The Music Fund
Capital to musicians and allows investors to gain exposure to the music industry through an investment fund.
| Date | Investors | Amount | Round |
|---|---|---|---|
| - | investor investor | €0.0 | round |
| N/A | €0.0 | round | |
N/A | Acquisition | ||
| Total Funding | 000k | ||
The Music Fund operates as a financial technology platform providing a distinct funding mechanism for musical artists by allowing them to sell a portion of their future royalty streams for immediate, upfront cash. Founded in 2017 by CEO John Funge and CTO Thomas Jerde, the company was established to offer artists an alternative to traditional loans or advances. The founders leveraged their deep backgrounds in data science and finance, having previously developed an AI-based automatic music valuation model at the systematic investment firm Winton Group. This expertise forms the core of The Music Fund's proprietary technology.
The company's business model is centered on a data-driven approach. It utilizes a smart-pricing algorithm, powered by artificial intelligence and machine learning, to analyze artists' streaming data from platforms like Spotify and Apple Music, along with past royalty statements, to forecast future earnings. Based on this prediction, The Music Fund offers to purchase a percentage of an artist's royalty income for a fixed period, typically two years. Artists can receive amounts reportedly up to $50,000 within 24 hours. This structure is not a loan; the artist has no obligation to repay the funds, even if the actual royalties collected fall short of the company's projections. This model ensures that artists retain full ownership of their copyrights and master recordings while gaining access to capital for career development, such as recording, touring, or marketing.
The Music Fund's target clients are independent artists with a significant streaming presence, typically a minimum of 100,000 monthly listeners. The company generates revenue by collecting the agreed-upon percentage of royalties for the specified term. Its model is designed for scalability, focusing on executing a high volume of deals rather than maximizing profit on any single transaction. After spinning out of Winton as an independent entity in late 2018, the company participated in the Techstars Music Accelerator program in 2019, securing seed funding from investors including Techstars and Warner Music Group. In a significant milestone, The Music Fund was acquired by the financial management platform HIFI on September 30, 2021. Following the acquisition, Funge and Jerde joined HIFI's executive team as Chief Technology Officer and Vice President of Data Science, respectively, integrating their valuation model to enhance HIFI's financial product offerings for creators.
Keywords: music royalty financing, artist funding, fintech, data-driven funding, royalty exchange, music finance, independent artist capital, streaming royalties, AI music valuation, artist investment, royalty income, music catalog valuation, alternative finance, creator economy funding, upfront cash for royalties, Techstars Music, HIFI, John Funge, Thomas Jerde, music advance alternative