On a cold, rainy Tuesday night in Sydney’s Dulwich Hill, most of the shopfronts are dark, but one is shaking. A small crowd is absorbed in a set by local band Entertainment Quarter, performing behind a shelf of records and T-shirts, in a space that used to be a butcher’s shop. It is so intimate that the band greets new arrivals with a friendly “hello” as they step through the door. Among the posters plastered across the walls, one stands out: a call for patrons to become members for $15 a month to help keep the not-for-profit venue, Lazy Thinking, alive.

Founder Jim Flanagan launched the venue’s membership model in June, citing average losses of $1,000 a week. More than 100 people have since signed up. The aim is to reduce the venue’s reliance on bar sales – a business model Flanagan says no longer adds up for grassroots live music venues. “We sell drinks and hamburgers, and we take a small portion of ticket sales,” he says. “Those income streams have never been enough to cover the cost of running the venue.”

Flanagan believes the broader shift in drinking habits “is largely a good thing for the world” but the impact of people drinking less means even a full house doesn’t guarantee breaking even. “We will often have a full, potentially sold-out show and we will make $400 at the bar, as opposed to maybe 30 years ago – a show like that would make $3,000-plus.”

With a standard $15 door price for every show, members are still counted as full-paying fans, so artists receive their usual cut of ticket revenue. Alongside it, Lazy Thinking has launched a fundraising campaign to support initiatives including artist residencies. Flanagan sees the model as a necessary experiment at a difficult moment for the sector. “It’s just horrifying how many music venues, both in Sydney and the country, are closing,” he says. “It’s a bit of an apocalypse out there.”

‘For a lot of people, it’s like their other lounge room’

According to Apra Amcos, the Covid-19 pandemic wiped out about 1,300 small and mid-sized live music venues – roughly one-third of the sector. Those that remain continue to grapple with rising rents, insurance premiums and other operating costs, which has also affected band rooms and rehearsal studios.

In May, Sydney venue Mary’s Underground announced it would close after seven years, citing financial pressures and declining bar sales. Against that backdrop, venues such as Lazy Thinking are rethinking the economics. “I don’t think the ancient model the live music industry is built on – by which artists get the majority of the door, and the venue basically survives by selling beer and chardonnay, is viable,” Flanagan says. “We need alternatives.”

In Melbourne, where, according to a Music Victoria live music audit, venues hosting at least one gig a week had declined by 25% between 2019 and 2023, rock’n’roll haven Lulie Tavern decided to launch its own membership program last July.

It has more than 500 members, who pay $30 a year for perks including parties, a weekly jackpot and discounted tickets to its annual LuliePalooza block party.

Almost all shows at the Abbotsford venue are free. Co-owner and band booker Asia Kwin Taylor says: “For a lot of people, it’s like their other lounge room.” Fellow owner Jon-Lee Farrell says the membership club grew from a simple question: “What does sustainable mean to us?” Faced with less predictable attendance, declining profits and “hard meetings” every week, the extra revenue from memberships “just takes a tiny bit of pressure off”, he says.

The membership has also created a sense of belonging among regulars. “Seeing people [with] the little Lulie Lovers keychain hanging off their belt buckle – it makes me so happy,” Kwin Taylor says.

‘There have been lots of times I’ve wanted to throw in the towel’

In Queensland, the founders of Mo’s Desert Clubhouse in the Gold Coast suburb of Burleigh Heads built adaptability into the venue’s business model from the start, with podcast studios, rehearsal spaces and a live-streaming channel alongside their live music program.

After surviving Covid by storing soap for a neighbouring factory, the venue is confronting new pressures. Co-founder Kimberly Ferguson, who goes by Kimbo Slice, points to the venue’s industrial estate location, the Gold Coast’s early-morning beach culture and reduced alcohol sales. “Dry January has extended this year to June,” she says.

A typical week of programming might include a former Australian Idol winner, a metal show, a surf-rock lineup and a standup comedy night. “We really honestly can’t diversify any more than we already do,” Ferguson says. “We’re holding on right now by our fingernails, as I know all venues are. I think that the only reason we’re still here is because of that versatility.”

Mo’s is preparing to launch its own membership program and Ferguson is lobbying the local council for greater support: “Something has to change, or there will be no future independent venues on the Gold Coast,” she says. “Everything’s going up, but the sales are coming down.”

In Cairns, Sky Rixon runs the city’s last remaining independent music venue, Elixir Music House, which she opened with her parents after moving north from Sydney in the 2000s.

Over the years, Elixir has teetered on the edge of survival, from fighting off noise complaints from a neighbour through a petition that attracted almost 7,500 signatures to grappling with changes in consumer behaviour. But Rixon says another barrier often goes overlooked: land use rules that make it difficult for venues to adapt quickly. “There’s a step before we all start talking about having hybrid businesses,” she says.

With her public liability insurance costs rising by more than 1,100%, Rixon is now working to establish an Australian arm of the UK’s Music Venue Properties initiative, which buys grassroots venues to secure them as permanent cultural spaces.

“There have been lots of times I’ve wanted to throw in the towel,” Rixon says. But what keeps her searching for solutions is the community itself and the feeling of “being under the same roof as other people, experiencing that one beautiful moment that nothing else can give”.

‘I’m optimistic that we’ll find a way’

As squeezed margins at grassroots venues flow through to artists, others are trying to strengthen different parts of the music ecosystem. In June, musician Nicole Munnelly launched Second Press, an independent Australian streaming platform that returns 85% of its revenue to artists.

Meanwhile, not-for-profit gig guide SydneyMusic.net is focused on getting more people through venue doors. “Coming out of the pandemic, we realised that actually now we were dealing with a demand problem,” says co-founder Joe Hardy. “If we make it easier to find events, surely it’s going to get more people out to shows – and we’ve definitely had that theory proven many times over.”

Before its submission to the New South Wales government’s social issues committee, SydneyMusic.net found 84% of users surveyed said the gig guide had encouraged them to attend more shows. The organisation has also launched an initiative called Every Corner to spotlight community-led gig guides around the country. But after narrowly avoiding closure in 2025, SydneyMusic.net has again turned to fundraising. For Hardy, remaining a not-for-profit is non-negotiable: “It’s uninfluenceable. You can’t buy a better spot in the gig guide.”

Hardy believes the increasingly creative ways venues are adapting speak to deeper structural problems in the broader music industry.

“Everyone is just chasing the short dollar rather than thinking deeply about what sort of investment is required to rejuvenate,” he says. “That is such short-term thinking that’s going to further kill music more than it’s already been killed. We really want to be part of a bigger ecosystem that’s thinking about how the change needs to happen.”

For Flanagan, the industry’s willingness to experiment is cause for hope: “Whilst this is the toughest I could ever possibly imagine it being for live music operators, I’m optimistic that we’ll find a way.”