We’re excited to introduce you to the always interesting and insightful Matt Lutz. We hope you’ll enjoy our conversation with Matt below.

Matt, thanks for joining us, excited to have you contributing your stories and insights. Can you talk to us about a risk you’ve taken – walk us through the story?

The biggest risk I’ve taken is starting Music Benefactors.

There are several reasons starting Music Benefactors was a risk. I had little experience in the music industry. Having connections is crucial to success in any business. I didn’t know anyone. My background was in finance and investing. This was a completely new industry to me. I spent months on LinkedIn connecting with people in the music industry. I’d send cold connection requests with a deck explaining what I was building and ask if they had 10 minutes for a introductory call. Most people ignored me. Some accepted the request and others even gave me 1o minutes of their time to discuss. Many of the people I connected with were instrumental in helping me get to where we are today.

The biggest risks to starting Music Benefactors are my age and circumstance. I’m not in my 20’s. I’m in my 40’s with two teenage daughters. We don’t realize it when we’re in our twenties how little we have to lose. I started my first business in my late twenties. God, it was so much easier then. I started a few businesses since then with varying success. Most failed. If you look at the statistics, 80% of new businesses fail in the first five years. I often joke, I should start five businesses at once to get one that succeeds. I wasn’t walking away from some great career with a 401K I could return to if it didn’t’ work. When you become an entrepreneur, you make yourself unemployable. You develop great skills but big companies don’t want people who can do many things. They want people with very defined skills. They put you in a box. I felt like I was running out of time. If this didn’t work, I was in big trouble. I worked gigs to pay my bills while I built the company and went through the approval process with financial regulators. It was the hardest thing I’ve ever done.

Matt, love having you share your insights with us. Before we ask you more questions, maybe you can take a moment to introduce yourself to our readers who might have missed our earlier conversations?

I am the Founder and President of Music Benefactors, an SEC registered investment platform which enables independent recording artist and music business to partner financially with fans and investors. Music Benefactors solves two problems. One, getting capital to independent artists. The music business is hard even for well capitalized businesses. The likelihood of success is small for the most talented musicians. One of the biggest hurdles to success is access to capital. Without capital, the artist can’t properly make and market their music. Without marketing, the best music never gets heard. We help artists get the money needed to properly fund projects. The other problem we solve is enabling all fans and investors the opportunity to invest in projects only previously available to institutions and high net worth individuals. Through our platform fans can invest as little as $25 in music projects. In return, they share the profits the projects generate. We’re democratizing the music business. Artists maintain control of their work while fans become financial partners with their favorite bands and recording artists. What many people don’t know is music is an asset class just like stocks, bonds, mutual funds and real estate. It’s intellectual property. Any time someone uses that intellectual property, the owner of it gets paid. This is why the many successful artists are selling their catalogs. Institutional investors are realizing music is a great investment. I wanted to introduce everyone to music investing. By doing so, independent music projects get made, artists maintain ownership of their work and regular people get access to investments previously only available to hedge funds and private equity firms.

Do you have any stories of times when you almost missed payroll or any other near death experiences for your business?

I feel most entrepreneurs and small businesses have near death moments but we rarely hear about them. These happen daily yet we only read about the companies in silicon valley who raise millions of dollars from venture capital firms. Most of us didn’t go to Harvard or Stanford and had a fraternity brother whose dad is a partner with a VC firm. Those are the only people raising big bucks to fund their startups. My near death experience occurred before things even started. Like most entrepreneurs, I bootstrapped Music Benefactors. When I started it, I had about six months of savings. I set out to raise funding. I prepared a deck and would travel to New York whenever I could get a meeting. I’m in Pittsburgh. It’s a difficult place to raise funding. There are about five venture capital firms in Pittsburgh and they only invest in autonomous car projects from Carnegie Mellon. I’d drive to New York whenever someone agreed to a meeting. I’d send emails to others investment firms letting them know I was in town and see if that had twenty minutes for me. It was an effective strategy. They don’t want you to make a trip just to see them but if you were in town for something else, they’d carve out time for you.. I had many great meetings. People would listen, tell me what a great idea it was and they want to learn more. I’d get an email a few days later stating “they really like the business but are unfortunately going to pass.”

I blew through the six months of savings in three months. I was broke and didn’t raise any money. My rent was due. Nothing was built. I hadn’t started the application process with the SEC (Securities and Exchange Commission) and FINRA (Financial Industry Regulatory Authority) which required the help of a securities attorney who don’t work for free. I had no fall back plan. If I took a regular job, the business would never get started. On paper, this is the worst time to start a business. Entrepreneurs aren’t completely rational. I started working gigs. I delivered groceries for Shipt and lunches and dinners with DoorDash. I was able to pay my bills and continue working on the business. I built the initial website myself and went through the application process with financial regulators on my own. It took 7 months for regulators to approve the application. It sucked. All of it. If you ever need an ego check, start a business. I was embarrassed that I couldn’t raise any money and I had to deliver food just to pay my rent. I met my girlfriend, Dawn, at this time. I was too embarrassed to ask her out initially because I was so embarrassed by what I was doing.

The financial regulators eventually approved the application and we were licensed to operate a funding platform for the music industry.

Can you tell us the story behind how you met your business partner?

Music Benefactors has recently merged with Explorer 1 Music. Explorer 1 Music is a Grammy nominated independent record label headed by Paul Woolnough. Paul was employee number two at Penske Media which owns Billboard Magazine and Rolling Stone. As I mentioned, because of my lack of music industry connections, I spent considerable time on LinkedIn pitching anyone who would listen to me. I sent Paul a LinkedIn connection request one day. He accepted and agreed to a brief call. On the call, I laid out how we could be a valuable resource for EX1. He came back to me with a merger agreement.

Contact Info:

• Website: musicbenefactors.com
• Instagram: instagram.com/musicbenefactors
• Facebook: facebook.com/musicbenefactors
• Linkedin: https://www.linkedin.com/in/matt-lutz-9b29b312/