Songkick raises $10m in new funding round (interview)


Live-music firm Songkick has raised a new funding round of $10m from VC firm Access Industries, with plans to up its efforts to work directly with artists in 2016 following its recent partnership with Adele.

The new round comes just six months after Songkick raised a $16m round from Access and fellow VC firms Sequoia Capital and Index Ventures in June, as it merged with direct-to-fan ticketing company CrowdSurge. Songkick’s total funding since 2007 is now $42.6m.

In its announcement of the new round, Songkick gave some figures on the merged company’s growth, albeit not specific values for its revenues.

“In 2015, we have continued to expand our artist ticketing business, with more than 3x growth across Europe. We are now ticketing one out of every three concerts in London and have helped artists sell tickets across 48 countries in 2015,” explained co-CEOs Ian Hogarth and Matt Jones in a blog post.

The company cites Kenny Chesney, J Cole, Jess Glynne, Metallica, Mumford & Sons, Stereophonics and Jamie xx as examples of artists using Songkick’s platform, although its most high-profile partnership of the year came recently with Adele.

Songkick sold more than 165k tickets for her UK and European tour to fans who’d registered on her website, although the first day of the sale was marred by a bug that meant some buyers could see the personal details of other fans while trying to check out.

However, Songkick talked up its tout-busting technology, which saw 18,000 “known and likely” touts blocked from buying tickets before the sale began. The company says that less than 2% of the tickets that it sold subsequently appeared on secondary ticketing services.

Hogarth and Jones talked to Music Ally ahead of the funding round’s announcement, starting with what they are planning to do with the investment.

“It’s exciting to have further validation of the direction we set with our merger, and more capital to continue to build our innovations,” said Hogarth.

“It’s very much about the technology, we have been quietly been building and testing some new proprietary technology that we feel could be impactful for artists and fans around the scale of ticket touting that goes on. We have a very exciting product map there.”

Jones said that the Adele partnership is a sign that “bigger and bigger artists care about the live piece” to their businesses, and defended Songkick from accusations that the privacy bug on day one had been swept under the carpet.

“A couple of people blew it out of proportion,” he said. “We sold another round of European sales, so we want to put that to bed. But what we learned was that in getting us to sell 40% of every room [on the UK tour], she showed how much artists care about their fans, and the value that can be created out of that.”

Unsurprisingly, both Hogarth and Jones cited a recent study by Media Insight Consulting that claimed the anti-touting measures may have saved Adele’s British fans £4.2m – based on a survey on what prices they would have been prepared to pay on the secondary market.

“For now, our approach is to let the results speak for themselves. We’ve seen some amazing results from this campaign on what happens when an artist like Adele does take control of her tickets,” said Hogarth. Songkick’s blog post claimed that “tickets sold outside of the advance sale were four times more likely to be posted for resale”, meanwhile.

Songkick is working with Adele on her upcoming US tour too, although the US is a very different market when it comes to ticketing: even artists wanting more control are generally only able to get between 8% and 10% of tickets for a given show to sell directly to fans.

“It’s a very different market to the UK and Europe. Artists get a small amount of inventory,” said Jones. “That said, it’s a bigger touring market, there’s more artists: it still has quite a scale. It will be interesting to see what happens when we see a lot of artists doing it, even if it’s only 8% of the tickets.”

Coming out against the secondary ticketing market so strongly sparks two further thoughts about Songkick. First: can the company really go up against the biggest player in the live market: Live Nation / Ticketmaster, with its GetMeIn and Seatwave subsidiaries?

Hogarth declined – as he always has in interviews – to rattle his sabre too openly. “The way we think about it is we are champions of artists, so we are led by the technology they choose to adopt and get behind,” he said.

“In the case of the work we’ve been doing with Adele, that was ultimately driven by her team having a strong position in wanting to stop secondary. We think other artists will be excited about that, but the knock-on effect that has on the broader industry ecosystem is secondary to us.”

Can even major artists have a significant impact on the way tickets are sold (and re-sold) to fans though?

“On one side, some incredible artists are taking stands they believe in and trying to push the market to a place they feel is great for the broader artist community,” said Hogarth, citing Taylor Swift’s streaming stance and Adele’s ticketing strategy as “great examples of artist leadership”.

But? “It’s also very challenging for artists to challenge the status quo in a landscape where there are so many big, powerful platforms. So we are again trying to do what we can to empower artists to do as much as they can with technology.”

Songkick is marshalling managers in its support. “Our artists just want to take control of their business and connect as closely as possible with their fans. Working with Songkick for our presales makes that possible,” said Joe Goldberg of Zeitgeist Management, whose roster includes Death Cab for Cutie, Best Coast and Josh Ritter.

“We’ve offered ticketing pre-sales for many years in an effort to get some of the best seats into the hands of Bonnie’s fans at face value prices. This allows us to cut back on inventory made available to scalpers, as well as raise funds for charity through our Special Benefit Seats program,” said Kathy Kane from Bonnie Raitt’s management team.

The second question sparked by Songkick’s stance against the secondary ticketing market is this, though: shouldn’t the company stop promoting those platforms on its own service? Historically, when searching for individual gigs on Songkick’s website, links to secondary sites like Viagogo were shown underneath primary sources.

However, when Music Ally checked this morning, we were unable to find any of those secondary links, which could be a sign that they have been removed permanently. We have reached out to Songkick today for a comment on that, and will update this story with its response.

It’s clear Songkick has grand plans, although the scale of its business – thus far, it’s been too small to publish detailed financial results through Companies House in the UK – and how close it is to profitability remain unknown.

There’s also the question of Songkick’s eventual exit, given that trio of big VC backers. Does it eventually get bought by a Spotify or an Apple as the ticketing element of the “full stack music” vision that Hogarth set out in an opinion piece earlier this year? Or by one of the bigger beasts of the live/ticketing industry?

One of those two endgames seems more likely than an IPO, but for now the company will continue building its technology, striking deals on an artist-by-artist basis, and talking up its independence, while deepening its relationships with services like Spotify.

“There is a pretty broad ecosystem of places where artists interact with their fans,” said Hogarth, listing streaming services, social networks and messaging apps as the key platforms – perhaps a hint that Songkick plans to do more with the latter category in 2016, incidentally.

“There’s a lot of big platforms out there with hundreds of millions of fans. We think the ecosystem is large enough that an independent, neutral player can exist to help artists tie them all together, and integrate tickets with their recorded-music experience across all of those places.”

Written by: Stuart Dredge