One of the music industry’s most prominent startup accelerators is shutting down. 2023’s Techstars Music cohort will be its last, with MD Bob Moczydlowsky saying that the accelerator model is no longer the best way to invest in music-related startups.
“Even though the way we have been investing has been working, it has been held back by the constraints of an accelerator, which we feel is an outdated model,” he told Billboard. “The amount of capital we can provide is limited. It is also held back by the constraints of labeling it ‘music.'”
Look away now, orchestral fans.
“We want to invest in companies solving problems for music, not music tech companies, but the reality is that founders see ‘Techstars Music’ on the door and they bring us their startup to help kids learn to play a violin,” added Moczydlowsky.
“We actually believe instruments will become irrelevant and software will mainly replace them. Our thesis now is we want to fund the future of entertainment, self-expression and live events.”
Since its launch in 2017, Techstars Music worked with 70 startups, with the likes of Sony Music, Warner Music, Sonos, Concord, Amazon Music Avex, Peloton, Hybe and Q Prime Management as ‘member companies’ (supporters) of its program at various points.
Splash (when it was called Popgun), Endel, Amper Music, Fave, Community (when it was called Shimmur), Fanaply, Superpowered, TribeXR and Strangeloop Studios are among the most prominent startups to have gone through the Techstars Music program.
Moczydlowsky said that the accelerator model’s heyday was in 2008, but that it is no longer as relevant for startups.
“Now the cost of running a business — talent, travel, etc. — has grown. Smart founders can now find online most of the information accelerators provide on how to structure a company,” he said.
“The economic deal that accelerators offer to founders has not evolved in that time, so every year, the accelerator is providing the same amount of capital investment, buying the same amount of equity from founders, but that capital is buying fewer and fewer things.”