Audi wants to cut streaming music intermediaries so that artists receive their fair share. Coming out of the stealth led today by the serial entrepreneur and DJ Ranidu Lankage, Audius is building a blockchain-based alternative to Spotify or SoundCloud.
Users will pay for the Audius tokens or they will earn them by listening to the ads. Their portfolio will then pay a fraction of cents per song for decentralized streaming across the network, with artists receiving about 85 percent – compared to about 70 percent of the major streaming apps. The rest goes to make up for whoever is hosting that song, as well as the developers of listening software clients, one of which will be built by Audius.
Audius plans to launch its open source product in beta by the end of the year. But some powerful investors have already been found that see SoundCloud vulnerable to the cryptocurrency revolution. Audius picked up a $ 5.5 million A series, led by General Catalyst and Lightspeed, with the participation of Kleiner Perkins, Pantera Capital, 122West and Listen Ventures. They are betting on the fact that the Audius token will grow in value, ensuring that stocks accumulate a fortune. He could then sell pieces of his tokens to earn revenue instead of charging artists directly.
"The biggest problem in the music industry is that streaming is taking off and artists do not necessarily earn a lot of money, and it may take 3 months, or up to 18 months for unsigned artists, to be paid for the streams, "says Lankage. "This is what encryption really does. You can pay artists almost in real time and make it completely transparent."
The big question will be whether Audius can use the token economy to solve the problem of chicken and The egg of getting its first creators and listeners on a platform could be less robust from a functional standpoint than its traditional competitors. There are many mobile parts to decentralize, but there are also many dissatisfied musicians out there waiting for something better.
From the Sri Lankan hip-hop star to the serial entrepreneur
Most startup guys do not have single billboards on their biography, but Lankage does. Born in Sri Lanka, his hip-hop songs in his native language of Sinhala were the first language to be played on BBC and MTV. He signed with Sony and even got the platinum record, but left the label looking for more control over his work. After moving to Yale, he applied his musical business knowledge to build a Reddit for dance music called The Drop with Twitch & # 39; s Justin Kan in 2015.
The two still joined on a video version of the # Q; A application, Quora called Whale, but also out of his mind. Lankage's next adventure, Polly, a survey tool built as a complement to Snapchat, has inspired the now super-popular Instagram Stories surveys and adhesive questions. But after an acquihire of Reddit fell, he returned to his first love: music.
"I've always been passionate about creating tools for creators," says Lankage. But this time, he wanted to focus on helping them turn their art into a profession. He collaborated with CTO Roneil Rumburg, an engineering partner of Kleiner Perkins who would build a cryptographic portfolio called Backslash, and product manager Forrest Browning, who had sold his StacksWare measurement boot software to Avi Networks.
Their goal is to build a blockchain streaming music service where listeners do not have to understand blockchain. "A user would not even know that he has a wallet," says Rumburg. They will hear an announcement from time to time, receive a subscription or pay for streaming. Since Audius is open source, developers will be able to build their listening customers who could specialize in discovering certain types of music or offering their own payment schemes.
"I have known Ranidu, Forrest and Roneil for a long time and have always been impressed by their ability to merge art, technology and business", says investor Niko Bonatsos of General Catalyst. "In Audius, they bring together all three skills, with a deep technical heart and a convincing solution for a very large market."
Tokens, Not Record Labels
For beginners, Audius is focusing on access to independent electronic musicians. These are the types that might be popular on SoundCloud, but they actually have to pay for hosting there, while they do not come back far behind due to weak platform monetization options. Do not expect U2 and Ariana Grande on Audius, at least not yet. But the start could differentiate by offering access to content that can not be found elsewhere.
To get artists on board, Lankage tells me plans Audius "to use token incentives". Those willing to jump before there are many listeners could get a token bonus that could be worth more if they help to make the service popular. And where the artists go, their fans will follow. Audius hopes the artists will share their links first because that's where they will earn more money.
Audius has also deployed a legion of big-name consultants to help him develop his blockchain relationships between product and artist. Among these is the co-founder of Augur Jeremy Gardner, the artist EDM 3LAU, the co-founder of EA Bing Gordon, and more still can not announce yet.
The focus of Audius will be the user's experience. If the system feels too complicated, listeners and artists will remain elsewhere. A DJ could earn more streaming from Audius, but if Spotify or SoundCloud offer better ways for fans to subscribe to them and generate more games in the long run, they will still direct their supporters. But if Audius can hide the nerd bits while it solves the problems of the music industry, it has the potential to be one of the first mainstream consumer blockchain projects that treats the technology as a utility, not just a new bag on to bet on.