New York City’s Kobalt Music has managed to raise a total of $126 million dollars, thanks to the recently acquired $60 million from Google Ventures and Michael Dell’s MSD Capital. Wait there’s more, a further $153 million the company raised to finance a second part of its business; buying part or all of an artists’ rights to help collect royalties on their behalf. Kobalt developed a proprietary technology that figures out how to allocate all the royalties due musicians at a much greater speed than is customary. This is a big deal since musicians have had to wait a great deal of time, we’re talking years for payments. Just think of all the digital platforms capable of playing music.
Since the inception of digital music, the industry has been calamitous about how artist are paid and how much. With Kobalt’s algorithms keeping track, the process has become much more efficient. The CEO, Willard Ahdritz says the funding will be used “to scale the organization, double the tech team to increase our speed”. Ahdritz also explains the publishing side of the business is profitable. Overall, the company has been growing revenues at a rate of 40% annually for the last four years, and is projecting gross annual revenues of $260 million for the end of June 2015.
This is a critical time for the digital music industry especially since streaming has become more popular than downloading. Kobalt has created a sophisticated big data dashboard that allows you to see the number of plays across a slew of outlets like YouTube, Spotify, Soundcloud, thanks to their tagging system. Thereby letting the artist know how much they are owed. Kobalt says more than 8,000 songwriters and over 500 publishing companies use its platform today. Currently they are covering about 400 million people and would like to get that number up to 1.5 billion in 6 months.
Bill Maris, of Google Ventures, in a statement. “The company’s solid execution over the past decade coupled with Willard’s unwavering passion and commitment made this an attractive investment for us. Kobalt’s commitment to trust, transparency and technology has positioned it as one of the most innovative brands in media today.” Dell Inc. has been providing the technology for Kobalt this whole time, so it just made sense for MSD Capital to jump on board.
Just to let all you reading know back in 2013, Kobalt was valued at $250 million. So perhaps with all that money flowing through the arteries at Kobalt, submitting a resume, might not hurt.