The community-owned rave: event organisers as DAOs

This piece explores the intersection of underground rave culture and Web 3 concepts like decentralized autonomous organisations.

Lately I’ve been thinking about an idea I had pre-pandemic. I wanted to set up a local rave night to fill a gap I perceived in Berlin’s nightlife. I mentally prepared myself to do all the heavy lifting involved in setting up a new club night – something I’d witnessed from friends taxiing artists around, losing money on events, having to staff the entrance, handling logistics, and of course doing the promo. The pandemic put all those ideas on hold and helped generate a new perspective on things.

Goal-oriented

I previously explored what artists’ fanbases can look like as blockchain-based decentralized autonomous organisations (DAOs) – I recommend reading it if you’re not familiar with DAOs. One important aspect for DAOs is that they should have a clear reason to exist, so that people have something clear to organise around and identify new initiatives.

For events, that goal is pretty straightforward: for example to run a number of events per year (e.g. 6, 12, 24) with a clear musical and subcultural footprint (e.g. hyperpop meets queer hardtechno).

There are lots of activities to take care of, such as:

  • Artist bookings
  • Travel & accommodation (unless fully local)
  • Artwork & design
  • Promotion
  • Venue decoration
  • Tickets & admissions

Many of these require funds and when starting out there’s always a risk you won’t break even. DAOs can mitigate that risk and distribute the heavy lifting surrounding these tasks to a passionate community.

Community-owned raves

My first association with the above words would actually be ‘free party’ culture and teknivals of the 90s, as pioneered by Spiral Tribe (artwork above). They would travel country & continent with soundsystems and throw public raves that were free to attend (and usually illegal). The idea was that by being at the rave, you were not just audience, you’re a participant – a similar mindset to Burning Man‘s ethos. The teknival scene still exists today, by the way.

But what would a community-owned rave look like if it could somehow be formalized?

  • Persistent community. Most events have an audience that reconvenes and persists through brief gatherings. Part of the audience will be ‘regulars’ and part will be newcomers. It can be hard to know which part is which and to really feel connected. By making sure the community is organised outside of the context of the occasional event, the community can exist in a persistent state and experience connectedness daily. (see also: Why local is the answer to a future of new normals)
  • Shared outcome ownership. The community puts together the events. This may be a representative democratic process, where people get elected to a board or special crews, e.g. for artist selection, brand and artwork, and perhaps various ongoing activities like music releases, mixtapes and podcasts, meetups, listening sessions, etc. This way the output and outcome is a collective responsibility.
  • Tokenized. Participants should be rewarded. Most underground events don’t make a lot of money, and don’t have a goal to make lots of cash, so rewards for contributions could come in the form of tokens which give people the ability to participate in the governance of the DAO or get access to other perks. Event tickets could represent a token, which gives you a way to essentially peg token prices to fiat money and automatically make attendees community members (I’d make sure to only sell 1 per person though – maybe translating actual attendance to tokens, rather than just holding the ticket. I’d also carefully think through the implications of attendance always representing 1 token).
  • Proposals & voting. People can submit proposals for artists, event decoration, and peripheral activities. They can request budgets in the form of tokens which they can hold (for governance or to let them accrue value) or cash out in order to finance their activity.

The exact mechanics would depend a lot on the community and what it wants to incentivise. For example, in some contexts you might want to encourage people to spread the word by sharing photos of the events, but some events might enforce strict no-photos rules so that people can be themselves without the pressures of being seen on social media (or worst case: becoming a meme).

Not public, not private, but community events

One example of how this might work can be gleaned from the Friends With Benefits (FWB) DAO, which is a creative community that requires people to buy $FWB tokens in order to participate. It then rewards tokens, as described in the bullet points above, for certain activities. While I personally would avoid throwing up high economic barriers to participatio, for the sake of inclusivity (which is also why many events in Berlin have flexible entrance prices, e.g. minimum 5, but 10 if you can afford it), FWB has been able to create an economic space where members can reward each other with tokens that can be cashed out in order to finance projects. (I don’t mean to imply FWB in general is not inclusive – it’s just a general concern I have with regards to onboarding people into tokenized communities)

This has translated into a real-life event in Miami recently, with DJs like Yves Tumor and Jubilee, that you could only attend if you held a certain number of tokens. For those from out of town, the community created a city guide which can be unlocked in exchange for tokens. It’s an excellent example of how communities can create value for other members either through direct activities (events) or peripheral (guides) and how that value can then flow around the community. All of this didn’t exist a year ago, so what they’ve been able to achieve and fund is incredible.

Stronger together

Many events already function as decentralized autonomous organisations in informal ways. Connecting it to the Web3 allows the community to persist across the metaverse and leverage NFTs, communal creation, and channel the unique talents of all involved.

It gives a certain predictability too. If you have a big community around your event, it can be tough picking artists for your line-up, since you only have so much time per night, which means not everyone will get to play. If the community becomes self-sustaining and energized, it should be easy for the organisation to make a risk assessment and set up more event nights.

It could even extend its footprint, so that people in other cities can set up local chapters under the same brand. Over time, the DAO becomes representative of a subculture and may see artist exchanges and people traveling to each other’s cities to meet community members there and experience the local chapter’s events. At scale, the DAO and the new subculture might become synonymous, though it’s also possible to think small and keep it to a small, local community of fans & friends.

The choice is yours – and theirs.

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Communities exchange value, or how no artist should care how much YouTube pays the industry

Music rights holders get paid astonishing amounts of money, but most artists cannot make a living from their art. All the major DSPs love throwing around the big numbers they pay out to ‘the industry.’ Yet, most artists cannot rely on them to put food on their plate. There are, however, many methods that allow musicians to step away from over-reliance on big tech companies or major labels. Most of them involve community, and more specifically community-building.

The big girls

So YouTube paid out $4 billion to music rights holders in 2020 and Spotify, by Music Ally’s calculations paid out more than $5 billion in the same period. In the US, in the first 6 months of 2020, the biggest streaming services together made up more than 85% of total revenues for recorded music. And during the recent DCMS hearings on the streaming economy in the UK, YouTube defended itself by stating that “record labels agree that it is possible we will become the music industry’s number one source of revenue by 2025.” That seems to be a good thing for YouTube more than anyone else as it probably means that even more than 2 billion people will be coming to the service “to experience music each month.”

A major argument that came out of those same DCMS hearings was to ‘simply’ grow the overall pie being paid out by the streaming services. BPI‘s Geoff Taylor, for example put forth that “[t]he total amount coming into the industry should be substantially higher and that would benefit everybody in the chain.” During the hearings, a counterargument surfaced, through BMG, that “the status quo gives the impression it was designed for the convenience of industry players, rather than with a view to the perceptions of artists and fans.” BMG used this point to set up their defence of user-centric payment systems. However, it also paves the way for another argument altogether, something BMG hinted at too in further evidence they presented: the importance of monetizing the artist-fan relationship more directly. And that should be done by building a community.

Focus on community

We’re not new to the idea of community as an important element in artists building out a living for themselves. Just last Tuesday Bas argued that “the one strategy that I feel almost any artist can apply is that of building a community of fans that can sustain you.” This related to DAOs and in my own article about why fans should want to buy NFTs one of the key arguments was that these tokens represent an opportunity for two-way communication between artist and fan. But there’s more to community-building than future-forward web3 technologies. What first of all needs to happen is a shift in mindset. One of the things that struck me in a recent podcast recording for The Daily Indie[in Dutch] is that so few artists actually experimented with building community during the pandemic.

Of course, Patreon, OnlyFans and their like saw fast growth during the pandemic. All the musicians who set up a subscription model or turned to monetize their livestreaming efforts did an amazing job. But for each one of those, there’s plenty others who still rely on their single-single-album release strategy. Why not flip it around? Take Dutch artist POSTIE who is social media first and recorded music second. He posts a video every Sunday and then after a while releases those songs as an album. Another way of putting this is that he doesn’t use social media to drive streams, but streaming services to drive followers.

Image by Alina Grubnyak via Unsplash

The community builders

Let me highlight two people who give some excellent advice on community building. First up is Anna Grigoryan, who writes a newsletter called Community Weekly in which she presents and explains tools to build community. My favorite advice of hers is to find your community mission. That’s where it starts. With the question of who you’re doing what you’re doing for. And then following that question with how you add value for those people. I would also add, that quickly after that, you should ask how your fans, your community, can add value for you. Anna is also very open about her own struggles in building a community around her newsletter. I find this very helpful when thinking about the communities I’m involved with for example.

This is where my next community builder comes in: Jen Lee. I came across her as the community manager from the Means of Creation fans Discord. First thing that happened when I joined the group was that I got a personal note welcoming me and encouraging me to post in a channel. She’s just been interviewed by Peter Yang and that message to me is pure strategy. In the interview Jen puts forward the following idea:

Like building a product, an online community needs to:

1. Exceed user expectations by personally welcoming new members.

2. Overcome the cold start problem by seeding the community with great content.

3. Deliver great UX by focusing the conversation on a few channels.

From these two community builders you have the starting gear to step into the studio. Whether you’ll focus on one of the subcriptions services (Patreon, OnlyFans, etc.), one of the social media (IG TikTok, etc.), the community platforms (Discord, Geneva, etc.), or turn your hand to web3 protocols (DAOs, NFTs, etc.) the basics are the same.

The Call-to-action

It’s as simple and easy as can be:

  • If you’re an artist start experimenting with community building. Do it now and be open with and towards your fans for feedback and interaction.
  • If you’re not an artist yourself, you’ll know them. Help them out by giving them these building blocks.

Together, we can make sure that the focus of the music industry starts to inch away from the shouting big numbers and boasting massive usage stats. Instead, we’ll focus on creating communities where artists and fans exchange value.

Decentraland

The Decentralized Autonomous “1,000 True Fan” Organisation

Decentralized ownership registries helped enable digital art’s NFT boom of the past year. Next, blockchain, the distributed ledger technology, will underpin fanbases and the way artists build careers, teams, and engage with industry infrastructure.

Can you put a fanbase on the blockchain? Here’s what it could look like.

Decentralized Autonomous Organisations (DAOs)

If you spend some time in Web3 circles, you will encounter the term DAO. It refers to organisations that utilize blockchains’ distributed nature and (often) smart contract functionality in order to govern themselves.

These organisations are grassroots, meaning that there’s no central leadership and the members of the organisation decide what things they want to incentivize, and what rules they want to create. They allow people to pool funds, govern those funds and use them to coordinate or incentivize communal efforts and contributions. 

At this point there are way too many DAOs to give a comprehensive overview and they come in many forms. For example, Stake Capital’s StakeDAO allows its members to earn stakeholder revenue share for their participation, for instance by supporting the Discovery and Creator nodes Stake Capital runs for the Audius network, a decentralized music streaming platform. Another well-known DAO, with the stated aim to push culture forward, is Friends With Benefits ($FWB) which requires new members to invest into the DAO by buying membership tokens, so that the community is invested in itself (you can read more about how they govern these funds here and what types of things you might expect in the community here). MetaCartel is a community of people that funds “post-hackathon” projects through grants. Decentraland, pictured above, is a game akin to Roblox and Second Life, but is governed by a DAO.

The Mint Fund, which was founded to fund underrepresented creators’ NFT minting costs, aims to become an “artist-owned curation DAO”. Mat Dryhurst (@) suggested a decentralised structure for SoundCloud in 2017, when people feared the company was running out of time (and cash) as it let go a large chunk of its staff. Back then the concept was novel, but it’s quickly becoming mainstream.

There are even tools like Aragon, Colony, and DAOhaus that make it relatively easy to set up a DAO in which the community participates in the ownership and governance of what’s created through the sum of their work, contribution, and participation.

Image via aforementioned Aragon.

The Decentralized Autonomous Artist

Not everyone’s music will drive millions of streams, not everyone is able to tour constantly, not everyone will go viral… but the one strategy that I feel almost any artist can apply is that of building a community of fans that can sustain you (sometimes referred to as “1,000 true fans”). There’s benefits to thinking small.

How can a fan community contribute to an artist’s success? Well, it depends on the artist, but they can financially sustain the artist through various types of patronage, they can amplify what an artist is doing by increasing their reach and leveraging network effects, but there are also other types of contributions that may be framed as collaborations, fan art, or other. In fact, when the community includes the artist and ‘artist team’ (ie. the business roles surrounding an artist), you can disintegrate some of those roles and place the associated activities inside the community through incentive structures.

What if the BTS Army was a DAO allowing people to either purchase or earn $BTS tokens in order to unlock various types of experiences and opportunities that are completely fan-organised? BTS wouldn’t even have to play a role in the DAO, though if what the DAO is doing is sufficiently valuable (which it would be), it may decide to let people trade $BTS tokens for tickets to concerts, livestreams, merch, or NFT collectibles. BTS can then choose to sell those tokens for fiat money (e.g. dollars or won) and cash out or retain $BTS and take a more active role in the DAO (token holders are often rewarded with increased influence in the governance of the DAO, corresponding to the amount of tokens they hold).

Since it can all be logged to a blockchain, much of this experience becomes portable beyond any specific platform, allowing the fanbase to organise itself wherever it prefers. This way experiences can travel beyond the walled gardens of Facebook, Apple, or virtual platforms and into the so-called metaverse in which the DAO and its members own their data and collect the value from it. Work is also being done on making various blockchains more interoperable, so things will be less locked into blockchain ecosystems than they are now.

Instead of communicating with an audience as followers on a social media platform owned by others, you can involve them directly in the organisation of your fan experience in a transparent, open, grassroots way through DAOs. The bonus: community ownership. We’ve seen countless artists open up Discords and other types of communities next to their social media presence – what we’ll see next is the Web3 version of this: decentralized autonomous fan organisations.

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