At a recent event hosted at the Neuehouse Hollywood, artist Annika Rose performed a short set-list and discussed her career and the future of web3 music with Jasmine Solano. One of the most fascinating parts of the conversation was about how Rose’s label, Nvak Collective, was paving the way in using web3 to make the artist development process revenue neutral, disrupting the current and outdated record label model that often leaves up-and-coming artists in debt with no way of recouping without achieving a huge margin of success.
At the event, I connected with Nvak’s Co-Founder and COO Alex Salibian, who took some time to talk with me about what led him to forming Nvak, how it is working to create new opportunities for talent from underserved communities and countries, and what the future holds for the relatively young new label.
Indy Review: Thank you for taking the time to do this.
Alex Salibian: Of course, of course, my pleasure. Excited to chat.
IR: To start, what made you want to be part of the music industry? What was the first music you remember hearing and loving?
AS: My background in music is interesting because it was a love/hate relationship. My dad made my brother and I start taking classical piano lessons when we were very young, like five or six years old, and we had to practice an hour every single day, but it wasn’t…and I hated it…it wasn’t until I was twelve when my brother got me into Metallica and Pantera and the Chili Peppers and Incubus and AC/DC and Black Sabbath, and begged my parents to let us get guitars. I got a classical guitar first, then got an electric guitar a year later, and then my brother got a bass, and we started learning all of those songs we were listening to. I was about fourteen when I became interested in writing my own stuff and composing, and fifteen when I met a friend who knew how to actually record. He had a ProTools rig and microphones in his garage. From then on, I was hooked on making my own music. But since I had a background in classical music, the music I would make was mainly instrumental and didn’t have much pop sensibility. I ended up going to college, stopped taking piano lessons and studied sociology at UCLA while spending most of my time just trying to make music. It wasn’t until my senior year that I got an internship at Interscope records. That was my entry point to the music industry.
That internship ended up being in the department that managed a well-known producer, Jeff Bhaskar. A year after the internship, I got a job as his personal assistant at his studio in Mar Vista. He had no clue I was interested in music, but I would just go and clean up the studio, walk the dog, get groceries, serve snacks at sessions. But I would go in early every day and play the piano and learn how to record the way he liked from his engineers, hoping he would take notice, and eventually he did. He started training me as an engineer, and eventually a year and a half later he signed me as a producer. This was September 2014 that he signed me, and that’s when I really got my start as a record producer. So that was the entry point, and once I started producing records under Bhaskar, it took off quickly from there. Worked with a band called Young the Giant, the first Harry Styles album, The Head and the Heart, and then it wasn’t until 2019 when I decided to pivot once again and move towards the business side of things and establish Nvak Collective with Tamar (Kaprelian), my co-founder. That was a large and difficult transition from making records to wanting to have a larger role in the music ecosystem. I could have a whole other call around the “why” there and what led to that. I just saw a lot of things I didn’t understand or agree with in the music industry, and I felt called to set myself to be able to change some of those things. Tamar and I had a joint vision of how we could do so. By March 2020, when the pandemic hit, we decided to raise money and create Nvak collective, a for-profit entity, to do what we’re doing now.
IR: Awesome. While I’m sure there are a bunch of different things you noticed, but I’m wondering if there’s one memory that stands out of “this is wrong, this is not how things should be run (in the music industry)” that inspired you towards creating Nvak?
AS: So Tamar and I both have our own “whys”, and the two halves make a whole for Nvak Collective. For me, after the Harry Styles record, I was in London with him, I was his musical director, and then decided to stop and move back to the states and get back into the studio. After that, and I was on top of the world, and my manager was getting me into a lot of good sessions, I spent a good two to three years developing artists, and all of them fell through. Where one of them, the A&R left the record label and nobody cared about the artist anymore. One of them, the manager actually ended up stealing from the artist and something else happened. The other one got dropped. It was this situation where it became so obvious I had no clue how the industry operated, and I was so fixated on making this song in the studio, that I wasn’t really understanding who my customer was and what happened to a song once it was made and what increased my chances of actually having an impact with the music I was working on. It was through honestly three years of a dry spell that started having me ask questions and get very curious around the answers to those questions. And then I met Tamar at that point and I was like “oh shit, now I can actually build the infrastructure to answer these questions” and answer them for other people, because I started interviewing producers who weren’t having dry spells and asking similar questions around their relationships with managers and A&Rs and other producers and artists – and none of them had any answers in terms of the actual workings of those relationships and how they contributed to the success or failure of a record.
IR: And those are important questions to ask. I know Nvak is mainly focused on breaking into the web3 space, and that’s an area that’s still fairly new and evolving, but can be huge for artists. Has it been more difficult to teach artists about the possibilities of the space as a way to make money, or do introduce web3 opportunities to audiences who may not yet grasp how it can give them a greater connection to the artists they love?
AS: Interestingly enough, I didn’t get to touch on this at all at the event at Neuehouse, but Nvak’s main mission, and this might seem strange, but is to superserve women, non-binary and LGBTQ+ artists in emerging markets. That is the ultimate mission of the record label. We believe talent is equally distributed but opportunity isn’t. There are these pools of talent in new regions that need access to infrastructure, and have stories to tell that have not been told, and by providing equal access to resources and networks, then we can start telling these stories.
So the emergence into web3 came out of necessity in order to achieve that mission. If we are going to be going out to new markets and developing artists and investing in the early phases of their career we need to be coming up with tools and systems by which they can acquire and engage with fans. And now it starts to sound a little bit more like web3. Our process and our pitch to artists is direct to fan engagement is the future. You need to know and understand how to acquire and engage with a small group of fans that live by your work and will support you as you scale. That’s the first thing we try to make clear with web3. Then in terms of communicating this to their fans and people who might not understand it or be interested, the technology’s changing so quickly, we’re already seeing the elimination of a lot of jargon, and a lot of processes that are heady, or difficult and complicated, when it comes to even setting up a Meta Mask or going through with an Ethereum transaction, 99% of people don’t know how to do that. But, the general concept of finding a fanbase and serving value to that community in order for them to band around you in the form of a fan club or content that they may own and be able to benefit from as well, these things may be built on blockchain and use NFTs, but you don’t necessarily need to understand that underlying technology in order to benefit from it. So what we try to explain to artists is this is the same thing as going out to the subway station and handing out flyers. It’s the same things artists have to do getting in a van and touring. They’re just doing it digitally. What blockchain does and NFTs do is keep it safe, and keep it so that people that are supporting you from now, and will achieve a status and be recognized for their early belief in you. As we proceed, all of the jargon is going to disappear and it’s just going to be gifts and awards and tokens and tickets and merch, like it always has been.
IR: You mentioned it’s about getting the artists who have these die-hard fans who will be with them all the way, but to get them to that point, it’s still a matter of time and development and whatnot. Is Nvak looking to start with artists who don’t have that hardcore fan base yet and support them and help them develop it, or looking for artists who have already achieved some level of fandom on their own?
AS: We are looking for those who do not have it. It all depends on…it is still very subjective. Tamar and I, we’re creatives. We have ears and we use that and our guts to decide if an artist is going to be successful, and we’ve learned what to do and not to do over the years in terms of working with an artist, so if we find someone that we believe in and has zero following, then 100% we’ll build it from scratch.
Two case studies that we have recently; one of our artists, Rosa Linn, who had a hit last year, was from Vanadzor, Armenia, and had literally 150 followers on Instagram, like her friends and family. Now she’s in the hundreds of thousands and has twenty five million monthly listeners. Granted, that was a web2 case study. With Annika Rose, she had 100,000 Instagram followers but zero Twitter followers and zero Discord followers and we didn’t see any crossover from Instagram, so we built her Twitter and her Discord following from scratch, using POAPs (Proof Of Attendance Protocols). And you saw the results of that from the Neuehouse event. That’s just a step on the ladder, but we’re very interested in, if an artist has a voice and a story to tell, what are the systems we can put into place, by which they can start to acquire and engage with fans.
IR: To touch on Rosa Linn, she’s clearly broken out with the huge single “Snap”. With an artist like that, who has now gone into the zeitgeist, has it changed the day-to-day of Nvak, having an artist who has reached that point, and what it takes to manage that?
AS: 100% yes. It completely flipped everything on its head. The second half of last year was completely restructured in order to manage her and make sure we could capitalize on that success. And the good thing is it builds a new revenue stream which could support us as we test the MVP with the music video game and the fan club. However, now we’re looking at Rosa’s career from a little bit more of a bird’s eye view, and we see there are far more fans of “Snap” than there are of Rosa Linn, which is the common by-product of the current passive engagement model that is marketing for music; it’s TikTok to Spotify. You could argue that Annika Rose is in a better place than Rosa Linn. Rosa has some leverage with the song, so she can get into good writing rooms, she can get good show opportunities, and all that stuff is happening, but in terms of an engaged fan base that is following her on a day to day basis, responding to her, buying her merch or potentially buying tickets to a show, you could argue that Annika has more. And the fact that Rosa had that hit and TikTok success and staple story of the last couple years of what it means to make it in the music industry, we’re still dealing with that fan issue, it’s just proof that there needs to be another system in place.
IR: That’s interesting. The first artist I heard of on Nvak was Annika, as her PR person (Falcon Publicity) reached out to me about “In My Head”, which I liked a lot and included in our New Music Friday playlist the week it was released. It’s hard to get someone to hear past that first single if they’re not an active music listener, and there are so many passive listeners in this playlist age.
You mentioned earlier Annika’s video game, which is a newer idea, past NFTs and what people think about as web3. How does that play into the new monetization for the artist and the label? What part do you see a video game playing in a business model for a new artist or artist model going forward?
AS: The music video is one of the oldest and tried-and-true marketing drivers in the music industry, since the early eighties, and obviously with the help of MTV, music videos have been a necessary marketing driver in order to launch any successful track. Even today, an artist on Columbia or Capitol Records or whatever label it might be, they are making a music video to go along with their song. It serves the purpose of telling the stories through a different medium, which draws in more people and amplifies peoples’ emotional connection to the song and the artist. So it’s a very specific fan engagement tool. So our thought process was what’s the next version of that, since no one has innovated the music video in fifty years. We wanted to make that same thing; an elevated method of telling a story and allowing for a deeper emotional connection to the song and artist, to make it interactive and dynamic. So ultimately the music video game is a marketing driver, not necessarily a profit-generating tool. However, it acts as a gateway to the fan club, which is a profit-generating tool.
IR: So you see it as more of a Freemium game, where people can make purchases to add to the game that might also benefit the artist?
AS: It is somewhat like that. The “free” of the “Freemium” would be playing the game, and the premium would be the game allowing you access to the fan club, and certain behaviors within the game and outside of the game allowing you to achieve status that’s on chain and put to a leader board, and its status that you own in the fan club. It is in a sense a Freemium model, yes.
IR: From the Neuehouse event, and hearing you speak about making the artist development process “revenue neutral”, knowing each artist requires different needs, how do you develop your plans for each new artist Nvak signs?
AS: This is going to be interesting when it comes to large-scale adoption of some of these processes, but Nvak isn’t built to scale horizontally, meaning signing a large group of artists. It meant to scale vertically, meaning each artist is immensely more profitable than a typical artist. Because it takes a very bespoke approach and curative approach to each artist to figure out what it is we’re doing for them, and it’s all based on their narrative and who they are. So what we’re trying to figure out is this system between A&R marketing and our Nvak media and computer graphics arm so they can all be telling the same story. So if Rosa Linn is singing about a long-lost love and her brand is being an underdog from a village in Armenia, that is also being told in her social content, it is being told in her photo shoot, in her traditional music video shoot, and also in the music video game, and in the fan club, and in the interaction with her fans. All of it is telling one cohesive story. So we will make different decisions based on each artist in terms of how we’re going about creating the game and what activations we will be doing. Right now, we’re just focused on Annika’s game, as that’s coming out March 21st, and hers is around “Bruises”, which is about a friend going through some personal health struggles, and the marketing campaign will very much be centered around her narrative moving through the music industry as a young woman, and the impact that’s had on her life. When we do Rosa Linn’s, where she’s at with her career, it’s going to be a very different fan onboarding process, and a very different storytelling process.
IR: One thing I really love about Nvak is that you’re putting both the physical and mental health of your artists as a priority, along with financial advice. Because you work with international artists like Rosa Linn, and some who are local, how do you implement things like health insurance for artists who aren’t US-based, or provide them those benefits they need when they’re coming from countries with different laws and systems?
AS: Whenever we enter a new market, there’s a long onboarding process of finding community managers and project managers on the ground in each region. So before we entered Armenia, we went in person and found a project manager and community manager; normally it’s just those two people that are needed in order to get access to any resources we may need for the creatives that are working with us in that region. We did that in Armenia, Israel and Malawi to start. It takes anywhere from six to eight months to get everything running and get support from the state department, find physical locations, and build the relationships necessary to provide these resources. We start by running a writing camp and an educational camp, so it’s one week of education and one week of writing, and we fly in collaborators from LA and New York, and then whoever shows the most promise and rises to the top, we’ll sign and then tap into whatever healthcare system is available in each market, any therapists or psychiatrists that are available. If there aren’t any available, we’ll try to find a diaspora from different markets to help. Like in Armenia, therapy is just terrible, but fortunately there are a lot of Armenian American therapists in Los Angeles that speak the language, so we’ve been able to pair them that way. Armenia is just getting health insurance set-up, it’s not great but it is there, so if we have to pay stuff out of pocket for the artist, we will. Or if we signed them up for the plan and cover those expenses, we do that as well.
We started the process of planning for Ghana and Egypt before this year. We’ve already started interviewing community managers and project managers, started outreach at the state department, and trying to figure out the key people we’ll need in order to have relationships with in order to achieve these things.
IR: That’s incredible. The amount of work you guys have done to set that up, I’m sure it’s difficult but it’s really admirable. Seeing how many artists out there have recently canceled tours as they’ve been burning themselves out…
AS: Thank you. The Artist Care program has actually saved us numerous times in terms of lifting an artist when they’re getting burnt out. It is, by far, the most valuable arm of the company.
IR: Investing in the artist and their health is best for the long term health of the artist, so Nvak is doing the exactly right thing.
I know you mentioned earlier that the focus is finding female, non-binary and LGBTQ+ artists from underserved communities and countries, but I’m wondering outside of that, what other factors go into deciding who is a good fit for Nvak and who you are looking to sign?
AS: I used to boil it down to drive, talent and vision; those three factors. It’s only been two years of doing this, and we’ve had a lot of ups and downs through the process, like…there are so many different factors that go into whether an artist is going to be able to handle a commercially viable career as a pop musician. It’s such a specific job; it’s not an indie musician, it’s not classical, it’s not jazz – it’s a pop star. And to be able to do that, there needs to be a certain level of fire and desire. The artist has to want it more than we do. Obviously the talent needs to be there, there has to be curiosity in terms of learning new things, a willingness to trust, a good support system from their family and friends as well, and if they don’t, a willingness to embrace us, which happened with our Lebanese artist, who doesn’t have a great support system. It caused severe delays in the development process. And then, work ethic ultimately. It’s a lot of people from countries that don’t operate on the same kind of structure as the U.S. does, and teaching them that the calendar is a valuable tool, and you show up to meetings on time, and you structure your days based on the goals you’re trying to achieve. Teaching them how to map out plans for each quarter and all of that, while maintaining a routine that’s important for their mental health. It’s all rooted in education and people’s willingness to learn, so that’s why we do start with these foundation-based workshops which are educational, because the best students normally rise to the top, and those that are the best students end up being the best artists.
IR: Looking at the more traditional aspects of the record industry (ie: streaming, radio, physical music sales), I know Nvak is focused on web3, but I’m wondering how important are these parts of the industry for your artists and for the label itself for its financial success?
AS: Hugely important. If we are trying to create a pop artist, they want to perform for 20,000 people a night. That is the one goal that has not changed for any artist that I’ve spoken to, they want to play for the stadiums. In order to do that, you need to reach millions of people. To reach millions of people, you need a distribution system that is accepted by millions of people, and that is Spotify. That is not going to change anytime soon. Where radio is in decline, there is still another ten years of radio left. If we want to help our artists achieve their dreams, we have to be very realistic that we can’t ignore the traditional music industry. All we can do is create alternate ways in which to penetrate that industry and achieve success in it, while it is becoming more and more saturated, because more and more people are making music. So it is important, that what I mentioned earlier about marketing drivers, the work we are doing in web3 acts as a marketing driver where the fan club and the music video game can do two things: provide enough revenue to the artists that they have a longer runway, so if they aren’t succeeding in the sense of having a viral hit, they don’t have to get dropped because the label and them aren’t losing as much money, because they’re making steady income from the fan club, and then the second thing is act as a viable market driver to the editorial playlists at Spotify/YouTube/Apple in order to get them onto niche playlists and expose them to a larger demographic of people.
IR: Now, obviously Spotify (and the streaming era in general) has been under a lot of scrutiny because of the royalties that are paid out to artists in comparison to both Spotify and the labels. Does Nvak approach this any differently with the artists you work with and the royalties paid out?
AS: Yes. I will say it’s not Spotify’s fault. They have their deal with the record labels; they give 70% of revenue to the record labels, and it is the labels that are screwing everyone over, which is a common misconception. Spotify is barely profitable, so that’s something fascinating to look at and see how the media has manipulated it.
IR: Considering Spotify isn’t charging that much…
AS: Yeah, it’s not on them. They didn’t strike the best deal, but they also had their hands tied. How else would they get those catalogs and do what they’re trying to do? What we did for the web2 distribution model, was basically do an indie model, which is a fifty/fifty split with the artists. However, we do take all of the creator royalties off the top, meaning if we are paying producers and songwriters or mixers a percentage of the master royalty, it’s not just coming out of the artists’ share, it’s coming out of the bigger pool. We split that with the artist. So that was one main change we made that we felt was important, that the collaborative fees don’t come out of the artist’s share, otherwise it’s fifty/fifty with the artist and we do exclusive licenses so that the artists retains ownership over the work.
IR: Fantastic. Now I know there have been a lot of issues with vinyl production for labels, because of the backlog that happened during Covid. Has that affected Nvak at all, when trying to create physical product for your artists?
AS: We are way too underwater to even be thinking about physical product at the moment. (laughs) To be honest, yeah, we are deep in digital. I cannot wait until we can start looking at vinyl and creating physical; it’s just that the overhead is too big and the margins too low. We don’t have the infrastructure to pull that off right now.
IR: My final question for you, what are the labels main focused goals for 2023, and what do you envision the labels next five year plan to be?
AS: There are two main goals outward-facing for the label: One is launching this MVP for Annika, and releasing a report on all the data from it and how viable it is to scale, and then scale it and try it for multiple other artists. Probably we’ll only be able to get to two more music video game launches this year, but if all goes according to plan and we prove that it’s profitable and a good business model, then everything will kick into gear in 2024 in terms of providing that service beyond Nvak’s roster as well. So that’s a big one there. The second goal is to set-up the two emerging market writer camps in Ghana and Egypt, and find the next two artists for the Nvak collective roster.
So that would be the immediate goal for this year. When looking at the five year goal, we are trying to create a massive flywheel between the Nvak foundation, the non-profit, Nvak Media, which will utilize web3 to optimize the artist development process, Nvak records which focuses on old school A&R and marketing as a traditional record label with progressive deal structures, and of course Nvak management and publishing, both meant to create a network of songwriters, producers and artists so we can build a community and ultimately a culture around the type of work we’re doing. So in five years time, we want to be able to set a new operating system for how a record label can function that’s built on artist development and direct-to-fan engagement instead of ignoring both of those things, which has been the norm for the past decade.
You can learn more about everything Nvak is doing from their website, and follow them on social media @nvakcollective.
And be sure to check out Nvak’s artists Rosa Linn, Annika Rose, and their other current and future signees!