork, fintech allows people to actually manage their money digitally. So think Google Wallets, Apple Pay, Stripe, PayPal, mobile banking apps, this is all fintech, right? Now, where else does FinTech operate? Well, biometric authentication, right? Things like LinkedIn. If you want to verify your your information on LinkedIn to become verified, uh that's that's that's a form of fintech, right? AI-informed fraud detection, encrypt transactions, blockchain, uh, decentralized finance lending. So if you want to buy something online and uh and it costs, let's say, 200 pounds and you think, I want to spread that over three months, then you can use something like Klana, FinTech, right? Now, the other thing that fintech does is investing, and that is what we're going to look at. Okay, now fintechs are operating in the music industry because artists are data rich, right? So businesses operating in a global digital ecosystem with fairly broken financial infrastructure, like the music industry, is where fintech really starts to thrive because fintech can modernize payments and royalties, financing, also fan monetization. So if you roll back to some of the interviews that I've done with some big CEOs about the companies that they're starting in the Web3, this all falls in line with decentralization and with actually artists having control of their careers. I know this is a lot to follow, by the way, everybody. So I'm gonna try and simplify some of this now to actually explain how FinTech finances from giving artists money to invest in their careers. Okay, artists need money, right? There's nothing new about that. Um, it's not gonna go away, it's still gonna be a thing. Artists need money because they need to spend money on recording music and on marketing the music and also money to live on, right? Now, traditionally, as we know, you can get advance from a record company, from a distributor, from a music publisher to be able to do that. And that's the system that we know, and that still exists, and I think that that will continue to exist for various reasons, right? However, there is another option here, and that is fintech. So you may have noticed I recently interviewed just a few weeks ago, Elliot, who's the head of growth of Duetti, Duetti a FinTech company, right? So they will invest money in an artist in exchange for a partial or wholesale of their music catalogue. And they then can also use their marketing tools to be able to use that catalogue and drive further revenue on it. Now, the data is the crucial aspect there. So let's just dive into that a little deeper. Artists are effectively running their own brand business now, right? Regardless of who they're signed with or who their stakeholders are, they can launch products, they can build fan communities, they can own IP, a music asset class in its own, whether that's songs through music publishing side or recordings through what would traditionally be signed to a record company, still can be. They also run their own direct to consumer business. Now, there's nothing new about that, but how that is monetized is starting to change. So if we think about how fintechs operate, so the financial operating system for creators, fintechs are not just a bank, they're a platform, right? So think about artists checking their accounts, their smart wallets, their expense tracking, building credit on fan engagement. You know, where a bank might run a credit check on an artist, a fintech wouldn't do that. Instead, they would look at their data, their fan engagement. And that could be data in in in regards to reach in social media or in regards to reach through streams. That data is absolute treasure to fintech companies because of how they operate. So, what do fintech get out of this? What do fintech companies actually achieve by doing this? Music gives fintech a cultural credibility, it gives it a younger audience, it gives it an organic community growth, it gives it brand differentiation. For fintech startups, competing on features is actually quite hard, but competing on culture is powerful. And music, as I mentioned earlier, is culture. Now, blockchain has also accelerated the convergence. Now, I know what you're thinking. That created itself somewhat of a distorted understanding, let's say, in the early part of this decade, especially when we started to understand NFTs and what they do and then where they went wrong. But I boldly predict that they're going to come back and they're going to be called something else. And that's going to be a part of this too. Blockchain offers smart contracts, automated royalties. It also offers transparent ownership records and programmable payments. Now we know that labels and legal systems are slow to innovate. The music industry still runs on legacy contracts, on manual reconciliation, on long payment cycles. FinTechs don't do that. FinTechs offer a build-around creator-first model, let's say. So we're talking about modular services that can integrate with modern platforms. Now, if we then think about the acquisition of catalogue and how that catalogue can be used, share data, what we're seeing is that music is an incredibly powerful tool for fintechs to be able to invest in. And even if they lose money on it, they gain in other ways. That's totally different from a record company, isn't it? A record company would want to invest in an artist to be able to say, we'll give you this, in the hope that we not only get it back, but get more. FinTechs do do that, but instead of just getting money back, they also get data. And that data-rich flow is absolutely crucial to what they're all about. So when artists think about their intellectual property, their songs and their recording of those songs, there's a different type of value that's added to it, other than just the music. It's the role that music plays in other things. Now, we've known for many years now that music in itself, in its own intellectual property, when it in regards to sales and digital and fixed digital, i.e. streaming, we know that that doesn't really make as much money as it used to. We know that, and my goodness me, so many people have tried to change that and to fix it, and maybe people will, but I don't think it will happen. Because so instead, music has had to transition into making its money effectively through media, through sync licensing in a whole heap of creative ways, whether that be through television, through ads, through games, that has started to become the new answer to how to monetize music IP. Now, what I'm presenting to you is another way. Now, music intellectual property has become a higher value asset class in recent years. We started to see a lot more catalog sales. Here's why. Streaming creates predictable income, and investors want to yield and diversify. Better data reduces risks because it tells people more about what's actually going on. Artists need upfront cash, and additional revenue channels through Sync have grown. Together, all of these things turn music catalogues into highly sought-after financial assets. Artists and rights holders, songwriters, producers, whoever owns rights, can exchange those rights for money and then parallel other income streams against that. That's what we mean when we say an artist-entered artist-centered ecosystem that also has other things where an artist makes money. Now, streaming, we know it doesn't make money, but there are huge upsides to it. So let's have a look at that. Streaming has created predictable long-term revenue. So streaming platforms like Apple and YouTube and Spotify have turned music listening into a very steady recurring revenue stream rather than one that's driven by physical sales, one-off downloads, or patches of campaign management that show boosts and then drops. Older catalogues earn ongoing royalties as listeners stream them. Because the idea of what is new is is almost gone now to many people. I I remember just streaming a song for what I thought was the first time just yesterday on uh Discover Weekly on Spotify. And I thought, wow, this is really cool. And then I looked at it and I was like, oh, it came out in 2016. And I felt a bit silly, but it doesn't matter, does it? Because that was new to me. And that's how streaming works in terms of music discovery. So if we put that back to a legacy catalogue, no wonder we're seeing so much catalogue sales because all of that old data, if you will, is now new data, and old songs are now new songs. Now, these cash flows are predictable and they're long-lived, right? And they're very, very attractive to investors seeking to yield. So this matters because investors can model future income with more confidence than in the past, which makes music catalogs resemble long-duration financial assets. Music catalogues also offer higher yields with many bonds or saving products. So institutional investors like pension funds and private equity and hedge funds began treating rights as alternative income assets. But as markets mature and data gets better, it means that music and artists have a completely different metric for not only growth and discovery, but also value. Okay, so I hope that that kind of makes a little bit more sense. Please do, you know, I say this a lot, but I really mean this, guys. Feel free to reach out to me, ask me questions. I don't claim to be an expert on this subject. There are a lot of people out there that are experts on this. I suppose if I have an expertise, hopefully it's in the music industry. And the music industry can feel like it sits so separately to other industries. So one of the things, if you listen to this regularly, you'll know that one of the things I like to do is look at other aspects of the creative industries to see what we can learn in the music business about how the film industry operates or how casting works in films and television compared to how it works when it comes to talent scouting for labels. It might sound like complete two completely different worlds, but they're not. If you're wondering at any point, what on earth do all these financial services and technology have to do with the music industry? My answer to you is simple. Everything. Okay, that's a little summary on that subject. It's time to start thinking about it, everybody, because I don't think this is a flash in the pan. I think it's already it's not even the future. It's already here. It's kind of like AI, right? And the fact that there's a huge crossover between fintechs and AI. There has to be, right? Because it's all deeply rooted in technology and where data sits and how it informs people and how it informs people's creative choices and decision-making processes. So there's a lot to think about here, I know, but if I was to boil this down to simplicity, it's this. Artists need money. There's only really been two ways that that's worked before. Either artists spend money, their own money, or they get it from an investor like a record company, a music publisher, or a distributor. Now, there's another way to get that money, and it's just understanding how it operates. So when I interviewed Elliot from Duetti recently, it suddenly became clear to me that actually we're not necessarily talking about big A-list music recording artists that they're trying to work with. It's actually more grassroots artists as well, and mid-tier, mid-level artists. It's a whole range of different people. So if you're making, let's say, roughly$2,000 on your music revenues per year, you are eligible for working with a company like Duetti. And I mention Duetti because I'm very impressed by what they offer, because it's not just the asset class acquisition of whole or partial catalogue. It is that. That's their bread and butter, if you will. But it's also what they then do on the marketing side. When I when I take uh a guest on, like Elliot or like anybody else, it's because I believe in their their goals. I believe that they will add value to you, the music creator communities globally, right? And so if I talk to a person or I talk about a company like I am now, it's because I genuinely believe that they are playing a role that, yes, it helps themselves, of course it does, it's business, nothing wrong with that, but it helps a lot of music creators to be able to get out the hole of I need money to do this thing, and I don't have that, and I don't know how to retract the interest of a record company, and I hear maybe I shouldn't even do that, right? So I am not here to downplay the importance of record companies, not one bit. We need them, right? We need the people at them, we need the expertise, we need the systems that they create, the protocols, the campaign management, the whole thing, there's a list that goes on there, right? I am not for one minute rubbishing them. I'm just saying there's another way of doing this. And it'll be very interesting to see how record companies build their response to fintech. I don't know what that's gonna look like yet, but who knows? Maybe I'll revisit this in another year and I'll do another episode on it. But it's been a year since I've talked about fintech, and as you can see, I've learned a little bit more about it, and I'm trying to do that so that you do too, because I think it's something that you're gonna need to know about going forward. Okay, that's enough from me today. Have a great day, and may the force be with you.