Sellaband and the 80/20 Rule


There are two things about traveling to Europe which stress me out above all. First, because I normally am limited to flying coach class, I experience bouts of anxiety up to the moment I am safely seated in either a bulkhead or emergency aisle seat. Occupying a frame of six feet, seven inches, my big ass simply won’t fit into the nooks and crannies aircraft designers humorously consider to be seats. My second concern is battery life. I’ve grown accustomed to rationing the life of my iPod in strict accordance with the plane’s map position shown on the television screen. As a back up plan, I usually travel with a book or two in case the iPod battery icon goes into the red.

Here Comes EverybodyThis last trip to Austria, having become engrossed in Clay Shirky’s “Here Comes Everybody”  I was able to economize on battery life. I found the book interesting enough to read three times, once on the flight over, once again during the late hours in Salzburg, and a third time on the return flight. Clay Shirky’s talk on the internet site “Ted Talks” is a fast track synopsis of the book and both crystalize the conceptual basis of the Sellaband mechanism. The internet-based record label is both a symptom and a possible solution of the changing virtual world of the internet. As much as we would like to direct traffic in this world, Shirky’s concept of technical revolution resulting in a period of chaos rather than instant re-organization leads me to think again of the Sellaband model as the primal brine from which the new order of music marketing will eventually crawl out onto the land once again.

An interesting correlation can be made between Shirky’s description of Power Law Distribution and a cursory analysis of the Sellaband community. The Power Law Distribution, also known as the 80/20 rule, is the curve that can be applied to almost any system in which individuals take part on a voluntary basis and there exist no strict work assignments or compensatory schedules. As a simple illustration, say you could not be home for Halloween but still wanted to pass out candy to the neighborhood goblins. If you were to leave ten pounds of candy on your doorstep, there is a good chance that 80% of the candy will end up in the hands of 20% of the goblins. The vast majority of kids would take one or two pieces, some would grab a handful, and a handful of kids would take as much as they could get away with.

This curve can be applied to different aspects of the Sellaband community. There are now over 8000 artists on the platform with the bulk of monetary investment being represented by a small percentage of artists. I would feel confident in making a wild guess that 80% of the funding in Sellaband artists has been invested in 20% of the total artist roster.Conversely, there are tens of thousands of investors or believers as they are known in Sellabandese. Leaving statistical analysis to the experts, I would bet that 20% of these believers are responsible for 80% of the total dollar amount invested in Sellaband artists.

SellabandThis is the second summer of Sellaband’s existence and there are mumblings related to the slow rate of activity regarding investment. But this slowdown has not affected all artists equally. Following the 80/20 rule, the lower percentage of artists who do a higher percentage of self promotion and networking will reap a greater return from the lower percentage of believers who invest the highest percentage of funds. The high percentage of artists who do nothing to further themselves will reap the lowest level of investment from the highest percentage of believers who invest the lowest percentage of funds. The 80/20 rule is not something that was handed down from above as a mode of behavior. It is simply a symptomatic analysis of that which exists in a voluntary community.

There has also been some concern that the system will suffer from the cannibalistic effect of artists seeking support from the existing community without bringing new investment from the outside. Again, if we are to trust the integrity of the Power Law Distribution, very few big investors are needed to balance the inactivity of these artists for the proportions of the 80/20 rule to remain intact.

Sellaband is an experiment that has grown out of the ashes of what once was a powerful money-making machine. The survival of Sellaband depends less on profit than it does on the willingness of individuals, artists as well as believers, to take part in a social community on a voluntary basis. Community efforts will always suffer the effects of insecurity, ego, greed and the whole litany of human frailties. There are the 20% who are responsible for 80% of the sloth, and there are the 20% who actually do 80% of the work. To be successful as an individual in such a loosely regulated social structure, the individual must first do what is necessary to insure success on a global level. 80% in such a community will not understand this and will work toward only their own success even at the expense of other community members.

Then there is the concept of assimilated accomplishment. Want to be a good athlete? Hang out with the small percentage who really work hard. Want to be a good musician? Go play with the percentage at the top of their game and learn from them. This seems to be true no matter what one seeks to accomplish. Being better than the next guy is one thing, but being as good as you are able to be, accomplishing anything up to your personal potential requires that you stop looking right and left for comparisons and concentrating on the goal at hand. In a system like Sellaband, where there are no homework assignments, no practice schedules and success at any level is contingent only on the degree of personal involvement and commitment, any significant growth of the community will continue to reflect this 80/20 rule. The structure of a community like Sellaband is never intentionally created to conform to the Power Law Distribution. Rather, the 80/20 rule is a graphic description of what will occur naturally when individuals follow their natural behaviors in a social system.

Given the information that Sellaband’s primary focus is to “sell parts” the promotion and marketing of completed projects becomes a secondary byproduct of the platform. Using this information wisely is key. There are many artists as well as believers who spend a great deal of well-intentioned time offering opinions as to how Sellaband could or should better serve the community. But the fact is that Sellaband is in the business of “selling parts, and lots of them.” The higher the number of parts sold, the larger the community. Those within the community who look to Sellaband for more structure and support are thinking in old-school label terms and misreading the value of the platform. Structure and services come at a loss of freedom and initiative. The Sellaband landscape is a fertile ground for creativity of thinking, marketing and self-promotion which does not exist in traditional label structure.

Clay ShirkyShirky’s statement that technical revolution brings on a period of chaos before settling into a new system is not bad news but provides an optimistic outlook for creative self-starting individuals because it leaves the field open for fresh ideas. There will always be those who complain that the sky is falling. But progress is defined by those creative individuals who use what is falling from the sky to their advantage in new and flexible ways. The old label system used both artists and consumers to their advantage. Platforms like Sellaband are providing the opportunity for artists and consumers not only to use the system, but to create the new system out of the chaos that evolves when an old system is turned on its head by technological advances.

The face of music marketing has changed little since Enrico Caruso’s first recordings became a mass-marketing bonanza for the fledgeling recording industry. But advances in technology have brought about a Lon Chaney effect and this face changes more each day than it has over the last century. The good news is that the changes are being instigated by individual initiative in combination with community acceptance. In the cycle of Closed System>Revolution>Chaos>New System, Sellaband straddles the area between Revolution and Chaos. Whatever the new system shall be and how effectively it serves the community is in liquid form. Have you ever stared at a restaurant menu and said to yourself,” Man, all of this is really close, but I wish I could just go to the kitchen and cook myself exactly what I want.” Well, the restaurant is built, the pantry is full and the fire is burning. The menu is up to anyone willing to step up and cook.

2 Responses to “Sellaband and the 80/20 Rule”

  • Hi Pete,
    Just wanted to let you know I’m a SAB artist and I heard about your site from Phil Sommersby. I really enjoyed reading this article and I appreciate all your insights. Glad to have been invited to your site and I look forward to reading it in the future.
    Thanks!
    Aryn
    p.s. if you’d like to know more about me, my SAB page is http://www.sellaband.com/aryncalhoun

  • I also would like to add that the 80/20 rule applies to almost anything. For example, a friend of mine runs a network of websites and 20% of his network produces about 80% of his total income.

    Or my college class from last semester, 20% of the students got A while the rest did not (sadly I was not one of them).

    So it’s no surprise really that 20% of the Sellabanese will donate about 80% of the donations.

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