Like practically everything in New York City, it turns out music scenes revolve around real estate too. After all, musicians in the city have to solve the same existential challenge that all New Yorkers face: How am I going to afford to live here?
Some musicians work corporate day jobs. Some get by on ramen, living at the outer edge of an outer borough. Others are finding more innovative — and entrepreneurial — solutions.
For the musicians and artists behind the Clubhouse, a collective in Brooklyn, the solution may be a hybrid business — part arts incubator, part real estate venture.
Founded by Andrew Thomas Reid, a musician and marketing creative, the Clubhouse resides in a Victorian house in Ditmas Park. It's modeled after Gertrude Stein's salon in Paris, where Hemingway and Picasso shared their early works, and February House, which hosted writer Carson McCullers and burlesque dancer Gypsy Rose Lee alike. The half dozen artists who make up the active membership live together. They share meals, living expenses, a Google Doc that organizes the chores, and, frequently, musical projects.
The real estate angle comes through its relationship with new media company BKLYN1834. Springing from conversations between Glenn Markman — a Brooklyn native and commercial broker at Cushman & Wakefield. And, Adam Quinn — a designer at the architecture firm Gensler. BKLYN1834 was launched in March of 2014 with $400,000 of seed capital and a mission to support musical collaboration and cross-hybridization at the Clubhouse.
21st-Century Patronage. Initially BKLYN1834 acted as a sort of in-house sponsor of the Clubhouse's social media identity, funding a video series of live performances and arranging forays into "brand integration." For eight months BKLYN1834 paid the Clubhouse's rent, asking residents to fulfill a quota of art production in return. Songwriters were asked to submit one song per month. Videographers produced bi-weekly videos about the residents of the house, who introduced viewers to upcoming Clubhouse musical projects, or even just offered virtual tours of their bedrooms. House residents also had a weekly quota of social media posts, with engagement targets of likes, comments, and shares.
While the partnership has focused on supporting the creative pursuits of the Clubhouse community, the broader ambition of BKLYN1834 is to reimagine the business model of performing and recording artists.
"If there's an alternative to a [record] label, what does it look like?" asked Quinn when we spoke.
SPOILER ALERT! BKLYN1834 hasn't cracked the code yet. But its partnership with the Clubhouse is a compelling portrait of local musicians and entrepreneurs investing sweat equity, alongside the monetary kind, to reinvent a broken business. And like many at an early-stage startup, the venture is still honing its elevator pitch.
"It was very easy to describe what the Clubhouse was," said Danny Garcia, a current resident of the Clubhouse and a member of the band Foe Destroyer. "But it wasn't easy to describe what BKLYN1834 was."
Former Clubhouse resident Nolan Thies, a member of the band Nations who often engineered recordings at the house, said the venture's mission was so broadly defined that it was often hard for the artists to understand how they would make money.
"You could never really summarize BKLYN1834 in one sentence," Thies said in an interview, recalling that when he described it to people, a typical response was: "'I kind of understand, I guess... but how do they make money?'"
Early Wins and a Big Loss. Markman's real estate network provided an early brand integration opportunity. Through a project with Blackstone Properties, BKLYN1834 produced a series of live events at the former New York Times building on W. 43rd St. and filmed an onsite music video with rapper Pharoahe Monch, providing hipster polish and social media fodder for the century-old midtown high-rise.
Still, though occasional production gigs have cropped up in the preceding months — including some video work for Converse — nothing offered the company stable income.
Then, in late 2014, Markman died of stomach cancer. The loss complicated the partnership's struggle to identify a clear path forward, including their consideration of a plan to raise at least $2 million. Developing a reality television show based on the residents of the Clubhouse was considered and rejected.
Compounding the already difficult situation, BKLYN1834 still faced the same grim realities of the new media economy. While artists and businesses often enthuse about the social media marketing revolution, the return on investment for social media remains elusive.
Like any media venture in the digital age, music-oriented businesses require multiple income streams to flourish. According to Gill Holland, owner of Louisville-based independent label sonaBLAST!, especially valuable are publishing rights, which can make for huge wins from song placements in film, television, and commercials.
"There still just isn't enough money in streaming to not have to rely on the revenue from the publishing side," Holland said in an interview. He added that even with publishing income, labels still have to keep expenditures at an absolute minimum. "What little remains from album sales [does] not justify any significant investments in producing and owning master recordings."
Faith in the future. Though BKLYN1834 had been paying musicians at the Clubhouse to produce songs for their social media channels, the master and publishing rights for these songs remained with the musicians. With the rapidly approaching release of a digital compilation album "Comp_01" in November of 2015, BKLYN1834 realized that they needed to clarify rights ownership of the music. However, problems arose when Clubhouse bands were offered a contract that transferred portions of their master and publishing rights to BKLYN1834.
Nolan Thies, whose band contributed two tracks to the compilation, said that the initial draft of the contract was untenable, especially considering that Nations had recorded their material without BKLYN1834 support. Eventually, though, the details were ironed out, and a deal was made. BKLYN1834 would fund the music videos, and hire a publicity firm to handle the release of the seven songs included in "Comp_01." Hopes for this new chapter in the collaboration were high, and glowing articles and previews appeared in the press.
But just as soon as things had come together, they came undone.
"Basically, BKLYN1834 pulled out without telling anybody, and stopped financing the remainder of the campaign," says Thies, whose band Nations contributed two tracks.
BKLYN1834 Creative Director, and founder of the Clubhouse, Andrew Thomas Reid acknowledges that there was a problem with cash flow and timing.
"We ran out of money just when the engine started going," he says.
BKLYN1834 stopped paying rent for the house in Ditmas Park. Reid left for Los Angeles, where he is developing a television dramedy about life at the Clubhouse.
When asked if royalties had been paid to any of the bands on "Comp_01," BKLYN1834's Quinn said he was not sure, as royalties are administered by a third party. He disputed Thies's characterization, though, and said that BKLYN1834 had been transparent with the artists throughout.
"The fact is, major music blogs picked up a majority of the singles and music videos from the project and we were able to land a Billboard spot for the entire album itself," says Quinn. "We did all this on a limited budget."
The musicians interviewed seem to understand this, and none have hard feelings. On the contrary, several emphasize how grateful they are for the financial support and promotion BKLYN1834 gave their work. The songs that were uploaded to Soundcloud have each logged many thousands of plays. Nations, whose song was released first, has a video with more than 18,000 views. Though difficult to quantify, such benchmarks are not without value to emerging musicians.
The struggle continues. Meanwhile, BKLYN1834 is still exploring iterations, including one as a venture capital-backed arts incubator.
"Instead of saying, 'We're going to bring everybody in, and we're going to own your stuff,'" Quinn said, the alternative may be "'I'm just going to take a percentage when you walk out the door and become successful.'"
Another strategy may return BKLYN1834's focus to real estate. Former and current Clubhouse members hesitate to talk about it, as BKLYN1834 wants to keep plans secret for the moment, but tantalizing details occasionally slip out. Quinn lights up when he mentions the shuttered recording studio-cum-venue Death By Audio, whose former space is now occupied by Vice Media.
Whatever lies ahead, BKLYN1834 is grappling with the same economic reality that all DIY musicians face today. Frustration, cash flow problems, and unexpected losses are a standard part of the process. Though it is not clear how musicians, and artists in general, will harness the potential of social media, or whether the economics of streaming can support a healthy music business, BKLYN1834 continues to invest in art and artists, which is no small act of faith.
"This is a huge experiment," Quinn acknowledged. "And we're going to make some mistakes."