In the current digital landscape, it is becoming clear that AI is not something to ignore, and in some cases, where it is assistive, it’s beneficial for businesses to use it for things such as finances, organisation and developing a full business plan with some simple prompts, expanding the idea into a practical reality. There is a large split in the world of people who either think AI is helpful for efficiency and keeping costs down(Gibson, 2024) or that it’s damaging to the environment. Both statements are true, but I think there is a balance on when to use it and how to counteract the environmental impacts that AI can cause. I used Claude to help develop my business idea. It devised plans for things such as app content, additional features, user interface, marketing strategy and what I need to start an app. It also helped figure out ways that I can monetise the idea, which leaves me with how I can push people to pay for the app, Applying relevant theories which is important to solidify the framework of the app, especially when it comes to gaining a further understanding of marketing tactics and consumer behaviour, which influence the way people use the app and whether they choose to keep using the app or not.

The idea

The foundation of my idea is a simple app called ‘Bandsplit’, which helps band members split gig money more easily, with in-app agreed splits done automatically when the promoter/venue pays straight into the app. All band members would have an account and join as part of a band, in which they can see how much money is in the overall account (Appendix A), thereby creating security and accountability between band members and promoters. The other side of the app is for promoters, where they can post gig listings and open applications up to bands/artists. This page will detail where the gig is, how much it will pay, capacity, whether it’s a headline or support slot and how long the set will be (Appendix B), providing all of the essential information that a grassroots or professional band would want. The app would work on a freemium model, which is a term coined by Jarid Lukin, made famous by venture capitalist Fred Wilson (2006), but it has existed since the 1980s. One of the best examples of this model that compares to my business is Monzo Bank. It offers a free version for simple bank transfers, which has its limitations, so it can push users towards payment. They have a tiered payment structure where the different levels of payment provide perks, and it also includes a separate business version (Appendix C&D). Chris Anderson, Author of the book ‘The Long Tail’, wrote another book named ‘Free: the future of a radical price’ (2009), which explains the freemium model as a system where “a few paying customers subsidise many un-paying ones”. The quote implies that not everyone is likely to pay, so balancing the cost with how much the subscription would cost, to make a profit and allow the non-paying customers to use it for free. He also mentions that a lot of people make a business free whilst they figure out if the app is popular enough to push people into payment.

Further theoretical framework

Metcalfe’s Law

Many theories cover topics such as marketing, consumer behaviour, and entrepreneurship, and I’ve narrowed down some theories that apply to my idea, just like the freemium model does. The first theory that I have picked out is ‘Metcalfe’s Law’ (1980), which was later popularised in 1990 as the network effect. This theory suggests that with a specific business, such as mine, the value of the product will increase as the network grows, especially in a digital landscape (Fernandes, 2021). To put this into the context of my business, every time an individual joins, they are likely to bring around 3-5 other people from their band, and this will happen every time someone new joins. To capitalise on this, I would create a prompt after logging in, where it would say something like “your bandmates aren’t on BandSplit yet”. Underneath this prompt, there would be a link that they can put into their band group chat, and when clicked, their bandmates can log in to their account and be put directly into that band’s account. This would hopefully create an efficient sign-up process which exploits the theory behind Metcalfe’s Law. To further this, my app also incorporates the two-sided network theory. This is essentially Metcalfe’s Law, but instead of just bands adding value to the app, it applies the same rule to the promoters and venues side of the app. For example, the more promoters that use the app, the more bands are likely to use it as well, vice versa. Additionally, if more promoters that use the app are successfully finding bands, then it should influence other promoters/venues to join the app.

Hook Model

When discussing consumer behaviour, the Hook Model, developed by Nir Eyal (2019), comes to mind, as this theory finds ways to keep bringing users back to the app with a four-phase process:

Trigger
Action
Variable Reward
Investment

(Tyler Segalla, 2023)

The trigger is something that initiates the process and gets the user to open the app. In most businesses, including mine, this will be a type of push notification which tells the user something that they can look at in the app. In my specific case, there are several different notifications that I can put out, such as a “Ding” sound when money comes in that reads “here’s your money from:___, take a look”. I would also prompt them to look at gig opportunities by asking them what their preferred gig is and then notifying them when something they might like comes up. The idea is that this will provoke a response from the user, pushing them to use the app, which is considered the ‘action’. It’s important that people frequently access the app because it creates value and allows us to monitor app engagement, which Marie Jehanne (2023) says is “critical for understanding user behaviour analysis within mobile apps”, which helps me understand what the best method for user retention is via trial and error. Once they complete the action of clicking on the notification, the next step is a variable reward, which is a very broad term, but in my circumstance, the reward is seeing the money in the account, which is a novelty, as they are no longer worried about whether the money is going to come through or not. The novelty mustn’t wear off, because it activates the dopamine system(Segalla, 2023), causing pleasure, which is why it is essential to create multiple notifications and rewards. The final part is the investment, which can be anything from users sharing their data, paying for the product, or engaging with the product. For instance, I would put an offer at the top of the page after they click on a notification, saying things such as “invite a friends and both get 1 month free”. This, in theory, works because when a user’s dopamine level is high, they are more likely to engage with a product. This is why people impulse buy on sites such as TikTok Shop, which is accessed through the dopamine-boosting app. Ideally, the main focus would be pushing people to pay for the app, as that is the main way to monetise the app. This Theory as a whole is a good way to keep people engaging with the app, which is a priority, as people who continuously use the app may be more likely to pay for it.

Key Marketing Strategies

The Core message is to communicate the three main value propositions, which are transparency, as everyone sees the same numbers, which means that none of the members can lie about the amount of money they got. Fairness, and this is because splits are agreed upon by all band members. And finally, simplicity, which is the main driving factor, because I know, from the survey I conducted, that it is annoying to go through the whole process of splitting money up. Whilst it’s important to have these values, it’s important to market them correctly, using tools and strategies such as word of mouth, funnel marketing, and relatable content on social media.

First of all, the most important place to sell the idea would be on Platforms such as TikTok and Instagram. This is where we are likely to have the most reach, and with consistency and relatability, it could benefit the company massively. Additionally, TikTok has a feature called ‘Creator search insights’, which shows you what is currently trending as well as content gaps(Appendix E), which is more useful than the trends page. For content ideas, I have created a few that I think will tick the boxes:

skits of a band member coming up with excuses to hold onto the money (done by a known content creator)
educational pieces on how money is usually split, and the mess it can create.
honesty on the hard process of building an app
Post a scenario for the comments to debate. e.g. 4 band members, but the drummer drove, should they get more of the split? (creates engagement, meaning the algorithm might bring them back to our page.
When a beta version of the app is created, present an example of the app working.

On TikTok specifically, this should work well because, as quoted here, “Polished content creates distance. Relatable content closes that distance” (Vert, 2025). The humanisation of the content provokes a response from the user, which is usually with a like or comment, and this tells the algorithm that this content is worth pushing into their “For you page”. When it comes to Instagram, it is a similar process, but the average demographic of the users is different, as well as the algorithm. For example, TikTok algorithm prioritises the more raw, viral trends, whereas Instagram tends to push the more high-quality and valuable videos. Attached is a more detailed comparison(Appendix F). One aspect that would be continuous throughout the two apps is that content and marketing would ideally start before the app is even built. I would get all of the legal framework to start it, and then start marketing it as a company that “needs your help!”

For marketing theories, the go-to in this scenario is Funnel marketing. It is a great way to map out what needs to happen to get consumers from a “what is it?” ideology, all the way to a paying customer. The funnel was first visualised in the book, ‘Bond Salesmanship’ (Townsend, 1924). The most popular version of this is the AIDA model, which means Awareness, Interest, Desire, Action. There are different ways to interpret the funnel, such as the four categories I am applying:

Discovery– This means when someone comes across our social media page or sees a flyer. If the videos are correctly done and create desirability, a finite number of people will move to the next stage.
Interest– The next stage. It’s the point where people who enjoyed the content will actively go to the website or maybe download the app to see what it’s like, especially since there’s no obligation to buy it. This is the part where building trust between the user and us is the most important.
Invite– At this point, the user has looked around the app and found out more about what it can do, and they will most likely invite their bandmates to test it out fully if they like it. Then, they might even tell their friends and family about it, which is Word of mouth, a very powerful marketing tool.
Upgrade– Now they have had time to use the app, build trust, and keep revisiting the app, then they will get to a point where the free version is limiting, in which they may be inclined to upgrade.

This method is only useful if there is a motivation to put it into practice because the process is not going to happen by itself. For the first step of discovery, I need to present the app as a useful thing, whilst boosting the profile with accessible content that will evoke varied human emotions. To push it to the interest phase, I will need to keep putting links to the website and the app so that it is easily accessible due to the low average attention span of contemporary society. Once there is a narrowed selection of consumers, as a result of the first stage, then it’s about making sure the website is always visible, and this shows that there is interest in the app. An easy way to do this is by having friends and family fill out a survey, which I recently did. This checks off the discovery and interest at the same time because I made people aware of the app and got to know if it is something worth following through with. If the people who have gone through both stages have downloaded the app, then they will be encouraged to invite band members to use the app to its full potential. They can use the app without inviting, but once users look through the app, they will realise the main purpose is to have other people on it, and this is why the network effect works so well. To move them to the next step, upgrade, it is going to require some kind of limit on how many times they can use certain features. This will hopefully motivate them towards realising that it is worth paying for, especially with the perks that could be on offer.

Does this idea work in practice?

After the secondary research, looking at theories and marketing tools, I have explored ways to develop the idea and make it an attainable business, especially as I look further into how to the logistics, such as the legal framework, financial possibilities, and the different options I have to build the app. Additionally, I have conducted some primary research to assess whether my business plan aligns with market needs and if there is desirability for the product. For the primary research, I created a survey and encouraged all musicians I know to fill it out, which would help me understand who is more likely to pay for it and why. Furthermore, I completed a SWOT analysis, which can be really helpful for calculating what my business has that is missing from other businesses; it also helps me realise the risk that comes with it, whether it is something I can control or not.

Survey

To go forward with a business, it’s important that the idea is actually going to benefit the target consumers and fill a gap in the market, which is why I created the survey. The questions were partly demographic questions, such as Age and Level of musician, followed by questions about opinions on the idea, if they would pay for it, and if not, then what would encourage them to pay for it. The results that came back were quite positive (Appendix G). I managed to gather 19 responses from different levels of musicians, mainly around the grassroots and semi-professional levels, in which the large majority said they would be interested with enthusiasm, with only 1 maybe and 0 no’s. Whilst it is only a small proportion of musicians, it is still very revealing and beneficial to my business. I prefaced that it would be a similar payment structure to Monzo before asking if they would be willing to pay for the service; I attached an example of what the offers would likely be (Appendix H). As expected, the results showed that 79% of them said they would be inclined to pay for something like this, while the others were leaning towards an unsure answer, but no definitive no’s again, which is a good result. This research is perfect for understanding whether my business meets the demands of the current market and how to capitalise on the gaps, and now that I have received positive results from it, I can plan the next steps. The survey results confirmed that a good number of bands would be open to using the app, which, if we link back to the two-sided network theory, the more bands I can get on there, the more it will increase the value of the app for promoters. Something that I should have mentioned in the survey, bands only have to pay one subscription, meaning that they can all split the £7.99 between them, which makes it much cheaper for them and makes it more likely that they would pay it, and this is a part where the network theory works on another level.

Legal Framework

One of the most important parts about building an app that handles money is making sure it is licensed properly, which is why I will need to use a third party, such as Stripe Connect, which is a legally recognised way of embedding payment/money moving into an app. There are other recognised choices, such as the FCA, which is what most of the well-known banks use. The FCA costs significantly a bit more than Stripe does, hence why I would be using the latter. There are additional considerations when money is involved, especially when I think about one of the main reasons the app idea came about, which is making sure that Artists do actually get paid. My initial solution to this was to take action on the artist’s behalf if the promoter fails to pay, but after thinking about it, it is a risky thing to promise. It’s also very expensive and would require having the authorisation to do so. However, whilst I may not be able to take legal action on their behalf, I can provide a paper trail for artists and promoters which will equip them with all they need in a small claims court, assuming they need to. Furthermore, it’s important to include in the T&Cs that promoters will have to pay the artist, unless the gig doesn’t go through, which means that they are contractually obliged to do so. As a final layer of protection, I would enforce the use of Escrow, which is a third-party company where the money is held between the two sides. The idea would be that the band and promoter agree on the gig, and the money would go into the Escrow at the point of agreement. It is held in the Escrow until the gig is finished, at which point it will then go into the band’s account; if the gig gets cancelled, then the money goes back to the promoter. So while I can’t directly get involved, I can provide users with the legal backing to make sure people get paid, whether it’s internally in the app or in a small claims court.

SWOT analysis

Some significant questions that all businesses have to ask themselves are what the strengths and weaknesses are that can be controlled, and how they can capitalise on the opportunities provided while being cautious of the external threats that may come. This method is often used in the early stages of business planning, and at this stage it is quite beneficial because, as Alison Lipson (2023) says, A SWOT “helps increase awareness and planning to help fine-tune any company’s business strategies and create situational awareness”. Whilst I will explain most of the SWOT analysis, I had AI create a visual with the information that I gave it, just for better understanding (Appendix I).

Strengths

One of my strengths is that I have the advantage of being the first person to create a purpose-built app like this. The only competitors I have are on opposite sides of the spectrum. For example, a traditional bank is considered a competitor, but it’s not really fit for purpose, whereas on the other side, there are things such as Splitwise, which is mainly built for splitting money on holidays between friends. This is good, but it also leaves a big threat, which I will expound on later. Another strength is the extra layer of protection when money is involved, as mentioned before, where I can provide things such as Escrow and a paper-trail, along with a contractual agreement signed by both parties for legal backing. Additionally, a strength that brings people in links back to the network theory, because every signup could bring in multiple others. This is important for gathering data to improve the app and help it grow.

Weaknesses

Every business comes with unique weaknesses, and mine are mostly focused on the difficulties of building an app, especially one that handles money. First of all, building an app from scratch is very difficult and costly. I have no experience in building an app, and it would take a long time to learn. So some alternative options to resolve this would be either hiring a freelancer to build it or bringing in a co-owner who believes in the idea and can build the app. Both of these options cost money; the first option would be a one-off, upfront payment, but it would be a significant amount. On the other hand, having a co-owner means giving up a percentage of the company’s profits, which probably wouldn’t be much for the start, and if it were to be successful, could end up costing far more than a freelancer. Another issue I could face would be the legal side of regulating an app that holds money. As I mentioned before, there are ways to do it, such as FCA protection and Stripe Connect, which is cheaper and more efficient for my business. The main issue that links all of these together is money. Building an app like this costs a significant amount of money, and it’s not the only cost, either. The approximate cost breakdown (Appendix J) explains the rest of the costs, such as operational costs like keeping it on the app stores. The cost breakdown was made by AI as part of the last section, where I talk about how AI developed the idea.

Opportunities

My business is in a good position because the market is so large, meaning that there is a bigger chance for success, even if I were to narrow down the target audience. At the moment, the target audience is just musicians, which is a very large net, as there are approximately 180,000 musicians on PRS for music alone, and this excludes the millions of indie bands across the world. This gives us a lot of room to narrow down the target demographic so that we can start with loyal customers and build our way up. Assuming the app grows, it provides new opportunities, such as expanding to different strains of the creative industries. The app could expand to benefit groups like Podcasters (a growing industry), film crews and maybe even sports teams. It doesn’t really have a ceiling on who it could benefit, but I would probably limit it to these kinds of industries. Finally, there are opportunities to integrate this app into others once it reaches a certain height. There is a chance that the app gets connected to and used by companies like Spotify and Distrokid. This is less likely to happen as they already have their own ways of distributing their royalties, but I wouldn’t rule the idea out.

Threats

Threats are External factors that could cause issues, and whilst they are out of my control, I have to plan for what I can do in case these things do happen. One problem, which links back to the downside of being the first company to do this idea, is the fact that bigger companies, such as Monzo, could easily replicate it, and probably to a better standard. This is why I want to make it as good quality as possible upon first launch. Another threat that has become more prominent as a consequence of COVID-19 is that the gig economy slows down due to something like a pandemic. Results collected by UK Music (2021) show that the music industry’s economic contributions dropped by 46% due to COVID-19, when big and small live shows were completely cancelled. The reason this poses such a threat to my company is that the entire backbone of it is built on people doing gigs and being able to find live shows, so if something like this were to happen, then it would be a massive issue.

Conclusion

As mentioned at the beginning, my idea was initially to build an app that simply creates a more efficient way for bands to split gig money. However, after inputting the idea into AI, it developed into an idea that has the logistical backing to put the idea into practice, and it also helped me figure out how to do things, which I wouldn’t have known before. The AI did have some disadvantages. For instance, it gave some slightly incorrect information, which is why I made sure to fact-check it before taking its word. However, for the most part, the information it gave me was relevant and useful for improving the app features and marketing plans. I started by telling AI my idea and then asking it to help with the business plan, in which it explained what the problems with the current process are, how my idea solves them, and it devised an in-depth plan for the next 12 months, including my next three short-term steps (Appendix K). After reading through the plan, I asked it to create a marketing plan, which I went into detail about earlier. The AI gave me the initial framework for the marketing plan, as well as theories, which I then researched so I could understand them and implement them into the marketing of the business. I then asked how I could make it worth it for the user to pay for the app, and after I gave some of my own ideas, it applied them to its own ideas and merged them to create the visuals back in Appendix H. At that point, I told it that I wanted it to be a two-sided platform where there was a band side and a promoter side, which, in (Appendix L), is an example of what that would look like. Within that explanation, the AI suggests that I should not build both sides at once, which is something that I will start with as a beta test, but I don’t want to wait too long before adding it because it is quite an important part of the two-sided network structure that helps carry the company forward. As I mentioned before, I asked AI what it takes to actually build an app because I have no idea how to do it myself. It replied with some useful insights for when it gets to that stage, such as the different methods of using either a freelance developer or a co-owner with app-building knowledge. Then I questioned how I can protect artists from non-payment, and it answered with the previously mentioned solutions, and this also sparked my idea to introduce Promoter and band ratings, so that it becomes easier to trust them or see if there have been issues in the past. I can also, according to the ‘Late Payment of Commercial Debts Act’ (1998), charge up to 8% interest on overdue payments, which is an idea I got from the AI. Overall, my initial thoughts of AI were that it was going to spread misinformation and tell me what I want to hear, which, to an extent, it did do, but on the other hand, it was very insightful and helped me develop the idea to the point of action being the next step.

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Appendicies

Appendix A