The below was originally published in our weekly editorial and database email digest, which connects the dots among the latest music/tech news as laid out across our suite of member-exclusive databases.

Music/Tech Investment Dashboard

Exits: Apple strengthens its music/tech muscles

We added Apple’s AI Music acquisition to our Exits table. AI Music is a startup founded in London, UK, in 2016, whose proprietary “Infinite Music Engine” tech facilitates adaptive audio solutions for brands and marketers. Their site appears to be no longer active.

• We’ve covered both smart speakers and health/wellness apps as potentially high growth opportunities for the music industry, especially from a partnership and discovery perspective. Both trends are also directly connected to generative, AI-facilitated music experiences (e.g., ambient, context-aware sounds delivered through smart speakers for focusing and relaxing, or adaptive remixes to accompany workouts, meditations and other fitness activities).
• Apple happens to be at the center of these commercial opportunities, so it’s not surprising that speculation abounds as to what the big-tech company will do with its new AI Music acquisition — from adaptive soundtracks for Apple Fitness+ subscribers to real-time ambient sounds delivered through HomePod, to audio advertising matching listener context to audio content.

New investment funds: Sony opens up investment opportunities for creators in India

Sony Pictures Entertainment and Sony Music Entertainment partnered to form Sony Entertainment Talent Ventures India to create co-investment opportunities for celebrity talent, including actors, musicians, athletes, gamers and content creators in India. This co-venture will focus on metaverse solutions, brand partnerships, and management.

• The focus on metaverse solutions is notable, especially considering that in all of 2021 we saw just one company from our Artists on Cap Tables database with a focus on the metaverse: Irreverent Labs, which named electronic duo The Chainsmokers amongst their investors. So far in 2022 there hasn’t yet been much publicized activity around celebrity investments in metaverse startups, although influencer-style metaverse partnerships are plenty.
• Partnerships like the one between Warner Music Group and Sandbox that was announced last week will likely lead to more celebrity investment activity in this category.

Funding rounds: A rare data-analytics raise

Slovenian music data analytics startup Viberate raised an additional $3.5m in its latest Series A round (investor names unconfirmed) for a total of $15.5m over four rounds. DJ Umek founded the company with managers Vasja Veber and Matej Gregorčič in 2015 to provide music-industry professionals with an array of data points and analytics around audience demographics, tickets sales, streaming and social media.

• This appears to be the company’s first funding round since late 2017. We have seen less funding in the music data analytics category as of late, but this investment may indicate an opportunity for startups to address data needs in the music industry that are still going unmet.

Music/Web3 Dashboard

Music NFT platforms: More scams to watch

Following the teardown of HitPiece last week, our community is on high alert for other platforms that may be taking similarly uncouth approaches to music NFT releases. That vigilance brought NFT Music Stream to our attention last week. In a near-identical structure, the company is taking an “opt-out” approach to their music NFTs, and allegedly blocking the artists on Twitter who ask them to remove their content from the platform.

• As we covered in our digest last week, John Legend joined the relaunched OurSong platform to make it easier for artists to mint NFTs, signaling the need for a more accessible solution for Web2 artists to enter Web3. Unfortunately, by sidestepping an artist’s consent, NFT Music Stream’s business model skews the value proposition of NFTs by painting Web3 in a negative light, further pushing away artists who had already been reluctant to experiment with Web3 thus far.

Music NFT drops: Continued momentum in royalty- and live-centric use cases

We added about a dozen new NFTs to our database this week, including drops by Vérité and a collaboration between ecodao and BRUX.

Vérité partnered with the platform Royal to release three tiers of NFTs, providing the purchaser a fractional percentage of streaming royalties on her song “He’s Not You” from 2021. The drop sold out all 505 tokens, capturing 39% of royalties on the song for a total of $90,000.

• Vérité was an early adopter of NFTs, releasing her first precisely a year prior on February 9, 2021, on Zora for $100. She has released other NFTs on Catalog (which runs on the Zora protocol).
• We covered the topic of fractional royalty ownership in chapter 2 of our Season 1 collaborative report on music and Web3, which questioned whether the use of NFTs to share royalties with fans was compatible with the entrenched complexities of the global music copyright ecosystem. Despite this complexity, companies like Royal have already raised tens of millions of dollars off the backs of the assumption that NFTs will serve as an effective bridge between Web2 and Web3 monetization systems for music. Whether this thesis is sound remains to be seen, especially in terms of expectations versus reality around collectors’ return on investment.

ecodao’s sellout of a collection of music NFTs on Mirror throughout the past week, in partnership with independent artist and FWB fellow BRUX, is another interesting case study we’re monitoring. ecodao, a DAO formed in fall 2021, releases artists’ work in limited editions for DAO membership, with revenue divided as 50% going to the artists, 25% to ecodao and 25% to an ecological organization of the featured artist’s choosing. Ownership of the NFT also unlocks admission to an in-person event, the first of which will take place at ETHDenver this weekend.

• At large, we’ve been noticing an emerging trend in recent weeks toward NFTs unlocking in-person experiences. For example, Coachella’s big NFT collection auction, which has run for the last week, includes substantial in-person perks like lifetime festival passes, dinners and private parties (at the time of publication, the rarest NFTs have a floor price of $500,000 each).

Niche Streaming Services Dashboard

We’ve made the first new addition to our database on niche streaming services in a while: Fellow music & tech enthusiast Rivers Cuomo has spent the last few years developing his coding skills through an online Harvard course. Last week, he unveiled his 2021 #pandemicproject, Weezify, a hyper-niche streaming service that hosts thousands of Cuomo and Weezer demos created between 1975 and 2017 to both iOS and Google Play stores.

• The launch of Weezify is part of a larger direct-to-fan hub for Cuomo called Mr. Rivers’ Neighborhood, which features a Discord server, setlist survey and Bandcamp-style demo marketplace.
• Following intensified conversations challenging Spotify’s culture and questioning the need for music to appear on the platform, we will continue to watch this landscape of niche streaming offerings, to see if other musicians follow suit and release their own music streaming platforms or look to Web3 solutions for alternatives.