How Charta Is Revolutionizing The Contract Creation Process Within The Music Industry [INTERVIEW]
Charta’s ambition is to turn contract negotiations into a conversation.
Whether you’re teaming up with an artist to produce their forthcoming release, or are hiring a mixing engineer to work on your own single, having concrete terms laid out and a contract signed is paramount. Unfortunately, the current process of contract creation is jarring and convoluted, taking months to complete and oftentimes coming at a cost in the range of a few to 5 thousand dollars.
Newly-launched platform Charta aims to remove the friction that comes from contract drafting and negotiations by saving legalese for the very end of the process, and letting the two parties come to an agreement within the platform in a plain and lightning-fast manner.
Charta’s transparent and simple process aims to solve a common pitfall within entertainment law: the way “lawyers gatekeep contracts” in co-founder Zach Bohlender’s own words.
Contracts are very dense and creators interact with them so infrequently that they are unaware of all the terms. Lawyers will oftentimes add many more clauses after the two parties have agreed on their small set of terms, and will then hash it out in a manner that is fragmented and has very little clarity for the clients.
“The way Charta works is that each party goes through a plain English questionnaire and fills out their preferred terms. We compare those answers and show you in the platform exactly where you don't align. You can then negotiate back and forth using the platform, and the moment that you've come up with one set of terms you both agree to, you can view the final contract and sign an auto-generated law firm-quality document that reflects exactly what you and the other person agreed to,” explains Zach, who has worked with the likes of Metallica, Dr. Dre, Frank Ocean, Tyler, the Creator, Calvin Harris and many more throughout his career as an entertainment lawyer.
Alongside the minimum cost and easily digestible process, Charta’s unmatched speed is an impressive feature, which is bound to position the platform as a game-changer within entertainment contract drafting and copyright assignments. As co-founder Arash Rashidi explains, they have been able to reduce the average time a user can get through the contract creation questionnaire from 30 minutes to only two.
“We really want it to be at the point where you can get an agreement done before you leave the studio, where you can be like: ‘we're gonna release this track tomorrow, let's do it.’ If it's hip-hop, for example, things just move so fast, if you have a hot track, you're gonna put it out as soon as possible,” says Zach.
“You're not going to wait six months for your lawyers to do the clearance agreements, you're just dropping it. And you could actually accommodate that release timeline using Charta, which no one can beat, period.”
At the moment, Charta’s service offers agreement options for a featured artist, producer, mixer, and mastering engineer, and aims to add a work-for-hire agreement and a publishing split agreement soon. As Zach explains, however, the entire entertainment industry relies on monetizing copyrights; whether it’s video games, merch design, visual art, or anything else. Each of those industries depends on people collaborating to create art, but ultimately one person or entity has to monetize the creative output. Thus, after having tackled the music industry, Charta aims to move into other fields within the creator economy.
“There's so much shared DNA across the entire creator economy that we're going to lean into. We're going to try to become that gold standard for these types of very simple copyright assignment agreements across the entire creator economy.”
Despite all this revolutionary work on the individual front, Zach and Arash are not only viewing Charta under the lens of a consumer-facing product, but actually consider it a B2B SaaS company that scales from individuals all the way up to enterprise. By adding the legalese at the very end of the process, Charta is data first. And as Zach explains, one of the big challenges in legal tech at the moment is extracting data from contracts.
“Contracts have an incredible amount of data. They have business rules that have to be followed, but it's all locked into a PDF that is not actionable whatsoever. It's just useless, really. The beauty of our process is that it unlocks so many other things down the road. Because we put the legalese at the very end of the process and just work with the data that we're given, we're able to take that data and export it to partners that we collaborate with.”
Yet, Charta’s future plans extend even further. They are planning to translate the entire service into different languages, allowing two people to negotiate via a UI that accommodates the preferred language of each. They are also working towards implementing web3-based technology into their backend, which, using the blockchain, will allow people to unlock automated and instant royalty payments. In Arash’s words:
“Imagine a world where you're not waiting six to nine months to get paid out by Spotify. You get paid out instantly. Someone streams your song and that fraction of whatever they were going to pay you shows up in your bank account.”
Charta has been in development for two years now, and is already revolutionizing the way contract creation is being approached within the music industry, and the entertainment economy at large. As the company grows and more features are added, we are excited to continue following them and witness their impact within the artist and creator community.
Find out more about Charta via its website here.
