Bandcamp Founder Explains Long-Term Community Building | How I Built This with Guy Raz | NPR

Diamond says Bandcamp sells music directly from the artist and the whole company is built around artist welfare. There is no advertising and little focus on subscriptions, only a small revenue share on each sale, so the company earns only if artists earn.

In 2007 bands built custom sites at great expense or used MySpace, where it was the platform's logo, advertising and traffic. Writers had easy tools like blogging platforms, but musicians had none, and he wanted to solve that.

The conversation starts with an approximate 85 percent figure, but Diamond clarifies that after processing and platform fees artists received about 82 percent on average, varying by transaction size. He describes typical payout timing as 24 to 48 hours. These are 2021 figures, not current terms.

Outside money can push a company toward growth at all costs. Reaching profitability let the team keep control and be sure the mission would last long term.

He says trouble starts when what a company says it is for differs from how it earns, as in ad businesses where sales pushes more ads into the product interface.

Bandcamp launched ticketed live streams in roughly six to seven months. Merchandise sold during shows made up around 30 to 40 percent of a show's revenue.

Diamond says he initially avoided social features after seeing spam on MySpace. As the catalog grew, fans asked to find more music. Bandcamp built collections around actual purchases rather than likes, and Diamond says that community discovery had become an important source of sales.

Diamond describes Bandcamp Friday as waiving the company's revenue share, not every processing fee. He says the days encouraged artists to tell fans about direct support, with awareness carrying into other days. He reports a positive net effect rather than treating fee waivers as automatically costless.