October 14, 2022

Here’s how Magic Mozart NFT will fund artists through micro grants

We believe that each person is created on purpose and with a purpose. No matter how difficult the present may seem, the best is yet to come as long as we persevere. But sometimes we need help and support, whether financial resources to make an investment in our careers, or knowledge to navigate the journey. When I talk to most artists about their biggest binding constraint in launching their musical careers, it's almost always a money issue. 

Yes, some people aren't in a thriving arts scene. Maybe they don't have a great voice teacher in their area, or they simply want to further their education but aren't sure where to start. The nucleus of the barrier to relocate, work with top teachers, and take more courses almost always seems to have some kind of financial competency. Direct funding resources do not currently exist at scale in the opera sector. Yes, large institutions can apply for grant funding from the NEA (National Endowment for the Arts, USA) or large foundations, but individual artists, arguably the heart of culture, do not have access to liquidity. So they work jobs unrelated to their craft, show up to their lessons and courses physically and emotionally exhausted, and the cycle repeats year after year. 

The challenges have only intensified over the course of the pandemic. We surveyed our Living Opera community in 2022, capturing over 300 respondents across the world: 26% said their annual household incomes were between $25,000-50,000 and 43% said theirs were less than $25,000–significant declines since 2019. Moreover, 53% said they have a job outside the music sector, often in a retail, customer service, or administrative occupation, to support themselves — even if such jobs do not utilize their specialized skill set. Furthermore, this financial precarity fuels declines in mental health: 54% reported that they were formally diagnosed with anxiety or depression.

It's worth noting that while all this is going on, critics will say opera is dying. No, opera is not dying, there are actually more singers than ever these days. What is dying is the current model for how we train artists. Many are unaware exactly how we were ever able to produce a Callas, Pavarotti, or a Caruso for that matter. In previous decades, voice teachers would work with singers for free for years, with the expectation of compensation with their protege emerged on the international stage. These gurus would supply their students with as many lessons as they needed. It wasn't completely altruistic of course, they viewed their time spent with the artists as a financial investment in the artist. This is the only model that will ever produce truly bulletproof artists. An emerging talent must have this kind of support to excavate the full weight of their talent. Just like a pro-athlete will be taken under the wing of a coach, so it was in our art form at one time, and the proof is in the pudding.

So what can we do?

That is why we view blockchain technology as a catalyst for positive change in the arts, and we cannot delay any longer. Using revenues from the Magic Mozart collection, we will launch a decentralized autonomous organization (DAO) for grant making, community-building, and education in the arts, starting with and specializing in opera, to award micro-grants to young artists and promote skill acquisition. While our plan is for it to begin as an LLC in Tennessee, we will work on making it a non-profit so that micro-philanthropists can receive tax exemption for their donations to artists.

Arts and cultural institutions received $23.5 billion in charitable donations, approximately 5% of the $484.85 billion in 2021. Unfortunately, these donations rarely flow through to the artists, nor are there any sufficient grant making bodies that can operate at the scale or pace needed to help artists receive the resources they need to become financially independent, let alone succeed. Traditional sources of financing are also inadequate. Since performing artists, at least in the U.S., are nearly always freelancers, bank loans and even rental agreements tend to come with high interest rates because of their perceived credit risk.

Even if a loan were available, consider a singer who auditions and does not end up receiving a contract. Then, the singer would be in an even more difficult situation to repay the loan. That is why we want to meet artists where they are – whether it is an additional $500 to pay for voice lessons or $1,500 to finance a round-trip for an audition. Having invested nearly 30 years cumulatively between the founders in the arts, we know that many artists struggle to obtain the right information and receive proper mentoring.

We want to - and can - fill that void.

A DAO that facilitates micro-grants can operate at scale and at a much faster pace. Thanks to legislation that allows DAOs to receive a similar tax treatment as non-profits, philanthropists who donate to the DAO will have the option of writing the expenses off on their taxes. Furthermore, since the DAO will crowdsource proposals from artists and allow for transparent voting with a clear articulation of the eligibility and criteria, artists do not need to wait months to receive a reply; a grant can be executed within the span of two weeks and the funds transferred directly to the artist.

We plan on allocating 25-50% of the NFT collection profits to building the Living Arts DAO. Expenses include: funding for the disbursement of micro-grants, personnel costs for DAO governors, designing the verifiable credential, legal fees, and more.

Join us on the new journey to decentralize philanthropy within the arts and culture sectors — we believe that blockchain is a tool that can help us as artists receive the proper remuneration for our effort and expand the audiences that we can serve. The Living Arts DAO is our pioneering step in this frontier.

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