
Paul Graham - The Record Label Executive - julycohen
http://www.maximusklein.com/2007/05/03/paul-graham-the-record-label-executive/
======
bootload
_'... The one-hit wonder is never the guy who creates a new type of music
...'_

I really like this article. It has an opinion, bit sarcastic and tells a good
story and totally misses the point. Lets start using the music industry
analogy.

Firstly all the guys trying out in the contest are mostly musicians. Musicians
that can firstly have enough skill to play instruments, have the youth, energy
and attitude to create their own tunes and sound. They come from a different
era of their predecessors. Turned off by the gimmicky clothes, fancy hairdo's
and makeup of binary boys of the 80's and 90's.

More important they are students of music. They have a band, can play their
own music but are missing something. Not talent, not ideas (well mostly) but
the knowledge and chance to play a good gig and record and commercialise. Do
they sell out and re-create the cheesy sounds of the middle of the road
_Windbag Recording studios_? Do they defect to the _artsy experimental Sol
Records_?

No. They know in their heart there is a new sound. More importantly they know
there is a growing audience that is looking for a new sound. A new sound that
says, _"screw you record companies. we can do it for ourselves. we don't care
what you think... %$ush off &!@(^@!!! "_ And so begins the bad-boy image.

Now lets look at the exec. He's a _Rollins_ type guy. Had quite a few hits way
back and understands the music industry. More importantly whats wrong with it.
There is a gap. A big gap. All the _suits_ are funding bands with _mega-
dollars_ for wardrobe, explosions and experimental albums with 27 minute
guitar solos.

So along with a few other band members and roadies they create a company and
hatch a plan to blow the other record companies and distributors out of the
water. By reducing the cost to sign, nurture and release _unknown_ bands and
make some profit at the same time nurturing talent. Something the big boys
have seem to have forgotten.

Thats right unknown bands. Untested, talented, raw and more importantly ones
that want to succeed at all costs with an attitude that makes the older more
established bands sneer at the youngsters. With their clunky looking
instruments, ripped t-shirts and shorts and attitude. They sneer also because
they realise, these youngsters can do what they cannot do. Faster, with less
money still managing to listen to their audience and evolve where required.

Then one has a hit. Others in the label start getting serious airplay. The
suits take notice and a new _sound_ is created.

Sound fanciful? Well I'm really just re-telling the story of punk-music. A
movement that smashed the pomposity of the glam-rock 70's and while short
lived and patchy allowed a core group of musicians to succeed where they
otherwise they could not have. In the process giving us Lou Reed, Pretenders,
Romones, Blondie, Pattie Smith, Talking Heads etc.

YC is that anti-establishment incarnation of punk music in software. Long live
_'minimalism, speed, and arrogance'_ ~
<http://en.wikipedia.org/wiki/Punk_music#Early_history>

------
pg
The odd thing about this post is that it's not merely mistaken, but
diametrically opposite from the truth. The thesis seems to be that because of
my "position as a partner in an investment portfolio" (what?) I'm forced to
choose bland, unimaginative startups that will turn a quick profit. In fact
one of the defining differences of YC is that we don't have to do this.
Because we make a large number of small investments instead of a small number
of large ones, we can and do fund the riskiest projects we can find.

This whole article seems to be based on a misunderstanding of why Reddit
succeeded. It looks so simple; therefore it must have succeeded merely because
I promoted it. But everything simple looks easy in hindsight. If it was so
easy, why didn't anyone do it before? Technically it was possible to build 10
years ago.

(And no, Reddit didn't copy Digg. The founders of Reddit didn't know about
Digg when they started, and the two derive from different sources. Digg is
Slashdot with voting instead of editors. Reddit is Del.icio.us/popular driven
by voting instead of bookmarking.)

~~~
aquateen
After all this time, this is the first I've thought of the slashdot/digg and
reddit/delicious comparison. Unfortunately, reddit is more digg and less
'delicious-like' nowadays.

~~~
jaf656s
I agree, I can't remember the last time I actually looked at the reddit
homepage, but I still read programming.reddit quite often.

------
byrneseyeview
"It's easy to look at Paul Graham and think - hey, he's one of the boys! He's
a hacker, just like us! He cares about the technology! Well, if you ever were
put in Paul Grahams position as a partner in an investment portfolio, you
would stop being the way you are now. Being an investor means that you are
playing a hacking game too, but the object of this hacking game is to make you
some money. And to do that, you cannot take 10 risky investments - you have to
go with 8 safe investments, and take 2 risky investments."

The point of diversifying is that you _can_ make only risky investments. If a
VC is honestly putting his money into the safest companies, rather than the
ones with the highest risk-adjusted return, he should be fired.

------
ecuzzillo
Even if you take what the article says at face value, the implication that PG
is morally bankrupt doesn't work, because of the following: music bosses are
morally bankrupt because they get wildly unimaginably rich off artists'
efforts, and prevent said artists from getting even mildly well-off. If PG
were like a music boss, he would take 100% of the company for $20k, and
proceed to make the startup sign an agreement that prohibited investment from
any other firm. Then, he'd sue the users of said startup for using said
startup's product, on the rationale that he was defending said startup's
founders.

------
Goladus
Record Label Executives aren't out finding bands. They have low-level lackeys
that do that. Designated representatives are the guys that put on the "hip"
face for the company, not anyone with actual power and connections. The only
real important thing about them is that they've been designated to hold the
keys to the kingdom. Their main purpose is to get the band to sign a
preliminary agreement to prevent them from signing with anyone else. [1]

By the time you get to the actual contract, the deal is a complicated 40-page
mess that could very well be screwing the artists using a variety of different
tricks. [2]

The YC teams can confirm or deny this, but from everything I've read, the
terms are quite clear and straightforward. The basic exchange is funding and
support for shares in the company, though there may be some relevant
adjustments on an individual basis. Participants understand the deal before
they have to agree to it, and so far basically always decide it's a win-win.
PG is not a lackey for some larger organization, and doesn't try to confuse
young companies and trick/coerce them into signing bad deals.

[1] <http://negativland.com/albini.html> \- Semi-Rant about the situation from
the guy who produced Nirvana's "In Uetero"

[2] <http://www.music-law.com/contractbasics.html> \- Article about Music
Contracts

------
budu3
I oppose the authors assertions because 1\. PG wrote a lisp book, practically
invented Bayesian spam filtering, and is working on a new programming
language. How much more hacker cred does he need? 2\. Unlike record companies
YC doesn't own the IP of the companies they fund, as far as I know. In the
music biz it's common place for the record company to own publishing rights to
your material.

~~~
Tichy
Totally agree - also I am not aware of any essays written by music industry
bosses encouraging you to start a band. They would be more likely to tell you
that you don't compare to mainstream act xyz, so you better get lost.

In fact I suppose PGs essays would make good reading for forming bands, too -
isn't a band a kind of startup as well?

------
BrandonM
I think it is a good article from a completely different perspective than I
had previously considered. I don't know that it's completely accurate, but it
makes for a good read.

I would really like to see blog authors be more careful proofreading, though.
I mean, at least read the first sentence to make sure that it is grammatically
correct, because it sets the tone for the whole article.

------
budu3
I do agree that the technology startup biz is a lot like music biz where
startups have to impress VCs in order to become super-companies. Some startups
prefer to do it on their own, much akin to independent labels. Comparing PG to
a label boss however is a far stretch.

~~~
madanella
I think the top post on this thread makes it more balanced. Think of pg as an
independent label(like sub-pop or Dischord) founder and it all fits well.

------
rms
Paul has learned to reduce his risk by now rarely funding undergraduates and
teams without demos.

~~~
SwellJoe
I dunno about the undergraduates thing; if they have a killer demo, I think
they'd still get in (though they'd probably need to be willing to take a leave
of absence if the company has the capacity to succeed at the end of the
program). But it also reduces the frustration that everyone feels (including
other groups) when one group fails to launch due to lack of commitment to
building a company.

Besides that, the number of applicants has sky-rocketed, and they can't take
everyone. Having a demo just makes it clear what you're trying to build and
that you have the capacity to build it.

