Stem CEO and 2018 Forbes 30 Under 30 Music alumna Milana Rabkin introduces Scale by Stem.

Beginning today, music artists and indie labels have access to a new stream of funding. Stemdistribution and payment platform invested in bythe likes of Mark Cuban and Scooter Braun (with clients Ariana Grande, Justin Bieber, Kanye West and Usher) is providing more than $100 million in advances each year via Scale, its newly-launched financing product supported by a capital partnership with CoVenture.

Scale is led by Stem CEO and 2018 Forbes 30 Under 30 Music alumna Milana Rabkin, who, with co-founders Tim Luckow and Jovin Cronin-Wilesmith, launched Los Angeles-based Stem in February of 2015 to help artists establish sustainable businesses. Stem provides creators with tools to streamline music and video distribution, royalty splits and data tracking. Scale promotes further independence among creators by providing an alternative to traditional means of funding and empowering them to own their own music.

Scale felt like the natural next step for Stem, says Rabkin. We had figured out how to simplify splits and handle royalties, but wanted to help independent artists leap to the next stage of their business since day one our focus has been on empowerment and clarity.

Early payments from Scale are made in the form of a revolving credit line with the ultimate draw limit and fee based on net share of income. Unlike most other industry advances, Scale offers artists more flexibility with repayment, meaning that they choose what percentage of their earnings are contributed to paying down the advance each month. The product also offers all content shareholders access to capital.

Creators using Scale are not required to report how advances are spent. The company also does not perform personal credit checks or collect interest, minimum monthly payments or finance charges. Before launching Scale, Rabkin started Stem Check, a service that helps artists evaluate the financial viability of a prospective deal with a label or distributor.

The workings of Scale by Stem.

Music producer and artist Billy Lemos is among the first artists to use Scale to finance future projects and says, Scale has allowed me to fund my ideas without signing to a label. I have full control and freedom with my music and dont need to worry about any deadlines.

While labels can provide benefits for some artists, standard record deals tend to favor the company and place operating, marketing and distribution costs on creators. As an increasing number of music performers today choose to work independently, Rabkin hopes that Scale will drive financial literacy and empower them to think more like entrepreneurs with an understanding of the value they are bringing to the table. She also thinks that it will raise the bar for the industry to be truly transparent.

Success in the music industry I think will come when we can dispel the notion of the starving artist, says Rabkin. All of the new emerging platforms are really important they are so heavily dependent on music as the media that drives engagement yet, the people creating music have no way to understand the value of what theyre creating.

With more than 40,000 new songs released a day on Spotify alone, Scale enters the market at an opportune time. According to Rabkin, independent artists are the fastest growing segment of the music business, and growth within the music freelance economy is expected to continue as the industry expands. Artists have aired their grievances about the increasing pressure they feel to sell their rights for a paycheck, and Rabkin says Stem is a viable alternative to lease, not sell.

I personally believe that as more services and labor work is automated, more humans will be driven to creative work, says Rabkin. Days of doctor, lawyer or accountant versus creator are going away, and I hope its tools like Stem that allow creators to create sustainable careers and businesses recognized by society I never want a parent to tell a child that they cannot be a creator.

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Artists, Labels Scale Business With Advance Capital From Stem, CoVenture Partnership - Forbes