Music Investment Hits a Swift & Sudden Slowdown…

Consider this sudden shift: in late May, year-to-date financing of music startups and companies was more than double the same level in 2012.  By the end of June, it was suddenly 10.3 percent below last year’s mark.

Things are suddenly moving in the wrong direction.  During the first half of 2012, total music-related funding topped $238.8 million, compared to $214.1 million at the same point in 2013.  The new comparison look like this, according to funding activity tracked by Digital Music News.

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Tilting the tables last year was Sonos, who grabbed a lofty, $135 million round in June of 2012.  That was complemented by several, low-millions rounds during the same month.

But wait: what about that $40 million round just secured by Shazam?  That’s a lot of cash indeed, though last year, July funding exceeded $100 million (and July is almost one-third over).  Earlier, YouTube confirmed a sizable investment in VEVO (rumored to be in the $45-50 million range), though that was actually counted back in January (based on very credible rumor).

And with that, here’s the running tally of year-2013 rounds, including the injection for Shazam.

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8 Responses

  1. hmm

    I’d say that VEVO and Beats both skewed last years numbers. Those companies had significant advantages versus your average music startup.

    • Lou D. Chris

      Yet Vevo has a $50MM round in 2013 also?

  2. jw

    I don’t know why music investment should be consistent. That takes for granted that innovation is consistent, which it’s not. I wouldn’t have given most of these companies a dime. It could just be that there wasn’t anything worth investing in during the month of July. That seems reasonable to me.

    • KT

      You’re 100% right!
      it will be interesting to see what new start-ups are discovered this year at SXSW’s Inaugural conference in Las Vegas.

  3. FarePlay

    Granted this is a short timeline; could it be that those of us who are pro-artist advocates are having some impact?
    Perhaps, the VC community is a bit spooked that we are actually battling back so hard on the side of artists.
    Copyright cannot be some arbitrary compensation model. For artists to receive an equitable stake It must take into account the alternative streams of income that technology destroys.
    Adapt? That may just be a two way street.

  4. Randy Nichols

    You left out the cloud based tour merch management platform atVenu who have raised a nice sized round. They have deals with several major merch companies and are on the road with acts in small clubs to sheds.
    If you havent heard of them they replace the the daily reports on excel spreadsheets bands have been using for the last 25 years. It has multiple user web and IOS access and provides the artists team intelligent daily tour merch data in addition to inventory forecasting and a deal with Soundscan to submit your tour sales to them through their app.

  5. Z Curtis

    maybe music companies have gotten the funding they need, for now?

  6. JS received $1.40 million in March of 2013.