MusicTech Industry Scan
Music is the soundtrack of our lives. The average American spends approximately 20% of their week listening to music.
Over the last decades, disruptive, MusicTech innovations have increasingly democratized music consumption through reducing barriers of access and cost.
Today, music easily comes with us beyond the car and the home. The Sony Walkman debuted on the market in 1979 and the concept of mobile music has continued to evolve over subsequent years. However, it was not until Apple released the iPod in 2001 that thousands of songs became available on a single compact device at our fingertips.
MusicTech continues to make quick and ready access to thousands of songs more convenient than ever. Yet, more importantly for the average consumer, the cost barriers to such access have dropped significantly since the technology’s debut.
While pirated music was a plague of the early 2000s, legalized streaming platforms of recent years have made music-on-demand both risk-free and affordable. A premium (unlimited) Spotify subscription is $9.99/month compared to the cost of $0.99 — $1.29 per song through iTunes/Apple Music and the $15 per album average for a CD in 2009. Moreover, Spotify’s comprehensive library can be accessed through a diverse array of devices that allow price-sensitive consumers to enjoy its scope, without being limited by the pricy restraints of Apple products.
Less publicly known are the innovations that have augmented the ease with which industry insiders produce and profit from music. MusicTech has come a long way since the initial iteration of Garage Band, it continues to allow artists to more easily collaborate, record, and release their work.
Today’s Music Industry:
- Industry giants monopolize much of the production and distribution process across mainstream platforms and national radio syndicates.
- With data collected from consumers, Amazon & Spotify use algorithms to create the perception of personalization for fans as they continue to demand more access to the music and musicians behind it.
- Touring & live production remains a critical element of the consumer-driven “experience economy”. With streaming & music rights under fire, the ability to maximize revenue from live productions is essential.
Today’s proposed solutions can be largely categorized as:
- Harnessing data from digital downloads, streaming, and live event attendance to solidify corporate partnerships and targeted advertising. SE-based startups: Hurdl (Nashville) & Aloompa (Nashville).
- There have been dozens of Apps released that claim to facilitate easy co-writing and tracking of artist collaboration that should then be able to contribute to the music rights conundrum. However, there is yet to be a clear winner from the race to become mainstream among industry insiders. SE-based startups: Cre8tor App (Miami) & The Labz (Atlanta).
- New interfaces for fans of targeted audiences or genres. SE-based startups: With The Band (Nashville).
Building MusicTech in the SE?
There are deep musical roots that transverse the American southeast. Immigrants in Appalachian created a new Americana genre. The sounds of Jazz arose from the banks of the Mississippi River. The Grand Ole Opry show, broadcast from Nashville, connected the region through story and song for decades. Sun Studios in Memphis gave rise to an iconic, American king, and decades later Madonna started her career by singing in Miami’s nightclub.
This rich history and a growing tech sector set the stage for a budding #BuildinSE Music Tech scene:
Happenings: A global hub for the music industry’s Latin subsidiaries with the likes of Warner Music Latina and Universal Music Latin Entertainment. The city hosts the Latin Grammys each year and is known for its unique “Miami Sound”.
Each year, thousands of tourists flock to South Florida for the 9 Mile Music Festival, Tortuga Music Festival, Ultra Music Festival, & Sun Fest. The Winter Music Conference comes to Miami Beach each spring.
The Frost School of Music at the University of Miami is a nationally ranked business program that also has partnerships with the University of Miami Law School’s Sports & Entertainment program.
Miami’s Notable Media + Music Startups:
Miami, FL | Est. 2014
Mission: Digital platform that rewards fans with exclusive experiences for how much they demonstrate their love their favorite music. A “social music community” currently offering beta access to the platform via its Unitea app.
VC Funds:$5.3 million
Funding Notes: Angel Investors raised the company’s initial $1.4 million. A 2017 $1.6 million Seed Round was followed up with a secondary seed infusion in Nov 2018 led by Rokk3r Fuel EXO.
Happenings: Nashville aka “Music City” hosts a number of annual music festivals and hundreds of thousands of tourists pass through its honkytonks on Downtown Broadway each year. For MusicTech entrepreneurs, the Music Business Association’s annual conference held each spring.
The TechStarts Music Recruiting Tour 2019 held office hours to recruit music industry startups across 11 international cities, but only Nashville & Atlanta in the southeast. The Nashville Entrepreneur Center is home to the southeast’s only MusicTech Accelerator: Project Music.
Belmont University’s Mike Curb College of Entertainment & Music Business is consistently ranked among schools graduating the country’s most competitive music business graduates.
Industry giants like ASCAP, BMI, SESAC, Warner Music, & Sony all have corporate offices along Music Row.
Nashville’s Notable Media + Music Startups:
Nashville, TN | Est. 2011
Mission: Digital cloud-based platform for artist roster management, tour management, and tour funding. Artist management & touring of the future.
VC Funds: $2 million
Funding Notes: A group of angles raised a $2 million round in 2013. The details of its 2018 deal with Pinnacle Financial Partners are not public, but continue to advance the company’s growth.
Nashville, TN | Est. 2016
Mission: Data-driven experiential (DDX) marketing system converts live event audiences into a direct to consumer SMS channel.
VC Funds: $2.5 million
Funding Notes: Techstars & Techstars Music Fund contributed $2.5 million to a seed fund in June 2017.
How to Build Your Music Network
Recruit Local Experts & Interns:
- Belmont University |Tennessee |Mike Curb College of Entertainment & Music Business
- Kennesaw State University | Georgia | Joel A Katz Music & Entertainment Business Program
- Middle Tennessee State University |Tennessee| College of Media & Entertainment
- University of Miami | Florida |Frost School of Music
- CMA EDU Program local chapters at the following universities: University of Alabama (Tuscaloosa), University of Central Florida, University of Florida, University of Miami, North Carolina State University, Clemson University, University of South Carolina, Austin Peay State University, Belmont University, MTSU, University of Tennessee (Knoxville), Vanderbilt University
- GrammyU Program local student chapters located: Atlanta, Nashville, Memphis, & Southern Florida
Find Mentors, Feedback, & Funds:
The following accelerator programs are based in the southeast:
- Project Music — Nashville
On the national level, the following programs specialize in Music startups & innovation:
- 2112- Chicago
- Backline — Milwaukee
- Capital360- Hollywood
- gBeta- Los Angeles
- Real Industry — San Francisco *students only*
- Techstars Music — Los Angeles
- Zoo Labs — Oakland
Although not located in the Southeast, these Music-centric funds consider startups across the United States:
- CAA Ventures — Los Angeles
- Plus Eight Equity Partners — New York City
- Raised in Space- Santa Monica
- SF Music Tech Fund — San Franciso
- Walden VC — San Franciso
- WME Ventures- New York
- WMG Boost — New York
Annual Events & Opportunities:
At ModernCapital, our mission is to increase the number of startup success stories in the Southeast by leveraging a cross-regional, collaborative network. We believe the future of company building will be geographically distributed, hyper-personalized, and driven by creativity.
Based in Nashville, ModernCapital believes the best talent will #BuildInSE(translation: Build In Southeast).