Gambling is ruining the music industry

Huh?

Anyone who knows me knows that I am a diehard New York Giants fan…

In fact, I’m wearing my favoritist Giants hat as I type this very Substack.

And like every other degenerate sports fan, I dabble on the gambling apps from time to time.

And… like every other degenerate sports fan… I’ve been know to bet on a few parlays.

If you aren’t a sports gambler (good for you), a parlay is simply a bet that combines multiple bets, resulting in a much lower win percentage but much higher-payout.

A normal bet would look like this:

I bet $10 on the Giants to win, and if they do, I win $15.

A parlay looks like this:

I bet $10 on the Giants, Steelers, Bengals, and Chargers to win, Malik Nabors to have 100+ receiving yards and Russel Wilson to have over 300 passing yards. And if all of those bets hit, I win $4,000.

Needless to say, the parlay is much more exciting.

Also needless to say, I’ve never won a parlay in my life.

And I’m not alone.

In 2023, parlays accounted for a staggering 70% of all NFL and NBA sports bets on FanDuel (a popular betting app).¹

It’s easy to see why parlays are so popular… they’re essentially a lottery ticket that you can root for.

But the darker truth is that the gambling companies are essentially hacking our dopamine receptors by making “the prize” so tantalizing, that we don’t pay any attention the cost associated with it.

The betting apps are always talking about how “Joe Schmo from Wisconsin won $10,000 from XYZ bet last Sunday”…. always making it feel like we’re just one bet away from changing our lives forever.

Now… it’s hard enough to beat Vegas at a single bet, let alone combining multiple bets.

But the disproportionate reward brings bettors back to the app every week, desperate for more parlays.

The result?

Me (and 70% of bettors) lose money every Sunday.

And my Giants still stink.

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So how does this apply to the music industry?

Well the parlay phenomenon shines a light on a deeper problem in today’s society (especially in the music industry):

We’ve lost the ability to accurately calculate risk and reward.

The disproportionate reward partnered with the disproportionate marketing (highlighting the winner of the disproportionate reward) has created expectations that are…

… you guessed it…

… disproportionate.

Back when I was a trader on Wall Street…. (take a drink every time I say this on my Substack)…..

The best traders weren’t the ones who swung for the fences.

(Those folks actually were fired pretty quickly.)

It was the folks who were able to practice restraint, and focus on aggregating base hits.

It required discipline, objectivity, and an ability to detach from the excitement that surrounds a tantalizing prize.

It was sexy. It wasn’t fun to watch.

But it worked.

But ever since I started my record label, MAD Records, I’ve noticed that the “parlay problem” is more than just a gambling issue.

Over the past 20 years, the emergence of social media, “viral content”, and streaming platforms have slowly rewired our assessment of risk and reward as artists.

Just a few decades ago, building a music career was largely viewed as a “grind”.

There were no shortcuts.

It was essentially just a game of slowly aggregating fans (mainly through touring) until you had an audience that was large enough to (maybe) get a label to notice you.

It was the equivalent to betting $10 to win $15…. it wasn’t exciting, and most times you still lost anyways.

But as social media gradually consumed the music industry and streaming made touring perpetually unprofitable, the grind was replaced with the same disproportionate reward mechanism as the gambling industry.

We were suddenly bombarded with stories about artists who “blew up on social media” or landed a major playlist and became an overnight sensation.

Bedroom artists were catapulted to headlining spots at festivals, creating the feeling that “everything you ever dreamed of” was only one Instagram reel…. one viral music video…. or one playlist placement away.

And suddenly, the slow and methodical approach towards building an audience was replaced with a desperate hunt for viral content that could fix everything overnight.

And for some folks, this WAS true.

Just like the parlays, some people do win. No one disputes that.

But the question no one asks is - does this risk/reward profile actually make sense? Is chasing this disproportionate reward worth my time relative to other options?

The answer, just like the parlays, is most certainly no.

Now - I know what you’re thinking:

“What choice do we have? The streaming platforms have a stranglehold on the industry, and the old ways of building a career are dead”.

And while I sympathize with this mindset, it’s entirely defeatist.

There are still reliable ways to build an audience that don’t require gambling on high-risk, high-reward options.

Let me illustrate with an example:

I work with a really talented artist here in Nashville named Grace who goes by the artist name “GREYLEE”.

And Grace recently wrote and recorded a song called “Swimsuit Season”: a song about body dysmorphia, and the impact it has on young women as they’re growing up.

It’s a really beautiful song, and if it reaches the right audience, could be extremely successful.

So I met with Grace recently to discuss her plans for promoting the track.

She planned to film a pretty extensive (and expensive) music video and posting it on her socials and YouTube, hoping that it would catch the right algorithm, find her audience, and explode her song into the public discourse.

(Giants win, Malik Nabors over 100 yards, Russell Wilson 300+ passing yards.)

Of course, I completely resonate with her desire to create a music video that captures the ethos of the song…

But the reality is, creating a music video to promote a song just results in TWO things we now are hoping magically blow up.

And who knows, maybe it would.

But I stressed to Grace in that meeting that although it’s a nice idea, it’s probably not the most realistic route to get her music in the hands of her target audience.

“What other options are there?” she asked.

So we started spitballing ideas.

Instead of spending a sh**load of money on a music video and praying it goes viral, what could we do that would guarantee her music gets in front of her target audience?

So I suggested finding a support group for young girls with body dysmorphia / eating disorders, and asking if she could play a charity concert for them instead.

If she’s going to spend money on something, she might as well put on a show for the very people she’s trying to reach with her music….

No, it won’t reach millions of people.

But it would reach a few dozen young women that would become superfans almost immediately.

“Do I just…. knock on the door?” she asked?

“Why not?” I responded.

So she did.

She went to an outpatient center for eating disorders, knocked on the door, asked for their press directors email, set up a call, and organized a charity event.

And now, she’ll perform “Swimsuit Season” for the very people she wrote it for.

And (as long as she collects their emails) she’ll undoubtedly leave with a handful of new fans who will support her for life.

Is it overnight fame and fortune?

No.

If Grace wants to build a strong, stable career, she’ll need to do this kind of thing many times over… and it will be a ton of work.

But while everyone else is waiting for their parlay to hit…

Grace will be out grinding in new, creative ways that build a real community around her art.

(If you want to support Grace’s charity event, you can share/get tickets here.)

I know it feels like there aren’t any real options for artists right now…

But I encourage you to use your creativity to think outside of the box you’ve been conditioned to think in.

And that starts by reframing your idea of “success”.

Instead of shooting for a million streams…. aim for 10 true fans.

Instead of praying your content goes viral… find the people who need your music, and connect with them personally.

Do this relentlessly for a year, and I assure you that when you look up… you’ll find that you’ve started building the thing you were hoping for.

And…. don’t bet on the Giants, they never win :(

God speed 🫡⚔️

Michael from MAD Records

(Want to learn from our community-funded label, MAD Records? Get a 14-day free trial of MAD Records Community and get access to exclusive sync licensing opportunities, the ability to sit in on live label meetings, access to our 10-week Artist Development curriculum, and a whole lot more by clicking here.)

1. https://bircheshealth.com/resources/addicted-to-parlays