MUSIC BROKERS: 25 Years of Success and Expansion in the Music Industry

Press Release. MILAN, Sept. 05, 2024 (FinancialPost) — MUSIC BROKERS celebrates its 25th anniversary, marking a significant milestone in the global music industry. Since its founding in Buenos Aires in 1997 by Federico Scialabba and Julian Cohen, the company has experienced exponential growth, revolutionizing the sector with its innovative approach to lounge music. Over the past 25 years, Music Brokers has achieved a profound sociocultural impact, becoming a case study in prestigious international business schools and establishing itself as a global leader in the music industry.

Foundation and Expansion by Federico Scialabba and Julian Cohen

The global boom of this music label, founded in Buenos Aires in 1997 by Federico Scialabba and Julian Cohen, is essentially based on the successful combination of a recognizable repertoire of classic songs, updated with gentle arrangements (Bossa Nova, Soft Jazz, Reggae, Chill Out, Lounge, and more recently Afrobeats) performed by proven professionals. These artists often use multiple pseudonyms, much like stars of the 50s and 60s did to earn extra income. Critics have labeled this model as opaque and overly productive, but in an era of AI, where musicians struggle to secure work, this approach provides a protective shield against the looming threat of technology.

The Music Brokers Phenomenon

Over the past two decades, Music Brokers has emerged as a particularly interesting phenomenon, now being studied as a success case at top international business schools. This Argentine company foresaw the growing appeal of lounge music among a global audience two decades ago and capitalized on this trend with an innovative approach. They launched songs and collections that connected with diverse audiences through highly effective marketing and distribution strategies, leading to an unforeseen sociocultural impact. Today, it’s hard to find a sophisticated retail space or trendy restaurant where Music Brokers’ playlists aren’t playing.

Music Brokers’ playlists undeniably set trends worldwide, providing the soundtrack for both European summers and exclusive Latin American beaches. Thanks to apps like Shazam or Soundhound, this music often returns with travelers, virally spreading to new destinations and playlists, creating a global phenomenon.

The Lifespan of a Song in the Digital Era

How long does a song last? It’s a tough question to answer. According to the 2024 Midyear Music Report by Luminate, 120,000 new audio files are added to Spotify every day. Amid the rise of AI-generated products and the so-called white noise—nature-based sounds used by thousands of listeners to relax—new music recordings enter an oversaturated streaming market where they must compete with established names from both this era and the past.

AI: Strategy and Criticism

“As the role of artificial intelligence in the music industry becomes the hot topic, there are still those who question musicians’ decision to maintain parallel careers. With one career, they make a living, financing the other artistic endeavors that take much longer to develop,” explains Federico Scialabba, president and founder of Music Brokers, who rarely speaks to the media.

During our conversation, Scialabba plays songs from Music Brokers’ artists who have collaborated with superstars, performed at Coachella, recorded songs for major brand commercials, or even sung at the funeral of a former U.S. president at the request of the Carter family. Under pseudonyms but without hiding their faces or side projects, these performers build careers within the Music Brokers universe, contributing their vocal talent to the reinterpretation of classic songs through soft lounge arrangements—music designed for socializing in public spaces without disruption.

The Success of the Music Brokers Formula

For over 20 years, Music Brokers’ formula of giving new life to countless classic songs has been a global success, with some even referring to the “Music Brokers sound.” As Federico notes, “Stax and Motown had their own sound, just like Phil Spector’s productions with the Wrecking Crew.” Before becoming a successful record executive, Federico was a renowned DJ in Buenos Aires and still considers himself one. “Our achievement lies in identifying a need in today’s society, aligned with the emergence of a new type of public space. In Brazil, our marketing director once summed it up perfectly: Você cresceu, sua música também (You’ve grown up, and so has your music).”

Minimalist interior design, the need for people to communicate peacefully without background noise disturbing them… and the comfort of recognizing a familiar melody in the distance, creating a sense of ease.

In its early days, Music Brokers sold music on vinyl and CD—formats still available for collectors, particularly in the Netherlands. A major milestone in its expansion was becoming a supplier for the U.S. giant Walmart, distributing its catalog in over 2,000 North American outlets.

As experts in collectible sales, rescuing lost recordings from established artists, and meticulously producing triple compilation albums dedicated to specific artists or genres, Music Brokers became known for its Trilogy digipacks. These featured the critical work of A&R to secure difficult licenses and the inspired graphic design of Federico Dell’Albani, whose style soon became the label’s visual hallmark. Then came the breakthrough of Bossa ’n’ Stones (2004), and the rest has been a steady ascent to glory.

Bossa ‘n’ Stones and the Key to Success

The irresistible recipe: the immortal repertoire of Jagger and Richards, softened by bossa nova rhythms and performed by anonymous or little-known artists. This was enhanced by a highly sexy cover featuring a denim bikini bottom with a zipper, directly referencing Andy Warhol’s iconic Sticky Fingers (1971) cover for the Stones. The mix of classic song covers with scantily clad women on the cover wasn’t a new invention—any music lover would recall the instrumental albums of Italian saxophonist Fausto Papetti in the 60s, often categorized in record stores under easy listening.

The New Era of Easy Listening

Were Bossa ’n’ Stones and the subsequent collections from Music Brokers the easy listening of the new era? Perhaps. But it’s undeniable that the idea of reimagining past hits caught on simultaneously on both sides of the Atlantic. New York’s indie scene trio Ivy, led by Fountains of Wayne’s Adam Schlesinger and French vocalist Dominique Durand, or the Parisian duo Nouvelle Vague, with their techno-bossa covers of after-punk anthems performed by guest female vocalists like Camille, Mélanie Pain, or Helena Noguerra, were doing something similar. However, Music Brokers managed to reach a much wider audience with fewer resources.

International Expansion and New Projects

That pioneering album, extensively copied by its creators and competitors alike, launched individual careers such as Karen Souza, Sarah Menescal, Shelly Sony, Michelle Simonal, and Groove da Praia. It also laid the foundation for the expansion of the first independent Latin record label on a global scale, with operational bases in Argentina, Brazil, Chile, Uruguay, Paraguay, Mexico, the United States, and the Netherlands, as well as a strategic partnership in Spain.

Today, Music Brokers is one of the world’s leading music managers. “We work with Spotify, Apple, YouTube, Deezer, Amazon, Tidal, and other platforms, managing thousands of playlists in parallel. All our releases gain exposure in countless countries simultaneously, allowing us to constantly experiment with new projects,” explains the president of Music Brokers. “As a company, we’re comfortable with the formulaic products we have, which have given rise to a significant number of artists with a substantial following. But we’re not a company known for talent scouting; instead, we focus on ideas for new projects.”

The Vintage Café Collection

“Everything sounds better with a little jazz swing in it,” declares the Spotify presentation of Vintage Café, one of the label’s most successful collections. “With a distinctive sound and familiar songs, we’ve become the favorite soundtrack for retail spaces, restaurants, cafés, and bars worldwide—and even airports and waiting rooms. This market continues to grow steadily,” says Scialabba.

This captive audience compels Music Brokers to keep producing songs and creating new collections to meet the growing demand. “Last year, we released an average of two songs per day, and this year we’ve already launched 450 songs,” Federico emphasizes. While streaming now generates the majority of revenue, Music Brokers remains committed to physical products, which still account for 15% of the company’s revenue, well above the market average.

“One advantage of physical products is that you can set the sale price. Today, vinyl prices vary wildly, which allows us to unleash our creativity. The format is clearly not dead; even CDs are experiencing a slow but steady resurgence,” notes the entrepreneur.

Spanish Flow, Current Projects, and the Future of the Industry

Among current projects, Scialabba mentions how they’re working on a new fusion called “Spanish Flow,” combining Spanish sounds with flamenco and chill/trap beats in a subtle and cool style. He’s also excited about the recovery of historic Mexican songs in collaboration with the Mexican production company 3 KAMIKAZES, “fusing them with electronic music but keeping the original vocals.”

Where is the music industry heading? “I foresee a new technological shift with blockchain. With encrypted technology, distribution will become much more agile, and every time a song is played, all parties will be paid automatically. The technology is already available, but we need to merge the financial market with these traceable musical assets… This will be a new revolution, creating specialized virtual record stores without heavy negotiations or access barriers to the content they need. This scenario will be extremely stimulating for content creators and will allow us to continue growing and evolving for another 25 years.”

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