There was a lot of press coverage for indie band Hamfatter when they appeared on Dragons Den in search of £75,000 to help them take the next step in their music career, and were successful in gaining the support of Dragon Peter Jones who invested £75k for 30% of future income.
The reason that the band had decided to take this unusual step was because they found their dealings with record companies impossible. “The deals they offer you are absolutely horrific," says singer Eoin O'Mahony.
"I don't understand how any band can live. You've got to sell like a million records before you've got any chance of anything.”
Investing in musical talent is not unusual Tom Parker was an experienced music manager and businessman who convinced RCA to take Elvis from Sun Records and whose dedication to his acts netted him up to 50% of their earnings.
It is not uncommon in the USA for bands to advertise for investors or financial backers. For their equity they get a guaranteed percentage of the bands future income and in some cases some input into the bands musical direction.
Investing in a winning act can be so lucrative that Jazz Summers the music industry mogul behind acts including The Verve, Snow Patrol and Wham has joined forces with Power Amp a venture capital firm and investment advisory group, and together they are looking to raise £10m for the Power Amp Music fund to launch a tax efficient investment fund.
Web site www.sellaband.com set up by ex Sony/BMG managers Johan Vosmeijer and Dagmar Heijmans has moved into this lucrative environment and you can now invest from as little as $10 in your choice and genre of musical artist or band.
What to look for, or in the case of this investment listen for is of course down to what you believe will do well and Sellaband have a wide choice available to bend your investment ear.
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