Startup MelodyVR has published its annual financial results, revealing a net loss of £2.6m in 2016 as it geared up to launch its musical virtual-reality app.
The British startup’s parent firm EVR Holdings is a public company, listed on the AIM market thanks to a reverse takeover last year. That means we get more insight into its financial affairs than most early-stage music startups.
EVR Holdings recorded a net loss of just over £2.6m last year, although it ended 2016 with cash and cash equivalents of nearly £3.4m, buoyed by a new share placement of £3.4m in October.
MelodyVR isn’t yet generating any revenues, as its app – which will let music fans watch live performances in VR – has not yet been commercially released.
It was made available in December as a closed beta test, shortly after MelodyVR signed its first major-label licensing deal, with Warner Music Group. It has also filmed (and funded) performances by more than 500 artists to build its catalogue.
“I believe that MelodyVR is increasingly well placed to dominate the VR content ecosystem given the limited offering of entertainment content that is currently available to consumers,” said CEO Anthony Matchett in a statement accompanying the financial results.
“As the VR market develops, fuelled predominantly by promotional campaigns from Samsung, HTC and Google, as well as the recent release of PlayStation VR, we expect the demand and appetite for high-quality VR content to increase from both consumers and hardware manufacturers alike.”
“With the world’s leading technology companies, such as Facebook, Samsung, Google and Sony all battling for market share, we expect that promotional activities involving low-cost, or free of charge VR devices and featuring exclusive content, will become more commonplace.”
MelodyVR has not yet said when its app will launch commercially, although the ‘business review’ section of its financials does provide some information about its plans for 2017 – including a possible move into the adjacent technology of AR.
“Over the next 12 months, the Group will continue to follow an aggressive expansion strategy, focusing heavily on content creation and product development as well as areas of interest such as content analytics, augmented reality and interactive advertising,” explained chairman Sean Nicolson.
“In addition, it will also seek to strengthen its Board by the appointment of new directors who bring additional commercial, corporate and strategic experience.”
MelodyVR is also planning to open satellite offices in Europe, North America and Asia, starting with Los Angeles and New York.
Nicolson said that the MelodyVR app will launch “at a time that is strategically aligned with the long term goals of the Company and our partners” while stressing that its team “continues to work closely with hardware manufacturers such as Facebook’s Oculus and Sony PlayStation, refining both launch strategy and marketing plans”.
At the recent FastForward conference, MelodyVR COO Steven Hancock talked about the company’s plan to make its app free to download, but to use an iTunes-style a la carte model to charge for the individual performances within it.
“We’ve been fortunate enough to work very closely with Facebook, Oculus, HTC, Google and Sony PlayStation, and today there’s a phenomenal appetite for people to pay for things in VR,” said Hancock then.