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Mint Season 4 episode 32 welcomes Lee Parsons, CEO of Opulous, who’s changing how artists access the funding they need to pursue their music. He’s on a mission to wake up the outdated industry and he explains why the legacy music system is about to encounter a rude awakening.
In this episode, we discuss:
- 00:00 – Intro
- 08:18 – How Web3 Will Fix The Music Industry
- 14:27 – How Do Artists Get Started on Opulous?
- 15:43 – What is an S-NFT?
- 19:22 – The Future of Music NFTs at Opulous
- 24:22 – What Will the Decentralized Layer of Web3 Music Look Like?
- 27:33 – Does Web3 Favor Established or Up n Coming Artists More?
- 30:38 – How Do You Turn Listeners into Investors?
- 34:44 – Copyrights on-chain
- 40:14 – Future Plans for Opulous?
- 43:30 – Beyond the Collectible; Staking Your Music NFTs
…and so much more.
I hope you enjoy our conversation.
Support Season 4’s NFT sponsors!
1. Coinvise – https://coinvise.co
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Lee Welcome to Mint, my friend. Thank you for being on. How are you doing?
Lee Parsons: I’m good, mate. I’m good. A pleasure to be here Adam. On the channel. So, look forward to the conversation.
Thank you. Thank you, sir. excited to have you. This is the first conversation we’re having, I guess explicitly on music meets defi, we kind of treaded around the topic across like 20. Other plus seasons, give or take, but I’m glad you’re on because I know jack shit of where defi meets using. I have ideas. I have thoughts. But you’re the real expert here. And we’re here today. So, let’s jump right in. Who are you? What does the world need to know about you? But more specifically, how did you get your start into crypto.
Lee Parsons: So originally, I was working the music industry, I run a company called ditto music. And I started that with my brother back in maybe like 2008. And the story behind that was just really quickly, we were in a band, we were trying to get our music out, we were on a record label that dropped us the day the songs first came out, we just didn’t know. We didn’t know how to release our music. And at the time, everyone was still doing CDs, it was like the end of the CD era. And we were the first people to get a contract with Spotify. I think there was like, four major labels and us at the time. And we just started a company that helped artists get onto Spotify and iTunes and Apple digitally. And then they keep all the rights to their music. And it’s a tiny little idea. But at the time, you just couldn’t get onto Spotify or anything like that without having an intermediary. So, I grew that company, it’s about having half a million users. No VC backing, just me my brother working away. That’s, you know, probably about 300 staff in in most countries now we’ve worked with some of the biggest sites in the world. And then around 2017, I was in the Philippines, because we have an office out there. And a producer friend of mine, he’s a friend now. But I just met him. Crazy guy, which he just sat me down and told me about Bitcoin. And I didn’t, I’d heard about it. But I didn’t. I didn’t obviously, I just hadn’t really looked into it probably because no one explained it to me. We spent like a day just drinking beer and he was telling about all these kinds of different things he’d been doing and he built he bought a house from his what you can what you only talk, he was talking about a Ethereum and then loads of really bad points that I ended up buying.
What year was this?
Lee Parsons: This was like early 2017. Right? I think Bitcoin was about $3,000, something like that.
Okay, so like the low period
Lee Parsons: So, wait, so I was like, man, well, this is obviously gonna take off. I went, I thought, right, I’m booking my flight home. The next day, I’m going home, I’m gonna take everything out the bank, and I’m buying everything I can. So, I literally went home the next day, I’m quiet, let go kind of guy. They’d worry about it. Afterwards, I went home, I’ve got this book. What was it? I think was it. It was just about I can’t remember what the books called. It wasn’t banking on Bitcoin was it or something like that? It might have been, it talks about Ethereum and how you could use it in the future in, you know, in a Tesla and all this stuff. And it was just like, Man, this is this is obviously the future, there’s no way you know, the current banking system versus what this is offering that’s going to survive. I’m 100% Confident in this, let’s go, went to the bank where I lived. I said right when all went out the bank, you guys are finished. And this is, you know, oh, so hyped up about it, like you guys are finished, you’ll give me all my money and they’re like, you can’t have and they were like, you can’t have all your money back today. And that’s what you’re talking about, give me my money out of the bank. And I’d already, I already fallen out with this bank because I took my mom in there once. And my mom was actually the director of my company because she was, she just she had to have that kind of level of security to do something. And I took her in, I said like, you know, I want to do some work in my business account and they thought was they thought was trying to set an account with my mom. And they were just, they were really rude to me. They’re like, okay, well, you know, we can’t do that today. So sorry about this. And then my mom phoned them up and they ended up sending her a big bouquet of flowers and all this other stuff because they obviously looked at my business account thought well because, you know, we pay out 10s of millions a month that ditto, and they just literally shoot me out of the bank like I was, you know. So, we’re already fallen out with this bank. So went back because I want my money, they wouldn’t give me my money. This girl comes out with this pamphlet goes, look, you can earn 1% interest if.
Lee Parsons: Like, Get out of my way. So, it took me about three days, I took all my money out the bank, and I moved most of it into, like Coinbase and Kraken, I bought all the Bitcoin I could buy, I can’t say how much money it was, I had a decent amount of savings. And then, they all got to like 20 grand, and I’m just like, Man, I’m a genius. I’m Oh, this is like three months later. So, I’m like, I’m a trading genius. This is brilliant. And then my mate from the Philippines, my friend from the Philippines gets back in touch. And he’s like, man, if you really want to make money, you need to get into these old coins and not really. So, you can imagine what happened next, I went all the way back down to less money than I started with. And then um, and then that took us it’s like January and my friend who just saw Fernando, me and him were just so far into it at that point. I was like, man, looking at all the problems we had in the music industry for reporting, and, you know, giving money to people and I started looking at what big, what blockchain could actually do. And you know, away from all the speculative nonsense about the price and everything. As that man, this is just still, you know, I was still pretty happy with it. And then so I started what a company called Blue Box, which was the original version of Oculus. And I was doing that for about two years, man. And like, it was so, it was such a mad experience. I was going to like China and I was meeting, I met all of the blockchains you know, some horror stories. And then with some of them, you know, these, I’m talking about really big top 20 blockchains, who had three staff, and you know, not even a proper office, and I talked to all of them. I started trying to build my product through a bear market. I couldn’t get any funding from anywhere. And this is having a company that’s worth hundreds of million dollars ditto, you know, which is one of the world’s biggest distribution companies that I own? No one was interested at all because it was a bear market, right? Absolutely. No one cared about crypto, it was going down every day. And then around, when was it? Must be 2019. When my founders miles, he was one of the original people who put together algorand. And he was one of the first lead investors, when I say put together, I’m talking about on the finance side, he put like that he helped using Cosmos capital he put like the seed round for, got investors in. So, he had contest algorithm. I spoke to him a few times before. And then we kind of knew a bit more of what we were going to do. But those two years were crazy man. And it was honestly I thought this is never gonna happen because the market was so bad. And then we got some funding off algorithm to kind of build a defi products. And that was around what September over a year ago, and then the market or just turned that it went crazy again. And since then, it’s been like, but anyway, that’s how I got into crypto. And since then, you know what? The best thing I did all the money that went back down to zero, I waited until that March when COVID hit, I think Ethereum is about $90 and put everything into Ethereum. And just left it and so the answer I want.
Everything is locked in Ethereum now.
Lee Parsons: Yeah, man, I’ve got other stuff. I’ve got a lot of algorithms; I’ve got a few things. But for the most part, I’ve got like stable tokens and stuff now, but I don’t have, I don’t have anything in the bank. Really, I don’t ever use banks, I just use my crypto.
How Web3 Will Fix The Music Industry
Lee, can you talk more about like the hype around where music meets crypto right now and what’s going on in the current state? And I want you to take it also from the point of view of because you have such a deep history and you have such deep roots in the music industry. What kind of problems are you kind of seeing web three solve as of now?
Lee Parsons: The biggest problem we’ve had in the music industry has always been lack of transparency, or lack of lack of reporting, right? When we were doing CDs, imagine this like we did, we’ve got, we have Spotify now. So, you can track exactly how many plays a song has. Because if you don’t, you know, if you give someone a report, it doesn’t match up with what they’re seeing on Spotify is completely different. Imagine what it’s like in CDs. When you label, a label would man, I have friends that labels and they were saying they would literally cross out columns and just make this up and put that there. And our artists never used to make any money. Because the record, even a record deal now, there’s artists I know, who have signed a record deal for like 100 grand, so they’re getting advanced, and I think it’s loads of money. The record label takes 90% of your copyright for the most part, if it’s not 100% You get so you get 10. No sorry, 90% of your profits, right? 90% of your profits come and go to the record label. And out of that 10% that you get they pay for everything. So, say 100 grand comes in, your video costs 50 grand that’s gone that way. We spent 20 grand on this that’s gone that way. There’s five grand left, the record label will take 90% of that which and then get what four and a half grand and then give you and so you end up with nothing with anything and then they own the copyrights forever. Just so the actual song you’ve made. The reason you see so many artists complaining at the moment because everyone from you know, pre-Spotify, pre independence era doesn’t own anything. So, 10 years later they got no income coming in, and then only thing and meanwhile, the record labels are making. I don’t know what it’s like $3 million, every hour at the moment, just in streaming. I mean, it’s cool, it’s crazy amount of money. But it doesn’t trickle down to the people actually making the music, that’s the biggest problem people would have.
When I started Ditto. It was, it was just crazy to me that unless I signed with the label, I can’t get a song on the radio, because if it’s not in a shop, you can’t get it in the radio, and one in every probably 10,000, 20,000 artists were signed to a label, and the competition is so fierce assigned to a label that you take the worst deal ever. And that was a problem right now, it’s all kind of shifted the other way in, in, in the direction of the independent artists, because, you know, they don’t need labels as much, they’re holding on to their copyrights. But the one thing they do need is funding still, you know, because if they want to raise 100 grand to go to a video or something, how do they get funding because a bank is not going to give them money, they don’t want to take them on record label. So where are they going to get the money from? So, I guess that’s kind of how, that’s how I just came in on the defi front, because what we do, our defi is backed by artist loans. So, say someone I mean, we work with a lot of big artists, I don’t want to name them on here, but say you had an artist that is earning $1 million a month, crazy amount of money, and you know, artists are, so they’re earning $12 million a year. And that’s backed by their copyrights, I know exactly what they’re gonna earn in the next three years, because I can see from their, from their analytics and Spotify and what playlists so on how much money is gonna come in. Now, they still can’t go to a bank and get a loan on that money because I don’t classify as proper earnings. Meanwhile, music copyrights are one of the fastest growing assets in the world, the fastest growing faster than anything are about 100% in the last few years. So, everyone’s trying to buy these music copyrights. So why can’t an artist who’s making this money get a loan, without Plus, they can take a loan out of the pool that’s in the middle. So, say, to take a loan out $5 million, then that is a staking pool that’s lending. And then people come into that pool and stake their money and earn interest on that money, do you not mean so it’s kind of, it’s like a normal pool, but it’s actually backed by an asset that’s earning money.
So, this is the revenue that’s being generated from their copyright contracts that they otherwise can’t go and get financing from, from a traditional bank, right? So, you guys are coming in as that new modern bank to provide them the financing that they need to kind of tap into the value that they’re generating that they couldn’t otherwise tap into. Right?
Lee Parsons: Yeah. And the independent market is 60% of the whole, when I started, it was like 10. But now it’s like 60% of the whole market and growing. So, most people have access to their own money and their own copyrights. And what happens is that they don’t pay the loan back. I mean, they have to pay it back anyway, most of it goes through ditto right now where it’s automatically taken out. If they don’t pay it back. We take the copyright until it’s paid back, and then they get the copyright back. You know, but they can only take a loan out, obviously, if they’re already earning money. So, it’s really 100% rate of them, you know, us getting the money back.
So that sounds incredible. That sounds like it’s a win, win, win situation. Right? What am I missing here? It sounds like I’m just having this aha moment. And I don’t know this. This is why I’m asking you right? Like, that sounds like such a big problem that needs to be solved.
Lee Parsons: Yeah. And I think that’s what we should be doing on web three. Like you said, the best thing is, is connecting someone who wants to stake money and support someone, and someone who wants to borrow money and you don’t need a bank. Like I said, who’s going to take four days to let you take your own money out and throw my mom out the bank? Which I’ll never forget. But the fact they said, that’s my mom, you don’t mess with my mom. She goes, like that just shows you right?
Is she involved in Opulous right now?
Lee Parsons: My mom. My mom is just, she. Or she still involved, right? Your mom?
Always. So, Opulous came into the picture again, what was it? What was the year?
Lee Parsons: We actually launched last January, which was January 2021. But we’ve been probably I’ve been working on Opulous with algorand for nine months. And I’ve been working on the previous product that was still linked, we had investment for like our three, if you know our three quarter blockchain and a few other people and that and we were running two projects, then we kind of merge them into one as Oculus, about 18 months ago, something like that.
So, Lee let’s scenario arise from it. Okay. Let’s say lil pump comes to you and you guys had to drop a lil pump and he’s actually not applicable. It’s a big artist comes to you right now. Okay.
Lee Parsons: Not Little pump, a big artist.
No, no, I say because you already did a drop a little pump.
Lee Parsons: Yeah.
How Do Artists Get Started on Opulous?
No, no, no, no, he’s dope. Alright. A big artist comes to Opulous. Right? They say, okay, I’m earning X amount of money per month, here are my contracts, okay, then justify that? How do they tap into Opulous? What does the step by step process look like now?
Lee Parsons: Yes. So, at the moment when we launch right, eventually it will be open to any artist to do so if you’re earning $300 a year, you’ll still be able to, you know, apply for a loan and the moment we’re looking at the bigger artists with bigger loans so we can fill those pools very quickly. Yeah, I mean, so they’re all kind of worked out from, from what their earnings but we have, there’s so much data out there, it’s very easy to kind of see what they’re going to be earning, it will go to an algorithm that will tell you how much money they can borrow. And then it’s really simple man. It’s so obviously it’s an algorithm. That’s it’s obviously mathematical itself, but it’s its own blockchain man. So, transparency
What is the interest rate on a loan?
Lee Parsons: Well, obviously, there’ll be different interest rates, right. So, you’ll have some that will be shorter term loans or longer-term loans, but you know, we want to be able to be around the 10% You know, zone for people staking and then add other rewards in for people using the plus token. So, we’ve got a few cents, the same as you have on a Nexo or anywhere like that. So, you stake a certain amount, Nexo tokens, you know, you get you get a higher reward.
What is an S-NFT?
Got it. Got it. I want to talk to you more about this S-NFT. That you guys’ kind of like coined at Opulous. It’s called the security non fungible token, it was the backbone for the little pump royalty drop that occurred if I’m not mistaken, on Republic, right, was taken on Republic. This security backed NFTs security approved NF T’s. They’re like one of the biggest question marks and excitements in music ex crypto, let alone crypto in general, right. And a lot of people are trying to figure out how do I overcome the securities issues that have been around since like, what 1946? That I’ve kind of like stumbled many, many people from quote, unquote, innovating, because of these laws that the SCC believes, protects the everyday investor or the accredited investor, right? Yeah, but you guys have found a way around it. Okay. In your own unique nature, for the most part, give or take, I want to learn more about that. What is an S-NFT? How do you think about it? How did you come to picture with it?
Lee Parson: So yeah, so it’s not even that we found a way around it, we’re just doing it, we’re just registering it as a security with the SCC. And eventually, we’ll have an exchange where you can trade that as you would a normal NFT. But, you know, it takes time to do this stuff. It’s a 12-month period to register something with the SCC, but you know, you can take the chance and hope that no one comes knocking on your door in 12 months. So, it’s a very hard thing to do. But I know, for me, I’m looking at this very long term. And I even know from speaking to people that, you know, some of the biggest changes, they think the next wave of tokens coming through could be securities because, you know, once the SCC do start coming into this industry and working out what is scary, and what isn’t, there’s, there’s a lot of, there’s a lot of projects out there that are questionable, even just a you know, even just defi products, and even some of our defi products will be SCC registered on some parts of it, because it’s just once you’ve got that out of the way, it’s a lot easier. And as far as an S-NFT, is say, with a little pump sale, we broke a song up, I think it’s sold into about 1200 pieces. They all get, they all get an artwork NFT, they all get royalties off the song, the songs already done, I think over 3 million on Spotify alone, it was one of his biggest songs. Because once you, once you put the song out, or the community of people have bought it or just streaming, it’s a death. So, it’s kind of a win win for both communities, really. But yeah, for me, building long term, looking at it from you know, two, three years down the line and where it’s going to be, then definitely having a security, you know, it makes no difference to the audience and the community. It just makes it a lot safer. And the other thing is you’re dealing with artists and their managers and their lawyers. And it’s very, very difficult to get something but even if I thought it’s not a security, which I’m 50/50 Anyway, once I come to, you know, one of the biggest sites in the world, are they going to want to take any risk as something being a security? No. And the lawyers, the lawyers won’t either.
Yeah, makes a lot of sense. I’m adjusting the screen here. So, for people who are watching on YouTube, I just want to get an idea of what like, what the, what the user flow kind of looks like. Okay, so when it comes to actually registering a song with the SCC, because that’s what essentially it is you’re registering security with a SCC, to do a drop, it took 12 months from what I understand?
Lee Parsons: To be honest, the we just announced another one today, actually, and we’ll have one out in about three weeks, which is Kora, which is amazing artist, and he’s gonna, hhe’s doing his full album. Isn’t that 12 months? It’s quite, it’s quite quick to do. The problem is you know, when you do the first one, it’s difficult because even though it’s SEC registered, there’s so many guidelines, which kind of spent probably the last three months just making sure all our contracts are good, and we can get them done really quickly. And now. Now they are, we’ve got them all lined up the next few months.
The Future of Music NFTs at Opulous
Got it. Got it. Got it. What do you, what does the future of music and NFTs look like at Opulous? What is your thesis around this entire space? Around this entire movement?
Lee Parsons: So, we’re launching a normal standard artwork NFT platform and our next drop has you know, we’ll do artwork NFTs drops. It’s really hard. It’s really strange, man because when you hear you know, I was listening to Gary Vee talk you can’t get away from, can you about music NFTs? And he’s like, the same thing as actually. What do you mean the future of music NFTs? It’s all very good saying it’s going to revolutionize the music industry. But what are they actually going to do? Does anyone know what they’re actually going to do? I think right now, no one does, we’re just kind of working on it as fast as we can to dictate where it’s going to go for me. And then it is the best way of storing an asset on the blockchain and proving ownership. So, the most natural use for it is saying, you know, I own this piece of copyright, I own these royalties are coming in. And they also have a, you know, I have a digital representation of that I have an artwork representation of that, for me, that’s the most useful one, because we’re also building an exchange where they can be traded. And if you want to go and trade copyrights, that they’re not liquid, you know, I can go and spend probably three months trying to buy, I don’t know, a Lewis Powell the song or piece of catalogue, but it would take me three months, it’s probably going to cost me $100,000. In legal fees, what I can’t do is go and buy, you know, $100 worth of a copyright, because no one would do that a lawyer wouldn’t do it. The way we’re using NFTs is to break all of that down, make them tradable, make them be able to buy as you know, a small portion. And that’s where I see that part of the market going, you know, and that’s, that’s what we’ve been building for a long time, ask everything else is the Wild West, we’ll see. Right?
So, let’s talk about the Wild West, because there’s a difference between collecting something to collect. And there’s a difference between owning like collecting to own right and own an artist share of something. And it’s very much a gray area, like there is no distinct definition of what’s better than what because even the economics behind owning a song, don’t really play out the way people kind of imagined it to. For example, we have yet to see like an actual use case and actual scenario of somebody making legit money from part of a song share that they bought, partly because all this is new. How do you think about the difference between collecting to collect and collecting to own? How do you how do you decipher the two?
Lee Parsons: I’m trying to make them both collectibles, right. So, the one we launched today is the same you know, if you have you have an artwork drop which are very collectible alongside you had the song drop now, I can calculate how much you know, Karl’s NFT is going to earn over the next few years for someone and they are going to get you know, the even the the people who bought the little pump NFT, you’re gonna make a lot of money from it. Because, you know, at some point, over the next few weeks, we’re paying everyone out for the first three months and they’re gonna be like, you know, I’ve got money here. This is crazy. So, if you compare that to other NFTs that are just a piece of artwork that’s probably gone down over the last 12 months, you know, that’s huge. And then obviously, whoever your, who’s your favorite artist.
In a space in the music kind NFT space. There’s a bunch, there’s people from Valencia to Queen George to Daniel Allen, the list goes on and on and on. I collect a bunch of them.
Lee Parsons: Oh, amazing, man. I’m on the music side who’s like your favorite musician?
Musician. So, I’m a drummer. So now we’re getting. You can see like the like the little outline of the drum kit, I guess. The thing is, but my favorite drummer has to probably be either Tony Royster, Jr. Steve Gadd. There’s, it’s endless. It’s endless. But I guess I’m like, like an artist point of view, maybe from like a singer songwriter right now. I would maybe say, Amy Winehouse, I love him. I’d love to own something from Amy Winehouse, for example.
Lee Parsons: We nearly did an Amy Winehouse track, which was a bit worried about legalities on it in the end, because the ownership was a bit unclear. But I guess for you to own a piece of Amy Winehouse track, that’s going to be really collectible. Now, even if it’s not going to make you a millionaire.
Lee Parsons: It’d be cool.
It’d be cool to see like, a little bit of that song when I hear a play.
Lee Parsons: So that’s where we are really, it’s about, there’s a lot of different reasons why someone’s going to buy an S-NFT. So, some of what a Kyle fan, they want to support him, right? That’s the first thing they want it, they’ve got, then you have investors who want to make money who think well, this Kyle albums gonna do really well. So, I’m going to buy it now. And in three years’ time, I think the value is going to go up from it. So, you have investors. You know, there’s this kind of all different types of people that are going to want to buy something from a musician, I think music is the one thing that everyone is, you know, he’s passionate about if I was selling, you know, there’s this, there’s, there’s a, love the AI and algorithm, which I think is awesome. And they do the same kind of thing for houses. And you can buy a little piece of a house, but it’s just, I just they’re not going to capture the same passion as buying a piece of an Amy Winehouse song, but I’m not dissing that project thing, that projects great. But I think the one thing everyone has is that love. Everyone has a famous, you know, Favorite musician, and everyone has someone that they think actually yeah, that’s, that’s something that I want.
What Will the Decentralized Layer of Web3 Music Look Like?
Yeah, you know, a lot of the music NFT that I collect today, they have no real value, for the most part, the market determines their value, right? When you introduce royalties into it, you introduce another metric that potentially values the collectable song in a completely different light. Because it’s revenue generating, right, you can show data to back its value, etc, etc, etc. And I’m also trying to debate like, which one do I prefer more, because the majority of the ones that I collect right now are just purely collectibles, right? And also, there’s no real way to listen to them just yet to enjoy the collections that I that I kind of bought into right, which is another problem that I want to talk to you about, like the consumption layer. How do you imagine that decentralized web three consumption layer for music, looking and feeling like it’s gonna be like a decentralized Spotify that builds on top of all these open networks that allows anybody to listen to anybody song, but people own different versions of them, whatever it may be. And then it’s like a governance token that pays people out as royalties. You know what I mean? Like, what, what is that? What does it look like, a few years from now? Because no one’s really doing that yet.
Lee Parsons: To me, that’s a question. I think, it probably looked like the last thing we expect it to look. Because don’t you think, though, because when we all come into this space, you know, pets.com example, all the internet businesses that, you know, we thought this will be, you know, everyone will go to pets.com to buy dog food, like no one wants to do that. They do want to go to Amazon, and buy everything. And all those different things that came along with what not what they thought it’d be, I don’t think we’ve seen the best use case, it’s going to beat Spotify at the moment or anyone near it. Because Spotify is everywhere. It’s on your television, it’s on your laptop, it’s on your, you know, everywhere you want to be Spotify is so how are you going to take something from web two, from web three, that’s going to beat that? It will happen because you know, the same way Napster happened. But right now, we don’t really need it to happen as a listener. I mean, we need it from a musician standpoint to things out, but you’ve got to change the whole community moves fast and technology, right? That’s how things move. It’s not technology, you can’t sit around and think, well, let’s find an answer for this from a tech wise, eventually the community will discover a way of doing it. And we will all just be like, yeah, there you go. That’s what we wanted to do.
I wonder where Apple and Spotify come into the picture? How do you imagine like the ecosystems, both ecosystems implementing NFT’s as part of streaming services, for example, do you think they’re gonna allow people to purchase songs, in addition to stream them and listen to them? Or, you know, like, where does it play now?
Lee Parsons: Spotify just announced that they were doing that.
They are doing NFT’s? Yeah, yes. I saw that.
Lee Parsons: Token showed. 100%. I hope they announced it again. Um, but even then, I know Spotify very well. I speak to them all the time. And they don’t have a clear path at the moment. They’re just kind of looking at it, looking at were, where it should be. But, you know, it’s like Facebook going to the metaverse, they’re gonna win. They’re gonna win because they are Facebook, they don’t have to do as much as someone else has to do to beat Facebook. So, I think as long as Spotify make the right moves, they’re gonna win. But that’s also not going to stop an 18-year-old, 19-year-old kid coming up with an answer and changing the whole thing, which I hope will happen. Yeah.
Does Web3 Favor Established or Up n Coming Artists More?
Yeah. I’m curious to also hear your point of view of like, does the web three market favor established artists or up and coming independent artists, maybe not even up and coming just like new, independent artists?
Lee Parsons: It depends what you mean about web three? You mean? How do you mean like.
So, let’s say, let’s talk about the Ethereum community, for example. Okay. Ethereum community they support innovators, right, a lot of the entire foundation of Ethereum is innovation. Right? We are still in the innovator’s adoption cycle, right? The really, really early stage of the adoption curve, right. And from what I’ve seen, you see, creators, let’s say, like Daniel Allen, who was absolutely nobody on Twitter raised $180,000, with 200 followers, on Twitter raise that amount of money in less than 48 hours, right? They saw the innovation within his model of sharing a percentage of his artist share right into his EP that has yet to be produced, that is not yet revenue generating, there’s nothing to prove its value. Maybe there’s some data on Spotify to show he has about a million monthly listeners, but still not a substantial amount. That project was absurd. And it also influenced the evolution of this new wave of web three native musicians who went to go ahead and then copycat, a similar model to his a basically, forming a crater Dao distributing his percentage of artists share into that crater Dao, issuing a governance token that then collectively, everybody kind of buys into and then raising money off that governance token to then crowdfund in EP right? That entire, it’s a very like web three native model, but it comes from an independent artist who otherwise wouldn’t have the traction as little pump. soldier boy, Kanye, etc. How do you think about that? Like, does the Ethereum community, the crypto community, web three community, whatever buzzword you want to tie to it? The current state of where we are today? Do they favor more? The up-and-coming independent artists aren’t tied to record label? Or the ones who are revenue generating or the ones who are established, that have a fan base, etc? What have you seen kind of, kind of layout us?
Lee Parsons: Yeah. So, I’d say there’s a big difference. You know, most people, I mean, you know, most people on Ethereum, average pop music fan anyway, right? Because you’d have a hard time. The audience, you know, the audience of music fans, I guess, would definitely favor the independent musician of Ethereum. But I think if you look at what he’s done, as you said, it’s not going to keep replicated over and over again. If you look back when Myspace launched, you had a few artists who became superstars, because they got in there first and did something amazing which he, which he obviously did. And everyone was like really excited about it. So, he has done something for the first time. That was genius. And, you know, and that’s worked is that the model to keep it going forward? It could be actually mean similar to what we’re doing. But I guess everyone who works in Ethereum is a bit to the left anyway, of what they want to kind of so they’re going to support that, you know, it’s unlikely he’s going to go into a BTS forum and get the same response. Terrible, but I think, yeah, he’s obviously he’s obviously done something really, really good there.
How Do You Turn Listeners into Investors?
Now, I’m curious, like, a lot of people are like, a lot of people in crypto are both listeners and collectors. But a lot of people outside of crypto are not collectors. How do you make in turn more listeners into collectors? Into investors?
Lee Parsons: Yeah. So, I guess the funny thing was, when we, the first one, the first sale we ever did was for a guy in England called big zoo, and Taylor Bennett, who’s trans rappers’ brother, and they were just friends. And I was like, man, let’s just, let’s just put a song out and split it and, and see what happens. And that was probably about 18 months ago, we did that. And I don’t think our audience had heard of either of them at the time. But what he saw was incredible. These people who bought like a tiny piece of a song for like 200 bucks, started playing their back catalogue. The one guy hosted the party at his house, where he was playing the song and all for all his neighbors. And it just created this crazy kind of superfan of people who didn’t know anything about the, I tell you one thing right after working in music for what, 15 years, when a song is making your money, it sounds a lot better. I have a playlist to do stuff. Some of it, some of it’s difficult hearing, man. I mean, let’s not sugarcoat it, little pump songs not gonna win. It wasn’t Bohemian Rhapsody at all that one but it sounds pretty sweet when you know you’re getting paid for it. So, these people, you know, a massive fan of these eyes now. And you know, and they actually do like the music because they feel so much more connected to it than someone who’s just playing it there. You imagine a fan who actually is, you know, someone who does know that artist is a superfan and has that song and they want the artist to win because you know, music fans are the most obsessive people community there is that and they do all that for free right now, you know, the BTS funds, you know, they just spend all their day on Twitter, having a go everybody that says anything bad. But imagine when that actually getting, you know, paid for doing that it’s creating. It’s creating a new ecosystem for music and funds.
Yeah, yeah, I hear you. I don’t know. I’m like, I’m so curious to see how this kind of plays out in the future, what legality, what infrastructure goes into play to standardize a lot of the experimentation that’s been happening behind the scenes that has yet to be caught up on by the SCC. And to really think and see, like, look at the data and see, does owning something, collecting an NFT of someone entice that person to kind of further support and further sell and further listen to that artist in their craft, the best example we have of this is boarded Yacht Club, and the absurd, like the complete insanity that comes from that community and how, how dedicated those people are to their craft to one another, to their brand, etc. And I wonder if that’s gonna hold true for musicians, music artists, if a fan goes ahead and collects, whether it be collectible for the sake of collecting or an investment, and you’re able to earn royalties, if that really does change the relationship between the artist and the fan, we’re still very much like the pre-early inning, to really see that thing come into play and to see it come to fruition, but we’re seeing small instance of, instances of how it does make a difference, right, but nothing fully to the extent where we’ve seen like, like a Charlie Amelio blow like she has on Tik Tok, for example, right? We haven’t seen like that happen in web three, like we haven’t seen a web three Native artists really take off in the in the mainstream. And I think intentionally because, again, we’re so early on.
Lee Parsons: Yeah. And you know, that’s the best thing about starting a company, right? Because if you’re investing in any company, I don’t know, I have a plan myself for what I want to be doing in five years, but it might completely change, right? It’s like you just have to be ahead of the curve, know what’s going on, and be ready to kind of, you know, someone else’s something amazing. You got it. You got to take, take the positive, take the positive out that keep working like we don’t know, do we really, and it’s probably, it’s definitely the most exciting thing I’ve ever worked in. Because of that.
Yeah, I hear you. I’m curious. Also, on the website you guys talk about, I have it right here on my right. Copy, music copyright backed NFTs. I want to talk to you about copyright. Okay. Copyright is very much still a gray area. I’d argue in unchain, excuse me. And it’s something that’s actually quite difficult. If you look back in like the LimeWire era, I remember people used to upload songs to LimeWire. And like pirate songs, and they changed like the frequency or the tune just a little bit and upload it to LimeWire. And it would kind of pass their content ID systems that would otherwise flag copyrighted material. And it makes you think we’re, we’re working in building on a network that’s so open, so transparent, and so borderless that a lot of these issues can kind of prevail again, on chain. Sure, there’s a level of ownership. Sure, there’s a level of transparency, you can trace back when something was uploaded, first, whose wallet address it came from. But it still doesn’t stop, for example, the pirating of music, let’s say, okay, when you think of, when you think of copyright, okay, on chain. And again, it’s such a big topic, it extends way beyond just music, but for copyright on chain for music, what is the perfect scenario look like?
Lee Parsons: The perfect scenario, right would be that you create a piece of music, you put it on the blockchain, every time anyone interacts with that music, you get, you know, it’s recorded, right? Because that’s the problem in the music industry. It’s like, I live in Brazil. And I think something like 90% of the money that’s supposed to go out doesn’t go out. Because nothing is recorded, the way it works at the moment in music industry, right? Say, where everybody plays, everybody in the UK pays a license. So, if you own a bar, or a restaurant or anything like that, you have to pay license for PRS. And then someone from the PRS will come in to your bar once a year and say, oh, you know, what songs have you played, and then they count that for the whole year, the whole year. So, say you’ve got an independent song, and it’s played like, you know, 10 times in each and each little thing and you’ve had loads of plays, the chances are, I’ll never get picked up ever. So pretty much all the money just goes straight back to the major labels, because your ratio, and all these other guys are the ones that they will always record. So, all that money just is not going back to everybody else. So, the transparency and the recording of what your asset does is the most important thing. I think that’s definitely gonna happen. But, you know, we’re a long way off, because you need so many things that happen, but the blocks that we’re building now, all of us music companies will eventually, you know, allow that to happen.
Yeah, I hear you, you know, my whole thing is like, it’s still, it’s still, the whole idea behind these platforms of it being highly curated, right, and being very selective on who can publish new can come on, kinda like works towards solving the copyright issue, right and legitimizing people’s brands, legitimizing people’s platforms, like the element of curation, very much, very much helps with minimizing copyright problems for now. My question to you is like, can platforms solve the issues of copyright without risking decentralization?
Lee Parsons: platforms on web three?
Correct. correct. Because, again, it’s one thing to submit something to Zora, right? Music NFT and to publish something on Zora, it’s another thing to get it published on Opulous, sound or catalog, right? There’s a band of collectors that wait to buy things on those platforms that trust the curation process from those individuals, but they’re highly gated and highly centralized, the technology, right, is inherently decentralized. But I guess my question is a lot of their answers as to why they keep things gated is of course, one for exclusivity. But another point is to maintain, like the issues that would happen in would kind of like evolve with copyright issues. Right? When you have anybody publishing anything, right? And the issues that come with that? Can these platforms, continue to grow, continue to innovate, and also preserve the copyright issues without kind of like combating with decentralization and coming head-to-head with decentralization?
Lee Parsons: Right now? No, I think like I said before, I think the will, there’s just, there’s no way now, right? We can’t up. I’d love to go straight into the decentralization of everything, wouldn’t you? But you’re just not going to work in this system. We need people in the middle to kind of record stuff and do so because there’s nothing, you know, we’ve probably got about 1% of what we need on chain at the moment. But you know, I think 10 years down the line, we will, don’t you? You want a system were.
I’d like to think so?
Lee Parsons: That’s the whole point, right? Because so you don’t have a third party involved who can mess anything up or steal or act dishonestly. And that’s what we need.
Yeah, I don’t know. I think the primary winners right now are the ones who are making it easy to interact with these primitives, right? Making it easiest and most efficient and most approachable to interact with these primitives. Right? And I think with that comes monopolies. With that comes empires that will end up being built, despite our ethos and love for decentralization, which could be a good or bad thing. I don’t think I don’t think that’s up for discussion, because we’re not just there yet, but I don’t know. It’s something that I think about like can web three music platforms really address copyright infringement while staying decentralized? You know, I don’t know, I haven’t gotten a clear answer on that just yet.
Lee Parsons: Me neither. I see if I do. I’ll let you know. But you’re right. We don’t have an answer right now I’d say.
Future Plans for Opulous?
Talk to me more about like, what are the future plans right now for opulous? What can we look forward to? What’s in the pipeline? What upcoming drops? I know you mentioned, there’s another one coming out in three weeks that you talked about briefly, fill me and what can we expect in the next few months to year?
Lee Parsons: Yeah, man. So, we have our next NFC S-NFT coming out in a few weeks with a guy called Adad who’s like one of my favorite UK rappers. He was like someone that Drake’s been, I think it’s like Drake’s favorite UK rapper, he’s just amazing, independent guy who’s done hundreds of millions of streams, then I’ve got Kyle, his album. And we’re just about to record a video with Tiger will not me personally. Normally, Tiger is about to record it. And he’s got an amazing single coming out. We have an artwork, website launching, so that we’ll be doing like artwork, or artwork drops alongside the S-NFT sales. So, you can buy, you can like kind of pre-register for the main sale buy, you know, buying NFT’s, we just did a 3d artwork drop with Adads, we have a new like artwork team that we’re working with on that, our own platform launches next month with our own staking on it. And then we will have the copyright loans, which will be the next part where you can just stake USDC and Opulous. And, you know, people were taking loans out from that, we’re building an exchange, a copyright exchange, so after the do the sales, you know, you can go and trade it, you know, in fractions of the Sun, which is awesome. You know, something else I forgot was going to say that. And then I think in a couple of weeks, we’re going to start paying the first royalties for the little pump. So, for all those, all those massive little pumps fans out there, finally, all the way in, they’ve been doing probably never pumping alive, but you know what you don’t need, that’s probably the most thing I’m excited about. I work in digital distribution, right? So, if I’ve got a song out, I don’t get excited anymore, cuz I’ve got so many artists, but I remember like, you know, I’ve got, we have a label. So, we have like, 20% of a song for doing the distro. And it’s like, I get to see the stats from tick tock and Spotify and Apple and all the things like daily on what it’s done on, like, let’s sit in there. Now everyone is not any music, and she’s now gonna be able to do that log into Opulous and see that okay, well, this got use on Tik Tok yesterday. So, it’s just shot up on Spotify, and you’ve made some more money. And it’s so cool, man. And it’s so addictive. And, you know, eventually people have just a library of songs in their account that they’re probably just streaming themselves to death. And then, you know, checking the sales every day, we’ve already built that I’m just waiting for the sales to come in. So, I can get the data out.
You know, another thing that hasn’t really been tapped into yet is there’s already value locked in a lot of these collectibles, right, a lot of these music NFTs that people already have boughten, whether they are ownership based or whether they’re collectible based.
Lee Parsons: You said boughten.
Boughten, excuse me. I don’t know, it’s a word, now making it a word. Boughten is my word, there you go.
Lee Parson: It literally is your word, congratulations
And it’s live. I want everyone to quote me on that boughten, is a but or boughten?
Lee Parsons: I never heard boughten and before but I love it.
What about button, button?
Lee Parsons: Getting off track there.
Beyond the Collectible; Staking Your Music NFTs
I love it. My point is there’s a lot of value locked in these music NFTs. Could there be a way for people to stake their NFT’s and these NFT lending and borrowing protocols for them to extract that value? That’s number one, to who would take a loan against these illiquid JPEGs, is in liquid?
Lee Parsons: Yeah, my that’s some crazy person. Like, I guess on the music side, that’s pretty much exactly what we’re doing. And we have a new CTO, who was one of the, wasn’t really original NASA people, but he worked on a lot of the web two products. And we’ve been looking at, you know, different ways that I get, it’s hard to explain them, because we don’t run out. But you know, an NFT can obviously represent, so let’s say you bought Opulous NFT and you’re saying right, this sounds effect. I know this is going to 1000 pound a year because of we’d look at, say you buy because we’ll have albums that are old albums, right? So, you might catalog on all Michael Jackson song, you bought 1% that earns you $1,000 a year, you will then be able to take the Anthopoulos system and get a loan from it. Because we know what money you’ve got coming in as regard as taking a loan from an NFT. I’ve thought about that as well. It’s like no, thanks. If I was a bank, there is no way. Right. Would you, I guess.
I don’t know. I don’t know. I’m asking you, is there a way to take loans against like illiquid wav files in all these music collectibles that people are basically purchasing on chain? Is there a way to kind of pull all these assets together and take loans against them as a whole?
Lee Parsons: Is there a way to quantify the value of it?
Guessed to an extent. I mean, the value is what it’s been bought for the floor of that.
Lee Parsons: Right? Okay, so I’m gonna go and buy an NFT for a million dollars is worth five pence and then take a loan out from it. Actually, I’ll be a moron to do that, anyone would know. But, you know, I think that that’s the problem, right? Because you’ve still got to sell it to someone, just because you put that as a value doesn’t mean that’s the value because you could no one would want to buy it what you’re gonna do, then.
I guess my point is, I have 1000s of dollars of NF T’s music, NF T’s that I’ve gotten, that are just sitting in my wallet. No only thing that they provide me is access to the community, even if the artist even has set up access and utility like that. I’m trying to think of how can I take it a step further as a collector and put my money to use that’s locked in these collectibles? Yeah.
Lee Parson: I mean, that’s the problem, then a teaser, right? That’s why we don’t run it in the same circle. Because where’s the value? You know, you bought it. We got all excited. We bought it, you try it, you know, is that going to go and trade on the open market for the same price? Do you know if you tried to sell it? You know what the value is?
Yeah, I mean, some of them have risen from like, point one to like, 8 Eth. Right?
Lee Parsons: Yeah, sick.
Which is amazing. You know, some of them are worth like, 10 Eth. And I bought them for point one.
Lee Parsons: Amazing. So, you’re so you’re really, are you? Are you collecting for collectibles? I mean, I guess we’re all, you’re all in it.
Here’s the thing there is like, I have two perspectives. I think at one point, it’s going to end up like we’re gonna see the same way that happened in March and February 2020. We saw that corporate artist, the Instagram artists transition into NF \T’s and end up being in Sotheby’s and Christie’s and doing exceptionally well through platforms like nifty gateway, I think the same thing is gonna happen with music artists. And if I could be a small part of that process and using my platform to help them once I collect something, I’m fucking happy. And if it just so happens that I can also read the value they generate for themselves and all the collectors like why not it’s a win, win.
Lee Parsons: But what classes music NFT then? Are you classing a piece of artwork, the wave what?
Let’s say, let’s say I buy something off Zora? It’s a WAV file, okay, a WAV file with a piece of art, that’s a gift. I can listen to that. There’s value, I have an offer, let’s say for example, like I want Eth offer and I bought it for point one.
Lee Parsons: right? Is that a gift that only you have? Or is that you, because you remember when.
Let’s talk about in two situations. Let’s say it’s a one on one, it’s only one that I have? Assuming it’s one, one, and then let’s take it from another point of view. It’s a collectible. It’s an addition of 25, edition of 100, edition of 1000.
Lee parsons: Yeah, so. But who would buy it? Who would buy it? And it’s a song that 1000 People have.
The 0X39, some random ass address wants it.
Lee Parsons: Oh really?
Let’s just say, yeah.
Lee Parsons: I mean, it just, like you said, it depends who wants to buy it? Right? I mean, yeah, that’s what you’ve just got to be making sure you’re, I mean, the artists have got to be really careful. And, you know, obviously, we speak to a lot of artists every day, some of them have just dove in and tried to make as much money as possible. But the majority of musicians have been quite skeptical about the space. And honestly, that’s why a lot of them like Opulous is because Okay, well, I can see you’re actually doing something, my fans will appreciate that I’m not ripping them off, because that’s what an artist does not want to do. Really, you know, if you’re, if you have a huge fan base, someone like you know, 50 cent you just massive and you kind of they’re not, it’s not gonna get you know, you can have independent artists, you’ve got a ridiculous engaged fan base. Now they can’t sell something because a bit flat, if you’re 50. And you know, you’ve kind of got that mid fanbase, you can but for the most part, fans, fans are very close to the artists and they can’t sell something. That’s rubbish. And I think this is the main problem that we have at the moment as you guys want it a music NFT is and what the value is, you know, I hope that’s something you know, we can we can change with Opulous.
Yeah, I think that’s a perfect place to wrap off. I was actually the last question I had for you. But Lee before I let you go. Where can we find you specifically? Where can we learn more about Opulous and everything that you guys have in the pipeline?
Lee Parsons: I am Ceoleeparsons on Twitter. That name was a joke when my brother and me started because we had no staff, but it’s grown into something that I hate now, but I can’t change it. Ceoleeparsons on Twitter. Opulous app on Twitter. You can ask me anything on Twitter again, man. I really appreciate you. I know you’ve had some really big names on the show man, you’re obviously, you’re obviously really ambitious and hardworking man, thank you for inviting me on man. And I’ll make sure our community support as much as we can as well.
Thank you, sir. We’ll have to do this again. Once more drops come in. And Opulous has 10x is where it’s at right now. I’m looking forward bro. Excited. Thank you.
Lee Parsons: down but we got to back up. I appreciate it, man. Thank you.
Thank you, bro.