CLU’s
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 Christian
 León
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INDEX
SUMMARY STATEMENT……………………………………………………………………………………………..3
Vision……………………………………………………………………………………………………………………..3
Mission…………………………………………………………………………………………………………………...3
Philosophy…………………………………………………………………………………………………………….....3
Value Proposition………………………………………………………………………………………………………..4
Objectives……………………………………………………………………………………………………………......4
Keys to success…………………………………………………………………………………………………………4
COMPANY SUMMARY………………………………………………………………………………………………...5
Company Ownership……………………………………………………………………………………………………5
Company Location………………………………………………………………………………………………………5
Management Summary…………………………………………………………………………………………………5
Value Chain……………………………………………………………………………………………………………...9
PRODUCT AND SERVICES…………………………………………………………………………………………11
PRICING STRATEGY………………………………………………………………………………………………...15
INDUSTRY ANALYSIS……………………………………………………………………………………………….17
Historical Framework………………………………………………………………………………………………….17
Actual Framework……………………………………………………………………………………………………..18
Industry Attractiveness………………………………………………………………………………………………..18
Industry Trends………………………………………………………………………………………………………...19
Industry Size……………………………………………………………………………………………………………19
Industry Life Cycle……………………………………………………………………………………………………..22
SWOT analysis Competitive Comparison…………………………………………………………………………..23
Porters Diamond……………………………………………………………………………………………………….25
Competitors Analysis………………………………………………………………………………………………….27
Competitive Edge and CLU’s Differentiation………………………………………………………………………..28
MARKET ANALYSIS SUMMARY…………………………………………………………………………………..29
Market Segmentation………………………………………………………………………………………………….29
Target Market Segment……………………………………………………………………………………………….29
Market Trends………………………………………………………………………………………………………….29
Market Needs ……………………………………………………………………………………………………….…29
Survey………………………………………………………………………………………………………………..…29
STRATEGY AND IMPLEMENTATION SUMMARY……………………………………………………………....33
Marketing and promotion strategy…………………………………………………………………………………...34
Sales strategy………………………………………………………………………………………………………….34
Strategic Alliances………………………………………………………………………………………………..……35
FINANCIAL STATEMENT……………………………………………………………………………………………37
Expenses……………………………………………………………………………………………………………….37
Income…………………………………………………………………………………………………………………..38
Break even point……………………………………………………………………………………………………….40
Balance Sheet / Income Statement………………………………………………………………………………….41
Ratios……………………………………………………………………………………………………………………42
BIBIOGRAPHY…………………………………………………………………..……………………………………43
APPENDIX………………………..……………………………………………………………………………………44


 

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 Christian
 León
 Uribe
 

SUMMARY STATEMENT
CLU Management-Booking Agency exists primarily to support independent
musicians to take their music projects to the next level through professional
advice and guidance. Our main objective is to provide a variety of services in
order to help mid-level and well-known independent music projects grow and
evolve in the direction that is right for them in their future career moves. We offer
development strategies and services specialized in the internationalization and
expansion of their market within the Latin American countries and in general the
Spanish-speaking market including the Hispanic market in the USA.

CLU offers different services that can be provided separately or through an “all-in
house” basis; this depends on the needs of each individual project. Our services
are mainly divided into the following:
1.
2.
3.
4.
5.

International artist management, A&R, advising and consulting
International PR, marketing and promotion
International booking
International tour management
Legal, accounting and finance services

Vision- To be a cutting edge and leading agency specialized in the
internationalization of Indie music projects into the Spanish-speaking markets
across different countries.
Mission- To support the growth of Indie music projects through the provision of a
wide array of professional services that are effective and fair.
Philosophy
At CLU management we believe in music and our passion is to inspire and help
artists to take their career to the next level. Through our wide array of services
we intend to address three key challenges faced by Indie projects:
•
•


 

Artist’s lack of knowledge and experience on the complexities of the
music business world.
Provide professional services Indie artists often have to do by
themselves losing focus in their core activities such as songwriting,
rehearsal and live performances.

3
 

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 Christian
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Expand the scope and potential of the projects through the
internationalization of their music.

•

In addition, CLU as a company keeps in mind that the services and products it
generates are part of an industry’s engine driven by economic profits for both the
artist and the agency.
Value proposition
CLU management is seeking to provide:
High expertise planning and executing internationalization strategies
Fair and affordable trades in management services, promotion-marketing
strategies, booking activities and tour management services for
Independent music projects
Work directly with the most important actors within each country market,
through the exchange of information and the consolidation of a solid
network.

•
•

•

Objectives
The objectives of CLU are to:
Provide expertize and tools to expand indie project’s markets.
Become a specialized management agency and expand rapidly into the
region building networks that can become the path where many projects
can develop their potential.
Maintain a gross profit margin of 15% over the first 5 years.
Hire and manage talented projects with commercial potential.
Raise or invest US$50,000 to start up the agency.

•
•

•
•
•

Key to success
The keys to success are:
•
•


 

To identify and work with attractive music projects which have the
highest potential to succeed through internationalization strategies.
The ability to create, refine and enhance unique and tailored high
quality services and solutions for each client

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 Christian
 León
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•

•
•

Strategic and solid networks with the main players, partners,
associations, promoters, sponsors and indie record labels of the most
important indie Hispanic industry.
Rapid insertion and integration of our clients into the defined markets
Achieve maxim profits/benefits for our clients through fair margins,
which also provide earnings for the company.

COMPANY SUMMARY
Company Ownership
The Management agency will start out as a simple sole proprietorship, owned by
its founder Chris Leon Uribe. It will be functioning as a Limited Liability
Corporation to benefit from the corporate liability protection. Additional ownership
will be reserved for future investors and partners1.
Company Location
In its initial phase, CLU will be headquartered in Condesa area of Mexico City,
located at the heart of the local music scene of emerging artists. For future
stages (2-5 years) the goal will be to expand our presence in cities such as
Madrid, L.A., Buenos Aires and Bogotá.
Management Summary
Description of Management agency Team
CLU will start as a small size company that has a full time staff of three people:
One CEO initially responsible for the design and implementation of the
management, PR, Booking and tour management activities; two coordinators
responsible for overseeing the Legal and Financial departments respectively. In
addition and in order to keep a low payroll cost we will outsource some services
offered to music projects. The external team will be made up of a tier of
consultants who will be hired on a project-based basis to respond to the
necessities of clients in a tailored way.


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1

Bplans.com ‘Organic Restaurant Business Plan “Studio672” Start your own business plan. P.2, available at:
http://www.bplans.com/organic_restaurant_business_plan/company_summary_fc.php#ixzz33QVyAs1u


 

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 Christian
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Nonetheless the mid-term goal (2-5 years) in terms of staffing is to be able to
slowly build an organizational structure composed of twelve members who can
take up more areas in a dedicated way as described in the following chart.
Internal Mid-Term Organizational Structure
Chart 1

Board
 of
 
Directors
 

CEO
 
 

 LEGAL
 AFFAIRS
 
DIRECTOR
 

CFO
 
COO
 
Managerial
 
accountant
 

Management
 
and
 artistic
 
Director
 

PR
 &
 Marketing
 
Director
 

New
 Media
 and
 
Communication
 
Sub
 Director
 

Financial
 
accountant
 

Tax
 accountant
 

Tour
 Manager
 

Booking
 
SubDirector
 

Owner and Chief Executive Officer (CEO): Christian León Uribe. His
responsibilities include hiring the best candidate for each department; rise
financial investments, to oversee the general functioning of the agency,
coordinate CFO and Internal Legal Affairs Directors. At the beginning, oversee
the general management, PR, Booking and touring management activities and
hire the employees for the organization team and outsourcers.
Board of Directors: the Company’s owner and CEO, CFO, and Legal Director
will compose the Board of Directors. Their roles and responsibilities include:
•
•

Provide strategic vision and management direction of the company
Maintain a governance-based policy for responsibility, roles and functions
of the company.

Chief Financial Officer (CFO): duties are presenting and reporting, the internal
accounting, financial and economic strategies status of the company. CFO will


 

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 Christian
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hire and manage the staff and tier of consultants to secure client’s accounting
and finance needs. The financial department will be divided in three: managerial,
financial and taxes. Duties include:
•
•
•
•

Tax preparation and return
Royalties invoice
Record keeping
Collecting the bills and demand payments in behalf of our customers and
the company itself

Legal Affairs Director- This Director will have all the responsibilities and actions
related with the internal legal issues of the company. She/he will be specialized
in representing musicians putting together deals, negotiation and review of the
contracts, overviewing infringements and all legal aspects related to music
business.
•
•
•

Contracts negotiations
International civil and common laws
Artist’s rights related our services such as image rights, publishing rights,
performing rights, copyright, etc.

She/he will also responsibly of managing and hiring staff and external
consultants related to legal services and the budgets related to these activities,
communicating this information directly to the CEO.
Chief Operating Officer (COO): will be responsible for the development and
execution of all day-to-day strategies and actions in line with the Company’s
strategic plans. She/he will be responsible for directing and overseeing the
activities of the areas below him or she within the organizational structure (see
chart).
Management and Artistic Director- Responsible for scouting and choosing
bands, artists and the right projects that fit into the profile of our clients to offer
and develop the best internationalization strategies and services for each. Its
services will be very related to the international publicity plans and will be
responsible to provide along with the clients the content (videos, photos, records,
etc.) requires for the promotion.
She/he will manage and hire staff and consultants related to artistic services
provided to the clients. Its main duties are:


 

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•
•
•
•
•

Artist management and development and consulting advise to artist
Repertoire selection
Internationalization career plan
Artwork
Image consultant

In addition, he/she will be in charge of managing and implementing the budget
for the artistic services. This Director responds directly to the CEO.
PR and Marketing Director- This Director has the responsibility of designing
and proposing the best international marketing strategies, promotion activities,
publicity networks and sales for each artist but also of the agency itself. She/he
must authorize, execute and oversee the strategies and plans of:
•
•
•
•
•
•

Promotion
Publicity
Sales
Booking (subdivision)
New media and Communication (subdivision)
Merchandise marketing

Booking Sub Director: This sub director is the intermediary between the artist,
marketing and management CLU’s departments and local promoters. His or her
main duties are:
•
•
•
•
•

Ensure the best deals for the artist
To offer sponsorship agreements
Tour planning including, assemble and hold dates (along with
management team), production and technical specifications
Financial projections (along with CFO)
Contract and secure services of the local promoters

New media and Communication Sub Director: This subdivision is responsible
for expanding and managing social media networks and all the communication
areas of the clients and the company. Services also include social media
support, TV and radio promotion, advisory and pre-production of music videos
and photo studios. Responds directly to the PR and Marketing Director.
Tour Manager: Represents the artist in the field of live performers during a hired
tour. She/he will be responsible to hire the crew, provide and ensure production
requirement/riders, and organize and supervise travel arrangements,

 

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 Christian
 León
 Uribe
 
accommodations etc. Some other duties such as financing and budgeting cost,
as well as handling and collecting money will be coordinated along with the CFO.
Other duties include:
•
•
•

Coordinate press and media interviews on-site
Creation of the carnet document
Oversee tour coordination along with the promoters

External Tier of Consultants
Due to the huge extension of the markets and in order to keep costs low, CLU
has a solid tier of country-based external consultants composed of freelance
experts and companies. It will be important to create a trust relationship at all
levels with all external professionals we will be collaborating with through a “Joint
venture” basis. We also consider the possibility of building an “in-house” network
of freelance experts in the following fields:
1. Music and Entertainment Attorneys
2. Accounting and Finance Advisers
3. Local-International Marketing, promoters and New media-Communications
Value Chain
Primary activities
1. Find and advise music projects strategies
§ Choose the right projects for the services we provide
§ Analyze the best option for promotion strategies
§ Set of services
§ Management duties
2.International promotion and marketing mix
§ Create the press kit
§ Contact key players in each market
§ Deliver the press kit and follow up
3. Booking:
§ Marketing campaigns offering the projects to promoters, music festivals,
managers, venue owners etc.
§ Follow up the deals along with the Legal Department
§ Set the dates and places for concerts or tours along with the management
department


 

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CLU’s
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§

Follow up payments along with the Financial Department

4. Tour management
§ Overview the tour
§ Plan production, fees and media interviews etc.
§ Tour and concerts logistics.
Support activities
1. Human resource management
§ In-house team
§ Recruitment of core and external consultants,
§ Pay structures, incentives, bonuses
2. Legal and financial management
§ Liaison with clients promoters, venue owners,
§ Payments and Contracts
§ Licenses & permissions
3. Networking
§ Develop networks in the main markets
§ Build connections with new players in each market
4. Press kit
§ Receive, gather and organize music projects’ data,
§ Create a presentation package
§ Set up cost
5. Technology development:
§ Website/ portal management agency,
§ Update and support
§ Social media campaigns


 

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 Christian
 León
 Uribe
 

Chart 2

PRODUCT AND SERVICES
As it was stated in the executive summary, CLU is able to provide a variety of
services related to the internationalization of music projects and lined up from
management, to promotion, booking and touring. It is important to underscore
that in Mexico, Latin American countries and Spain, there is no differentiation or
distinction between management and booking agent activities. This is relevant
because in the United States and UK a certification for booking activities is
required by law and it is not allowed to mix both duties2.


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2


 

The Music Bible, Music Management Forum 2003, London: Bobcat Books Limited, P. 227-228.

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Product and services description
1.
2.
3.
4.
5.

International artist management, A&R, advising and consulting
International PR, marketing and promotion
International booking
International tour management
Legal, accounting and finance services

Although we have a set of establish activities such as “All-in-house” services, we
are open to provide an ‘à-la-carte’ services depending in the particular
necessities of artists providing mid and long-term solutions for their future career
moves. These assignments out of our set of services will be paid based on the
complexity and time-requirement that the project requires.
For each of the services, CLU requires to sign a contract in order to prevent other
player’s participation and to ensure trust amongst all the parties involved. Each
service has its own specific duration and its specific territory where CLU will
entitle exclusively the international representation of the music projects.
International Management
We will work together with the music projects as a team having the common goal
of develop and advance its careers. Firstly, CLU will make an analysis in order to
recommend what would be the best market and the most accurate strategy
related to a specific project.
Secondly, management services will be provided along with others like
Promotion-Marketing and Booking providing follow up of these activities and
providing any information about schedule, requirements, content or material
about the artist.
The management department will advise and consult with the artists about
income and expenditures. Furthermore, we will negotiate with third parties on
their behalf. The artist will be informed periodically about these matters.
The terms of the agreements will be 2 to 3 years with a further extension option
of 1 or 2 years. The artist must send a three-month notice of termination before
the due date. If he or she does not terminate then the term will extend for one
year.


 

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International PR, Promotion and Marketing Mix

CLU will use promotional strategies to reach the target market and facilitate the
promotion of artists. The promotion strategy will be tailored to the objectives and
necessities of each project. We offer “2 scenarios” for promotion strategies that
can be hired separately or one after another for better results:

1. International Promotion Plan: We do the first approach of a music project
into a new market through a press kit delivered directly to the hands,
desktops and online mailbox of our local contacts. These contacts
include: publishers, critics, journalists, venue owners, music and
entertainment executives, local record labels, promoters and
management agencies, etc. This scenario is recommended for unsigned
and mid-level bands that would start to make some presence in into a
new market. The period of this promotion will be one month.
2. Marketing Mix Plan: This plan is second part of scenario 1 and also
directly for well known or more experience independent projects. To
penetrate specific territory, we mix different kinds of promotion including
traditional and new media channels such as: indie magazines, newspaper
columns, Indie web portals, college and internet radio stations, television
shows of indie music, music blogs, publicity flyers, etc. The goal in this
scenario is to create awareness of the music project in order to be
attractive for promoters, venue’s owners, music festivals etc. The period
of Marketing mix plan will be 3 months.
During the promotion period, we will be monitoring the campaign and doing a
managerial follow up providing any information and material requested. We will
present the artists in the most attractive way with the information provided by the
artist such as:
•
•
•
•
•
•


 

Sound recordings (demos, LPs, EPs, Collaborations, featuring’s etc.),
Visual recordings (films, music videos, TV appearances etc.)
Photos, logos, artwork
Personal information about the members of the project,
Information about performances, appearances in concerts, festivals, TV,
radio, Films, etc.
Newspaper and magazine interviews, reports, notes, citations etc.

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 León
 Uribe
 
•
•
•

Sponsorships (current or past)
Web page, social media accounts, video channels etc.
Statistic data related to the fan base, likes, followers, streams web page
visits

At the end of both scenarios, Promotion and Marketing mix, we will present a
final report of the campaign including the list of those media and press that were
streaming, reviewing and publishing the project’s work. In addition, we will also
present a data analysis (downloads, streams, likes, new followers, etc.) in order
to evaluate the effect of the campaign and the interest generated by the project.
Booking
Interest raised by the promotion strategies, must be capitalized by the booking
team. It will be the intermediary between the artist/manager, and promoters and
venues owners. A specific Press Kit will be elaborated for media and industry
players to let them know about production and technical specification, issues,
costs and requirements of live performance. In addition it will also provide
artwork, photos, logos and material related to advertisement. The main goal will
be to assemble, hold and sign/confirm dates, concerts, festivals and tours.
Booking area will work along with management to coordinate this information and
do paperwork for contracts.
Other duties will include: financial projections, ticket sales monitoring and receive
and hold the deposits.
International Tour Management
A set of 6 dates booked in a maximum of 30 days period will be considered a
Tour. CLU will master mind the production plan, touring logistics and
management acting as a tour manager. The tour manager and one assistant will
travel accompanying the band to coordinate everything related to: receptions and
press conferences, show case’s, guest and V.I.P list and run the day-to-day
press office activities, insurance terms, etc.3
If during the tour there is a merchandising offer, the main role of CLU’s Tour
Management will be to provide the best strategy, approach, and advise as well
as to run the negotiation and signing. This deal normally is under a “Split-Profit
Deal” basis, where the merchandiser is responsible of supplying and selling

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3


 

The Music Bible, Music Management Forum 2003,London: Bobcat Books Limited. P.54

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products, splitting gross profits 80/20 in favor of the artist, after the
merchandiser’s administration fee reduction.
Accounting
CLU will be responsible for all the accounting of the international management
PR, booking and touring. The main activities in this respect include bookkeeping,
tax returns, invoicing, and payments. The Accounting Department will control
artist’s income in the sense of ensuring full and timely earnings. The payments
will be done in a monthly basis as well as the record of the transactions affecting
the artist. The report will describe income, source of income, expenses,
commissions, deductions etc.
The artist’s income will go directly to their bank account and artist will have the
right to audit our accounting statements no more than twice a year and only after
a 30 days notification.

PRICING STRATEGY
Generally speaking, the pricing will be based on the following:
•

•

Type and size of services: each service has its own characteristics and
price, percentage or payment plan and quantity or period of time will also
affect costs.
“All-in-house” basis: we offer a bunch of services interrelated avoiding
double full charges and “Double dipping”

In addition, in case we have to outsource some services we don’t provide inhouse, the strategies will vary on two aspects:
•

•


 

Complexity of the project: The Company plans on outsourcing the work to
a network of vendor’s ex. Accounting & tax company’s, Lawyers,
Marketing Agency and Show production companies.
Competitiveness of the price: The Company will measure its price quotes
from vendors to identify the best service at lowest price. Nevertheless,
we will add a 10% increase on this provider’s price quote.

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 Christian
 León
 Uribe
 
Management
The commission payable to the manager by the artist in respect of international
management services will be a 20% of the net profit in any kind of personal
appearance or concert. In the case of Touring under the “All-in-house” services,
management would not take any commission from “Touring management” duties
as it is stated in that section.
Management Partnerships
If there is a local manager interested in promoting the music project within a
specific territory she/he will report to CLU and share 50% of the commissionable
profits in a sub-management basis.
Publicity
For the 2 scenarios of international publicity we have a flat fee for each:
Scenario 1, PROMOTION: U.S.$350.00 per one month
Scenario 2, MARKETING MIX: U.S.$197.00 monthly under a 3 months contract.
These costs include all of the activities listed in “Product and services
Description” and also include management “Follow up” duties.
Booking
The “common” charge for booking services is 10% of gross profits. However, if
these services are under our “All in house” terms, CLU will charge only 7% of
gross profits from the artist for this concept.
Touring Management
In a normal basis, CLU will charge the 10% of the gross income minus taxes, for
touring management services.
If the services hired by one artist are under our “All-in-house” basis, CLU will only
charge for both, Management and Touring management a set commission rate of
17.5% of the gross income minus taxes in live performances while touring.
Therefore, the established 20% of the net artist income’s deduction of
management concept is eliminated under this scenario to avoid “Double dipping”.


 

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 León
 Uribe
 

Expenses such as hotel rooms, per diem, air and rail fairs, travel cost, car hire,
taxis, etc., will be deducted in relation of each case from gross, promoters or
artist income.
Merchandising and Sponsorships
These subjects’ income only applies when associated with tours promoted by
CLU and the commission of them will be treated separately from touring losses
and profits. In the case of merchandising deal the Split-Profit deal will give to the
artist 80% of the gross income of sales and Tour Management is taking 20% of
the artist’s net profit because of negotiation and paperwork duties4.

INDUSTRY ANALYSIS
Historical Framework of Independent music Industry in Latin American
In the decade of the 60’s the rock genre and the social movements where quite
related in Latin-American countries. After many aggressions against students
and repression of social movements dictatorship governments raised, resulting in
prohibition of music genres such as rock and funk among others. For instance, in
Mexico after the Festival of “Rock and Wheels Avándaro” (Mexican version of
Woodstock Festival) in 1971, the Mexican rock suffered systematic governmental
censorship. Government also took off this music from the radio and banned any
performance of this genre on TV. They also led constant press discrediting,
pushing the genre into a rough marginalization. Very few recordings of that time
are left because record companies stopped producing albums, or they simply
disappeared5.
After almost two decades, the 80’s movement “Rock en tu Idioma” appeared
mainly in Spain and Argentina and was spread within the Latin-American
countries becoming the flagship for a new generation. Unfortunately, by that time
and during the 90’s the mainstream labels still had the power of the industry
where they chose which music to produce and promote. Mexican counterculture
movements in the early 90’s supported emerging bands such as Café Tacuba,
Caifanes, Fobia, Maldita Vecindad and Mana6.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4
5

The Music Bible, Music Management Forum 2003,London: Bobcat Books Limited, P.54
Arana, Federico, Guaraches de ante azul. Historia del rock mexicano, México. Editorial Posada. 1985

6

“Rock en papel. La historia del periodismo del r o c k m e x i c a n o ” Entrevista a Antonio Rotunno en
M a r v i n Editorial María Enea, México, 2002.B l a n c , Enrique,O p . C i t . , p. 47 Cfr., Abril 2012, Número 100.


 

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 Christian
 León
 Uribe
 
Actual Framework
Based on this history, I believe today’s Indie movement can be seen as the
consequence of those genres and projects that could be mainstream but due to
the political and social events had to move aside of the commercial market.
However the current Indie scene is perceived in a different way; for instance
according to Javier Blánquez and Juan Manuel Freire (journalists and music
critics) the indie movement [...] “shows some of the features that any kind of art
should pursue at all costs: autonomy (regarding commercial interests) and the
rejection of the established canons”.7
Thanks to the proliferation of new technologies in the last 15 years, many new
music artists have begun to record, edit, promote and distribute their works by
themselves and with their own resources. This unstructured and dynamic indie
subculture was built from communication links embodied in concrete ideas and
practices such as: attending concerts, records, publications, any kind of artwork,
fashion, etc. In addition, the increasing number of new independent labels and
management agencies, concert venues, festivals as well as sponsors, allowed
the indie scene to capitalize financially as an industry. This heterogenic scene
has developed many music styles such as folklore popular, rock indie,
experimental, sonidero, electro cumbia etc.
Industry Attractiveness
The Indie world market has been steadily growing. For instance it has grown by
24 percent in the U.S.A. during the first half of 2013 8 and this trend is similar in
and Latin American and Spain. These trends along with the need to find new
ways to commercialize and expand Indie music to a larger audience constitute a
perfect environment for this kind of music projects.


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
7

‘La Musica como texto, el indie como subcultura: un acercamiento, desde la teoría subcultural, a la
Escecna Indie en México a partir del análisis de dos revistas: Marvin e Indie Rocks!. Gonzalez Tolosa
David, Universidad Autónoma Metropolitana Unidad Cuajimalpa, Maestría en Ciencias y Humanidades.
P.19, available at:
http://www.academia.edu/5624006/LA_MUSICA_COMO_TEXTO_EL_INDIE_COMO_SUBCULTURA_Un_a
cercamiento_desde_la_Teoria_subcultural_a_la_Escena_Indie_en_Mexico_a_partir_del_analisis_de_dos_r
evistas_Marvin_e_Indie_Rocks_
8

nd

nypost.com ‘Indie artist are new No.1 in music industry’ Claire Atkinson, January 2 , 2014, available at:
http://nypost.com/2014/01/02/indie-artists-are-new-no-1-in-music-industry/


 

18
 

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 Christian
 León
 Uribe
 
Industry Trends
Some of the trends impacting the Indie movement, which fit under the logic of
CLU, include:
•

Collaborative consumption: this new trend is changing the way in which
society is using network technologies to do more with less by sharing,
lending and renting products. As mentioned in a recent article published
by Trend Watching, “we live in a village where we can mimic the ties that
used to happen face to face, but on scale in ways that have never been
possible before”9. This situation leads us to trust and trade any products,
services or even music projects virtually thanks to the new technologies.

•

Music as a driver of social media engagement: this marketing tool
empowers super-fans and attracts new audiences gaining momentum in a
competitive environment.10

Industry Size
Although global recorded music industries’ revenue fell by 3.9%in 2013, music
sales in Latin America grew 1.4% ($521 million) in emerging markets such as
Brazil, Venezuela and Argentina. In addition, subscription services revenue
continue to grow and analysts provide very optimistic forecasts.11
Mexico and Spain are part of the Top 20’s highest revenue list for the record
music industry produced by the International Federation of Phonographic
Industry (IFPI) in 2013. Furthermore, Mexico is #1 within Spanish-speaking
countries music markets in Latin America, 2nd world wide after Spain as the
following chart shows.12

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9

Thewatching.com, ‘BOSTON: The End of Ownership’, May 16, 2013, available at:
http://www.trendwatching.com/about/inmedia/articles/2013_the_end_of_own ership.html
10

bpi.co.uk ‘BPI Digital Music Nation 2013’, available at:
https://www.bpi.co.uk/assets/files/BPI_Digital_Music_Nation_2013.PDF
11

‘IFPI Music Report 2014: Global Recorded Music Revenues Fall 4%, Streaming and Subs Hit $1 Billion’,
available at:
http://www.billboard.com/biz/articles/news/global/5937645/ifpi-music-report-2014-global-recorded-musicrevenues-fall-4
12

Industria Musical.es ‘Principales países hispanoparlantes en el Mercado de la música grabada’. Angel
rd
Navas, april 3 , 2014, available at:
http://industriamusical.es/principales-paises-hispanosparlantes-en-el-mercado-de-la-musicagrabada/#sthash.FLKb2xsA.dpuf


 

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CLU’s
 Business
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 Christian
 León
 Uribe
 
Chart 3

Since 2009, the Mexican music market has being growing constantly. On 2012
its revenues surpassed the US$140 million. However, in 2013 revenues fell due
to decreasing physical sales as is shown in the graph below.13


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
13

th

Industria Musical. ‘Evolución de la Industria de la música grabada en México. Carles Martinez, May 16 ,
2014, available at:
http://industriamusical.es/evolucion-de-la-industria-de-la-musica-grabada-en-mexico/#sthash.zKICF7Yc.dpuf


 

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 Christian
 León
 Uribe
 
Graph 1

The second place is for Brazil. We don’t rule out working in that market although
its first language is Portuguese. Argentinian market is 3rd within the Latin
American market. Berklee’s Professor Peter Alhageff stated that Colombian
music market revenue’s are close to $30M, which would rank it in #4 14 .
IFPI states that Chile and Peru are #5 and #6 respectively.
A very important point is that the US, the most important music market in the
world, has the second biggest Spanish-speaking community in the world, only
after Mexico. Many analysts consider this “US Latino Market” as the most
important Spanish-speaking market for record music worldwide.
In addition, according to Pro-Music.org, Mexico’s digital download revenues grew
21.95% in 2013 compared to the previous year. It became the first within Latin
American countries with more legal digital music platforms (download options,

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
14

Industria Musical.es ‘Principales países hispanoparlantes en el Mercado de la música grabada’. Angel
rd
Navas, april 3 , 2014, available at:
http://industriamusical.es/principales-paises-hispanosparlantes-en-el-mercado-de-la-musicagrabada/#sthash.FLKb2xsA.dpuf


 

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 Christian
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subscription services and ringtones) with 28. Mexico is followed by Brazil with19
platforms, Argentina 13 and Chile10.15
Spotify Mexico was the worldwide most successful launch of all performed by the
Swedish company. Moreover, on May 2013 Vevo started with its catalog of
100,000 music productions independently from Youtube. It helped to rank Mexico
as the second largest market globally in video consumption with over 500 million
monthly views.16
Music startup environment in Mexico
Due to the growing economy, Mexico has a healthy startup ecosystem and holds
the largest Startup Weekend presence outside of the United States. It is the 14th
largest economy in the world and is growing 40% faster than Brazil’s which has
being the “emergent-miracle’s economy” in the last few years.17
US invertors are watching Mexico in a different way and there are two big
examples to point this out. The fist one is the recent acquisition of a venture
capital fund by Dave McClure’s 500Startups. Secondly, the U.S.$ 70M VC fund
for Mexican tech companies.18
Industry Life Cycle
The traditional music industry and big record labels have been in decline for the
last 15 years. On the other hand, it is believed that the Indie industry is currently
in a growth phase, nearing the phase of maturity. In addition, the management of
independent projects seeking the internationalization expansion has been
gaining ground. Music startups and new ventures also helped in the increase of
projects and success of this industry. It is believed that channels such as Spotify,
Soundcloud, Bandcamp, and other services are allowing artists who had been

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
15

Industriamusical.es ‘En México se disparan las ventas de música digital’. Angel Navas, February 27th,
2014, available at:
http://industriamusical.es/en-mexico-se-disparan-las-ventas-de-musica-digital/#sthash.GaRXtdHx.dpuf
16
th
Industriamusical.es ‘Evolución de la Industria de la música grabada en México. Carles Martinez, May 16 ,
2014, available at:
http://industriamusical.es/evolucion-de-la-industria-de-la-musica-grabada-enmexico/#sthash.BsP4QbTG.dpuf
17
rd
Techchrunch.com ‘Mexico is happening at TechCrunch disrupt’. Eduardo Serrano, September 3 , 2012,
available at:
http://techcrunch.com/2012/09/03/mexico-is-happening-at-techcrunch-disrupt/
18

Venturebeat.com ‘Meet the mexican startup taking on the music industry’ M. Chris Johnson, September
4rd, 2012, available at:
http://venturebeat.com/2012/09/04/meet-the-mexican-startup-taking-on-the-music-industry/


 

22
 

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 Christian
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local to become global. These new companies are also growing steadily thanks
to the new technology and new ways of produce and market music. Consumers
are reaching artists they wouldn’t have otherwise, causing a shift in music
preferences and new interest for independent artists. For these reasons, we can
state that independent industry is in the growing stage and is still growing
everyday.
Graph 2

Source: developed by author based on above cited research.

SWOT Analysis Competitive Comparison
The competitive environment of our market is relatively strong. There is a mix
between the huge management agencies of the mainstream market, Indie
management agencies, independent “Free-lance” managers and DIY projects.
Taking a better look at the competitive landscape a SWOT analysis shows the
following:
Strengths
There is not a provider of services specialized in internationalization.
Furthermore, even though some of the competitors offer similar activities, no one
has the same structure in terms of the wide array of services. The relation
between the different activities and the specialization in these services put CLU
in a unique position over their competitors.

 

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Weakness
Due to the extension of the possible markets, it will be hard for CLU to establish
strong networks in all the countries. These networks must be developed from the
beginning based on individual music project needs. After some time and the
confidence obtained thanks to the success of the strategy, the networks can be
increased.
Opportunities
The quantity and quality of new independent projects are increasing thanks to
many factors such as social media, music software’s etc. There are many
projects that need guidance and support to exploit the market’s potential. In
addition, recent researches show that the Spanish language is the second most
spoken in the world only after the Mandarin. Almost 500 million of people have
Spanish as mother tongue therefore the number of potential music costumers is
very attractive.19
Another important fact is that the package of services offered by CLU are
interrelated making them more attractive and affordable and providing us an
opportunity to grow over competitors.
Lastly, thanks to the new technologies and social media CLU has the chance to
make business and expand markets without being in physically in each country.
Threats
We have identified some threats that can affect the strategy, results and also the
way CLU will operate:
•

•
•

Mainstream agencies: They are always looking for talent and taking them
to their market. Specially these days when they are not willing to invest in
the creation and development of the new projects. It will be a big threat
because at some point, they would like to snatch Indie projects that could
become an international success.
Competitors could copy CLU’s “All-in-house” business model and could try
to offer the same services in the same manner as us.
Independent artists are not often economically wealthy and the cost of the
some services couldn’t be afforded by some of them.


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
19

Quo.mx ‘Noticias: 500 millones ya hablamos español’ Redacción Quo, January 14th, 2013, available at:
http://quo.mx/noticias/2013/01/14/500-millones-ya-hablamos-espanol


 

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Porter’s Diamond
The following Porter’s Diamond helps further the analysis of CLU’s particular
industry.
Chart 4

Threat of New Entrants (2/10)
The threat of new entrants is extremely high, making it an unattractive industry in
that respect. The barriers of entry are very low in the indie industry. Many of the
musicians that have projects are their own managers. The difference could be
that professional and high quality servicers can’t be provided for anyone. In
addition, the start-up cost required to create a management agency in Mexico
considering technological tools, office and staff is relatively accessible. There
isn’t any regulation for new entrants by the Mexican law in this respect20.
Threat of Substitute Products/Services (3/10)
There are no perfect substitute services for what we are offering, considering that
the object is to support the internationalization of the projects, but there are

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
20

Ley Orgánica de Competencia, Chapter III, article 16, Mexico, available at:
http://www.eclac.cl/mexico/competencia/mexico/documentos/MEXICO-LeyFederaldeCompetencia.pdf


 

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certainly similar services that could be substituted. Not only are other indie-music
management agencies represent a threat but also, the services and strategies
can be copied from other managements. The key point will be to build strong
networks with the main players within the local markets in each country. In
addition it will be crucial to choose and offer the right projects in order to provide
an exclusive value in our services.
Bargaining Power of Suppliers (8/10)
The suppliers are basically the artists/projects. The management agency is not
necessarily tied to one project taking in consideration the huge number of artists
with a high level of competition among them. This situation will allow us to
choose any project we consider has potential to be commercialized, lowering
their bargaining power to a desirable level.
Bargaining Power of Customers (2/10)
We can define 2 types of customers for our services:
1. Unsigned-mid level-well known artists: On the top of it, our first customers
are the artists. We know that having an agreement with the artist, they will
have strong bargaining power due to compromise and responsibility it
represents.
2. Indie management agencies & record labels/ Promoters & venue’s
owners: When selling the artist and services we know that these
customers have a high amount of choices in the local and external
markets when deciding which music project they will be interested in. This
framework empowered them by knowing the costs could be low if the
options are many. In addition, it will take also time and big effort for us to
have enough bargaining power over the promoters and venue’s owners in
each market. Only by developing an exclusive catalogue of attractive
projects we will have the chance to balance this relation with customer in
our favor.
Competitive Rivalry within the Industry (3/10)
The management services have high rivalry within the indie industry. There are
companies on-line and off-line competing for the same consumers, which leads
us to develop better strategies based in our networks and using better marketing


 

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resources to rise above the competition.
Competitors Analysis
In Mexico we can find management offices of the big worldwide record labels,
two big management agencies and some small ones under the mainstream
scene. Besides to the management duties to commercial projects, these
agencies are always “fishing” new successful-profitable projects of the Indie
industry. This oligopoly structure grabs almost the 90% of the most commercial
artistic roster.
Although they are not identified as primary competitors due to the differing value
proposition, we have to consider them as players in our field. Under this
framework, competitors are:21
Big record labels
Warner Music Mexico
Universal Music Mexico
Sony Music Mexico
Management agencies
Westwood
OCESA/Seitrack
Small commercial agencies
Fraternity talent
MA Talent Agency
Over the last 15 years the Indie industry has seen the raise of many small
management agencies that have become more important thanks to the growth of
the industry and the success of some of the music projects. Now a day there are
different models for the management services in the indie scene. They are
divided in management agencies, agencies with management and booking
services, Indie record labels with management and booking department, 360
deals and projects that have their management services abroad. Only few of
them are really big and have services that involved international trades.
Due to the variety of services and providers, we can consider that the industry is
moderated concentrated. An important fact is that none of the agencies provide
specialized services in developing strategies for international career plans.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
21


 

Mainstream Competitors websites information available at Appendix A

27
 

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 Christian
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The following companies have been identified as our most relevant
competitors:22
Indie management agencies
Bunker Producciones
Pájaros de Piedra Management
Kaiman Entretenimiento
Los Manejadores
Because You Rock
Palmerita
Tape Booking and Management
Verbigracia
Abolipop
Publicity companies
Latin Music Wire Publicity
360 services, booking, management, publishing and record label
Class Music Group, Home Artist
Record labels with management services
Terricolas Imbeciles
Discos Intolerancia
Indian Gold Recods
International Agencies with Mexican projects
Moon Moosic Management
Cookman International (USA)
The Talent Boutique (France)

Competitive Edge and CLU’s Differentiation
One of CLU’s important advantages is that despite of many management
agencies within the indie music scene in Mexico, there is no one only focused in
internationalization services. In addition, some companies help in the promotion
and booking abroad, but none do it along with management services, giving
advice and providing specific plans and strategies for each project. Another
attractive advantage is the package of services and affordable prices under the

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
22


 

Indie Competitors websites information available at Appendix B

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“All-in-House” framework.
This “All-in-House” framework is a key differentiating factor is because everything
is set up to follow a path to take the music project through each step from
management advisory to promotion-publicity, booking and tour management.

Market Analysis Summary
Market Segmentation
CLU management has identified 4 groups of market segments for the services
we offer. Our customers would primarily be emerging artists who have limited
funds and wish to expand their project and move their careers to the next level.
In the first phase most of our consumers will be mainly nationals (Mexico) but our
services will be also offered in Hispanic music markets.
The Potential Customers for our services must fall under the following
characteristics:
•

•

•

•

Unsigned-Mid-level Projects: Talented Projects in their early professional
stages but who already have their own record, perform frequently and
have a small fan base. They are looking to expand their scope and
consolidate their projects into the markets.
Well-known Indie Projects: Projects signed by an Indie record Label or
one Major’s sub-labels. They already could have or not management
services. These projects already have an established fan base, and make
profits from their concerts, tours and record sales.
Indie management agencies and record labels: we also can consider as a
clients Indie agencies and record labels that are looking for
Internationalization strategies for projects they already signed.
Promoters and venue’s owners: as part of our booking services, we will
have them as client offering the music projects to hire a concerts or tours.

Target Market Segment Strategy
Market trends
Thanks to the language factor, online tools and the necessity to expand into the
market, many independent projects are starting to make concerts and small tours
outside their own countries within the Latin-American region. In addition, the
increasing number of promoters, venues and music festivals such as “Vive
Latino” in Mexico, “SXSW” in Austin, “Rock al Parque” en Colombia, “Tame

 

29
 

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 Christian
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Impala” en Chile and “Lollapalooza” in Argentina, “Territorios” in Sevilla among
others have been an important scenarios for the music exchange.
Market Needs
The market needs are established through the previous research and a survey
that we developed and implemented as part of this business plan (described
below). Based on the surveys we know that marketing, promotion, management,
solid plans and implementation for the careers are considered the greatest needs
of our potential costumers. An important fact is that the number of new artists is
growing each year creating a huge demand of skilled people and companies that
are able provide different kind of services in the region. According to the results
of the survey we know that artists do not often have professional management
support and act as their own managers with everything that this entails.
Surveys 23
While developing the background research for this business plan, it was evident
that in México and in Hispano America countries there is not enough and current
statistical information about the indie industry. In order better understand the
needs of potential clients CLU developed 3 online surveys directed to artists,
promoters, managers, record labels and other actors within the indie scene
mainly of Mexico24. The first survey was created to understand the general
perception about indie scene and information of management activities. The
second focused on promotional-marketing activities and internationalization goals
of the artists. The third survey gathers information regarding artist’s needs
related to their project’s goals and if they were interested in professional
internationalization services. Based on the answers obtained we present some
graphs that justify CLU’s core proposition:


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
23

Surveys and it results available at:
1. Management https://es.surveymonkey.com/results/SM-T2266GD8/
2. Promotion/Marketing https://es.surveymonkey.com/results/SM-5JQY6GD8/
3. Music projects https://es.surveymonkey.com/results/SM-7LH36GD8/
24

Each of the 3 surveys included 10 questions with a total of 30 questions. 61 people responded the survey
in a 15 day period. The survey is still online. The fact that we got this amount of responses in a short period,
speaks to the relevance of this issue for this group of people.


 

30
 

CLU’s
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 Christian
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Graph 3

Graph 4

“Free lance”


 

31
 

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 Christian
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Affordability: Knowing that most of the independent projects are not economically
wealthy, we investigated their willingness to pay or share for the management
services. More than 40% of the participants said they would a fair percentage for
the management services will be 20%.
Graph 5

Estimate of Potential User Numbers: Based on our research, we considered we
are solving a necessity of big number of artists, therefore a big number of clients.
Based in our survey, 50% of respondents confirmed that internationalization
would increase their chances to succeed.


 

32
 

CLU’s
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 Christian
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Graph 6

Strategy and Implementation Summary for the Agency
The primary strategy will be positioning CLU as a professional organization that
brings solutions to Indie projects through marketing and promotion strategies
within Latin markets attacking international awareness.
CLU’s most lucrative market will be the international booking services. In order to
achieve this goal, firstly we have to execute a solid marketing campaign and
publicity plan in the selected country. The second step will be to develop
management activities in order to follow up the connections providing all
information, data and content of the artist. The next stage will be to book the
projects for small tours, opening acts, and festivals in that country. The objective
of the international marketing and sales campaign will be also focused in gain
audiences and new fans by consolidating traditional and social media presence
in each country. The success of each level will be driven by the attractiveness of
the projects, the high skill management execution and the quality of the content
and information provided about the project.
Along with the effort of expanding markets for projects based in Mexico, we will
also be working in the same way opening the door to Latin-American and


 

33
 

CLU’s
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 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
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Spanish projects that want to penetrate the most important Hispanic music
market, Mexico.
Marketing and Promotion strategy
The marketing strategy is to engage with national and international Indie
entertainment industry contacts such as: magazines, journals, traditional media,
social media as well as live music planners. The action plan for this strategy is:
•

•

•

•
•

•

•

•

Partnership and data exchange: We will establish relationships with the
Independent Musician Association in each country in the region and Spain
in order to promote our services.
Networking: CLU will have negotiated affiliations with online and print
publications, event planners, and selected club, lounge, hotel, bar and
restaurant owners in the main Hispanic markets.
Local Buzz: CLU will negotiated promotional opportunities to advertise in
local media outlets to enhance awareness and establish a local presence
in the area.
Word-of-mouth buzz and in-person promotion: Brand presence at shows,
trade shows, conferences and industry events such as the Midem.
Social Networking: social networks through our profiles on Twitter,
Facebook and LinkedIn among others. In addition, the links posted in
social pages of our clients, artists, partners, and sponsors to maximize the
market audience.
Technology: The creation of Webpage with all the information related to
the agency. Furthermore, for future stages we consider the creation of an
app downloadable for all Smartphone platforms that will allow customers
to know about our services, artist roster, events, etc.
Search Engine Optimization: CLU will publish articles and press releases
to push its Google keywords, pay-per-click advertising and Google Page
Rank.
Online media sites: YouTube, Spotify and various user-generated
audio/video content and streaming music sites

The International promotion will be held and helped by the local Independent
associations and partnerships established to help the flow of Indie projects and
also to get mutual benefits when they wanted to export their local bands.


 

34
 

CLU’s
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 Christian
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Sales strategy
The strategy for acquiring sales will be:
•
•
•
•

To choose the right new projects to market abroad based in our criteria
Work with existing projects to continue their growth offering the consulting
and management services.
Work closely with our partner and build a strategic alliances
Constant development of new channels to integrate our management
services with the booking activities.

Strategic Alliances
In order to develop a strong position in the market we will create selected
Strategic Alliance Partner Program with main players within the indie scene in
Latin American, Latin market of USA and Spain. These strategic alliances will be
vital to the CLU's short and long-term success and include premier local vendors,
marketing agencies, event production companies, and entertainment entities.
In addition, mutual help and support of data exchange will be done with key indie
actors such as Indie record labels, indie management agencies, Independent
conferences and prizes, local Independent Musicians Associations, Indie
festivals, indie Magazines, Newspapers, Indie webpages and social media,
music schools, national institutions, venues, etc. As an example some of these
key actors with whom we would have a potential alliances, we enlisted:25
Independent conferences and prizes
Los IMAS (México)
LAMC
Fundación Cultural Latin Grammy
Panamerican festival
Premios de la Música Independiente (Spain)
Latin Mixx Awards
Local Independent Musicians Associations
Argentina: UMI (Buenos Aires), Qubil (Rosario), SuRock (Santa Fe), AMUISE
(Santiago del Estero), MIAS (Salta), Septiembre Rock (Santa Cruz) and AMI
Plazoleta (Trenque Launquen)
Union Peruana de Músicos Independientes
AMIC (Asociación de Músicos Independentes de Colombia)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
25


 

Web information list of strategic alliances Appendix C

35
 

CLU’s
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 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
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SCD (Sociedad Chilena de Derechos de Autor, Chile)
UFI (Unión Fonográfica Independiente de España, Spain)
MIE (Musikaren Industriaren Elkartea, País Vasco, Spain)
ABMI (Associacao Brasileira Da Musica Independiente, Brazil)
Indie Festivals
Vive Latino, Festival Ajusco, Festival Marvin, Hellowfest, Nrmal (México)
Contemporanea (Alburquerque y Badajoz), Territorios Sevilla (Spain)
Festival Verde de Cultura Musical (Panamá)
Rock al Parque, Festival stereo picnic (Colombia)
Festival Primavera Fauna (Chile)
Fest by Contrapedal (Uruguay)
Rock in Rio (Brazil)
Creamfields (Argentina)
Magazines
Rolling Stone
Revista Marvin
Indie Rock
Lifeboxset
Rock and radio
Zona de obras
Revista Freim
Arts & crafts
Haz df
Indyrock
Indie Web Pages
Red Bull.Panamerika.FM
Open Music
Managerdeartistas.com
Mexicoindie.net
Scanner FM
Enderock
Sol Musica
Mondosonoro.com
Musicosaovivo.com
To be Magazine


 

36
 

CLU’s
 Business
 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
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 Uribe
 
Music Schools
Academia de Musica Fermatta
Escuela de Música G.Martell
STRUM Guitar Center
ENM (Escuela Nacional de Musica)
Instituto de Capacitación Musical (SUTM)
TCSACM (Taller de compositores SACM)
International Management Agencies
Moon Moosic Management
KMP artist International
Kurtuva music
Gigntik music
National Institutions
CONACULTA (Consejo Nacional ara la Cultura y las Artes, Mexico)
SUTM (Sindicato Unico de Trabajadores de la Música, Mexico)
INAEM (Instituto Nacional de las Artes Escenicas y la Música, Spain)
Open Business Latin America and Caribbean

FINANCIAL STATEMENT
Expenses
Cost Projections Year 1 - In order to know how much money we need to invest to
start up the agency we made a projection of expenses for the first year. We are
talking in consideration Capital cost, fixed cost and Operating cost. As part of the
projection of this first stage of the agency, we are considering just 3 salaries. One
for the Director of the Legal affairs, one for the Financial activities and one for the
CEO responsible of management, promotional-marketing and booking services.
Note: All the transactions in the Financial Statement are recorded in US Dollars


 

37
 

CLU’s
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 Christian
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Chart 5

Year%1

Cost%per%
Activities%based%in%Value%chain Expenses
Unit
Details
Monthly
Capital%Cost Start%up%cost.%One%payment Registration
Mexican%Tax%authority $%%%3,000.00
Permits%&Licenses
$%%%%%%730.00
Fixed%cost Prepaid%Insurance
Insurance
$%%%%%%500.00
Monthly%wages
wages
3%wages
$%%%%%%500.00 $%%%1,500.00
Equipment
Computers
3%21.5Sinch%imacs $%%%1,499.00
Fax
Brother%FAX2840 $%%%%%%178.99
Printer
Canon%Pixma
$%%%%%%143.49
Mobile%phones
3%Galaxi%S4
$%%%%%%529.99
Office%Telephone%System Xblu%X16
$%%%%%%699.99
Audio/audiovisual%eq. Oklahoma%Sound $%%%%%%509.99
Operating%
cost
Rent
Office%space
$%%%4,800.00
Internet,%phone,%cable%
Services
services
Verizon
$%%%%%%%%79.99
Website
Designer
$%%%3,000.00
Website%expenses
$%%%%%%120.00
Domain%Maintenance Yearly
Marketing%and%sales
CLU's%Marketng
$%%%3,000.00
Miscellaneous%
Discretionary
$%%%1,000.00
TOTAL%FIXED%COST

Yearly%
$%%%%%3,000.00
$%%%%%%%%730.00
$%%%%%%%%500.00
$%%18,000.00
$%%%%%4,497.00
$%%%%%%%%178.99
$%%%%%%%%143.49
$%%%%%1,589.97
$%%%%%%%%699.99
$%%%%%%%%509.99

Total
$%%%%%3,730.00
$%%%%%%%%500.00
$%%18,000.00
$%%12,659.31

$%%%%%4,800.00 $%%%%%4,800.00
$%%%%%%%%239.88
$%%%%%3,000.00
$%%%%%%%%120.00
$%%%%%1,200.00 $%%%%%4,320.00
$%%%%%3,000.00 $%%%%%4,000.00
$%%%%%1,000.00
$%%43,209.31 $%%48,009.31

It is important to note that some of the expenses of the first year will be retrieved
or reduced for the second and future years. Especially the expenses related to
the start up cost. As an example we are doing the following projection:


 

38
 

CLU’s
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 Christian
 León
 Uribe
 
Chart 6

Year%2
Activities%based%in%Value%chain Expenses
Details
Fixed%cost Monthly%wages
wages
3%wages
Prepaid%Insurance
Insurance
Operating%
cost
Rent
Office%space
Equipment
Maintenance%and%repairs
Website
Designer
Website%expenses
Domain%Maintenance Yearly
Marketing%and%sales
CLU's%Marketng
Miscellaneous%
Discretionary
TOTAL%FIXED%COST%YEAR%2

Cost%per%
Unit
Monthly Yearly%
$%%%%%%500.00 $%%%1,500.00 $%%18,000.00
$%%%%%%500.00
$%%%%%%%%500.00
$%%%4,900.00
$%%%%%%800.00
$%%%1,500.00
$%%%%%%120.00

$%%%%%4,900.00
$%%%%%%%%800.00
$%%%%%1,500.00
$%%%%%%%%120.00
$%%%%%1,200.00
$%%%%%2,500.00

$%%%2,500.00
$%%%1,000.00

$%%%%%1,000.00
$%%30,520.00

Variable Cost Projections
We are also considering the variable cost of our core activities: PromotionMarketing and Booking. In essence these costs will be retrieved from the income
perceived from the customers.
Chart 7

Year%1
Activities%based%in%Value%chain Expenses
Details
Variable%
Presskit%Development%
Cost
Promotion,%Marketing%Mix (Design,%Material)
Estimated
Mailingshots%(Design)
Advertising%Promotion Estimated
Long%distance%Phone%and%
Booking
Fax%Charges
Estimated
Courier%Charges
Estimated
TOTAL%VARIABLE%COST

 

Cost%per%
Unit
Monthly

Yearly%

Total

$%%%%%%%%75.00 $%%%%%%300.00 $%%%%%%%%300.00 $%%%%%1,860.00
$%%%%%%%%60.00
$%%%%%%%%%%60.00
$%%%%%%500.00 $%%%1,500.00 $%%%%%1,500.00
$%%%%%%150.00 $%%%%%%600.00 $%%%%%%%%600.00 $%%%%%%%%750.00
$%%%%%%150.00
$%%%%%%%%150.00
$%%%%%2,610.00 $%%%%%2,610.00
39
 

CLU’s
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 Christian
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Income
First of all we have to consider that the agency has a wide range of services and
therefore many sources and variety of income giving as a result a wide range of
possibilities. For example:
•
•
•

•
•

Each of the services could be provided separately having a different
percentage of commission
Some of the services could be provided through external consultants and
therefore would have a variation in prices
We also can have a management percentage in concerts, festivals and
other kind of live appearance of the artist if they are not under the tour
management’s “All-in-house” services
The set of concerts could be more than six and the prices would be
different depending of the artist, country, amount of shows etc.
Deals with merchandizers and sponsors

In order to have an approach of what could be a real income for our services we
elaborated projection’s sample under the following framework:
•
•
•
•
•
•
•

We are talking our path of services only for one project
The marketing plan has 3 monthly payments of $197.00
We are considering the percentage stated under the “All-in-house” plan
Tour is considered as a set of 6 concerts at the amount of $5,000 each.
The period of this set is within 30 days
Each country has a different percentage of VAT deduction26. For this
example we are taking 15% of VAT.27
Because each country have their own coin, we are using US Dollar to
standardize prices of the transactions
The time of execution of these projections is six months but it will vary in
real cases. Here we are including: Advisory management (1), Promotion
(1), Marketing (3), Tour (1)


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
26

Wikipedia ‘El impuesto al valor agregado’ Accessed: June 21st 2014, available at:
http://es.wikipedia.org/wiki/Impuesto_al_valor_agregado
27

Note: Although CLU will be firstly based in Mexico, we are using 15% just an example. Due to the new
Tax Reforms Mexico’s VAT recently changed to 16%.


 

40
 

CLU’s
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 Christian
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 Uribe
 
Chart 8

Year%1
Activities%based%in%Value%chain Expenses
Income%Per%
Music%
Project Promotion/Marketing%Mix

Promotion%plan%1
Marketing%Mix%Plan
TOTAL%PROMOTION/MARKETING%MIX%PLAN%PER%PROJECT
Touring%(6%concerts)
Income%per%show
Less%Taxes%(15%)%
Income

Tour%Management
Booking
TOTAL%INCOME%PER%MUSIC%PROJECT

Tour%Management%17.5%%from%Gross%Income
Booking%7%%from%the%Gross%Income

Income%one%
payment Monthly

Total

$%%%%%%350.00

$%%%%%%%%350.00
$%%%%%%197.00 $%%%%%%%%591.00
$%%%%%%%%941.00
$%%%5,000.00
$%%30,000.00
$%%%(4,500.00)
$%%25,500.00
$%%%%%4,462.50
$%%%%%1,785.00
$%%%%%7,188.50

The amount obtained in this example ($7,188.50) is only for one project and
under the framework stated before and it is just and example to know at what
point with this income the agency will break even.
Break Even Point
Under this framework and having the projected expenses and income, we would
need between 9 or 10 projects to break even in the first year.
REVENUE= FIXED COST + VARIABLE COST
7,188.5x = 43,209 + 2,610x
4,578.5x = 43,209
x = 9.43
Using the data of fixed cost in the second year, the break even the next year
under this example will be:
REVENUE= FIXED COST + VARIABLE COST
7,188.5x = 30,520 + 2,610x
4,578.5x = 30,520
x = 6.66


 

41
 

CLU’s
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 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
 León
 Uribe
 
Balance Sheet / Income Statement
To analyse the following financial exercise of the first year of operation, we have
to take in consideration the following data:
• Because we will have a fixed cost of $43,209 in the first year in order to
start the agency, we will invest $50,000 as Equity to finance the project.
• For this first year’s Balance sheet we are making a realistic projection of
having 3 music projects under the stated income’s framework:
Revenue = 7,188.50 x 3 = $21,565.50
Chart 9


 

CLU$Management

Balance$Sheet$Year$1

Assets
Current)Assets
Cash
Prepaid)insurance
Total)Current)Assets

$)))))))))))))))))))))))) 41,746.19
$))))))))))))))))))))))))))))) 500.00
$)))))))))))))))))))))))) 42,246.19

Fixed)Assets
Equipment
License
Total)Fixed)Assets

$)))))))))))))))))))))))))) 7,859.31
$))))))))))))))))))))))))))))) 730.00
$)))))))))))))))))))))))))) 8,589.31

TOTAL)ASSETS

$)))))))))))))))))))))))) 50,835.50

Liabilities/owner's)equity
Equity
Retained)Earnings

$)))))))))))))))))))))))) 50,000.00
$))))))))))))))))))))))))))))) 835.50

TOTAL)LIABILITIES)AND)OWNER'S)EQUITY

$)))))))))))))))))))))))) 50,835.50

42
 

CLU’s
 Business
 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
 León
 Uribe
 
Chart 10

CLU$Management

Income$Statement$Y.$1

Revenue

$........................ 21,565.50

Expenses
Rent.expense
Marketing.expense
Variable.expense
Website.expense
TOTAL.Expenses

$.......................... 4,000.00
$.......................... 4,800.00
$.......................... 2,610.00
$.......................... 4,320.00
$........................ 15,730.00

NET.INCOME

$.......................... 5,835.50

Less.Dividends

$.......................... 5,000.00

Retain.earnings.

$............................. 835.50

Under this scenario, we are having a Net Income of $5,835.50 and we are giving
back money to retrieve the owner’s investment with $5,000 as dividend. Probably
the Net Income could look low for the first year, but we have to consider that
fixed cost for the second year will be reduce and also other sources of income as
well a bigger number of music projects under the “All-in-house” plan.
Ratios
Return on Assets
= 5,835.5 / 50,835.5
= 0.114
Return on Equity
= 5,835.5 / 50,000
= 0.116
Gross Profit Margin
= 5,835.5 / 21,565.5
= .27
Return on Capital Employed
= (5,835.5 – 7,859.31) / (50,835.5 – 0) = - 2,023.81 / 50,835.5 = 0.04

 

43
 

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 Christian
 León
 Uribe
 

BIBLIOGRAPHY
1. Allen Bargfrede and Cecily Mak, Music law in the digital age ( Boston:
Berklee press, 2009).
2. David Byrne, How music works (San Francisco: Mc Sweeney’s, 2012).
3. Donald S. Passman, All you have to know about the music business,
seventh edition (New York: Free Press, 2009).
4. Jeffrey Brabec & Todd Brabec, Music Money and success, seventh edition
(New York: Schirmer trade books, 2011).
5. Jeri Goldstein, How to be your own booking agent, 3rd edition (Palmyra,
Virginia: The new music times, inc, 2008).
6. Joseph A. Covello and Brian J. Hazelgren, The complete book of
business plan, 2nd edition. (Naperville, Illinois: Sourcebooks, inc, 2006).
7. Music Management Forum, The music Bible, (London: Bobcat Books
Limited, 2003).
8. Pat Pattison, Song-writing without boundaries (Cincinnati: Writers digest
books, 2011).
9. Peter Spellman, The self-promoting musician (Boston: Berklee press,
2008).
10. Philip Kotler, David Hessekiel & Nancy R.Lee, Good works! (New Jersey:
John Wiley & sons, inc; 2012).
11. Ray D. Waddell, Rich Barnet, Jake Berry, The business of concert
promotion and touring, (New York: Billboard Books, 2007).


 

44
 

CLU’s
 Business
 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
 León
 Uribe
 

APPENDIXES
APPENDIX A
Competitors
Big record labels
http://www.warnermusic.com.mx/
http://www.universalmusica.com/
http://www.sonymusic.com.mx
Management agencies
http://www.westwoodent.com/
http://seitrack.mx/
Small commercial agencies
http://fraternitytalent.com/
http://matalent.mx/acerca-de-ma/

APPENDIX B
Indie Management Agencies
http://www.bunkerproducciones.com/somos.html
http://pajarospiedra.com/artistas.html
http://losmanejadores.mx/
http://mexindiemusic.wordpress.com/2009/07/16/agencias-independientesmexicanas-de-booking-y-management/
http://verbigracia.com.mx/
http://www.abolipop.com/Artistas.html
Publicity companies
http://www.latinmusicwire.com/lm-music-publicity.html
360 services, booking, management, publishing and record label
http://www.classgroup.com.mx/booking/
http://mexindiemusic.wordpress.com/?s=disqueras+management
Record labels with management services
http://www.terricolasimbeciles.com/sellodiscografico/
https://www.facebook.com/intolerancia


 

45
 

CLU’s
 Business
 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
 León
 Uribe
 
http://indiangoldrecords.bandcamp.com/album/rancho-shampoo-el-vuelo-delgolondrino-igcd001
International Agencies with Mexican projects
http://moonmoosic.com/es/management
http://cookman.com/
http://thetalentboutique.fr/artiste.php?id=171

APPENDIX C
Indie Conferences and Prices
http://www.losimas.com/
http://www.latinalternative.com
http://www.latingrammy.com/es/fundacion-cultural-latin-grammy
http://bellasartesalliance.org/paf-2013/
http://www.premiosdelamusicaindependiente.com/14/
http://www.latinmixx.com/latinmixx2011/
Local Independent Musicians Associations
http://www.umiargentina.com/umiargentina/
https://www.facebook.com/pages/ASOCIACION-DE-MUSICOS-DELPERU/227924987228643
http://www.amiccolombia.org/
http://www.scd.cl/www/
http://ufimusica.com/
http://mieelkartea.blogspot.com.es/2013/12/manifiesto-mie.html
http://www.abmi.com.br/website/abmi.asp?id_secao=3
Indie Festivals
http://warp.la/editorial/desde-­‐el-­‐indie-­‐hasta-­‐el-­‐mainstream-­‐latinoamerica-­‐
festivalea
http://www.vivelatino.com.mx/
http://www.festivalajusco.com/
http://festival.marvin.com.mx/
http://www.hellowhellow.com/
http://www.festivalnrmal.net/2014/
http://www.contempopranea.com/
http://territoriossevilla.com/
http://www.fvcmpanama.com/
http://rockalparque.net/

 

46
 

CLU’s
 Business
 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
 León
 Uribe
 
http://www.festivalestereopicnic.com/2014/
http://www.primaverafauna.cl/2014/
http://www.festcontrapedal.com/
http://rockalparque.net/
http://www.creamfieldsba.com/
Magazines
http://www.indierocks.mx/?s=blog&x=-948&y=-2178
http://www.marvin.com.mx/perfil
http://www.indierocks.mx/
http://www.lifeboxset.com/musica-nueva/bands-to-watch/
http://rockandradio.net/2014/05/02/michael-jackson-tiene-nueva-cancion-lovenever-felt-so-good/
http://www.zonadeobras.com
http://www.revistafreim.com/
http://www.arts-crafts.com.mx
http://hazdf.com
http://www.indyrock.es/
Indie Webpages
http://panamerika.fm/
http://openmusic.com.mx/
http://managerdeartistas.com/
http://mexicoindie.net/
http://www.scannerfm.com/
http://www.enderock.cat/
http://solmusica.com/
http://www.mondosonoro.com/
http://www.musicosaovivo.com/
https://www.youtube.com/channel/UCsP9C5_N5fRQkxoRfpUMybA
Music Schools
http://www.fermatta.edu.mx/eng/
http://www.gmartell.com/
http://www.strumgc.com/
http://www.enmusica.unam.mx/
http://www.institutodecapacitacionmusical.org.mx/cms/noticias.php
http://www.sacm.org.mx/tcsacm/
International Management Agencies
http://moonmoosic.com/es/management


 

47
 

CLU’s
 Business
 Plan
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 Christian
 León
 Uribe
 
http://kmpartists.com/about/
http://kurtuvamusic.blogspot.com.es/p/agenda.html
http://www.gigntik.com
National Institutions
http://www.conaculta.gob.mx/
http://www.sutm.org.mx/
http://www.mcu.es/artesEscenicas/
http://openbusinesslatinamerica.org/contato/


 

48