Tech startup: Next Big Sound Inc.
Photo by Jon Rose
INITIAL LIGHT BULB: As an intern with Universal Motown in 2005, Alex White had big dreams. "I wanted to be the mogul with the corner office," he says. "I realized my friends wanted to do the same thing."
So White merged the concept behind fantasy sports with the music industry into "a consumer-facing music site where people could play the role of record mogul and sign acts to their fantasy label."
After the company was accepted into the TechStars program in Boulder in 2009, the target market changed from consumers to industry on the first day of the program. White and his co-founders, Samir Rayani and David Hoffman, decided to relocate from Chicago to Colorado during TechStars and launched the Next Big Sound website in August 2009. The company has eight full-time employees.
IN A NUTSHELL: Next Big Sound offers intelligence on thousands of musical bands, culling data from all corners of the Web. Beyond tracking activity on MySpace, Facebook, YouTube and other popular websites, it also captures mentions in the press and blogosphere. Users can look at the data in numerous ways, from demographic and geographic audience breakdowns to recommendations for boosting online listening activity.
"We sell a centralized dashboard to the music industry so they can keep tabs on everything that's going on," White says. For most of the history of the music industry, album sales have been the key metric, but those times are gone, White says. "There was this massive void," he says. "CD sales weren't reflecting how people were interacting with music online."
White says labels use the site's metrics to evaluate the return they're getting on their marketing dollars. "If you're spending $500 a week on Facebook ads or Google ads or fliers around town, you want to see what's moving the needle."
Next Big Sound employs a "freemium" model: Users can access limited information for free, but to dial in on all of the available data, a "Premiere" subscription is required. An individual subscription runs $10 to $65 a month, depending on the features, while enterprise deals can run into six-digit territory, White says.
The venerable music industry publication Billboard came up with a new chart based on Next Big Sound's metrics, the Social 50. "They licensed our data for it," White says. "That's entirely from us."
Brian Heisler, who manages Kyle Hollingsworth, Euforquestra and Mountain Standard Time with his Boulder-based Bear Orange, says Next Big Sound's geographic-specific data can be a big help for planning tours. "I can take a map and see where our fans are," he says. "I can say, ‘There's an area we should target for our next tour.' Any type of information you can get on who your fans are, where they are, or what they're doing is very helpful."
THE MARKET: White and company initially targeted managers - "They're like the CEOs of bands," he says - but a "flood" of inquiries came from label reps, publicists, scouts and other music-industry types after the website launched.
FINANCING: The Boulder-based Foundry Group led a financing round in August 2009 of about $1 million; Silicon Valley's Alsop Louie Partners and SoftTech VC also participated, as did several angel investors. White says future financing might not be necessary. "We thought we would have to raise a round last fall, but there have been a couple of large contracts, so we've been able to fund the growth internally," he says.
QUOTE OF NOTE: "I had a band's manager tell me, ‘I had no idea YouTube was such a big part of our online activity.' Once he understood how fans were interacting with the band, he was able to push that angle more." - Next Big Sound CEO Alex WhiTE
where Boulder | FOUNDED 2009 | web www.nextbigsound.com