Music/Audio Tech Investment Dashboard

Music startup funding rounds

We’ve added two funding rounds to our main list, including those for Dice ($122M led by SoftBank) and Lickd ($7M led by the Nick Mason Group, with participation from Warner Music Group and Epic Games).

Back in January, we wrote about the missed opportunities missed by ticketing giants (like Ticketmaster or Viagogo) to provide artists with more valuable data on their audiences on the one hand, or audiences with any music discovery or community features on the other hand. Dice’s discovery-centric interface seems primed to plug in this key gap in the market.

Warner Music Group has invested in at least six startups so far this year, making it the most prolific major-label tech investor (followed by Sony Music). Three of WMG’s investments so far in 2021 — Roblox (pre-IPO), Supersocial and Overwolf — have directly involved gaming.

It’s no surprise to us that Epic Games is in on Lickd’s funding round. There’s still a huge opportunity to open up long-tail sync revenue for games, both with direct in-game placements and with UGC on secondary platforms like Twitch — especially for the 95% of songs that aren’t able to get a high-profile placement in a blockbuster game like Fortnite or FIFA. Services like Pretzel and StreamBeats already exist that offer royalty-free music for gaming content creators to use in the backgrounds of their livestreams on Twitch; startups like Lickd could help bring more commercially recognizable music into this revenue mix.

Music startup exits

We’ve added three exits, including HIFI’s acquisition of The Music Fund and Dice’s acquisition of Boiler Room.

This marks the second consecutive week of M&A news for music livestreaming (Mandolin announced its acquisition of NoonChorus last week).

The Dice/Boiler Room deal may raise eyebrows given the former’s recent blockbuster funding round (see above), which contrasts with the latter’s historical dedication to niche genres and underground subcultures. Ongoing industry consolidation was one of the key concerns cited in our member barometer survey last month.

That said, this is Dice’s first acquisition; without a track record to judge from, it’s difficult to predict whether this particular acquisition represents worrying consolidation or genuine innovation.

HIFI and The Music Fund are both listed in our members-only database of next-gen financial services for artists, and both have historically offered customers upfront advances on streaming income. The acquisition is also HIFI’s first, and will help round out the startup’s suite of general fintech tools for artists and rights holders.

Adjacent rounds

Social token startup Roll raised a $10M Series A round led by IOSG Ventures.

Many active DAOs in music and culture today, including Friends With Benefits and Leaving Records’ Genre DAO, use Roll to manage their social tokens.

Almost every major company worth following (in our humble opinions) at the intersection of culture and crypto — including but not limited to Roll, OpenSea, Zora, Dapper Labs, Rarible, Mirror and SuperRare — have raised traditional VC funding this year. If this activity goes unchecked, there could be a serious tension between the community-driven orientation of NFTs, social tokens and DAOs, and the entrenched incentives of traditional venture capitalists who are looking for a lucrative exit strategy.

Music Crypto Dashboard

Music NFT platforms

We’ve added a handful of new platforms on our radar to this tab, including Album Trading Cards, Siki and TuneGO.

There are now 53 startups on our list of music NFT platforms. Our first reaction is that this number might be… too much. Then again, this is the fragmentary impact of decentralization playing out at its most extreme.

Music NFT drops

Sales of new music NFTs have been relatively slow this week. But some preliminary announcements of music NFT campaigns caught our eye in terms of their potential implications for long-term marketing strategy:

Proof-of-attendance protocols (POAPs) at music festivals and other live events. Last month, we wrote for NFT Now about the opportunity to use NFTs to bridge the gap between in-person concerts and virtual worlds. We’ve seen a few examples of this concept in practice:

Coinbase not only dropped free NFTs to its users that granted access to their in-person VIP lounge at Governors Ball, but also minted festival highlights in real time that acted as de facto POAP tokens that attendees could purchase on the spot.

The Museum of the Moving Image in NYC held their opening reception this week for their new exhibition on TikTok memes, which featured TikTok’s first-ever NFT collection with the likes of Lil Nas X, Bella Poarch and FNMeka. Reception attendees all received a POAP token that they could redeem and transfer to their own wallets.

New models for music journalism. Canadian magazines NOW Magazine and Georgia Strait minted nine of their most recognizable covers as NFTs on Rarible, featuring artists like Drake, Grimes and Daniel Caesar.

On the one hand, NFTs and DAOs could present a genuine opportunity for rethinking business models around community-oriented music media, especially when it comes to giving more equity and upside in a publication’s growth to contributors including writers, editors, photographers, graphic designers, stylists and, yes, the music artists themselves.

On the other hand, these campaigns from NOW Magazine and Georgia Strait have not been transparent about how, if at all, sales from their cover NFTs will be split among the creative community that made those covers possible. As more brands get involved with NFTs, we can expect the crypto community to demand more transparency and accountability when it comes to clearly laying out these kinds of contracts and revenue splits on-chain.

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