The story of Righteous Babe

The story of Ani DiFranco and how she and her partner Scot Fisher built Righteous Babe is a wonderful story about building artistry through a sense of community, the creativity to do so, falling in love, breaking up and the re-birth of relationships and the company. This story appeared in INC magazine and was written by Bo Burlingham, editor at large for Inc Magazine, who also wrote a book about companies that choose to be great instead of big called Small Giants. Righteous Babe fits right into this category!

Ani DiFranco is sitting in her dressing room at the Chicago Theater, six hours before a performance, and she wants to set the record straight. Money, she says, had nothing to do with her decision to reject all those offers from major record labels and start her own business. Nor did she turn down the offers out of fear of losing her artistic freedom. So what was it, then? “I didn’t want to participate in what big corporations are doing to society,” she says. “My decision not to work with a major label was not about me. It was about something bigger than me.”

There are, in fact, quite a few things bigger than Ani (pronounced ah-nee) DiFranco. She is, well, diminutive, although she hardly seems that way when she comes charging onto the stage at the start of a performance, her brown dreadlocks flying, her guitar blazing, her body twisting and turning in a blast of energy. Legions of fans can’t get enough of that energy and the music that goes with it. And yet, for all her artistic success, it’s often her commercial ventures that get attention — much to her chagrin. When Ms. focused on her business prowess in citing her as one of “21 feminists for the 21st century,” she fired off a letter of protest to the magazine’s editor: “Imagine how strange it must be for a girl who has spent 10 years fighting as hard as she could against the lure of the corporate carrot and the almighty forces of capital, only to be recognized by the power structure as a business pioneer.”

It is, however, a designation she can’t escape. Her record company, Righteous Babe Records, is one of the few successful artist-created labels around, having sold more than 4 million of DiFranco’s records and put out CDs by more than a dozen other performers. And it’s no ordinary company. In an industry dominated by giant corporations, Righteous Babe has the look, feel, and smell of a small hometown business. Staff members, for example, respond with handwritten notes to the thousands of letters the company gets from its customers, DiFranco’s fans. In return, the company elicits a level of devotion seldom seen in business. Customers go out of their way to protect it, patrolling the Internet and reporting on websites that try to sell unauthorized recordings of DiFranco’s music. Some fans are so passionate about the business that they come from as far away as Australia and Switzerland, not to see DiFranco perform, but to visit the company headquarters in Buffalo. “I’m standing here in total awe,” wrote one visitor from Los Angeles in the guest book.

And it’s not just the fans. Talk to the company’s record distributors, its printers, the manufacturers of its CDs, the concert promoters, not to mention its employees, and you realize that DiFranco and partner Scot Fisher have tapped into one of the most underappreciated forces in business, namely, the power of community. To do that while maintaining great margins is quite an accomplishment — especially for a company whose CEO believes, as DiFranco sang on a recent album, that “capitalism is the devil’s wet dream.”

Scot Fisher is a tall, quiet, somewhat diffident man who works out of a cluttered office at Righteous Babe’s headquarters. At 43, he still dresses like the construction guy he was when he first met DiFranco. Although he is usually referred to as her manager, the term does not do justice to the role he plays in her business life. Besides looking out for her career, he is the chief architect, co-owner, and operating head of Righteous Babe and its six component businesses, including a touring company, a retail operation, a music publisher, a real estate developer, and a foundation, as well as the record label. Together they do about $5 million in sales, mostly from DiFranco’s CDs and her touring. (Profits are harder to figure but probably run a bit less than $1 million a year.) Yet another venture, a concert venue, will open next spring in a restored church down the block, which will also house a jazz club, an art gallery, and the headquarters of Righteous Babe. In addition to complementing the other businesses, the concert hall represents a hedge against the uncertain future that Righteous Babe and all record companies face these days. “I’m in the buggy business, and it’s 1905,” says Fisher. “It would be insane to count on CDs being here in 10 years.”

“I’m in the buggy business and it’s 1905. It would be insane to count on CDs being here in 10 years.”
He wound up in the business almost by accident. Back in 1988, he was the co-owner of a small construction and housepainting company, and he’d recently moved into an apartment that the girlfriend of one of his partners was sharing with a woman she’d gone to art school with, an 18-year-old folksinger. One evening, he went to see his new housemate perform at a local bar. “It was sort of obligatory,” he says. “Then she started to play.” Nine years her senior, Fisher soon became DiFranco’s confidant and mentor. Along the way, they fell in love. At some point, Righteous Babe entered the picture. “In the beginning, it was more of a joke than a real business,” DiFranco says. “You know, ‘Yeah, uh-huh, I got a record company. You’re looking at it.'”

In retrospect, it’s not surprising that she would gravitate toward entrepreneurship. She’d been figuring out how to make her own way in the world from an early age. At nine, she was spending Saturdays busking at the local farmers’ market. At 12, she was making and selling cards of pressed flowers to earn money for horse camp. At 15, when her parents divorced, she moved out and lived on her own, largely supporting herself. Only once, in 1991, did she come close to signing with an established label, backing out as soon as she read the terms of the contract.

And yet, even without a contract, her fame spread. By the end of 1993, she had released five albums under the Righteous Babe label, and they were setting sales records at the folk festivals where she performed. Thanks to her constant touring, she was developing a loyal following, especially among young women, many of them lesbians who identified with her feminist lyrics and considered her one of their own. But Righteous Babe existed pretty much in name only. It had no structure, no organization, no full-time employees, and no office. DiFranco’s albums were getting very little radio airplay and couldn’t be found in most record stores. On top of that, she’d had a major falling-out with her business manager.

Into the breach stepped Fisher, who had been studying law while DiFranco was working on her music career. “I figured I could always be a lawyer,” he says. “When would I get another chance to manage Ani DiFranco?” DiFranco, for her part, had doubts about having her lover take charge of her business affairs. “In the end,” she says, “he just sort of declared himself my business manager.” Fisher says they had an understanding that he’d step aside if it turned out he was wrong for the job.

There was, in fact, little reason to believe he was right for the job. He lacked experience, credentials, and credibility in the music business. “It took [Ani’s agent] Jim Fleming a couple of years to tell me that the first time I called, he thought, ‘Omigod, it’s the boyfriend.'” Fisher says. “But I knew where I stood. I knew people didn’t respect me. I’m from Buffalo. I’m used to it.”

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