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MNTGE, a vintage clothing brand that integrates blockchain technology into its garments, partnered with Grimes‘ Elf. Tech initiative for a limited-edition merch collaboration. The deal will encompass vintage, one-of-one NFC chip-enabled vintage t-shirts and denim jackets, screen-printed with AI graphics designed by Grimes on the back and an Elf. Tech graphic screen-printed on the sleeve. The NFC chips will provide both a digital rendering of the garment and a certificate of authenticity, as well as the ability to preview new music from Grimes by scanning the chips on a smartphone. The Grimes + MNTGE jacket retails for $200 and the t-shirt retails for $50 here.
In other Grimes-related news, CreateSafe — the company whose Triniti API powers Grimes’ Elf.Tech platform — partnered with music technology platform Slip.stream to make more than 200 GrimesAI songs available to creators and fans in their video content and live-streams on any platform. Grimes unveiled the Elf.Tech platform in beta this past May, allowing fans to create and upload songs by cloning the singer’s voice.
DistroKid struck an expanded agreement with TikTok that will make music from artists distributed by DistroKid available across CapCut and TikTok’s Commercial Music Library as well as its recently unveiled social music streaming service TikTok Music, which is now available in Brazil and Indonesia and in beta in Mexico, Australia and Singapore. This is the first time music from DistroKid artists will be available on TikTok Music.
Additionally, DistroKid partnered with digital audio workstation FL Studio to distribute works uploaded to FL Cloud — described as a new service within the FL Studio 21.2 update that will offer producers a growing library of royalty-free loops and one-shots, unlimited AI-powered mastering and unlimited music distribution to all major digital streaming platforms.
Esports company GameSquare Holdings entered into a “definitive agreement” with FaZe Holdings to acquire online gaming and youth culture brand FaZe Clan “in an arm’s length all-stock transaction,” according to a press release. The release states that FaZe Clan and GameSquare generated annual revenue of roughly $138 million and reached a 26.3% gross margin last year. “Management expects to realize over $18 million in run-rate cost savings from the FaZe Clan acquisition, supported by reduced duplicate corporate costs and other cost savings,” the release continues. The combined company plans to give guidance following the close of the transaction, after which Richard “FaZe Banks” Bengtson will take over as FaZe Clan CEO; Thomas “FaZe Temperrr” Oliveira will take over as president; and Yousef “FaZe Apex” Abdelfattah will take over as COO. The transaction is expected to close in the fourth quarter of 2023, subject in part to the approval of FaZe Clan and GameSquare shareholders.
The Circuit Group, a recently formed entity designed to create business opportunities around artists’ intellectual property, signed a strategic partnership with U.K.-based house music label Defected Records. Under the deal, The Circuit Group will offer Defected, along with its sister- and sub-labels, expertise across its suite of services to help the label build its presence in North America. In turn, Defected will support The Circuit Group as it expands its presence in the United Kingdom, Europe and other territories globally.
Defected Records also signed an agreement with Reactional Music, the maker of an interactive music engine for video games. Under that deal, Defected licensed the masters for a selection of tracks from its catalog for use on Reactional’s music delivery platform and personalization engine for game developers. Songs to be made available under the deal include cuts from Bob Sinclar, Dennis Ferrer, Kings of Tomorrow, MK and The Shapeshifters, CamelPhat, Honey Dijon and John Summit.
Michael Bublé launched Fraser & Thompson, a new whiskey brand in partnership with longtime friend and master distiller and blender Paul Cirka. The whiskey is blended and bottled by Heaven Hill in Bardstown, Ky. and will be brought to market by spirits incubator WES Brands.
Warner Music’s ADA renewed its longstanding partnership with independent label LAB Records, which has released music by artists including Tommy Lefroy, BEKA, Beach Weather, Antony Szmierek, Des Rocs, Aziya, Crawlers, The K’s, Nell Mescal and Yoke Lore.
Sphere Entertainment partnered with Madison Square Garden Sports on a deal that will see next-generation Las Vegas venue Sphere become the official jersey patch partner of the New York Knicks. The Sphere logo will now appear on all Knicks game jerseys during both home and away games in the 2023-24 season; it will also be on Knicks practice jerseys, warm-up shirts and jerseys sold at Madison Square Garden’s in-arena retail locations as well as on shop.MSG.com.
Copyright management firm Pex and its rights initiative, RME, entered a collaboration with copyright protection platform Cosynd. Under the partnership, RME’s community of creators and rightsholders can utilize Cosynd’s copyright registration API to register their works with the U.S. Copyright Office.
ASM Global struck a partnership with Adventist Health that will see the California City of Stockton’s 10,000-seat facility renamed Adventist Health Arena. Upgrades to the arena will include a new 360-degree LED center-hung, ribbon boards, back-of-house enhancements and more.
Elsewhere, ASM Global signed a deal with the City of Andover, Kans., to manage and operate the Capitol Federal Amphitheater for five years beginning on Jan. 1, 2024. It also renewed its management agreement with the Jekyll Island Convention Center in Jekyll Island, Ga. through 2029, with an option for an additional five-year renewal after that.
Sen. Marsha Blackburn (R-Tenn.) is planning to roll out new legislation to beef up the BOTS ACT and combat the growing use of automated software to attack high-demand online ticket sales for major concert tours.
In November 2022, unknown individuals attacked Taylor Swift’s ticket sale for her Eras tour, using automated software to overwhelm the Ticketmaster platform and prevent some fans from accessing tickets.
The BOTS ACT, co-authored by Blackburn at the end of 2016 and signed into law by then-president Barack Obama, outlawed the use of bots to attack ticket sales and jump the line to buy tickets ahead of consumers, but the law has only been enforced once in the seven years it’s been on the books. Blackburn is hoping to change that with the adoption of the Mitigating Automated Internet Networks for (MAIN) Event Ticketing Act, a bill she co-authored with Sen. Ben Ray Luján (D-N.M.) that would create new reporting requirements for online ticket sellers attacked by Bots and enact new security requirements for sites like Ticketmaster.
“A fan should be able to buy tickets to live events without bots stealing them and hiking the price,” said Sen. Blackburn in a press release provided to Billboard.
Under the BOTS Act, the Federal Trade Commission (FTC) has exclusive power to file suit against bot users and work with FBI and DOJ officials to bring criminal charges. Individuals caught intentionally breaking the law can face civil fines of $10,000 per violation.
“We have given the FTC the tools they need to help reduce ticket costs and protect consumers and artists from scammers,” Blackburn adds. “Now we must ensure they are enforcing it. This bipartisan legislation builds upon my work to safeguard artists and their fans in the online ticket marketplace.”
The new legislation would create a new forum for online ticket sellers have to report successful bot attacks to the Federal Trade Commission (FTC) and create a complaint database so consumers can also share their experiences with the FTC, and various state attorneys general. The bill also includes evolving data security requirements for online ticket sellers and requires the sharing of information between the FTC and law enforcement; as well as an annual report from the FTC to Congress on BOTS enforcement.
“Live entertainment is one of America’s greatest pastimes, and all Americans should be able to enjoy it without the fear of being scammed,” said Senator Luján. “I’m proud to join Senator Blackburn in introducing legislation to expand the BOTS Act. This bill will allow the FTC to enforce safeguards and set requirements to protect consumers from online ticketing schemes.”
Officials from Live Nation-owned Ticketmaster told Billboard they supported the legislation, saying in a statement: “We commend Senators Blackburn and Lujan for introducing this update to the BOTS Act. Ticketmaster leads the industry in fighting bots, and we see first-hand that scalper bot armies are only getting larger and more sophisticated. Scalpers make billions each year, and until there are real consequences, they will continue to rob fans of tickets at the onsale which is why we’ve long supported much stronger enforcement.”
The bill has also received the support of the National Independent Venue Association which issued a statement applauding Blackburn and Luján for “introducing the MAIN Event Ticketing Act to further crackdown on ticket-buying bots that rob fans of the opportunity to see their favorite artists. The Act builds on the BOTS Act of 2016, which put in place foundational guidelines to prevent ticket resellers from engaging in predatory ticketing practices. We believe in restoring trust in the ticketing experience for fans, and we stand ready to work with Senators Blackburn and Luján to ensure this legislation advances as part of critical comprehensive ticketing reform.”
UTA has signed The War And Treaty for booking representation, with exclusive worldwide representation in all areas. Founded in 2014 by the husband-and-wife duo Michael Trotter Jr. and Tanya Trotter, The War And Treaty has quickly become one of the most exciting new musical acts. They recently teamed with Zach Bryan for the song “Hey […]
Investors want serious, swift changes to make Hipgnosis Songs Fund more profitable and stable. That was the key takeaway from more than 80% of investors’ votes last week on how the London-listed trust that owns rights to songs by Journey, Bruno Mars and Rihanna should proceed. While the landslide vote opened the door to possibly winding up the pioneering publicly traded music royalty trust, it doesn’t spell an immediate end — more like the long beginning of company-wide rethink to improve the company’s stock price.
More than 80% of Hipgnosis investors voted in favor of the board drawing up “proposals for the reconstruction, reorganization or winding-up of the company to shareholders for their approval within six months,” the board said in a regulatory filing.
“These proposals may or may not involve … liquidating all or part of the company’s existing portfolio of investments.” Adding further uncertainty to the fund’s future is that, while its board devises a plan to restore regular dividends and boost a lagging share price, it must simultaneously find replacements for its chair, Andrew Sutch, and two other members, after those three either resigned or failed to win re-election to the board seats last week.
Sources say Round Hill Music Royalty Fund’s outgoing board chair, Rob Naylor, is being considered to chair of Hipgnosis Songs Fund’s board. Naylor is a former London banker and currently the chief executive officer of Intuitive Investments Group, a fund that invests in high growth life sciences companies. Naylor would have been closely involved in negotiating Round Hill’s $469 million sale of its public fund to Concord, which shareholders approved in mid-October and closed this week.
Jefferies analyst Matthew Hose says one route the board might take would be similar to Round Hill’s sale — Hipgnosis Songs Fund could sell itself to its sister fund Hipgnosis Songs Capital, which is jointly run by Mercuriadis’ investment advisor Hipgnosis Song Management and private equity goliath Blackstone, or it could sell itself just to Mercuriadis’ investment advisor Hipgnosis Song Management.
Although investors soured on an earlier plan to sell about 20% of the Hipgnosis Songs Fund to Hipgnosis Songs Capital, with Blackstone’s backing it remains among the most capable buyers and it knows the portfolio of songs well, analysts agree. There’s also a clause in the investment advisory group’s contract that says if the public fund ends its contract with investment advisor, the investment advisor can buy out the fund. The clause, which was laid out in the fund’s 2018 filings when it went public, was intended to help Mercuriadis reassure artists whose catalogs Hipgnosis acquired that he would always stay on as the relationship manager in charge of their songs and legacy.
While Hose says a sale to Mercuriadis and the investment manager could benefit all parties, “the question is whether this board is able to propose an ‘open’ sale process for the portfolio that extracts this fair value for shareholders, while still honoring the manager’s option, or will the existence of the option simply prohibit any realistic bids?”
Analysts who cover investment trusts like Hipgnosis Songs Fund say that about 80% of the time following a no continuation vote, a fund winds up, either through selling its assets to multiple buyers or all of the portfolio to a single buyer and then distributing those proceeds to shareholders minus any debt repayments.
The deliberation over which direction to take the fund will also rely on an updated valuation of the portfolio, which Hose says will likely see a downgrade since the disclosure in October that the fund’s valuers had inaccurately estimated certain CRB III royalty funds.
“We see the potential for weakness in the portfolio,” Hose says. “An independent valuation of the portfolio by a new valuer that gains the trust of the market … could be crucial here.”
Duane Keith “Keffe D” Davis, the former street gang leader charged with masterminding the 1996 drive-by killing of Tupac Shakur, is slated to appear in court on Thursday (Nov. 2) for his arraignment in the case. According to the Associated Press, however, it’s unclear if Davis will have a lawyer representing him during the appearance after losing his bid to be represented in court by the lawyer who spoke out in public about his defense two weeks ago.
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Attorney Ross Goodman said on Oct. 19 that he saw “obvious defenses” in the murder case, pointing out that police and prosecutors do not have a murder weapon or the car used in the shooting, as well as “no witnesses from 27 years ago.” Prosecutors have said that Davis is the last person alive who was in the car that night.
Goodman told the AP on Wednesday (Nov. 1) that Davis, 60, could not meet terms of an agreement that the judge in the case gave two weeks to hash out on Oct. 19; Goodman did not specify what was holding up such an agreement. When Davis appears in court today, Clark County District Court Judge Tierra Jones could order a financial accounting of Davis’ assets to determine if he can afford a lawyer of if she needs to declare him indigent and name a public defender to handle the case.
A deputy in the Clark County public defender’s office told the AP that they are reviewing the case to determine if they can represent Davis or if they have a conflict of interest such as representing other people involved in the case in the past. The judge may also name a private practice defense attorney to represent Davis at taxpayers’ expense, or assign a public defender from the county.
“We’re just not sure at this point how this will play out and who will end up representing him,” said Jordan Savage, assistant special public defender. Davis’ longtime Los Angeles personal lawyer, Edi Faal, said he expected a public defender would be named to defend Davis; Faal previously said he was helping Davis find a defense attorney in Nevada and confirmed Goodman’s involvement two weeks ago. Davis is expected to plead not guilty to the murder charge, which could land him in prison for the rest of his life.
Davis was arrested outside his suburban Las Vegas home on Sept. 29 on the same day an indictment was filed against him accusing the self-proclaimed street gang leader of orchestrating the shooting that killed Shakur, 25, and wounded his label boss, imprisoned music mogul Marion “Suge” Knight.
Davis’ nephew, gang member Orlando “Baby Lane” Anderson, 23, was involved in a brawl with Shakur in a Las Vegas casino on the night of the shooting and denied being involved in the shooting; he was killed in a May 1998 shooting in Compton and the other two men in the car with Davis and Anderson are also dead. Davis, meanwhile, has discussed his alleged role Shakur’s death in interviews as well as in a 2019 tell-all memoir describing his time as a Crips gang leader in Compton, including claiming that he provided the gun, was in the car and was the “on-ground, on-site commander of the effort” to kill Skakur and Knight that night.
Nashville-based booking outfit The Neal Agency, known for a roster that includes artists Morgan Wallen and Bailey Zimmerman, has launched a music publishing division, Billboard can reveal.
The Neal Agency’s head of business development, Ryan Beuschel, will spearhead the new division. Beuschel joined The Neal Agency earlier this year following stints at Warner Chappell Nashville (as vp of A&R/strategy and ASCAP.
The new division’s first signing is singer-songwriter Palmer Anthony via a co-publishing venture with Warner Chappell Music (WCM). Anthony previously signed with The Neal Agency for booking.
“The ultimate goal for the company is to be truly a place to develop artists,” Neal tells Billboard. “Obviously, a big part of that is on the road, but [also] being able to have a hand in the creative process. … As the music industry continues to evolve, we have the opportunity to help create and build artists from the ground up.”
Beuschel says, “I think Palmer is a great example of being the first person that we did this with because he was signing to the agency, and then shopping around and looking into publishing deals. At one point, he mentioned, ‘It would be amazing if we could work together,’ and we knew each other before he signed with The Neal Agency. He had been touring in Texas and was writing some really compelling stuff alone and with co-writers. I felt like it was a great opportunity for The Neal Agency to have creative direction and touring strategy inside the same building, communicating with each other back and forth to push his career as far and as fast as we can.”
“Working with Ryan, with his background at ASCAP and Warner Chappell, this partnership makes a lot of sense,” adds Warner Chappell Music Nashville president/CEO Ben Vaughn. “I met Palmer because of [Beuschel and Neal] and it’s been really cool to watch Palmer starting to network through the town and co-writing. It’s great to build this new thing out with them.”
Anthony grew up primarily in northern California and went on to play baseball at the University of California, Santa Barbara, before pursuing songwriting. After graduation, he moved to Fort Worth, Texas, and immersed himself in the Texas music scene, opening for artists including Riley Green, Chase Rice and Randall King.
The Neal Agency agent Haley Teske was responsible for bringing Anthony’s talent to the attention of the company in the first place, leading to his initial signing for booking.
“I saw him at [Nashville music event] Whiskey Jam and I could tell he was a hard worker, and [I] just kept in touch until the time was right,” says Teske.
“I’ll say it was a best-case scenario for me, too,” Anthony says, “because Haley was a supporter very early in the whole scene and the fact that all these pieces kind of fell into place, with Ryan at The Neal Agency and Ben at Warner Chappell. It was a perfect scenario for me to keep it kind of in-house for publishing and booking.”
Neal launched The Neal Agency in 2022, following his departure from WME. The company’s initial roster included Wallen, ERNEST, Riley Green, HARDY, Seaforth, John Morgan, Chase Rice. and Ashland Craft. It has since grown to include Zimmerman, CCM/country artist Anne Wilson, Ella Langley and lifestyle brands Stevenson Ranch and Whiskey Jam.
Neal says passion — not an allegiance to a certain genre — will continue to drive new signings.
“Me, personally, I listen to a lot of alt-rock. I grew up on Southern hip-hop, Project Pat,” he says, noting that the agency also works with rapper mike for booking. “So we’ve grown to understand that, having to forge relationships with promoters and festivals that we didn’t before, is that there are no barriers for us as a company. It’s about passion, not genre, for myself and all of our agents and staff.”
SYDNEY, Australia — Sounds Australia stalwart Esti Zilber will take the reins at the national music export body, succeeding Millie Millgate as executive producer.
With effect from Monday, Nov. 20, Zilber, currently creative producer, will lead a team that includes Glenn Dickie (export music producer), Dom Alessio (digital export producer) and Larry Heath (associate producer).
“Esti has been such an integral part of the growth of Sounds Australia over the last 13 years,” comments Millgate, who leaves the organization to lead Music Australia as its inaugural director, “and I’m truly excited for the future of the program knowing what a compassionate and formidable leader she will be. Sounds Australia is in extremely safe hands.”
Joining Sounds Australia in 2010, Zilber has played a key role in developing and delivering Sounds Australia’s program around the world. “Her work with inbound buyers across Australia’s domestic music conferences has seen thousands of invaluable connections made between international industry and local artists and managers,” reads a statement announcing her promotion.
During the peak-pandemic years of 2021 and 2022, Zilber managed Sounds Australia’s Export Stimulus Program, which saw $1.2 million distributed, across three rounds, to over 320 Australian artists, crew and music professionals. That financial support was used to realize “significant career-defining moments” in global markets and earn much needed income after 18 months of cancelled work due to the impacts of the pandemic.
Prior to working at Sounds Australia, she was the executive assistant to legendary concert promoter Michael Chugg and managed the offices of Chugg Entertainment and, before that, worked in book publishing in New York and was the executive producer arts and culture at FBi Radio, the Sydney community radio station.
Sounds Australia will next year celebrate its 15th anniversary. Since its launch in 2009, Sounds Australia has managed the presentation of over 2,200 Australian artists on global show stages, covering 86 different international events, in 75 cities, across 26 countries. Its presence can be felt at the Aussie BBQ and Australia House at SXSW, and, for its 10th anniversary in 2019, the Central Park SummerStage with Australian artists San Cisco, Hermitude, The Teskey Brothers, WAAX, Tkay Maidza Australian Music Prize winning Indigenous hip-hop act A.B. Original.
Sounds Australia will “imminently” kick start a recruitment process for Zilber’s replacement, reads a statement.
Led by strong sales and a world tour by the group Seventeen, K-pop giant HYBE’s third quarter revenues grew 20.7% year-over-year to 537.9 billion won ($410 million at the quarter’s average exchange rate), the South Korean company announced Thursday (Nov. 2).
When counted over the first nine months of 2023, Seventeen sold 11 million albums, including 5.1 million copies of Seventeenth Heaven, an eight-track EP, in the week after its Oct. 23 release. Seventeen also performed 18 times in nine cities across Asia, including shows at Japan’s five major domed stadiums that attracted 515,000 fans. In the third quarter alone, Seventeen performed two shows at the Tokyo Dome in Japan as well as a concert at Gocheok Sky Dome in Seoul, South Korea.
HYBE also pointed to a string of successful solo releases by members of BTS for contributing in the quarter. V’s Layover sold 2.1 million albums in the week after its Sept. 8 release. J-Hope’s Jack in the Box, released July 15, reached No. 1 on the Tunes chart in 49 markets. D-Day by Agust D, also known as BTS member Suga, performed 28 times in 10 cities in North America and Asia.
HYBE’s music sales of 264.1 billion won ($201 million) was up 104.4% from the prior-year period and was 7.4% better than the 245.9 billion won ($187 million) in the second quarter. Concert revenue was up 83.9% year over year to 86.9 billion won ($66 million) but fell 44.8% from the prior quarter.
The company’s acquisition of Atlanta-based hip hop label Quality Control has quickly made a major impact. Home to such artists as Migos and Lil Baby, Quality Control accounted for 19% of HYBE’s streaming revenue in the quarter.
Big Machine Label Group, picked up in 2021 through the acquisition of Scooter Braun’s Ithaca Holdings, contributed 27% of third-quarter streaming revenue while South Korean labels took a 54% share.
Weverse, HYBE’s social media platform, increased its monthly active users to 10.5 million in the third quarter from 9.5% in the previous quarter and 6.9 million in the third quarter of 2022.
Shares of HYBE gained 5.4% to 243,000 won ($180.89) in early trading on Thursday in South Korea.
Total revenues grew 20.7% to 537.9 billion won ($410 million).
Music revenues gained 104.4% to 264.1 billion won ($201 million).
Concert revenue jumped 83.9% to 86.9 billion won ($66 million).
Merchandising and licensing revenue fell 25.3% to 85.7 billion won ($65 million).
Fan club revenue grew 21.3% to 21 billion won ($16 million).
Adjusted EBITDA grew 13.1% to 90.8 billion won ($69 million).
Net profit improved 5.9% to 98.6 billion won ($75 million).
A songwriter named Vince Vance is once again suing Mariah Carey over accusations that she stole her perennially-chart-topping “All I Want for Christmas is You” from his earlier song, a year after he dropped a previous lawsuit making the same allegations.
In a complaint filed Wednesday (Nov. 1) in Los Angeles federal court, Vance (real name Andy Stone) made the same basic accusations as he did in his last lawsuit: that Carey’s 1994 holiday blockbuster infringed the copyrights to his 1989 song of the exact same name. That’s no small claim: Carey’s “All I Want” has reached No. 1 on the Billboard Hot 100 during each of the past four holiday seasons.
But the new case includes far more detailed — and far more personal — allegations against Carey, including that she made up the story of how she wrote the song, and that her own co-writer, Walter Afanasieff, has disputed that story.
“Carey has without licensing, palmed off these works with her incredulous origin story, as if those works were her own,” Vance’s new lawyers wrote in the re-filed complaint. “Her hubris knowing no bounds, even her co-credited songwriter doesn’t believe the story she has spun. This is simply a case of actionable infringement.”
Notably, Vance is now represented by Gerard P. Fox, the same attorney who represented two songwriters who accused Taylor Swift of stealing the lyrics to “Shake It Off.” That case went on for more than five years of litigation before it ended in December 2022 with a confidential settlement.
Just like his first lawsuit, Vance’s new complaint claims his own “All I Want for Christmas is You” was recorded by his Vince Vance and the Valiants in 1989 and had received “extensive airplay” during the 1993 holiday season — a year before Carey released her better-known song under the same name.
But his new lawsuit includes new details about the success of his earlier song, calling it a “a country music hit” that peaked at No. 31 on Billboard’s Hot Country Songs chart and later reached No. 23 on the Hot 100 Airplay chart (re-named the Radio Songs chart in 2014.) He’s also now joined as a plaintiff by Troy Powers, who claims to have co-written the earlier song.
The new version of the lawsuit also makes more detailed allegations about the similarities between the two songs, delving into the “unique linguistic structure” and musical elements that Carey allegedly copied in her song.
“The phrase ‘all I want for Christmas is you’ may seem like a common parlance today, in 1988 it was, in context, distinctive,” Vance’s new lawyers write. “Moreover, the combination of the specific chord progression in the melody paired with the verbatim hook was a greater than 50% clone of Vance’s original work, in both lyric choice and chord expressions.”
Notably, the new complaint lawsuit also mentions Love Actually, the 2003 Christmas movie that skyrocketed Carey’s song even further into the holiday canon. The lawsuit notes that Carey’s song appears in “a featured performance scene in the penultimate act in the mega hit film.”
A rep for Carey did not immediately return a request for comment on Wednesday evening.
Slacker, the music streaming service owned by LiveOne, called off its planned merger with Roth CH Acquisition V Co., a special purpose acquisition company, the companies announced Monday (Oct. 30).
LiveOne CEO Robert Ellin attributed the move to a poor market climate for small companies. “Market conditions for micro-cap stocks, for stocks under $1 billion, are just decimated this year as a whole,” he says. Companies that go public through SPAC mergers also face a difficult time, he adds. A SPAC is a blank-check company created and funded for taking a private company public. SPAC funding and mergers peaked in 2021, according to SPAC Research.
The SPAC market has softened considerably since 2021. Many SPACs failed to close a deal and returned their funds to shareholders. Music Acquisition Corp. returned funds to shareholders in Dec. 2022. Liberty Media closed down its SPAC in Nov. 2022 after a fruitless search for a takeover target. A record 123 SPACs liquidated in the first half of 2023, compared to just seven in the prior-year period, and the average redemption rate — SPAC shares redeemed for full value before merging with a target company — increased in the first half of 2023, according to Kroll. “It’s a tough market to come out in,” says Ellin.
Additionally, LiveOne believes Slacker has gained in value since it agreed to merge with Roth. LiveOne previously announced it had signed a letter of intent to merge Slacker with Roth and put a pre-money valuation of $160 million on the music streamer. But on Monday, LiveOne raised its revenue guidance for Slacker to the range of $63 million to $66 million for the fiscal year ended March 31, 2024. The company expects adjusted earnings before interest, taxes, depreciation and amortization of $17 million to $19 million.
“I think it’s worth $200 million at a minimum,” says Ellin, “and probably way higher than that when you’re looking at what Tidal sold for at $400 million and change, where Deezer trades at 300 million [euros, or $317 million]. We’re the only one that’s profitable. We make money every month, every quarter, every year.”
The market currently puts a far lower value on Slacker, however. LiveOne — including Slacker — has a $92 million market capitalization. That includes an 81% stake in PodcastOne, a podcast company LiveOne spun off in September that currently has a market capitalization of $70 million. LiveOne said that prior to the spin-off, PodcastOne was valued at between $230 million and $274 million by third-party valuation firm ValueScope.
Slacker was founded in 2007 and acquired by LiveOne — then called LiveXLive Media — in 2017 for $50 million. Many of its subscribers come from a white-label service that powers other brands’ digital radio. For example, nearly every new Tesla automobile sold in the United States comes with a subscription to Tesla Radio that’s provided by Slacker and paid for by the automaker. LiveOne says it added over 300,000 new paid Tesla subscribers in the first five months of its fiscal year, a 30% year-over-year increase. The company expects to add over 800,000 new subscribers this fiscal year.
With the SPAC merger off the table, Ellin sees numerous potential avenues for Slacker. “There’s an opportunity today to roll up multiple other companies in the space,” he said during an investor call on Wednesday (Nov. 1). “We have four to five potential acquisitions in the audio business alone that would fit in very nicely with the company and be extraordinarily accretive to revenues and bottom line. We also could explore a sale or a strategic investor, including some of our current customers or investors. We also will explore a direct IPO as the markets change and fair market value for the numbers that we’ve delivered are available.”
Roth “is currently exploring opportunities with other potential merger candidates in order to complete its business combination,” according to Monday’s press release.