Two well-known musicians, singer Jon Anderson and violinist Jean-Luc Ponty, raised $109,933 on Kickstarter from music fans to get their new band started. As Anderson Ponty Band they plan to record an album and a concert for release next year. In a financial context the number of fans is small and the amount of money raised is almost too small to notice, but this crowdfunding exercise is not just a curiosity. It probably is the right amount of money for the new band to meet its initial objectives.
This approach to launching a major new band probably would have fallen short 15 years ago, when music recording and video production cost twice as much in nominal terms as they do now (or three times as much in real terms). Technological changes have made launching many kinds of businesses, including a music group, a smaller-scale exercise than before. In a way, the crowdfunding model replaces the record company. The technology of crowdfunding is important in itself, but crowdfunding is also relevant because the barriers to entry in many areas are lower than before. With crowdfunding a new business can get started without raising a stir if it wants, though with any kind of entertainment business, any form of advance buy-in from fans creates a pool of invested customers that can form the base for subsequent marketing efforts. Meanwhile the promotion for the Kickstarter project also serves as advance publicity for next year’s album.