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Mindset Ventures, an international venture capital firm that focuses on early-stage tech investments, has launched an early-stage, music-focused fund, Mindset MusicTech, aimed at the music tech sector. In announcing its debut, Mindset Music has revealed its first six investments: Audoo, un:hurd, Music AI, Aiode, ALLOY and OwlDuet.
Mindset Music is looking for startups that “enhance human creativity or improve efficiency” in the music business, partner Lucas Cantor Santigo said in a statement. “We’re looking to support companies with both capital and expertise, and give holistic support to those who are reimagining the music industry for the next generation.”
“The music tech space is extremely undervalued and has an enormous potential for disruption with AI and other new technologies,” added Daniel Ibri, managing partner of both Mindset Music and Mindset Ventures. “We plan to take advantage of this space and make a meaningful difference in the sector for the founders.”
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Mindset Music’s roster of advisors includes Drew Thurlow, former senior vp of A&R at Sony Music; music attorney Cliff Fluet; entrepreneur Tomer Elbaz; and music and tech attorney Heather Rafter.
The companies in Mindset Music’s portfolio provide tools for businesses and creators to operate more efficiently, and many incorporate AI technology. Music AI is an audio intelligence platform that provides what it calls “ethical AI solutions” for audio and music applications. The Salt Lake City-based startup’s products include stem separation and mixing mastering.
Based in Tel Aviv, Aiode allows musicians to collaborate with virtual musicians using ethically trained AI. Those musicians’ virtual counterparts are compensated through a revenue-sharing model.
U.S.-based OwlDuet calls itself an “AI-powered co-pilot for music creators.” Its production tool purports to allow users to create “Grammy-level production expertise without requiring advanced technical skills.”
Audoo seeks to improve public performance royalty reporting with music recognition technology. The London-based company works with performance rights organizations and collective management organizations.
London-based ALLOY provides information that facilitates the sync licensing process. The platform gives artists, songwriters, labels and publishers a means to set sync deal parameters and distribute sync metadata to digital platforms.
un:hurd has developed a music marketing and promotion platform that guides artists through the release cycle and connects artists with a network of playlist curators.
MQA, the audio coding technology company that makes high-resolution streams for companies like Tidal, entered into administration after its founding financial backer stepped down from its board, according to company filings and media reports.
Anton Rupert, grandson of the billionaire South African tobacco tycoon of the same name, was terminated from the position of director of the board of MQA Limited on March 17, according to a filing. Rupert represented Reinet Investments S.C.A., MQA’s founding funder.
The London-based company specializes in making large music files small enough to be compatible on any service or playback device without losing any quality, it says. While it grew its brand presence through partnerships with major music compies like Xiami Music in China, Tidal and the independent music trade group Merlin, it has struggled to make a profit.
The company flagged its uncertain financial future in its most recent annual report, which was for the year ending Dec. 31, 2021. In a statement in the report, MQA chief executive Mike Jbara described the company as a “loss-making start-up” and said it is aware it faces competition for its employees from other U.K.-based technology companies offering certain financial incentives. The company also stated it had secured funding committments to maintain operations only through the first quarter 2023.
MQA’s business was built on driving demand for their tech by providing tools to content creators who would add to the catalog of music made using MQA’s technology. Those MQA files would make their way to consumers ears via distributors and broadcasters that have agreements with MQA.
For listeners, the proof would be in the quality of the stream. The company said it had 132 consumer product agreements as of Dec. 2021.
Last week, technology news website What HiFi? wrote MQA was going into administration, citing a statement from the company. What will happen to the services MQA provides to its partner companies is unclear, but going into adminstration does not always disrupt a companies’ core operations, at least not at first.
Similar to declaring bankruptcy in the U.S., entering into administration in the U.K. protects insolvent company from creditors. This breathing space gives the company time to pull itself out of its financial problems or the court-appointed administrator will advise taking steps — such as selling off assets — to help pay off the company’s debts.
MQA did not respond to a request for comment.
In their last annual report, the company said it is “confident that we will obtain additional funding commitments during those discussions in (the first quarter) 2023.”
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