Beatport acquihires Listn, looks to bring social to its massive EDM community
The idea of a music social network isn’t a new one. Apple tried and failed with its iTunes add-on Ping. The New MySpace took a fat swing and miss at the concept. Spotify’s spammy Facebook News Feed integration drove more backlash than praise. Twitter Music is a was a big dud. Pandora, Rdio, and most other streaming platforms have tried to incorporate social in some form, all with middling success. And yet, many in the industry view social as the holy grail of the next generation of music consumption.
The latest looking to add social components to its listening experience is Beatport, the EDM (electronic dance music)-focused music download platform. Beatport, which itself was acquired by SFX Entertainment in February 2013, today announced the acquisition of Listn, an early-stage LA-based music social network.
Listn had raised a total of $500,000 in Seed funding at a $2.5 million pre-money valuation from investors that include Real Ventures, BDC Venture Capital, Launchpad LA, and Founder Fuel. The companies did not disclose the terms of the acquisition, but Listn founder and CEO Mike Schmidt tells Pando it was a seven-figure deal and noted that the company’s early investors “all made some money.”
"The technical challenges of it were fun, and we were seeing nice growth," Schmidt tells Pando. "But in the back of our minds, we knew the music industry was incredibly challenging, not to mention expensive to compete in. Monetization was something that was far down the line for us, so we were always having fundraising and acquisition conversations in parallel. That's how the Beatport relationship started, as a strategic investment discussion. But they were more interested in acquiring us. I think our investors were thrilled."
Listn offers music fans the ability to connect to existing streaming music services (Rdio, Spotify, Soundcloud, Youtube, Hype Machine, and your private iTunes library), collect and share favorites and playlists across multiple platforms with friends, and explore trending music. The service attracted 400,000 registered users since relaunching with this new product vision eight months ago.
Unfortunately, for those users, the Listn app will be removed from the App Store today and the service will shut down entirely at the end of the month, according to Schmidt, who tells Pando that the company’s five full time employees will all transition over to working on similar social music initiatives under SFX, and move from LA to New York in the process. In that sense, this deal is looking more and more like an acquihire, rather than a product acquisition, a fact that Schmidt concedes. And with Listn yet to monetize, it certainly wasn’t for the revenue.
“When we first started Listn we set out to change and improve the way the world shares and communicates via the music they love,” Schmidt says. "Now, over a year later we’re proud to be joining a company that shares that mission.”
A Listn blog post on the deal reads:
Beatport is the largest electronic music community in the world. We are a part of their incredible goal to round out the end-to-end experience, from live events to digital music. Now more than ever, we are focused on building a community for people from all walks of life, united by music.One problem in the quest to merge social into existing music experiences, is that none of these platforms (save for maybe The New MySpace) started with social as part of their DNA. Rather, each made some mid-course attempt to add in social either confusing or frustrating existing users, and at the same time not quite delivering a compelling enough experience to draw in new users seeking a social-first music experience. It’s hard to see how this will be much different for Beatport. As it is, the company offers an online-only equivalent of the iTunes store or Amazon Digital Music, albeit one dedicated to a single, particularly fervent genre of fans.
And therein lies what makes this deal interesting. EDM fans, perhaps more than any other category of music fan, are extremely digitally-oriented. Sure, hip hop has always had a dedicated sub-culture, one that flourishes in blogs and Rap Genius. Rock, punk, jazz, alternative, and other categories all have their dedicated audiences who are eager to discuss their favorite artists or a recent show. Even Pop has its “Beliebers” and Gaga’s “Little Monsters.” But none of these genres lends itself to the digital realm like EDM. If social music consumption makes sense for any genre it’s this one.
Case-in-point: SoundCloud. EDM is by and large the only reasons that SoundCloud “worked” as an early platform. DJs were the first to grok its value and rabid fans, who had nowhere else to find the newest sets and remix tracks and flocked to the platform long before more mainstream music fans caught wind of it. To this day, it’s the most social of all digital music platforms, allowing its users to follow and favorite individual tracks and artists, create and share playlists, consumer or contribute content, embed content elsewhere on the Web, not to mention offer content for sale.
In many ways, the most likely outcome for Beatport following this deal is that it becomes a lot more like SoundCloud. Where Schmidt and his team (both old and new) will be challenged is to look beyond SoundCloud, not to mention Spotify, Pandora, Rdio, and every other platform in the space, to reimagine what social music consumption should look like.
As society as a whole gets more digitally savvy, it seems inevitable that music, regardless of genre, will get more (digitally) social. But we have yet to see that magic implementation that takes this from concept to reality. The ink on the Listn acquisition has barely dried. And with just a five person team it’s unlikely that this deal will make a major dent in the music listening universe. But what it does mean is that Beatport, a major force in the EDM universe, is thinking deeply about social. On some level, you’d be surprised to learn that they weren’t taking social seriously. But today, the company put its money – at least some of it – where its mouth is. We’ll see soon enough whether it’s anything more than an expensive recruiting exercise.