Music/Tech Investment Dashboard

Music startup funding rounds: Livestreaming leans on the metaverse to stay relevant

As COVID continues to stall live music, investments in virtual reality and livestreaming are keeping pace. Since our last dashboard digest, we’ve added four new rounds: Music virtual reality startup AmazeVR($15M), blockchain music rights-startup anotherblock ($1.2M), music production platform 343 Labs and fan-growth app Fan Fair Inc.

Founded by former executives of the South Korean messaging app Kakao and dual-headquartered in Seoul and West Hollywood, AmazeVR is gearing up for a Series B in the coming months after securing an oversubscribed $15M Series A in three short weeks. Co-led by Partners Investment and Murex Partners, the round brings total funding for the startup to $31M since launching in 2015.

The platform aims to “blur the lines of reality” by giving fans worldwide the opportunity to attend physical-world concerts virtually as avatars. The idea is that fans can experience a show “face”-to-face with artists and interact with other users virtually. This spring, the company plans to roll out its first commercial VR concert with Megan Thee Stallion.

• In 2021, we recorded 17 funding rounds for livestreaming and virtual-events companies, accounting for over $1.2B in investments in the category. Across the “experiential, immersive and mixed-reality media” in particular, we tracked six rounds generating $32.5M in funding, including Wave and MelodyVR.
• Livestreaming hype seems to have come and gone quickly at the start of the pandemic with a flurry of buzzy performances and equally buzzy acquisitions. Since then, most livestream-related funding headlines have primarily had a business angle that includes AR, VR, the metaverse or all three. It will be interesting to see if there are any livestreaming companies in the lane of Mandolin, Moment House and LiveXLive that withstand the test of time sans metaverse strategy.

Stockholm-based anotherblock has raised $1.2M in pre-seed funding led by J12, alongside investors Steve Angello (of Swedish House Mafia) and Sebastian Knutsson (Candy Crush creator). The company hopes to support musicians by democratizing music ownership through a blockchain-based marketplace. Their first initiatives will focus on NFTs of varying use; some NFTs will act as tokens affording the holder royalty rights, while others will obscure the art so only the owner can enjoy it. The company notes that rights management for labels and artists will follow the initial marketplace launch.

Exits: Even more consolidation in creator tools

We’ve added three exits to our database this week, including Utopia Music’s acquisition of Proper Music, Friendable Inc’s acquisition of Artist Republik, and Sony Music’s acquisition of Ultra Records.

• This week Utopia Music (who recently acquired ROSTR, ForTunes and Musimap) acquired Proper Music Group, one of the leading physical music distributors in the UK. In doing so, Utopia is launching a new branch of business called “Distribution Services,” which furthers the company’s mission of “Fair Pay for Every Play.” Adding a physical distribution specialist when US vinyl sales have reached a 30-year high also helps position the parent company as a more attractive asset for artists.
• Friendable Inc recently announced an acquisition and a merger between Fan Pass Live and Artist Republik, another consolidation of artist-centric industry tools. The services will create mutual value as detailed by their names: Fan Pass intends to bring the fans (through access to live events, BTS content and exclusive merch), while Artist Republik acts as a path to attract the artists (with autonomy over music distribution). Their partnership aims to provide all of the services of a label without forcing artists to concede creative ownership.

These two acquisitions further demonstrate the paradoxical emergence of “independent” music distribution companies acting as hot Silicon-Valley commodities and M&A targets, as noted in our last database digest. In a race to ramp up a suite of tools to attract artists, both of the above parent organizations are leaning on new tech to provide services on par with traditional labels, with a rate of consolidation that starkly contrasts the rise of more decentralized Web3 creator tools.

Music/Web3 Dashboard

Music NFT platforms/startups: LÜM pivots to NFTs

We’ve added three new NFT platforms/startups to our database this week, including LÜM, Jamify and MoonwalkerFM.

Founded in 2018 by university students, LÜM launched as a music discovery and promotion app for artists, merging social media and streaming services. The startup found early success in micropayment models (i.e. tipping) between artists and fans, and amassed 200,000 users by 2020. Since its inception, the startup has raised $4.4M in funding.

In March 2022, the company plans to relaunch on the Flow blockchain, with a new focus on musician-related “Access Pass” NFTs for crowdfunding projects through fans. Modeling their business after NBA Top Shot, LÜM will launch with 25 artist NFTs, in the hopes of reaching 100 artist launches by the end of 2022.

• While many NFT platforms have attempted to break into the ecosystem with a singular, splashy artist partnership (e.g. MusicFX with Parker McCollum or 360NFT with Willie Taylor), several NFT platforms like LÜM are taking a different approach: Targeting “indie” artists and consistently delivering for them in small doses. Sound and Catalog are excellent examples of music NFT platforms seeking a certain standard in volume and quality of musical material, but not necessarily from A-list talent.

Music NFT drops: The importance of consistency

We’ve added 3 new NFT drops to our database — all from Sound, which has already accounted for 23 out of 44 of our NFT sale entries since their launch in early December.

Granted, there may be a bias as we hear more about Sound in the Water & Music server due to the nature of our community. However, their consistent output and execution in sales throughout their as-yet early existence, in addition to the quick involvement from investors, perhaps suggests that consistency and forward motion rather than large PR announcements or splashy partnerships may be the pathway to long-term success in Web3.

On the flip side: We’ve added several future drop announcements from artists including UZ, Ghostface Killah, Keith Richards, Akon, Sia’s Metaverse, and a forthcoming collaborative drop between Beatport and Pixelynx (the new music metaverse brainchild of Deadmau5 & Richie Hawtin). Many of these drops may manifest; however, it’s crucial to note premature announcements around NFTs have ended poorly in the past (e.g. the TikTok NFT collabs with Lil Nas X and Bella Poarch that never happened — and reportedly got the company’s marketing chief fired). Keeping in mind that hype machines have been an essential part of the rise of NFTs, consistent receipts seem to be the pathway to long-lasting impact.