R&B recording artist JoJo performs inside a friend's Los Angeles… (Jay L. Clendenin, Los Angeles…)
Imagine a service that allows you to see your favorite acts in concert without ever leaving your home, let alone changing out of your pajamas. Stageit, a Los Angeles-based online company, does just that.
The two-year-old service allows performers to play from just about any location with paying fans watching the show and even interacting with the artists between numbers. Think Skype meets pay-per-view.
R&B-pop singer JoJo recently put on a show from her vocal coach's Leimert Park living room. Though the singer couldn't see her virtual supporters on the laptop she was performing in front of, she did see their song requests, conversations with one another and questions they had for her. She was also able to keep track of a virtual tip jar.
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One fan tipped the equivalent of $400, another one who won a 15-minute Skype call with her tipped $795. The jar ballooned past $5,000 by the time she sang one of her biggest hits, "Too Little Too Late."
Not bad for 50 minutes of work.
"It was cool to be able to give my supporters, [especially those] in other countries that I haven't been to, an intimate setting to just let them hear my voice," she said.
Stageit's Chief Executive Evan Lowenstein, formerly known for the 2000 hit, "Crazy for This Girl," wanted a way to engage with fans without the clutter that comes with most social networks.
"What you have is people playing music next to mortgage ads and free iPod ads," the 39-year-old said from Stageit's Hollywood office. "It's not a necessarily conducive environment for an artist, and there's no way to make any money.
"We want the particular fan who understands the value of an artist's time is worth something," he continued. "It wasn't just about getting the artist paid, it was about enabling the fans to give money directly to the artist."
Since its 2011 debut, Stageit has been host of shows by marquee acts including the Indigo Girls, Jason Mraz, Trey Songz, Sara Bareilles, Korn, finalists and winners from "American Idol" and "The Voice," and Jimmy Buffett. Anyone can sign up to perform.
Buffett, a longtime friend of Lowenstein, helped launch the site with a demo at South by Southwest in 2011 and, along with Napster founder Sean Parker, has contributed to the $3.5 million raised in venture funding.
Lowenstein asked another industry friend, Jason Scheff of veteran pop-rock outfit Chicago, to test the idea with a private show in 2009.
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"It was just a box and a chat room and I'm watching him take his laptop through his house. He goes to the piano and starts playing a Chicago song, and then Elton John," Lowenstein recalled. "I had goose bumps. He's looking right at you, and everybody in the room feels like he's looking directly at them."
That intimate approach has translated to public kudos for the company. Stageit was named one of Billboard's best startups of 2012. Fast Company named it one of the world's most innovative companies in music last month. And Stageit took home an award at Midemlab's 2013 competition.
"We've invested so much as an industry in likes, followers, subscribes and friends and it hasn't yielded revenue like anyone had anticipated," Lowenstein said. "If you buy a $1,500 package to see Katy Perry, she doesn't know you exist. If you buy a Jason Mraz record, he doesn't know you exist. We are finally letting fans give money directly to their favorite artists and be recognized in real time."
The real payoff, though, is for artists. Stageit concert ticket typically run about $3 and fans spend on average $13.40 per show (including tips). Stageit's largest show, a benefit that included Crosby, Stills & Nash, Bonnie Raitt and Jackson Browne, drew 11,000 viewers.
Top tier acts can make about $15,000 to $20,000 per show, Lowenstein says, with mid-level acts making roughly $5,000. The across-the-board average is about $460 per show, with nearly 60% of revenue coming from the virtual tip jar.
Musicians made $1.2 million through Stageit in 2012, but that figure could top $4 million this year. As for the company? Artists take 63% to 83% of the profits, with the rest going to Stageit. "We're not profitable right now, what's more important for us is the artists are making money and proving that fans out there will spend money on artists," Lowenstein admits.
But his confidence in Stageit lies in its exclusivity. Shows aren't archived so if fans miss out, tough. Besides, as he says often during conversation, you can't pirate intimacy.
"We say Stageit is a front row seat to a backstage experience," Lowenstein added. "The front row seat is the most expensive in the house, but everyone wants to be backstage. All we're doing is putting a camera on that experience."