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Every podcaster is the next Chance the Rapper. (+ Support this newsletter on Patreon!)

Happy February (already?)! I can already feel that this year is going to fly by more quickly than the
Every podcaster is the next Chance the Rapper. (+ Support this newsletter on Patreon!)
By Cherie Hu • Issue #45 • View online
Happy February (already?)! I can already feel that this year is going to fly by more quickly than the last one. And happy almost Lunar New Year, to those who are celebrating. :)
Since the last newsletter, I’ve written articles about diversified subscription models, the rise of China’s electronic music scene and the false death of celebrity apps. You can access each of those in the “My writing” section toward the bottom of this issue.
Before diving into today’s essay, I have a special announcement about a new way to support this newsletter and my writing, to fund a future podcast, to play a role in shaping my articles and to receive more exclusive essay series from me:

Announcing The Water & Music Patreon!
I’m super excited to share this news with you all before anyone else: I now have a Patreon page!
Below are the three main reasons why I’m starting a Patreon—and the key benefits for you:
  1. Raise money to cover production costs for a much-demanded podcast companion to this newsletter, as well as a dedicated Water & Music Discord server for discussing all things music and tech and connecting like-minded Water & Music readers with each other.
  2. Incorporate readers’ perspectives into my writing and reporting process in a more structured way. Select members will be able to vote on future Water & Music newsletter topics, get early sneak peeks at my upcoming articles and even participate in monthly Hangout sessions with me.
  3. Publish brand-new, Patreon-exclusive essay series on big ideas in music and technology, available biweekly to members paying $7/month or more. By popular demand, the first series will be dedicated to analyzing cool academic papers and theories that provide new ways of thinking about the future of the music business and artists’ careers.
Full descriptions of tiers and benefits are available on the Patreon page; if you have any issues with navigation or payment, please reach out to me by replying to this email.
Also, if you prefer not to subscribe on a regular basis and just want to make a one-off donation, I accept contributions at any time via PayPal and Venmo, and will send you a personal thank-you note for your help. Every dollar counts! :)
Every podcaster is "the next Chance the Rapper."
How do we operationalize Chance the Rapper?
This is a question that, even if not uttered word-for-word, many people in the music industry have a vested interest in answering.
In countless conversations, I’ve heard people mention “Chance the Rapper” as shorthand for the potential of a world where technology empowers rather than cripples DIY artists in their fight to make a living and build a meaningful fanbase. It’s well-documented that Chance developed a following by releasing all of his music for free on sites like DatPiff and SoundCloud—making little to no income from recordings, and instead chasing higher-margin monetization of touring and merch.
Steve Stoute, founder/CEO of marketing agency Translation and its music distribution platform UnitedMasters, has been transparent about his vested interest in replicating Chance’s success at scale. When UnitedMasters first launched in 2017 with $70 million in tow, Stoute told TechCrunch that “there needs to be 250,000 Chance The Rappers"—i.e. there need to be more independent artists using technology creatively to ensure that they maintain control over their masters while being financially sustainable.
Other distribution companies aimed at independent artists have since drawn on the same rhetoric. "You saw what happened with Chance the Rapper,” Kobalt CEO Willard Ahdritz told Billboard in November 2018. “Now it’s possible to break out bands in the streaming world.”
I would go so far as to claim that there are already more than 250,000 Chance the Rappers out there—just look at any podcaster.
I came to this realization while being a guest on an episode of the comedy and current-events podcast Asian, Not Asian, hosted by NYC-based comedians Fumi Abe and Mic Nguyen. It was such a fun episode to record—we touched upon everything from K-pop group BLACKPINK performing at Coachella, to Hamilton showing up as a top artist on Mic’s Spotify Wrapped recap, to the myth of a mainstream even existing.
At about the 14:30 mark in the episode, Mic asked me what artists really thought about streaming, and how the typical star made most of their money. I brought up Chance the Rapper’s strategy of free distribution in exchange for brand equity—and both Fumi and Mic immediately responded that most podcasters and comedians were running on the exact same model.
As Mic put it somewhat tongue-in-cheek, comedy is no longer just about comedy, but rather about “having a great haircut”; it’s about polishing your online brand, which you then monetize through live shows, sponsorships and other sources.
The situation is even more exacerbated in the podcast world, where free distribution is the norm rather than just a “hot trend.” For instance, Fumi and Mic aren’t receiving any royalties from Spotify for Asian, Not Asian, even though they do have a sizable listener base on the platform. This skewed economics reinforces the need for Fumi and Mic to go out and perform more live shows, or to raise money directly from fans through avenues beyond just the recording alone (e.g. they also have a Patreon).
Partially by financial and legal necessity, podcasters are embracing a lot of the same distribution, branding and fan-acquisition strategies that Chance leveraged early on in his career. I think we’ll see this strategic convergence materialize even further in the wake of traditionally music-first companies like Spotify and Pandora expanding into podcasts—which potentially funnels all audio-based storytellers into a situation where they have to cater to the same audiences on the same platforms (and, indeed, more and more musicians are starting their own podcasts now).
Below are three main similarities I’ve noticed between podcast strategy and what is largely understood as the “Chance the Rapper model,” and the key learnings they reveal for the music industry:
1. The recording is an advertisement for a much bigger brand, and forgoes immediate income in the present to build long-term brand equity for the future.
As previously discussed, Chance developed his core fanbase largely by releasing his music for free. This was a crucial expression of his philosophy as an artist: in a 2017 interview with Vanity Fair, the rapper explained that he felt selling his music “put a limit on [my music] and inhibited me from making a connection.
In addition, due to the brutal nature of streaming economics, “music sells everything but music.” Chance structured his early career accordingly: his music didn’t sell itself (because it literally wasn’t for sale), but it successfully drove awareness and sales for other, more lucrative revenue sources, including merch and live shows.
Of course, many artists are funneled into this “recording-as-advertisement” mentality against their own will. Even if they’re not releasing their music completely for free on P2P file-sharing platforms, it can feel free when they get their monthly royalty checks and realize they received only $100 for 20,000 streams. When I wrote in a previous newsletter about the concept of songs as advertisements, I understandably received some pushback from readers on the notion that recorded music could no longer be a self-sustaining art form in its own right.
But podcasters, working in the midst of what will be a billion-dollar industry, are thriving on the exact same predicament: “podcasts sell everything but podcasts.”
Most podcasters have the exact same mindset as Chance when they start out: they release audio recordings for free, in the hope of connecting with others. I have yet to meet a podcaster who is in podcasting “for the money,” in part because any attempt at monetization beyond ad sponsorship is still even more of a wild-west territory compared to music.
But then how could podcasts possibly grow into lucrative media empires? In a manner similar to Chance: each podcast episode serves as an advertisement for the perspective and personality of its host, with whom listeners become more invested in interacting over time across multiple other touchpoints, both on- and offline.
Understanding this opportunity for diversification, all three major booking agencies (CAA, UTA and WME) have launched their own podcast divisions over the last few years alone, with their eyes set not just on the touring circuit but also on literary and cinematic adaptations—some of which we’ll see in the next section.
2. If the recording is the advertisement for the brand, the brand extends far beyond the recording.
Revisiting Chance’s career, the rapper has expanded on his influence to the point of doing much more than just releasing and performing his own music. In 2016, he hosted his own Magnificent Coloring Day music festival, which served as a platform for fellow musicians like Tyler the Creator, Common and Alicia Keys and broke the attendance record at the time at Chicago’s U.S. Cellular Field. Chance is also an active philanthropist, having donated millions of dollars to mental health services and public schools across Chicago, and engages with local youth through his charity SocialWorks. On the more commercial side again, the rapper is even joining Cardi B and T.I. in a new reality-TV-style music competition show on Netflix called Rhythm + Flow, which will debut later this year.
In short, Chance’s reach now extends far beyond his music in a way that still aligns with his origins, with his local community, and with his personal passions.
Podcasters of all backgrounds are going the same route, cashing in on the newfound brand value from their recordings. Aside from live shows, one of the hottest sources of diversification for podcasts is adaptation into novels, TV shows and movies.
For instance, the team behind the podcast Welcome to Nightvale is now publishing several novels that have sold quite well. Gimlet Media, one of the leading independent podcast developers behind shows like Startup, recently launched a brand-new arm Gimlet Pictures to develop TV and film versions of some of their flagship podcast series.
Even more traditional film and TV production studios are breaking into the podcast world. HBO has produced specials for the likes of 2 Dope Queens and Pod Save America; just yesterday, Netflix launched a new podcast terribly named The Human Algorithm, and is expected to launch its own comedy series on SiriusXM later this year.
Perhaps the biggest takeaways from this trend are that creative IP is more fluid than ever, stories are great stories regardless of where they live, and the winners in this landscape invest in the best storytellers.
In this vein, the diversification of podcast content is not dissimilar to how more musicians are getting into the film production or esports business, or how comic franchises like Marvel thrive equally in movie and video-game form as they do in print. As I wrote in my previous newsletter, an increasing number of independent artists are reacting to this trend and building up their brand at the intersection of music and other entertainment and lifestyle sectors from the ground up.
Importantly, both traditional production studios and newer, unicorn tech platforms will likely be competing with each other for podcast talent—which is where the third and final pillar comes in:
3. The long-term value of pursuing exclusive deals with streaming platforms is still on the fence.
A few years ago, Chance the Rapper found himself smack in the middle of the buzz around exclusive streaming deals, when he revealed that he received $500,000 from Apple Music to keep his latest album Coloring Book exclusive to the platform for two weeks. This marked a significant departure from his previous release strategies, to the point where his team took down leaked versions of his album from the very websites where he first built his fanbase (i.e. DatPiff).
The phenomenon sparked a key debate around whether Chance was still truly “independent,” or whether he had abandoned his roots and gone full-on corporate. We still feel the reverberations of that debate across the independent artist community today—not just in the shift in available capital for artist development, but also in the importance of maintaining an independent/DIY brand ethos even if it may not necessarily be the base behind the scenes (a.k.a. industry plants).
Spotify executives previously criticized the exclusive-deal strategy for music, arguing in favor of a level playing field—yet the company is now taking the exact opposite approach with podcasts. In my article “Why Spotify Is Not A Music Company,” I argue that Spotify is scrambling to position itself as the “Netflix of audio” by signing away millions of dollars for exclusive podcast deals with the likes of Amy Schumer, Joe Budden and Jemele Hill.
My personal stance, which is the same for both music and podcasts, is that exclusive deals ultimately help streaming services more than they help the artist.
Even though Chance got $500,000 upfront for Coloring Book—which is nothing to dismiss, especially for a DIY operation—his audience became much more limited for those first two weeks than if he had pursued an open-distribution approach right off the bat. That gap in potential audience can be even more profound in the podcasting world, where an exclusive Spotify deal means forgoing the 70% to 90% of all podcast downloads and listening that happens through Apple Podcasts.
One of my favorite music-biz writers out there right now, Dan Runcie, dove into this podcast-exclusive conundrum in a recent issue of his newsletter Trapital. Dan introduced the concept of a “barbell effect” in media—which claims that both really niche and really mainstream, mass-market media companies can sustain themselves successfully, but the middle ground is a recipe for struggle and/or failure.
He made the compelling argument that Joe Budden, a widely-renowned hip-hop commentator who struck an exclusive windowing deal with Spotify that keeps his episodes exclusive to the platform for 48 hours, is on the “wrong side of the barbell.” The host built up much of his passionate fanbase on YouTube—but now, as Dan wrote, “Spotify’s acquisition has forced the passionate YouTube community to wait 48 hours to watch the newest show. By that point, the show’s topics might be old news.”
But similarly to Chance, Joe likely received at least a decent upfront advance for that deal. For both music and podcasts, exclusives often involve significant tradeoffs between finances and audiences.
I am always in support of any creative entrepreneurs owning their relationship with their audiences, and signing deals that allow them to maintain that ownership. In this sense, adaptations into film and TV can actually be great for providing the original artists with enough upfront capital to fund future shows and feel a maximum level of creative freedom, while preserving their direct line to their most loyal listeners.
I’d love to hear your thoughts on these topics: What other strategic similarities have you seen between music and podcasting? Do you think monetization models will evolve such that audio recordings of podcasts will no longer just be “advertisements,” but rather be lucrative pieces of IP in their own right? Simply reply to this email and it’ll go straight to me!
My writing
Celebrity Apps Keep Failing. So, Why Are They Still Being Built?
I will be headlining the next New York MusicTech Meetup at the Dailymotion office on February 12, giving a talk about what it means for artists to treat themselves like startups. Tickets are just $13 each and are all-inclusive of dinner, drinks and networking with cool people in the local music/tech community!
And in case you didn’t get to read the top of this issue: I now have a Patreon, where you can show your support for this newsletter as well as help raise money for an upcoming podcast, a Patreon-exclusive essay series and other great perks. :)
Good reads
The Five Most Powerful People in the Music Biz Don’t Work in the Biz
Obligatory potato
Apparently there is an actual condition called potato depression. No, potatoes don’t have mental illnesses—but they do sometimes have genetic mutations that stunt their growth and lifespans. Scientists all over the world are experimenting with how to use selective breeding and gene editing to reduce these mutations in future potato crops, which could potentially disrupt the food industry altogether (e.g. many restaurants, even McDonald’s, have refused to purchase genetically-modified produce).
Did you enjoy this issue?
Cherie Hu


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