LocalStar startup signals ‘music middle class’
July 16, 2014
LocalStar, a Sacramento-based technology startup with roots in Nevada County, is developing an industry platform targeted at independent musicians and their fans, aiming to signal the birth of a new "music middle class" by providing a service that allows independent musicians to sell their music as subscriptions directly to their fans, earning recurring income while fans receive ongoing music.
"I'd say confidently that we've got 25 to 50 artists that would be ready to sign up with us if we started tomorrow," CEO of LocalStar Neal Liggins said. "Because no one is doing exactly what we are doing."
LocalStar would allow fans to subscribe to a musician on their site for a small monthly fee, and receive ongoing music and exclusive perks as a result. The company looks to build a viewer base for independent artists, and cultivate fans for life, allowing independent bands to make music a viable, sustainable job or career.
As part of the company's road map, LocalStar is competing in the Velocity Entrepreneur Showcase, sponsored by Velocity Venture Capital, a Folsom-based group that funds technology startups. The competition asks startups, after passing an initial elimination round, to collect one-dollar votes from supporters to move them to the next round.
Currently, LocalStar has gained local momentum in the competition, with voters pledging support for the company and boosting them into 2nd place in the competition.
"They're using the crowd source model to kind of see how much attention each company can generate, and kind of gauge the hustle, if you will, of each team and let that be a factor of who gets in and who gets to take it to the next level," Liggins said.
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The company was initially started by Liggins last November, who then collaborated with other friends and business partners at a Google tech startup weekend event.
"Being former musicians ourselves we were trying to figure a way to put effort toward music to make some sustainable income," Liggins said. "The same venue we saw bloggers using, we figured it would be sustainable if it were reoccurring, and we thought, 'Why wouldn't that work with music?' The only difference is the content. So we were able to piece together a model that would work music-wise."
Music industry sales from streaming and subscription service platforms have grown recently with a 51% increase in 2013, representing over one quarter of total revenues from recorded music. While mainstream artists often get the bulk of this online and digital income, LocalStar seeks to provide opportunities for independent artists to break into this market.
"A band with 1,000 subscriber fans at $2 per month brings home a $2,000 monthly paycheck," Business Development Lead and co-founder at LocalStar Robert Trent said. "That's good, reliable money for an indie artist. The Rhapsodys, iTunes, and Groovesharks of the world don't offer this type of opportunity to indie artists. LocalStar is replacing high overhead and one-off sales with recurring income."
Trent, also a former musician with the 1980s punk band "Ministry of Truth", said that a company like LocalStar would have made it easier for artists and bands in the past to make a living doing what they love.
"People love the local music scene and people love the music, but going to a bar and buying beers, its not supporting the band in a significant way," said Trent, a Nevada County resident. "LocalStar would allow them to quit their day job and put that time toward making music."
To market the company, LocalStar founders have implored social media strategies, which include the "Localgram," a guerrilla marketing campaign that seeks to recognize various local independent musicians and fans as "Localstars", using the Twitter hashtag #isalocalstar.
"We're totally passionate about celebrating local independent artists," Customer Development Lead at LocalStar Amaru Yawo-El said. "And we're excited to have a chance to express that with Localgrams."
The startup is also looking to design and distribute a mobile app that would allow a band or an artist to create an online and mobile channel linking their music, videos and social media to fans willing to pay for an intimate look into the lives of their favorite musicians.
"They create a channel, just like a TV station, and it's up to the band to fill that channel with compelling content that a user would pay to subscribe to," Trent said. "So the app would give fans an intimate look into their favorite bands and artists."
Liggins says the main focus for LocalStar is to raise funds to bring his vision to fruition for a probable April 2015 beta launch.
"I see it evolving into kind of a consumer basing platform almost like Pandora, but for underground or independent artists," Liggins said. "At this point it's more marketing to the musicians so the musicians can market to their fans. But at some point we see ourselves at a point where we can market to fans directly."
You can support LocalStar by going to http://www.localstar.me, or share a Localgram on your favorite social media site.
To contact Staff Writer Ivan Natividad, email firstname.lastname@example.org or call 530-477-4236.
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