beatBread launches Deal Comparison Tool to help artists and independent labels make better funding choices, avoid bad deals

 

beatBread, a leader in funding for independent musicians and labels, has launched its Deal Comparison Tool to enable artists and labels to compare and fully understand their funding offers, avoid unexpected traps, and make better funding choices. 

 

The beatBread Deal Comparison Tool enables independent artists and labels to compare offers from distributors, major labels, and other funding sources side-by-side for the first time. Clear like-for-like comparisons allow users to understand trade-offs between upfront cash and long-term costs. Artists and labels can visualize annual cash flows and costs and compare the relative strengths of each deal, depending on how music performs in the future. 

 

These insights empower users to choose the funding option that best aligns with their goals and risk tolerance, regardless of whether that funding is sourced from beatBread, one of its Funding Network partners, or even a competitor. In a beta test, that included a wide array of artists and labels with original offers ranging from $100,000 to over $100M, around 60% of artists and label owners chose a deal other than the one they had before using The Deal Comparison Tool.  

 

"It is impossible to make a smart decision without comparing your options and understanding your choices," said Peter Sinclair, beatBread CEO. "Even the most sophisticated executives can be deceived by "headline terms" in a deal.  The Deal Comparison Tool cuts through the fog and lets labels and artists truly understand how a deal is likely to play out in the real world.  
 
"Summary terms aren't enough to make a good decision, you have to understand cash timing, total cost, the true length of your commitments, and how these "real terms" vary based on future performance. After using The Deal Comparison Tool, some people pick a beatBread deal, but just as often, they choose an offer from one of our partners or even a competitor. And that's OK. Our goal is to be the place where smart funding choices are made, whether we fund the deal or not." 

 

It has become standard industry practice to offer headline terms (nominal term length, total deal value) that simply do not reflect how a deal is likely to play out in the real world. In the worst cases, beatBread's beta test showed that some independent labels would most likely end up forced into a distress sale after a few years if they took the seemingly best distribution or label JV offer in front of them.  

 

"When I came to beatBread, I had what I thought were two quite attractive distribution offers," said Dan Englander, Founder of independent label KingUnderground. "After seeing the output of beatBread's Deal Comparison Tool, I realised that there were several scenarios where I could have ended up strapped for cash.  Although I didn't take beatBread's offer in the end, I took funding from one of their Network Partners.   I'm very glad I found beatBread when I did."