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April 8, 2008

SellaBand wins $5 million in Series A

Mike Butcher

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Social music service SellaBand has won $5 million (Euros 3.5 million) in a Series A round from Prime Technology Ventures, also a Dutch company, reports TechCrunch UK. (SellaBand operates across Europe but is registered in Germany).

Music fans on SellaBand invest 10 dollars in an artist they want to back. If the artist gets to 5,000 ‘believers’ they get 50,000 dollars and then SellaBand steps in to get the band to record an album in a real studio. Each fan gets a limited edition CD. If the artist doesn’t reach $50,000, the fans can get their money back or give it to another artist. So far they’ve released albums from eighteen bands from eleven different countries. Last December SellaBand partnered with Amazon to offer a dedicated music store on Amazon.

We wrote early last year that this model seemed to be working quite well, and noted similar startups, with some being given a boost by Amazon - which seems to be deeply involved in changing the online music industry.

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This entry was posted on Tuesday, April 8th, 2008 at 9:48 am and is filed under Company & Product Profiles. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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  1. Usability Counts » Blog Archive » Cool Website Tuesdays: SellaBand

    April 8th, 2008 at 10:58 am

  2. Business News Research » SellaBand wins $5 million in Series A

    April 8th, 2008 at 6:52 pm

  3. M@Blog - by Matthew Romaine » *sigh*, the music industry

    April 9th, 2008 at 11:11 am

Comments

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  1. Ryan Merket

    April 8th, 2008 at 10:00 am

    Looks like someone is cashing in the Myspace band phenomenon. Great idea and execution.

  2. Darnell Clayton

    April 8th, 2008 at 10:04 am

    Wow, this is ingenious! Too bad the current music industry is not looking at this.

  3. ceejayoz

    April 8th, 2008 at 10:05 am

    That’s a brilliant idea.

  4. ZiZi

    April 8th, 2008 at 10:08 am

    YES, I love this idea.. good job to who ever did it :)
    I AM NEXT FOOLS!!
    my site launches next month.

  5. Nhim Long Xanh

    April 8th, 2008 at 10:15 am

    wow, good idea…

    Nice entry, thanks :”)

  6. Josh

    April 8th, 2008 at 10:17 am

    Awesome idea! Very original, very impressive!

  7. Simon Columbus

    April 8th, 2008 at 10:18 am

    Sellaband is a great project. Just today I received my first cd from them :-)

  8. Grammar Snob

    April 8th, 2008 at 10:58 am

    “We predicted early last year that this model seemed to be working quite well.”

    You predicted that something seemed to be working quite well?

    I predicted earlier today that the writing on TechCrunch seemed to be subpar.

  9. CouchTycoon

    April 8th, 2008 at 10:58 am

    congrats, sellaband!!!

    hope that will be helpful for our industry.

  10. Grammar Snob II

    April 8th, 2008 at 11:00 am

    @8: Hilarious. But it’s bad writing, not bad grammar. It doesn’t even make sense.

  11. Michael B

    April 8th, 2008 at 11:08 am

    Wow, that’s a great idea.

    -Please check out my website for ways to make moeny online
    http://mikesmoneyclub.blogspot.com

  12. free press release

    April 8th, 2008 at 11:19 am

    so the fans who pitched in can get the limited edition CD for free. does it incur any additional charges like shipping?

  13. Wayne Lambright

    April 8th, 2008 at 11:19 am

    it say’s

    You are the record company

    should it read.

    You’re the record company

    ?

    which is proper?

  14. Mr. Idle

    April 8th, 2008 at 11:24 am

    reading the comments above, i must say that i am wondering about how many people still do not know p2p financing sites like sellaband.

    anyway: congratulations and good luck sellaband!

  15. Search Engine Optimization Journal.com

    April 8th, 2008 at 11:45 am

    This is a great idea! What a good opportunity for bands to really get in the driver’s seat.

  16. Adam Wexler

    April 8th, 2008 at 12:06 pm

    Sellaband is one of the better ideas in the digital music realm. It’s an innovative way for artists to remain artists and produce wonderful music in the process. Congrats on the funding!

  17. Brian

    April 8th, 2008 at 12:14 pm

    Sellaband is an awesome idea and it will change the music industry. I’ve been on this site for awhile now. I’m glad it’s getting the publicity on TechCrunch. Everyone should check it out! There’s a new site out there called IndieGoGo that does crowdfunding for movies too.

    It’s pretty much the same concept as Sellaband- filmmakers can post their projects online, ask fans to contribute money, and fans will get perks (like free DVDs or VIP passes) in return. IndieGoGo is to the movie industry what Sellaband is to the music industry- it will change Hollywood. Check it out– http://www.indiegogo.com.

  18. Miles

    April 8th, 2008 at 12:38 pm

    what if people could buy shares in the bands at X$ per share. then as the bands got more popular the price/share increased? that’d be sweet.

    http://collegemogul.com

  19. Tim

    April 8th, 2008 at 12:49 pm

    German though, and not Dutch! :)

  20. Jason

    April 8th, 2008 at 1:04 pm

    How does SellaBand address distribution and marketing? Bands sign with labels to make connections and move the press machine in their favour. Even $50,000 is nothing unless the right taste makers listen to and like the music. Unless SellaBand can figure out who those tastemakers are and get *them* to invest, I don’t see how this will take off.

  21. Gary

    April 8th, 2008 at 1:56 pm

    I heard about IndieGoGo as well. Recently got one of their emails about the $10,000 fundraising success story for a movie called the Lilliput. It seems like crowdsourcing funds is starting to get pretty hot with companies like Prosper, Kiva, IndieGoGo, and Sellaband.

    Congrats to all changing their industries one dollar at a time.

  22. Grammar Snob

    April 8th, 2008 at 2:03 pm

    @10: I am a grammar snob but that is not the full extent of my services. You incorrectly inferred that my name was making a statement about the error in the post, which it was not.

  23. Duncan Riley

    April 8th, 2008 at 2:22 pm

    Interesting, I never knew startups won venture capital. Was it a competition?

  24. no one in particular

    April 8th, 2008 at 4:21 pm

    sorry guys, but this model will fail, destination : deadpool.

    the problem with it is that when you’re a newcomer, chances that your music will be heard is close to zero. their UI is not helping displaying new entries, but instead the popular bands (the one people already invested in, sometimes over 6 months course). last time i logged in there was 11,000 bands. only a few are listened to, and from that, they signed only 18 bands. Less than 1 million dollars in a year. sorry guys, but the model will fail.

  25. no one in particular

    April 8th, 2008 at 4:22 pm

    it would work if there was some sort of pre-screening like in american idol. otherwise you have no chance being heard.

  26. josh

    April 8th, 2008 at 4:47 pm

    Agree w/previous. 18 albums in 1.5 years, strange convoluted trickledown biz model that divides a small (currently 18 piece) pie into even smaller pieces. On top of this enough current (amie st) and unsuccessful (weedshare) models trying to get a piece of the market for music that no one’s heard of.

    On top of this, enough vc money invested to make anyone feel bloated.

    Most new unnoticed music gains traction, contracts and sales these days from these kinds of avenues:

    1.Myspace etc.
    2.YouTube
    3.The Blogosphere
    4.music recc engines
    4. Discovery in an iTunes ad.

    The commonality is that none rely primarily on music sales for revenue.

    Small startups offering a widely available commodity, regardless of the sales gimmick, don’t have alot of chance…

  27. Gary Storm

    April 8th, 2008 at 9:54 pm

    The key is that the music/artists have been funded by the fans, who each receive a limited edition cd for every ‘part’ they invested in (and that included postage), as well as shares of the ad revenue and regular cd sales in the shops.

    Free mp3’s for everyone to taste: http://www.sellaband.com/shop/

    Including from my wife, Mandyleigh Storm (Fire & Snow), who recorded with Mick Glossop (producer of Van Morrison, Frank Zappa etc) and musicians from Van Morrison, Frank Zappa and Steeleye Span.

    Ultimately success rests on the marketing/promotion of those recorded artists. You could have the greatest album in the world, but if no-one hears about it……

    Music chosen by fans is much better than music chosen by the accountants at trad record labels.

    btw any money invested can be refunded at any time before the artist reaches the target. Only when they reach the target is the money locked in.

  28. The Magnate

    April 8th, 2008 at 10:43 pm

    MagNet is coming….

  29. JMill

    April 9th, 2008 at 7:57 am

    I’m actually doing research for a project at MIT on the digital music industry. We’re giving away $5 in free Amie Street credit for everyone who completes the survey. Please click the link below.

    http://www.surveymonkey.com/s......GHNg_3d_3d

  30. eelco

    April 9th, 2008 at 2:10 pm

    Dutch site tweakers.net reports that Sellaband now wants to “cross the ocean” to the States. I wonder if that will also mean moving to the valley.

    ps: As i understand it, Sellaband is founded by Dutch people, but registered in Germany because its main investor was German.

  31. Gary Storm

    April 9th, 2008 at 5:53 pm

    Don’t know if the main investors were German, but they definitely registered in Germany for some legal reasons (cheaper maybe? more robust laws?).

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