On Friday 20th August we were fortunate to welcome Paul Pacifico, CEO at Association of Independent Music (AIM) to speak with UKBAA’s Roderick Beer as part of our Friday Focus feature. Advice from Paul on investing in the UK music industry features as part of the music module in the DCMS ‘Invest in Creative’ toolkit.
As part of the conversation, Paul talked through his experience of working in different areas of the sector, as well as where the real opportunities for investors lie. We’ve pulled out some of the high level points, including wider stats relevant to the conversation.
1. the UK is the 2nd biggest exporter of music in the world
The music industry contributes £5.8bn GVA to the UK’s economy every year. Paul both outlined headline stats that point to the sector’s impressive growth, as well as his experience working at the cold face. The ‘Invest in Creative’ toolkit pulls together a huge range of stats from subsectors across the creative industries.
2. technology creates opportunities
Paul shared with our investor audience that it’s possible to ‘sweat the assets’ with regard to music, for example for every 1 stream of a song in the UK, you can expect 2-3 steams internationally. He reminded us that up to 60k – 75k tracks are uploaded to streaming sites every single day – which points to the tremendous growth of these platforms and the opportunities that opens up. Opportunities lie in the distribution of music but, given it’s vast growth, also in the products that facilitate production – there’s now a need to find creative ways of standing out.
3. the music industry isn’t oversaturated, there’s still so much space for creativity
Whilst streaming sites are flooded with music, Paul suggested that there’s still ample space for creativity in the sector – in that there’s a need for investment into production and left-field thinkers in order to cut through the noise (think of punk!). Paul suggests looking out for the early-stage pioneers in this space and growing with them; this tip was also echoed by Andy Heath CBE – Chairman, Beggars Music as part of his ‘Invest in Creative’ interview (read more here) – he reminded us that entrepreneurs should be looking to ‘grow with consumers’.
4. AIM is currently conducting research into the risk and returns for investors when investing in the music sector
Paul shared that this is something that AIM is looking into at the moment, and believes that the research will make for a more ‘rational’ industry. He added that the perceived risk of investing in the sector is much, much higher than the reality.
5. Paul is progressing with putting together a music-focused syndicate
He’s looking forward to progressing with this initiative, as a means of taking another step towards bridging the gap between the investor community and music creators. The music industry is ripe for investment, offering exceptional growth opportunities for investors and creators alike.