Music Tech Investment Companies

I was recently asked if I knew the names of some of the venture capital firms that have invested in music tech companies, so I reviewed my 2008 investment recap post, and here are the firms I found (in no particular order):

• www.foundrygroup.com
• www.opuscapitalventures.com
• rock-creek-ventures.com/
• www.venrock.com/
• www.battery.com/
• www.sheltercap.com/
• www.redpoint.com/
• www.anthemvp.com/ 
• www.commonwealthvc.com/
• www.benchmark.com/
• www.mosaiccapital.com/
• www.baincapital.com/
• www.waldenvc.com/
• www.softtechvc.com/
• the-accelerator.blogspot.com/
• www.softbank.com
• novakbiddle.com
• www.southerncapitalventures.com/ 
• www.mentortechventures.com/
• www.benfranklin.org
• www.crosslinkcapital.com/ 
• www.kpcb.com/
• www.sequoiacap.com
• www.sherpalo.com/
• www.dagventures.com/ 
• www.nbvp.com/
• www.ptv.com/
• www.balderton.com/
• www.sparkventures.com

There are plenty more than just these, so feel free to add to the list.

MixMatchMusic Acquires Mix2r

MixMatchMusic just announced it has acquired Mix2r, a web app that enables electronica artists to upload their music for remixing and for creating derivative works by other electronica artists, fans and music enthusiasts. Mix2r's community of musicians, DJs and fans features more than 6200 songs and music stems.

"MixMatchMusic's combination with Mix2r adds a lot of dynamic new music to our library and brings us closer to the critical mass of stems and community needed to fuel our next stage of growth," said Charles Feinn, MixMatchMusic co-founder and CEO.

Mix2r founders Duane Nickull and Matt MacKenzie will be joining MixMatchMusic's management team. Nickull, who is a well known senior technical evangelist for Adobe, said the Mix2r site uses Adobe® Flash® Platform technologies including Adobe Flash, Flex and Adobe® AIR™. These technologies will be used to create future versions of the combined site.

"Emerging and indie artists win as a result of this combination," said Nickull. "The breadth and depth of content and the number of people contributing to it adds energy and creativity to the community, and that in turn will attract more people and more great music."

This is big news for both Mix2r and MixMatchMusic and I look forward to seeing what the combined companies will provide. Congrats to both!

Editors note: It's fairly early in 2009 and we're already seeing acquisitions. Will this be the year of M&A for the music tech community?

Some Stats on the Deals of 2008

Below are a few brief stats from the article I wrote regarding the music tech investments of 2008:

• at present count, there were a minimum of 46 deals for 2008 with at least one deal every month except for June
• there was an average of 3.8 deals per month
• the busiest month was April with 11 deals, while July and August followed with 6 and 5 deals respectfully (October was tied with August with 5)
• there were a minimum of 6 deals in Q1, 14 in Q2, 15 in Q3 and 11 in Q4; so there were actually more transactions in the second half of 2008
• the deals originated from 12 countries, but the majority came from within the United States (35), while Great Britain had the second highest number with 6 deals
• not surprisingly a little more than half of the deals (25) originated out of California with 13 from Southern California and 12 in Northern California
• only one deal originated out of Nashville

Music Tech Investments for 2008

In April of 2008, I provided a list of investments in music tech companies from the beginning of the year. Below is the updated list for all of 2008, as well as my final post for 2008 (investments are sorted from most recent to least recent). If I've left a deal out, please post it here with a link to the news source and I will amend the post.

Updated January 2, 2009

• Songkick raises $4 million (December 18, 2008)
• PassAlong Networks raises $30 million for music services (December 1, 2008)
• Band Metrics raises angel round (terms not disclosed; November 26, 2008)
• Hoodiny Entertainment raises angel round (terms not disclosed; November 25, 2008)
• DJTunes raises capital from MP3 inventor (terms not disclosed; November 19, 2008)
• RockYou raises $52 million (November 3, 2008)
• Awdio raises $1.5 million Euros (October 30, 2008)
• TuneCore raises $7 million (October 27, 2008)
• AmieStreet raises Series B (not confirmed; October 15, 2008)
• ReverbNation gets an additional $3 million (October 9, 2008)
• Spotify raises $15 million Euros (unconfirmed investment; October 2, 2008)
• Audiolife (terms and date undisclosed)
• Toshiba invests $20 million in MOD Systems (September 24, 2008)
• China's Hurray Invests $3 Million in Taiwan's Seed Music (September 24, 2008)
• Best Buy Acquires Napster for about $120 million (September 15, 2008)
• ClashMusic raises $400K (September 5, 2008)
• Cloudspeakers Gets Funding (terms not disclosed; August 27, 2008)
• William Morris Agency Invests In RoyaltyShare (terms not disclosed; August 12, 2008)
• YouLicense gets $1 million for online music licensing (August 5, 2008)
• Music Social Net Kerchoonz raises $490K (August 5, 2008)
• CD Baby sold to Disc Makers for $22 million (August 5, 2008)
• TrueAnthem raises $2 million for song widget (July 29, 2008)
• Warner Music makes investment in uPlayMe (terms not disclosed; July 29, 2008)
• TiketLeap raises $2 million (July 22, 2008)
• GET Interactive Gets $200,000 (July 16, 2008)
• Mevio Raises $15 Million (July 9, 2008)
• Topspin secures Series B financing from Foundry (terms not disclosed; July 07, 2008)
• Warner Music Group Invests $20M In LaLa's 10 Cent Song Streams (May 29, 2008)
• Amazon funds Animoto (terms not disclosed; May 15, 2008)
• Mozes raises 11.5 million (May 13, 2008)
• MOG secures $2.8 million (April 29, 2008)
• Benchmark invests in TuneWiki (terms not disclosed; April 27, 2008)
• Sony buys Gracenote for $260 million (April 22, 2008)
• Will Smth invests in PluggedIn (terms not disclosed; April 17, 2008)
• Imeem secures additional funding (terms not disclosed; April 15, 2008)
• Sellaband scores $5 million (April 8, 2008)
• MTraks raises $550K (April 7, 2008)
• Imeem acquires Snocap (terms not disclosed; April 7, 2008)
• MySpace announces joint venture with major labels (valued about $120 million; April 2, 2008)
• Universal Music Group invests in INGrooves (terms not disclosed; April 1, 2008)
• OurStage secures $13 million (April 1, 2008)
• Universal and Interscope invest $25 million in Buzznet (March 29, 2008)
• Kobalt wins £8 million pounds for web based music royalty tracking (February 7, 2008)
• Imeem acquires Anywhere.FM (terms not disclosed; January 28, 2008)
• 7digital raises $8.5 million (January 28, 2008)
• We7 secures an additional $6 million (January 21, 2008)
• Motorola acquires Soundbuzz (terms not disclosed; January 7, 2008)

If these deals and numbers are correct, than VCs and angels invested over $260 million in music tech companies in 2008, and that doesn't even include deals where the terms weren't disclosed, or acquisitions and mergers that account for more than $520 million - that's almost $800 million in music tech related transactions in 2008. Hope 2009 is even brighter, and best wishes in the new year!

BitTorrent's Future

VentureBeat is reporting that DAG Ventures is scaling back its investment in BitTorrent from $17 million to $7 million. This is unfortunate, as I think BitTorrent has a useful service, not to mention I'm a big fan of Bram Cohen. However, both VentureBeat and TechCrunch seem to illustrate that the move has been in the making for months due in part to changes in their business model and a growing lack of confidence in the company.

Interesting developments, but I'm not surprised, as BitTorrent's service relative to the music industry is a bit cumbersome for general music enthusiasts. That is, the average music fan is just looking for quick access to music without having to download software or participate in a P2P network, one of the reasons why web apps like Hypem, Pandora and Last.fm, as well as playlist sites like blip.fm and playlist.com have experienced massive adoption rates. Even audiophiles download lossless recordings from other places besides BitTorrent (e.g. Archive.org).

It's hard to say what will become of BitTorrent, but I wish them the best in the ever evolving music industry.

Thanksgiving from Band Metrics

As some of you already know, Band Metrics closed an angel round of funding on Monday, but I'm publicizing the news today - you can read the official announcement here. This is a huge milestone for Band Metrics, as it further validates the business model, especially in this economy. Not to mention, the investment was led by Atlanta-based entrepreneur Allen Graber, a well known technology angel, and I am deeply grateful for his trust, support and friendship.

As I spend time with my family tomorrow, I will also be giving thanks to all of our investors, friends and musicians that believe in Band Metrics - here's wishing you all, and my readers, music enthusiasts and fellow entrepreneurs a wonderful thanksgiving!

Music Technology Turns up Investment Volume: a few stats and trends

Is it me, or is music technology off to a great year! Since January (just over 100 days ago), VCs have invested over $58 million into music tech companies, and that doesn't even include deals where the terms weren't disclosed, like INGrooves. Moreover, most of these investments were aimed at companies marketing their services to the indie music industry, so that's great news for musicians and bands looking for tools to build and manage their careers. Here's a couple of stats and a quick summary of some of this activity since the beginning of 2008 (If you know of more, just drop me an email and I'll add it to the list):

updated July 08, 2008:

• Topspin secures Series B financing via Foundry Group (July 07, 2008)
• MOG secures $2.8 million (April 29)
• Imeem secures additional funding (April 15)
• Sellaband scores $5 million (April 8)
• MTraks raises $500K (April 7)
• Imeem acquires Snocap (April 7)
• MySpace announces joint venture with major labels (April 2)
• Universal Music Group invests in INGrooves (April 1)
• OurStage secures $13 million (April 1)
• Universal and Interscope invest $25 million in Buzznet (March 29)
• iLike users triple to 22 million (February 21)
• Imeem acquires Anywhere.FM (January 28)
• 7digital raises $8.5 million (January 28)
• The International Federation of the Phonographic Industry announces that global digital sales for 2007 were up 40 percent from the previous year to $2.9 billion (January 24)
• We7 secures an additional $6 million (January 21)
• Motorola acquires Soundbuzz (January 7)
• Also, the term "Music" has been mentioned in about 20,000 blog posts almost every day since January 1 (see below):

It looks like the music industry's tail is becoming a powerful whip! Btw, I review these kinds of music related companies here, so if you're involved with one and would like me to write about it, just send me an email.
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I was listening to the : Red Hot Chili Peppers as I wrote this post.