CD Baby CEO Tracy Maddux Knows What it Means to Do It Yourself

When Tracy Maddux—a passionate fan of live music—joined CD Baby, he decided he needed to see a show by each of the new employees he worked with. Nearly everyone at CD Baby plays music. It meant seeing several bands a month, for an entire year.

This crash course in the company’s own music scene opened Maddux’s eyes to the value of CD Baby’s musician-centered, all-embracing approach. “It influenced me in lots of ways,” he recalls. “I saw music that I thought was great but that had little commercial success, and music that was commercially successful that didn’t appeal to me. I saw this huge diverse world that isn’t made by tastemakers. We are not about exerting judgment. We’re about ensuring that any musician can get out and express themselves.”

But this immersion was not his first lesson in D.I.Y. values; that took place years before.

It was the worst snowstorm in decades, during a major transition for the company Maddux owned outside of Portland, OR. Maddux was in dire straits: He needed to get a shipment of CDs out from the manufacturing plant. So he put chains on his tires and picked up factory employees. He grabbed a snow shovel and dug out the driveways for delivery trucks to pull up to the loading dock. Then he drove everyone back home.

“The tough circumstance meant going back to basics, to manual labor and survival,” reflects Maddux. “I can certainly empathize with artists doing everything themselves to try and earn a living. I’ve had to do that, too.”

Maddux has brought this total commitment, as well as a strong background in finance and a fascination with operations and efficiency, to the world’s largest distributor and support hub for independent musicians. An MBA from the Kelley School of Business, Maddux had held positions in corporate finance at several tech companies before plunging into the CD manufacturing business in the early 2000s. It was there that he learned, hands on, what the transition rocking the music market entailed.

Worn out by the business, Maddux returned to finance, but longed to be part of something he believed in. “I wanted to do something that excited me,” recounts Maddux, who got the chance when he joined the company in 2010. “I was a Portlander, so I knew CD Baby’s story, knew it was this dynamic start up. For the first time in a decade, I got up and looked forward to going to work.”

“The way I see it, everything starts with valuing the work of our employees and really developing people internally,” Maddux explains. “They can use their knowledge to make company and processes better. When I got here, I found that we had a very young and strong team that hadn’t worked anywhere else. Universally, they had some connection to the music industry.”

This connection, in Maddux’s view, is key: instead of outside marketing experts or career CFOs, CD Baby has promoted from within, ensuring that everyone had a musician’s perspective as the company made decisions and launched new tools to help artists.

CD Baby’s job, Maddux believes, is to enable their artists to translate artistic expression into income, in as efficient and frictionless a way as possible. Maddux was shocked to learn, for example, that CD Baby used several warehouses, all with millions of CDs in alphabetical order by artist. Every new title meant someone had to physically shove thousands of CDs aside to make room, or start a new row somewhere.

As another example, development of new tools and products was once something that happened quietly, often done by the company founder himself and unveiled to employees suddenly. Then as CD Baby came under new ownership, development was shopped out to a small team across the country. Maddux brought the programming power back to the company’s headquarters, allowing the team to not only transition more smoothly, but to influence development of new features.

Yet the biggest source of friction for CD Baby’s artists comes not from the company itself, but from the structure of the industry they work in. “Coming from a tech and a manufacturing background,” he relates, “I was shocked how opaque the payment process is for artists and songwriters. The system is simply appalling.”

To bring some clarity to the muddy world of rights and payment has been one of the main themes of Maddux’s tenure at CD Baby. “My mission: I am a Sherpa for the musician,” he states. “The first part of playing that role well and fairly is transparency. If you read the rights agreements of some of our competitors, and they are dozens of pages long, you see what artists are giving up. We don’t want that. We can’t do things that are underhanded. We don’t want artists to leave a huge chunk of their potential revenue on the table. We’re here to guide them.”

Kevin Breuner, Marketing Manager: Real Music, Real Income: Former Major Label Guitarist and Current CD Baby Marketing Head Knows the Ins and Outs of Making a Musical Living

“The band I was in toured solidly, our albums sold well. We had all the appearance of success but we were dirt poor. I thought: there has to be a better way.”

For Kevin Breuner, there was. He discovered CD Baby, the company that’s now the world’s largest distributor of independent music. Not only did he find them, these days he’s the head of marketing for the company. But back when he was the guitarist in Smalltown Poets, he found that musical success didn’t necessarily translate into money.

“I started playing with them in the spring of my senior year at Belmont University in Nashville” Breuner says. “By October, we had a record deal. Our first album sold 200,000 copies and we were nominated for a Grammy. The second sold 100,000. We worked hard, played sold-out shows, but we were the last to benefit financially.”

On a major label and recording at places like the legendary Ardent Studios in Memphis, Smalltown Poets were a big deal. But the musicians ended up with very little. After the leaving Smalltown Poets, Breuner made ends meet by mentoring artists and working on a new project.

“That’s when I came across CD Baby, and it was exactly what I’d been looking for,” he remembers. “I started using it to distribute music. Then, when I decided to find a ‘real job,’ I ended up working here.”

Best of all, it meant he was still involved with music, his great passion. The son of a musician, he’d taken piano lessons as a young child, and had been exposed to his older sister’s record collection – everything from Van Halen to Men at Work. But it wasn’t until he was 16 and picked up a guitar that the idea of playing music himself really took root. He went on to study music at Belmont University, where he also received a good grounding in the music business, something that’s served him well over the years.

Although these days he’s in charge of the marketing at CD Baby, Breuner remains a musician, and he feels that gives him a unique insight into the process of working with artists.

“I can see things through the eyes of our clients,” says Breuner. “I feel I’m their voice. One of the great things about this company is we really do care. Anyone can call or email and we’ll work directly with them; they don’t even have to be our artists. We have tools to help people in their careers. For instance, I started a podcast in 2007. It addresses the concerns of independent artists, covering things they might not know. All that helps build the community.”

In a business that’s constantly evolving, Breuner understands the importance of keeping ahead of the curve.

“We’re offering a whole suite of tools for independent artists to make money from their music,” Breuner explains. “We’re showing people how to create revenue streams from YouTube and sync placements. We’ve taken the time to build those relationships. And with CD Baby Pro, we’re helping artists collect publishing money. On top of that, we still sell a lot of physical CDs. Our figures were up 15 per cent last year.”

He’s a firm believer in empowering fans, who are the basis of any artist’s popularity. Although it’s something the music industry has long fought, he believes it’s vital – and makes perfect sense.

“There’s a social economy to music, a value in what people want to do with music,” he continues. – ”With a music video, for instance, fans become your marketing department. You’re not only seeding the community this way, you’re opening up areas of revenue, and that’s going to continue and grow bigger. What I’ve learned, and what I try to pass on, is that artists and companies can’t just focus on one thing when there are all these different opportunities. The industry is shifting.”

Some things do remain the same, though, Breuner insists. To become a musician takes time and effort.

“You have to develop your craft and grow,” he says. “Using Facebook and Twitter to help increase your fan base is good, but you really need to grow as an artist. You need to invest time in building an audience. Find ways to connect well and do more of that, whether it’s playing live, or tweeting videos. Use it all to connect, not as a mandatory checklist.”

Breuner has learned just as much as he’s taught and advised, and he’s applied the lessons to his own musical career. Along with releasing tracks of his own, he’s very active with the re-formed Smalltown Poets.

“We got back together and did a Christmas album in 2011, then an EP in 2012, and toured around those,” says Breuner. “I’ve also been in a Britpop-type band called Hello Morning. Their lead singer made a solo record and I play bass for that, too.”

For Kevin Breuer, music is more than a job or a passion. It’s become a calling. Whether he’s in the studio or behind a desk, it’s his life.

“So many people still think all successful artists are on major labels. When I help show them that independent music can be successful, it helps us all.”

Ben Hubbird, Head of Labor Relations & Digital Promotion: Who Let the Music Nerd In? From College DJ to Indie Label: CD Baby’s Head of Label Relations Walks the Talk

“In middle school, I was awkward and nerdy,” remembers Ben Hubbird, now the head of label relations and digital promotion at CD Baby. “Music was my escape. I would listen to bands like Nirvana and Weezer, and they were just like me. I was lucky; where I lived in Eugene we had some incredible record stores and I always listened to our great college station, KWVA. They had a show that was two hours of Northwest music; bands I could go and see the next day.”

In those days, Hubbird had no idea he’d go on to become an advocate for thousands of indie bands in his role at CD Baby. But even then, he knew music would be the central force in his life. By the time he was in high school, he had his own show on KWVA, the first high schooler to do so.

“You had to list 100 bands you wanted to play on the air, and why,” Hubbird recalls. “I really sweated over that. But I made it; they gave me a show”

He also picked up a guitar, playing with friends. Eventually, years down the line, they recorded an album together, although it took the better part of two years to complete the sessions.

“We snatched time whenever we could,” Hubbird says. “Our engineer’s wife was four months pregnant when we began and his daughter was a year old by the time we’d finished it. My buddy suggested putting the album on CD Baby, because we’d get to keep the rights. It was like we were hiring them to work for us. I liked that.”

By this time, Hubbird was living in Portland and working as a political and community organizer. Although he loved the job, it was so all-consuming that it left him no creative time. He quit and went to work in one of the city’s first food trucks, Potato Champion.

“My girlfriend at the time worked for CD Baby,” Hubbird explains, “and she helped get me a job there. I loved the atmosphere of the place and the sense of openness. It was a company that wanted to work with musicians and for them instead of just making them into commodities.”

So, when he started a record label with a close friend, it was a given that he’d use CD Baby’s services.

“It let me experience everything from the other side,” Hubbird says. “We put it through its paces. The label, Party Damage Records, is our hobby; we’ve deliberately structured it so most of the revenue goes to the artists. But doing this has been a great opportunity to eat our own dog food, so to speak—to figure out what we’re doing right as a distributor, and what we can make better.”

The experience has made him an even firmer believer in the company, which has grown to become the world’s largest distributor of independent music.

“CD Baby started the idea of self-releasing on the Internet,” Hubbird observes. “It’s always been the go-to place. What we do now, aggregating all the different revenue streams, whether it’s CDs, digital download and streaming, YouTube, or publishing, we’re giving artists a full spectrum of options in one place. We’ve been the innovators in that. That’s rewarding; being able to help musicians. We’ve always been driven by the needs or artists. Not only do about half our employees work directly with musicians every day, but probably half, or more than half of the people that work here are musicians themselves.”

The nature of his jobs—both at CD Baby and as a label owner—means that he’s very aware of the shifts in the way music is consumed.

Hubbird’s role is the closest thing to an old school record label product manager as CD Baby has. He’s involved with CD Baby artists in a very hands-on way.

“With Head and the Heart,” Hubbird recalls, “they came into the office to hang out on pizza day one time, and I helped them with the transition to Sub Pop after they were signed. And I’ve been lucky enough to work with Henry Rollins. Not only is he a longtime CD Baby customer, we’re also now handling his spoken word material and the self-released Rollins band catalog. He sent me a signed book and a massive ‘Seek and Destroy’ coffee mug I proudly use every day.”

The nature of Hubbird’s job means that he has his finger on the pulse of trends in promotion and marketing as well as what types of music are popping at any given time.

“We’ve seen a shift from the ownership of music to access models like streaming,” Hubbird observes. “The connection with fans is more important than ever. With streaming and sync placements, an artist’s catalog tracks can bring in income; they’ve become more relevant than they were before. Someone hears a snatch of something, for instance, then uses Shazam to identify the song and goes to find it on Spotify.”

Hubbird is still very passionate about music. It remains one of the pillars of his life, the way it was when he was a teenager. But he’s also learned a few lessons along the way.

“I’d advise anyone starting out to be realistic,” Hubbird says. “Making a living as an artist should be a viable career path, but the way things are, it’s not for most people. But there are serious careers in music, not only making music, but also helping artists, the way we do here. Don’t dismiss that. If you love music, look for opportunities. More than anything, though, you have to really love music. If you can walk away from it, if you don’t need to do it, then you probably shouldn’t do it. If you absolutely have to make music, we create and manage services to help you sell and promote it.”

Phil Baur, Director of Distribution: A Rapper on the Inside: A Quiet, Tall Man, Who Helps Tens of Thousands of Indie Bands, Got His Start in Hip Hop

“The Pacific Northwest has a vibrant hip-hop scene,” says Phil Bauer, director of distribution at CD Baby, which distributes the music of tens of thousands of independent musicians and which is known for superior customer service and empowering artists to manage their own careers. “So many great artists.” And he should know; working with different groups, Bauer is a rapper with a long recording and performing history.

The Eugene, Oregon native has been involved with hip-hop since high school, and that’s the ideal complement to his day job. Many of the people that work at CD Baby are working musicians deeply committed to helping other artists.

“People I knew started rapping, and it quickly became something I was investing most of my time in,” Bauer recalls. “I moved to Portland, Oregon, and started working with a hip-hop collective about 10 years ago. Shortly after that we recorded our first album together, and one of the members sent it to CD Baby. They featured it on the front page of the website. I was amazed when I discovered they were in Portland, too. We’ve gone through them ever since.”

Not long after that, his involvement with the company would grow even closer.

“A guy in the group started working for CD Baby. He told me that they held jobs open for staff who were artists while they were out on tour, and we were touring regularly back then. That was ideal for me, so I started working for them too.”

With all the responsibilities of his current job seeking out artist monetization opportunities with services ranging from iTunes and Spotify to YouTube, these days Bauer doesn’t perform as often as he once did, but he says, “I’m still active with the group, and my job is completely immersed in music. I make time for it – just not as much.”

Bauer’s history in hip-hop also helped bring Macklemore’s catalog to CD Baby, long before the Seattle Grammy winner became a huge star.

“I’ve known him for quite a while,” Bauer says. “It’s a tight-knit scene between Portland and Seattle, and we’d do shows throughout the Northwest together. I was so pleased to see him make it.”

He understands that the success of artists like Macklemore is a sign that there’s more quality music in the marketplace.

“I think people are giving it more time in the studio to make sure they produce quality music,” Bauer observes. “And they realize they have to be savvier in promoting their work.”

He’s an ardent believer in the role CD Baby can play for independent artists, acting as a central hub to make their music available and help musicians monetize all the opportunities available to them.

“Our role is to be a one-stop service across multiple platforms,” Bauer insists. “We help them have everything in one place. We have the infrastructure, so they can earn some money and free up their time for their audiences.”

Engaging with fans has always been a vital part of music, and he sees it as more vital than ever before.

“You have to be able to connect with the fans,” says Bauer. “There are going to be new platforms developing, and artists are going to have to respond to them quickly. You have to go where the audience goes. You have to supply them with a steady flow of content, whether it’s YouTube, social media… you have to find a way to connect to them. We are always searching for solutions to make that easier for artists.”

Above all, though, music is at the heart of everything, and he’s a big fan of live music, like the SXSW showcase that CD Baby sponsors annually.

“It’s an important reminder,” Bauer notes, “and it would be a sad state of affairs if we didn’t have events focused on music. The showcase puts our artists in front of a festival crowd and shows that we have great, talented partners. It lets us connect with both the industry and artists, and the artists are always front and center.”

Being part of CD Baby remains a constant learning experience for Phil Bauer. It’s not only taught him about the business behind music, and how it develops and can work for an artist, but also as a musician.

“My focus is more on CD Baby,” says Bauer, “but being an artist is a very close second. I might spend less time on it now, but I’m definitely not removed. I never will be.”