Analysis

Techstars Music 2020 startups make their pitches (online)


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The demo days of music/tech accelerator Techstars Music are usually a big draw in the physical world, with music industry execs and tech investors convening in Los Angeles to watch its startups pitch.

By necessity, its 2020 demo day was different: streamed online with pre-recorded pitches. It was an impressive and varied selection of companies with concise, well-crafted pitches – plus the announcement that Amazon Music will be joining its selection of partners/backers for 2021.

Here are our notes on each of the 10 startups.

strangeloop studios

Strangeloop Studios

Strangeloop Studios’ founding team have worked on concert visuals and short films for artists including The Weeknd and Kendrick Lamar. They’re now applying their talents to the creation of virtual artists.

“Original music-based digital characters with their own identities,” as CEO Ian Simon put it, positioning this as a logical next step on from virtual influencers like Lil Miquela, but also from avatar-artists like Gorillaz and Hatsune Miku.

The startup’s first virtual group is called Spirit Bomb, although Simon made one thing clear. “None of our virtual characters is competing with or replacing existing artists, because all of the music is going to be 100% made by humans.”

Strangeloop Studios thus wants to collaborate with human musicians, but it’s not shy of stressing some of the advantages virtual artists might present. “Our studio can spin out promotional assets and music videos at a fraction of typical costs,” he claimed.

The artists will launch on social media, then release music. If and when one gets a big following, they’ll be used as the launchpad for other characters. The artists will also play ‘live’. “We can’t wait to see the efficiencies of a virtual artist who hits every single major [concert] market in a single night,” said Simon.

He hinted at plans to allow fans to get involved in making the music, and also said that the characters have been designed to be “easily ported” into Netflix shows and video games, and printed on merchandise.

audigo

Audigo

Audigo is a startup focusing on the process of recording music. Its business combines hardware, software and services: a cube-shaped wireless microphone; a smartphone app for recording, collaborating and sharing music; and a cloud platform around it.

It’s aimed at musicians, but also podcasters and video creators – the app can be used to record video as well as just audio. “No wires, no manual data transfers and no laptops,” was the pitch from CEO Armen Nazarian.

Musicians have already been beta testing Audigo’s technology – the demo included footage of one musician recording guitar, then another adding vocals and sharing the results to Instagram – and besides Techstars the company already has backing from venture capital fund Bolt.

Audigo will use a subscription model: a creator can get a microphone, access to the app and 100GB of cloud storage for $20 a month, paying $120 upfront for the first six months. A $35-a-month Pair Plan adds a second microphone and ups the storage to 250GB.

Both can be pre-ordered now, with an autumn shipping date. A Studio Plan will also be available with four mics and 500GB of storage.

entertainment intelligence

Entertainment Intelligence

Music Ally has been writing about analytics startup Entertainment Intelligence since its early days in 2016. Its pitch showed that it’s come a long way in that time, with some bold moves planned to stand out from the music-tracking crowd.

CEO Greg Delaney explained that granularity is the key: the ability to dig down to (for example) find “the hip-hop single with the most engaged audience, just in LA, in the last three months”.

There are several rivals, but Delaney tried to explain why EI is different. “We don’t scrape data: we get it direct, and we get all the details. Listeners’ age, gender, location, device, playlists,” he said. Spotify, Apple Music, Deezer, Pandora, Amazon Music and YouTube were the DSPs he named.

“Unlike some of the public reporting platforms that you may know of, we’re contracted by record labels and distributors to manage their data for them, so we can’t be cut off,” he added, showing a slide listing the likes of Tommy Boy, Sub Pop, Secretly Group, Africori and Concord Music as clients.

Currently, EI is tracking 200m streams a day, which Delaney said was 4% of the US market. “Our goal is to get to 20%, because at that point, our machine learning model will extrapolate to a whole market view.”

How will it achieve that goal? As of last night, EI will “warehouse everyone’s data for free”, although it will be making money from subscription products and consultancy, as well as an API for companies who want to use its data with their own tools. And, like several other startups pitching last night, EI is looking beyond music: to television, sports, podcasting, gaming and film in its case.

elastic audio

Elastic Audio

Elastic Audio is certainly confident: its CEO Andrew Beck said that the audio technology it’s working on is “just as big and just as important as the invention of 3D graphics”.

What it’s about is making the process of creating audio in gaming engines like Unity and Unreal Engine – which are increasingly being used for all kinds of non-gaming experiences too – much more efficient.

Beck said that it’s currently simple to make visual assets (graphics) that work across a range of devices, but much more complicated and time-consuming to do the same thing for sounds. “Audio systems have to be adapted for every platform,” he said, suggesting that this wastes “hundreds of hours” for audio designers.

Elastic Audio’s technology is inserted into these different platforms via plugins, with Beck promising that “we save audio designers hundreds of hours, and we give them new revenue streams”. However the technology can also be used by “non-game professionals and digital creatives who need to put sound in their project but don’t know where to start”.

fanaply

Fanaply

The next startup to pitch was Fanaply, who we just published a Startup Files profile of yesterday. You can read that here, but we’ll run you through the pitch details from last night too.

CEO Grant Dexter started by noting that the physical collectibles industry is worth $200bn a year. Fanaply is focusing on the digital equivalent, inspired by trends from Twitch viewers buying icons and badges, to Fortnite “selling $300m a month in virtual backpacks and dance moves”.

“So far, most of these virtual goods are being sold in closed ecosystems like video games, but fan behaviour is everywhere,” he said. “Fanaply is taking the mechanics of video games and applying it to the currently disorganised and non-monetised fan behaviour that exists around sports, entertainment and music.”

These assets – currently digital cards – might show that someone was one of the first 100 people to watch a YouTube premiere, or the top listener on Spotify for a specific artist one day, or that they attended an online event (like Travis Scott’s recent Fortnite concerts).

Fanaply deployed its technology in the Coachella Festival’s app last year – it gave out more than 40,000 of its digital collectibles – and is looking to work with more festivals, sports teams, artists and events in the [post Covid-19 lockdown] future.

Blockchain technology is hovering in the background: all these digital assets are ‘tokenised’ which means a.) they can be resold on secondary markets, and b.) Fanaply and its partners (including artists) can take a share of those transactions.

“We estimate that 1% of collectibles will trade three or four times a year, at an average of $5 each,” said Dexter. Which sounds small, but at scale could be “millions of dollars in ARR” [annual run rate]. He also predicted that for each musician, celebrity or athlete partner, Fanaply will be able to sell between $50k and $250k of items.

ulo

Ulo

The next startup was Ulo – actually an acronym of Unidentified Landing Object – which is building “a global platform for short-form immersive experiences”. Which you might expect to be entirely virtual, requiring headsets.

Nope. “An Ulo experience can fit in a 1,000 square-foot space, with a merchandise and lobby area,” explained CEO Dani Van De Sande in the pitch, outlining the company’s “plug and play system: projection, sound and interactivity for a room of 20 [people]. It’s like an interactive show.”

Ulo wants to work with music artists and brands alike to create these experiences, which fans would then pay to visit. It will also be creating digital versions for a wider audience to experience on their smartphones.

It’ll make money from its cut of ticket and merchandise sales, paying artists up front or doing revenue-share deals. It’ll also bring in revenues from brand partnerships, and from businesses (think hotel chains or entertainment centres) who’ll buy an Ulo system and pay recurring fees for content.

Van De Sande said that Ulo is gearing up for a launch in 2021, and is in talks with major labels over artist-focused pilots. “Imagine if someone like Billie Eilish, when she released her next album, pushed out 50 immersive journeys around the world…”

tribexr

TribeXR

The next startup, TribeXR, is the first virtual reality startup for Techstars Music, which has held off on the technology until consumer adoption of headsets grew.

CEO Tom Impallomeni explained that TribeXR is “a platform to make it easier to learn and perform creative skills”, starting with DJing. People put on a VR headset, and learn to mix with a set of virtual decks.

“You can bring a teacher into the studio for a one-to-one or group lesson, and the skills that you learn are real: they are directly transferable to the real world,” he said.

TribeXR isn’t just for learning, though. People using it to DJ can broadcast the results to platforms like Twitch. “Tribe is built for livestreamers,” said Impallomeni. “You can play from a VR headset to anyone on any device.”

The software can also be used by professional DJs to prepare for their live performances, but he said the opportunity is much bigger than the estimated five million pro DJs – it’s about the 100 million amateurs (or not-even-yet amateurs) out there too.

“We are a VR company with real revenues,” he stressed: it’s currently making $30k a month, and aims to reach an annual run rate of $1m by the end of this year, buoyed by adding a subscription element to the product. More than 16,000 people are already using TribeXR.

Beatport, Amazon Music, Tidal and SoundCloud were cited as its partners for getting music to mix with, and TribeXR is also thinking beyond music to other creative disciplines from music production and drumming to dancing, acting and fashion design.

“We are scaling up to 15 skills by 2024,” said Impallomeni, predicting this could help to build a business with $100m of annual revenues.

splashmob

Splashmob

The next startup, Splashmob, initially looked like something we’ve seen a few times before: a smartphone app designed to be used at concerts, giving artists control over fans’ screens to create a lightshow.

There’s more to it though: CEO Blaise Thomas explained that Splashmob’s technology also accesses the speaker and camera of fans’ smartphones during concerts – through a mobile website rather than by making fans download a specific app.

It can capture data (with permission, obviously); poll fans; encourage them to follow artists on streaming services and social networks; stream video from the stage, and combine it with the show’s visuals and fans’ own cameras.

Artists and event producers can use the company’s visual editor to put all this together, using its system of ‘droplets’ (each of the features listed above is a droplet) to cue everything up for the performance.

It also works with tools like Ableton Live. “This allows you to literally play the audience’s phones using a piano, drumpad, or sequencer,” he said.

Splashmob has plans for adding more droplets in the future, including 3D visuals, lyrics, augmented reality, chat, games and digital goods.

The white-label product is free at its basic level, although that only lets an artist use 10 droplets and connect with 10 audience members. $10 a month increases that to 50 droplets and 200 connections, while $100 a month boosts both to 1,000. There’ll also be an ‘unlimited’ enterprise tier above that.

fansifter

Fansifter

The next startup to pitch was Fansifter, which is trying to help artists, labels and promoters to pool their fan data – something that’s famously suffered from being kept in their respective siloes.

CEO Aivar Laan stressed that its fan-data management platform is fully compliant with privacy laws (Europe’s GDPR included), before explaining how it’s working for one pilot test, with veteran band Pixies.

The band, their label and their promoter had all captured some data of fans around their new album and tour. “By uploading the separate datasets to Fansifter, we dedupe it, enrich it and store it legally [and] a much stronger and more valuable audience profile is formed.”

The band, label and promoter can then use this data to improve their marketing campaigns, but the data could also ultimately be useful for brands.

“Imagine a car company who wants to hyper-target its video ad to dads who love 90s indie-rock, went to three-plus live shows last year, and also listen to Cardi B with their kids,” said Laan.

Fansifter would be the central repository of the data required to do this kind of targeting, with the original owners of the data (the artists, labels and promoters) getting a share of the revenues – and the actual fan data itself never being shared with brands. Sports, entertainment and consumer products are also on the company’s radar for the future.

delta ai

Delta AI

The final startup in this year’s Techstars Music cohort is Delta AI, whose CEO Tiffany Guan explained its technology for understanding what’s going on in social videos not just through hashtags and keywords, but through analysis of the video itself.

“Marketing teams can’t see what’s happening inside videos. it means they can’t accurately track trends or learn how audiences are interacting with their products,” she said, of the existing ways of tackling this. “And for IP holders, they don’t know the true volume of their copyrighted content that exists on platforms.”

So, Delta AI’s technology “watches and understands social video at scale: we can see how audiences are engaging with brand logos, products and characters in any video, using computer vision,” explained Guan.

Oh, and it can also track human movement, like dance challenges in TikTok videos. The company tested its technology using the dance challenge around The Weeknd’s ‘Blinding Lights’ track, which sparked more than 2bn views on TikTok. Delta AI found six and a half times more videos by searching using computer vision, than by using metadata (i.e. keywords and hashtags).

It’s currently analysing platforms including TikTok, YouTube and Triller, and plans to charge a tiered monthly subscription based on how many IP assets a client wants it to track, and on how many platforms. It’ll be partnering with those video platforms for data access, too.

“Right now, we’re initiating pilots with a top music label, a marketing agency, and two global video platforms with over 1.5 billion users,” said Guan. The plan is to complete these pilots by early June, open a seed funding round later that month, and then launch its platform in beta in early 2021.

Stuart Dredge

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