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Is it true that VC's are reluctant to invest in music related startups?

Is it true that VC's are reluctant to invest in music related startups?

30 Replies

Jayakumar.S Singaram
2
0
Jayakumar.S Singaram Entrepreneur
Member Founding Team at RINANU SEMICONDUCTORS LLP
I think so.. I think there is huge growth options for Music industry ( digital) in India ( as there is growth in food industry)
Barry Coffing
1
0
Barry Coffing Advisor
Founder/CEO at WeGet Artists
I will let you know. We raised $1.5M in angel money and we are now cash flow positive but we now need a series A in order to scale and grow. We have created an automated music search, discovery and licensing platform for independent music. As far as content we have 250,000 tracks from 11,000+ Labels, Libraries, & Artists from 78 countries. The interest seems to be from VC who could use what we have along with other investments that have or could be inhanced by music.
Andrew Lockley
1
0
Andrew Lockley Advisor
Investor and strategy consultant
My guess is that revenue stream, not sector, is of paramount importance A
Jateen Parekh
0
0
Jateen Parekh Advisor
CTO, Founder
I have heard from many VC's that they are, only because they have been "burned" in the past. It depends on your model, but if it includes having to stream or negotiate rights, savvy investors may want to avoid the headaches.
Barry Coffing
2
0
Barry Coffing Advisor
Founder/CEO at WeGet Artists
The Bay area has lost countless millions in music and may lose more because they don't understand music licensing and rights. There are some real ways to streamline these to take advantage of the amount of great digital content. Music is still the #1 driver of views of YouTube and a key component of video, tv, games & films.
Michael Brill
2
0
Michael Brill Entrepreneur
Technology startup exec focused on AI-driven products
With the market size a puny ~ $15B and shrinking, lots of big competitors, complex and expensive licensing issues... you can see why recorded music wouldn't get most investors excited.
Nick LaFond
0
0
Nick LaFond Advisor
Investor | Entrepreneur | Startup Advisor
Agreed with Michael; look at which sectors are growing and follow the money. It's no wonder VC's prefer SaaS enterprise right now.
Linda Marshall-Smith
1
0
Linda Marshall-Smith Entrepreneur
Marketing Consultant, Ambassador, Silicon Beach at CoFoundersLab
I think it is difficult to "blanket" a sector and say VCs are not interested in the whole sector. It would greatly depend, in my humble opinion, on the product being offered and/or the kind of company, the value and benefits to the end users -- which would equate to proven traction -- and how the company or product is sufficiently differentiated from others. For example, if it is SaaS, is it patentable or proprietary? And that holds true for any start up, regardless of the sector.
Bob Graham
2
1
Bob Graham Entrepreneur
Engineering and Software
I went to a 500 Startups Accelerator talk and one of the partners was there talking about music. When the conversation was about VCs and music he referred to music startups as "the valley of death" in silicon valley and said music startups aren't getting funded by VCs flat out. He then gave a list of "hot industries".
So yeah according to him at least it's not a hot VC item.
Michael Brill
2
0
Michael Brill Entrepreneur
Technology startup exec focused on AI-driven products
Certainly agree with Linda that it's not a binary thing... an incredible idea/team/execution can overcome a generally negative bias. Not sure how many of you recall investors writing off the entire search space in the late 90s and shrugging at Google. Look, software is magic, so anything is possible. Just making that magic in a relatively small, shrinking and highly-competitive market is hard.
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