San Francisco-headquartered Tune.FM, which describes itself as a web3 decentralized music streaming platform, has secured USD $20 million in funding from global investment group LDA Capital.
The cash injection will support the development of Tune.FM’s platform that blends streaming with an NFT marketplace for exclusive content and experiences. The platform allows artists to monetize their superfans directly via streaming royalty micropayments and digital music collectibles.
While streaming platforms like Spotify capture a large share of profits from artists’ streams, Tune.FM said in a January 10 press release that it offers artists 90% of their streaming revenue. Spotify has said that “nearly 70%” of every dollar it generates from music is distributed to rightsholders, who then pay the artists and songwriters.
“The project has positioned itself as a conduit for artists seeking greater control and compensation for their creative works, where artists can receive 10 to 100 times more for their music. The platform virtually eliminates intermediaries and empowers artists with greater autonomy, enabling them to monetize and distribute their music directly to their fans,” Tune.FM said.
“The platform virtually eliminates intermediaries and empowers artists with greater autonomy, enabling them to monetize and distribute their music directly to their fans.”
Additionally, Tune.FM’s music NFT marketplace allows artists to mint and sell digital assets and collectibles, offering exclusive perks and immersive experiences for fans such as backstage passes, meet and greets, VIP packages, merchandise, Facetime or Zoom calls, as well as limited access to fan clubs and group chats with the artist for news and behind the scenes content.
Tune.FM is poised for expansion, with mobile apps for iOS and Android in the works and plans to onboard major label content, offering fans a comprehensive music library of the sort available on Spotify and Apple Music.
The company also has plans to create a “music festival metaverse” in the future where fans are able to attend token-gated virtual live shows.
Tune.FM was co-founded by musicians and brothers Andrew Antar and Brian Antar. Andrew founded the first startup accelerator and incubator fund at Brown University, and built applications for clients like Bank of America, EY, and Comcast, while Brian produced music with local artists at Penn Studios.
“This investment signifies our commitment to the future of the music industry, one where artists are at the center stage, and their art is valued and rewarded accordingly.”
Anthony Romano, LDA Capital
Commenting on the investment, LDA Capital’s Co-Founder and Managing Partner Anthony Romano said: “By embracing the decentralized model and leveraging cutting-edge blockchain technology, Tune.fm empowers artists to take control of their destiny. This investment signifies our commitment to the future of the music industry, one where artists are at the center stage, and their art is valued and rewarded accordingly.”
LDA has executed over 300 transactions in both the public and private middle markets across 43 countries with aggregate transaction values of over $11 billion. LDA joins other Tune.FM investors including Animoca Brands, Mindfund, The HBAR Foundation, Broad Street Angels, and other angel investors such as Andy Hertzfeld, the co-creator of the Apple Macintosh.
The investment comes amid the growing attractiveness of superfan platforms. Back in October, Fave, a social media platform and fan-centric home for celebrity fans, raised $2 million in an ongoing funding round from Warner Music, Sony Music, Lyor Cohen (the Global Head of Music at Google and YouTube) and Shiva Rajaraman (the Chief Business Officer at OpenSea and a former VP at Meta and Spotify, among others).
Superfan platforms are designed to cater to the most dedicated fans of specific artists. These platforms prioritize fostering a closer, more personal connection between artists and their most avid supporters. This goes beyond simply listening to music and delves into exclusive experiences, personalized interactions, and deeper community engagement.
“We first focused on a fairer way to allocate the streaming pie among real artists by addressing fraud and other aspects that deprive artists of their just compensation,” he said.
“The next focus of our strategy will be to grow the pie for all artists, by strengthening the artist-fan relationship through superfan experiences and products.”
Music Business Worldwide