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Foreign
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I'm Dan Runcy. Welcome to Trapital. For most of the modern music business, the artists have had pretty limited options in terms of what financing look like. They could sign a record deal, they'd get an advance, maybe they'd fight over their royalty rates, but they hoped that the machine would work out in their favor. But in the past 15 years, the menu of options has grown considerably. There are platforms for every type of artist that would try to do any type of thing. If you want to release your music independently and only pay a small flat fee, you can do that. If you want bit more support and you're willing to share a cut of your future earnings, you can do that too. And if you want to tap into the value of your music without a traditional record label advance, there are several ways to do that too. In this episode, we're going to talk about two companies that are sitting at the center of that shift. Two economic platforms that in different ways are giving artists more options than they didn't have before the first one, you'll hear a conversation with Mag Rodriguez. He is the CEO and co founder of Even, which is a direct to consumer platform where artists can sell music and products directly to their fans. And we talk about what changes happen when that fan relationship isn't just stream this song, buy this thing or something transactional. This is about turning loyalty and community into meaningful revenue. And in full disclosure, trapital Ventures, a venture fund that I am the general partner of, is an investor in Even. After you hear my conversation with Mag, you'll hear my talk with Lior Tibon. He is the CEO and co founder of Duetti, a company that invests in music rights and also built its own exclusive platform to be able to evaluate music rights deals Private primarily some of the deals that other private equity firms or funds may not be looking at. To date, Duetti has raised hundreds of millions of dollars to both build its own company and its platform and the technology to do these deals at scale but to also invest in the assets themselves. So if you're an investor or operator trying to better understand the landscape, if you're an artist or rights holder yourself that is building a business and want to better understand why, what the options look like for direct sales, deepening your fan ownership or unlocking your own capital. This is an episode made for you. And we get into the infrastructure underneath how music is changing and what it means for the next generation of careers. Let's get into it. This episode of Trapital is presented by linktree, the link in Bio tool that lets artists house everything in one place, streaming links, tour dates, merch videos, audience collections, socials, and more. With 60 integrations across the platforms you already use, like TikTok, Instagram, Shopify and Lelo, Linktree allows you to centralize your ecosystem, save time and optimize your entire online presence from one place. Fans can tap one link and choose their preferred streaming platform, whether it's Spotify, Apple Music, any Amazon Music, or any others. To easily listen to your releases and make discovery seamless, you can build hype before the release day with Spotify Pre Save links and automatically use those to convert to streaming links when your track goes live. You can also own your audience by collecting fan emails and phone numbers directly through your link tree and build a list that you control instead of depending on algorithms. You can also see which cities engage most with your music, which links get clicked, and when fans are active. Plan your tours and releases Smarter. Use code TRAPITAL50 for 50% off your first three months of Linktree Pro. That's T R A P I T A L5O. You can get started at linktree.com or tap the link in our Show Notes. Terms and conditions apply for for more info, tap the link in our Show Notes to view the landing page. If you love listening to trapital and want to stay ahead in the world of tech startups and venture capital equity, TechCrunch's flagship podcast has the inside scoop. Every Wednesday and Friday they dive into the stories that matter most, from expert interviews to in depth discussions and roundtable chats with their team of TechCrunch reporters. Whether you're an entrepreneur looking for tips or just curious about what's shaping tomorrow's world, they've got you covered. Tune in to Equity wherever you get your podcasts. Today we are joined by my guy Mag Rodriguez, the CEO and co founder of even. Welcome to trapital man.
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I'm so honored to be here and also excited. Feel surreal actually.
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I appreciate you making the time and we're talking for good reason. You've had a number of strong announcements to kick off 2026, but let's start with J. Cole releasing the fall off his latest studio album and having the physical digital and the pre sales for his tour coming through. Even it feels like a lot of the momentum you've had over the past couple of years is proving we are built for artists that are doing their own thing independently. We are also built for the biggest artists in the world, so this is a pretty cool case study to see come to life.
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Yeah, I mean, it's incredible. You know, one of the main stuff that comes up, especially with like an artist at this level. I think no one really questions when a La Russell or a Mick Jenkins chooses to use even. But I think something that comes up is like, well, J. Cole's a superstar and he's working with UMG and Interscope. Why didn't they just do this themselves? And I think the, the misconception there is tied to people thinking that Even is just a storefront. But it's more than that, I think especially as artists are get bigger and are global superstars, there's a lot of moving pieces to really make that machine work. And Speed ends up being the decision maker. You know, launching a storefront and a web store, which is just the front facing element can take weeks and you know, a good amount of resources and getting the artist buying, getting the label buy and et cetera. Even offers that turnkey solution where we're built for the music industry. Everything from ingesting content, paying out publishing, paying out to the MLC reporting to Billboard or Luminate. So those sales count towards Billboard creating community engagement that bridges those communities together. And that's really why partners are choosing to come to Even. We're honored. Like this is our third campaign with J. Cole. It's not the first release. We initially worked with with Cole on the Inevitable audio series. The initial intention was never even to do anything with music. It was more so for him to release his audio series and they chose Even's infrastructure to do so. And then from there it turned into the 10 year anniversary of the album where they released bonus tracks that weren't available in the initial release. They did a vinyl release, they did a live stream at Madison Square Garden. And from there, every step of the way we've been able to prove the value of our infrastructure. Not only to withstand the amount of traffic, but also being able to move very nimble and quickly and how seamless that works. So the second campaign was a 10 year anniversary and then the latest campaign was with the falloff, which essentially is the destination to get all things J. Cole. The fall off. Whether you're buying the vinyl, the CD there, it's not on retail stores. The only way to buy this product is directly from J. Cole's what store that Even is powering. He has a mixtape there that's not available anywhere else. Birthday Blizzard 26. And then as of this week they launched the official pre sale sign up for his global tour. And again fans are going to one destination to get every Part of this rollout.
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Yeah, I do want to dig into the distinction you made because someone could look at this and say, okay, J. Cole, he's been working with Interscope for a number of years. What does he get from this type of release working with you all, as opposed to, let's say another Interscope superstar like Billie Eilish, who also has her own website, has her own ability to get vinyl inventory to release that, put that on her storefront as well. And I know you may not know the details about her operation, but. Yeah, what are you able to offer them that someone like Cole didn't have himself through? Again, his own. His own website, Interscope, Dreamville, et cetera.
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Everything starts with how Even's infrastructure is optimized. And an example of that is inside of the inevitable world, which is inevitable Live. It's like the sister website to the falloff and it was the initial destination. There's a community chat where now that launched in November of 2024. There have been fans there every single day, 24 7, talking to each other. It's essentially think of like a discord, but without needing a discord. But Cole also wanted to launch his own version of like a forum. And in a matter of like a day, he plugged in what he wanted with our team and next, do you know, he launched what's called Bill Central. It's essentially like a Reddit meets forum. This is where he's hosted an ama. This is where fans are, you know, writing like letters of what he means to them, but also just asking questions to each other. Hey, did you get the pre sale code? Hey, who's going to go to this show? Hey, Cole's doing this, you know, trunk sales tour around the U.S. do you guys know where he's going to be at next? So it's, it's become a destination where it's more than commerce. It's truly about engagement and welcoming and creating a safe space for fans. We've never had to block a user from both inevitable or the fall off or anywhere across even, because what we've identified is that fans that show up with intention sign up and then pay for access, especially through an accessible lens. It goes beyond just the storefront, right? Your traditional web store is transactional. You show up, you buy and you leave a storefront powered by Even. Fans show up, they engage, they buy, they engage, they buy, they engage, they engage. And then that goes on, goes on and goes on. And I would like to credit that as the reason why Cole and the team have chose to work with even now for three campaigns. Now with umg, we really needed to prove our value of what we do and what we offer and being able to show that and now have a company like UMG to say, hey, we want to be partners. We want you to service all of our global artists if they choose to want to release on the platform.
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Let's talk more about the UMG partnership because I assume that it is similar with Cole. This is an opt in where now all of the artists have access to it. But it's likely a conversation between you, the heads of the sub labels under the music group and then the individual artists as well.
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Yeah, yeah, it's exactly that. And this deal for, for clarity too, this deal is no different than the deal that we did with United masters or with a two lost or a symphonic or a secretly or any of our 3,000 labels that we service on the platform. It's the same exact framework and the exact same essentially deal where it requires the artist buy in.
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Right?
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The artist has to say, I want to sell directly to my fans and it requires that buy in because it's, you know, our slogan is by the art from the artist. Yes, many artists have a label or a distributor, but if it's not the artist going out to their audience and saying, hey, I have something really special that I worked on and I want you guys to get it from me and nowhere else, it doesn't work. Right. This isn't just, you know, public marketplace where you can go and find releases. We do have elements of that, but it's really designed to be intentional, to really super serve those super fans across the board. So yeah, it requires an opt in and it's just, it's not exclusive as well. A big part of this is we go to none of, none of our partners. We never said like exclusive exclusivity clauses. We want to be Switzerland. We want to service a new artist that's selling their first five albums and global superstars that are selling their hundreds and thousand album. And it's the exact same tool, the exact same infrastructure.
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Let's switch gears a bit to talk about touring because you mentioned the pre sales and I know in the touring business pre sales are a very hot commodity. You've had companies like Spotify want to have access to pre sales. Lot of credit card companies do cash app. What does that look like for even. Was that a tough thing to negotiate, especially for artists like Cole who's doing arenas?
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Honestly, we've never done a pre sale before. This is our first Time doing a tour pre sale, especially at this scale, like for this to be our first one. You know it was, it was interesting but it honestly it was something that his team brought to us as an opportunity to explore. He know we have the infrastructure. His fans were already engaging through the sites that even if powering so it just made sense to keep it in one place. And yeah, they, they came to us with the idea. We showed them how it can work inside of even and it plugged right back into everything else that we've kind of discussed where our infrastructure is really designed to be turnkey and now all things the falloff, you go to the falloff.com and it's really designed to be that where yeah, I mean it was incredible. I won't lie. The night before we launch it. So we launched on Monday. I didn't get much sleep. I was like let's, let's see where this goes. And you know I am very confident in what our team has built and the infrastructure where you know, it's, it's designed for scale. So we're curious to see where it goes. I think this is how we built even. We had product market fit before we had a business model and now with this pre sale avenue, it's something that is now built and other partners can take advantage of and use. We haven't built an economic or a business model for yet to be transparent and that wasn't necessarily the priority for us. It was really just let's show the value, let's see what we can do and then we can walk into those conversations more confident as far as like okay, what does this make sense for even to build out? And I think that's the beauty of being a startup in this day and age where like we can move fast, we can ship things, try things and if the demand is there then no one's going to question the, you know, the economics around it.
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And I think for you all, working with the artists like Cole on the album release is huge. Right. I believe the numbers that billboard shared was 110,000 units sold. The vinyls are $50 each and the CDs are around 25 and even the digital downloads 15. Okay, you can do some back of the envelope Matt there. Okay, that's you know, several million dollars being pushed through your platform and obviously even as a take rate of that. But touring for an artist at that level, that is touring and of course the pre sales are only a portion of it. But that's how you move from having a GMV that's in the seven figures, having a gmv, that's in the eight figures. Right. And that's just for one artist in their release. So that could be a pretty great business opportunity for you all.
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Yeah, I think it just has to make sense to the ecosystem. Right. I think we always, you know, that's a core part of how we build all of our product. It's this cannot take away. Right. If, when we, when we build product and when we make business decisions in the company, we always look at is this just taking money from one pool and bringing it to. Even while there is going to be some instances where that possibly makes sense just because we have a superior product, that's not how we're thinking about building in the industry. For us, it's been very intentional that the product only makes sense if it's adding to the pie, if it's adding value and it's giving teams resources to do so. So like the intention here isn't like, hey, we are a better platform to do pre sale signups and engage with fans. That's not necessarily our messaging. I think for us it's, we have it if you want to use it in your existing even campaign. But if you have a preferred partner that you already do that with, let's plug them into the system and we've done that. Even a good example of this is we have our own CRM system inside of Event. It's called Event Fan Connect. So think of like SMS sender, email sender, you can organize your fans and you can send SMS or email blast directly through the platform. But we also have direct integrations with Community and Lelo and Superphone. And for us it's really designed to be almost open source. Like that's really the ultimate vision. My CTO at Govinder gets nervous when I say that, but I think that is the beauty of what we're building. You can show up and use even in whatever way you want. But if you want to take your data or if you want to bring other parts of your business elsewhere, you can do so at any given time. And that's core part of like our ethos and tied back to the name, it should feel even, it should feel fair across the board and then for
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you all maybe to close things out as these partnerships start to grow, the types of companies that likely want to do them, you're likely going to get different offers and different pitches. I'm sure that a lot of the companies have either tried to invest themselves. That is a trend that we often see Especially from the major record labels. They like to feel like they have a stake in the upside, not just from the commercial nature of the partnership, but in the actual business that they're helping to push forward. To my understanding, these companies don't yet. Whether it's Universal, Too Lost or United Masters or others, these companies don't have an equity stake in even. But how do you keep that going and moving forward, especially as those opportunities likely continue to grow?
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Yeah, I mean, look, we've been blessed to have incredible partners on the investment side. We have incredible investors who understand the vision of even and we do a lot of due diligence and who we bring into our cap table. And a big part of it is we want to be Switzerland. We know what we built, and we know the power of the product that we've built. And this should be available to everyone and to the whole ecosystem. So, you know, when I say that the deal that we did with UMG is no different than the deal that we do with the United Masters or with the two loss, we're very transparent with the way that our deals are set up and the way that EVEN generates revenue. And I think for us, it's really designed to keep it that way. And if anything were to change at any point, like, it's something that we would, of course, make a statement, notify our partners. But as of right now, we're excited to have people as partners and help them add a new line item to their P. L. And I think in time, as those conversations develop, we can have those conversations. But no, we saw it all over Twitter and social. You know, I think there was two questions. One, did UMG just acquire even? The answer is no. And did UMG invest in even? And the answer is also no. We're grateful and we're honored to have them as partners. They've been incredible to work with among all of our other partners, and we want to continue to help our partners offer more tools and resources so their artists can grow their businesses. And I think everyone shares that same sentiment across the board, and we're just honored to play a small role in it.
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The general public misunderstanding your business model is a rite of passage in this industry because many of those same people that probably made that statement also think that Spotify pays artists, also thinks that Ticketmaster sets the prices for the tickets that the artists sell themselves. Right, of course.
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Of course. And, you know, I think we have a responsibility to that audience, whether it's fans or whether it's artists. You know, I think I. We don't shy away from it. It was interesting last night, La Russell calls me and he's like, mag, what's going on with all this thing on Twitter? And I. I was like, well, look, you should read the press release first, because I think it'll give you some context. And then of course, like, I'll answer any questions. And that's what I mostly, what I did yesterday is just like answering questions. I think they're naturally like. Our announcements with some of our other indie distributors and indie labels didn't get the same attention. So I think a lot of people just said, well, why didn't you announce all of your other partners? Well, we did. We were just a smaller company then than we are today. But what I do think is really special is I think there's something to be said that even was a tool that was first available to independent artists, and it's still available to independent artists. And it's something that a major label and a major partner wanted access to. So it just speaks volumes to. This is a model that the independent sector has owned and has really developed. So I think it's a huge compliment and it's something that artists should continue to double down on. But we rather do it through the work than press releases or public statements. I think the work should speak for itself. And, you know, we don't want to be all talk. We really want to show and highlight those stories. And we love the fact that it's artists really speaking out and talking about even and their experience with even. I think that that. That makes me and the team feel really good.
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Right. If press releases drove income directly, there would be a lot of companies in this industry that be at a much stronger position. But you don't have to respond to that. We can pause it there. I appreciate you, as always. Thanks for coming on, man.
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Thank you so much.
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If you love listening to Trap Ital, I want to put you on to another podcast that I think you'll really enjoy. It's called One Song. It's hosted by Diallo, Riddle and Luxury. Each episode unpacks one iconic track. They break down the original musical stems so you can hear how the song was built. And while also diving into the creative choices and cultural forces that shape the song. If you're into how music, media, and culture intersect, this show is very much in that lane. You'll hear songs you already love in a completely new way. Check out One Song wherever you get your podcasts. Let's take a break for a chart metric stat of the week. Speaking of J. Cole his song no role models from 2014 Forest Hills Drive. That song not only is the best performing J. Cole song on streaming and his biggest single to date, it is one of the best streaming songs of the 2010s. Looking at some data on Spotify for songs that were released in 2014, the top songs are Ed Sheeran Photography, Ed Sheeran Thinking Out Loud and then J. Cole no Role Models. This is by total Spotify streams. Both of those songs have around 3.3 billion streams and J. Cole's currently has 2.8 billion streams. It also has more total streams and daily streams right now than Uptown Funk, which was the number one song on Billboard's 2015 Year End Hot 100 list. It also has more than Maroon 5's Sugar and it is literally neck and neck right now with Taylor Swift's Blank Space in terms of daily streams. No Role Models does have more total streams. Part of that is because Taylor Swift was late in terms of adding her music to Spotify compared to Cole and other artists. But still, I don't think people realize how big and how popular and how sustaining no Role Models is not just for Cole, not just for hip Hop, but for all all songs of the entire decade on streaming. Let's get back to the episode. Thank you again to Mag for coming on and joining us on this episode. Towards the end of the conversation there he did talk about LA Russell giving him a call to talk about the UMG and even partnership. But I do want to talk a little bit about LaRussell here. If you're not familiar, he is a rapper from Vallejo. He's built up a pretty strong social media following and has gotten some big partnerships, features and collaborations through his work and doing it all independently. He recently signed a management deal with Roc Nation which will be interesting to see moving forward. He posted a pretty cool video of him and Jay Z talking about their new partnership. What Jay Z sees in him as well One thing that always stuck out to me about LaRussell is that he would host One thing that always stuck out to me about LaRussell is how he handles his DTC direct to consumer business. He hosts his own concerts in his backyard. He is the definition of selling music out of the trunk, but his trunk is the platform that he uses through even where he has sold albums for over $10,000 to Kyrie Irving, Gary Vee and they've spent that amount of money because they want to support it is very similar to that Proud to Pay campaign that Nipsey Hussle had gotten famous for when he had the $100 mixtape in 2013 and then ran it back in 2015 with the thousand dollar m. Now you have LA Russell selling his album for $10,000 plus. Granted, to be clear, that is not the set price that he's saying he's giving people the option to pay. But it just shows the continuation of that vision and what that looks like moving forward. So it's been cool to see. And again, for a platform like even, it can be a home to the Russell. It can be home to J. Cole, Brent Fyaz and future artists of all stages at Universal Music Group as well. So that'll be interesting to track moving forward. Now let's segue into my conversation with Lior Tibon, the CEO of Duetti. Hope you enjoy it. All right, today we're joined by Lior Tibon, the CEO and co founder of Duetti. Welcome to Trapital.
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C
Thank you, Dan. Thanks for having me. I'm a big fan.
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B
I feel like I should start calling you the money man because every time I turn around, there's a new tranche of money coming your way. You announced the year with a new fundraise, $200 million and it was a mix of equity, securitization, credit as well. And since you've now done this a few times, it'll be good to get an idea for how do you structure your business in terms of how these funds are raised, but also what they go towards. How do they fuel everything that you do at Duetti?
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Yeah, no, absolutely. Dueti has two kind of core functions. Number one is that we are building pretty sophisticated platforms, a lot of data engineering and data forecasting and marketing capabilities and management capabilities to look at different catalogs, right. On the master side as well as on the music publishing side, focus them, underwrite them, invest in them, and then manage them once we get involved. The second piece is that we actually need funding for the acquisition itself, right? Like we need, we need resources to, to affect the acquisition and pay artists and songwriters when we, when we acquire songs from them. And so these are really the two big functions of what we do. And so for that we really need to raise different types of capital, right? Like when we announced the $200 million raise in January, that included $50 million of equity and $150 million of debt. The equity funding, and we've raised over 100 million since we started three and a half years ago, is really primarily, not exclusively, but primarily focused on building the platform side, which means investing teams, investing, marketing, we have some great parties and a lot of other things that we do to put the world out there of what we do. And the second piece that, that is exclusively focused on financing the acquisition themselves and acquiring the songs and the masters and the royalty streams from creators out there.
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Would you include the credit with that piece as well?
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Yeah. There's different pockets of capital, debt capital that are suitable for different stages of the song life cycle. So for example, songs that are maybe younger. Right. And we are looking at songs and masters that are as young as two years old. Right. Which is pretty young in terms of the data that you have and your ability to forecast them. These are riskier. Right. And so it's a different type of deck investors that can get comfortable with that type of collateral. Right. From their perspective. On the other side, if you think about songs that have four, five, six years and beyond of data of our ability to predict also maybe size comes sometimes into play. And the artist profile overall, then that addresses a different type of the kind of investor universe with folks that are kind of willing to maybe they're a little bit more risk averse, but frankly they're also willing to provide capital at maybe better terms. Right. For the idea ultimately for the folks we work with. Right.
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B
That makes sense. And especially those two groups you mentioned, if you're looking at songs two to four years old, that's definitely a different asset class in a song that's five to eight years old. But even within those two classes. So those feel like very different asset classes than some of the other investment firms that are investing in back catalog that is 10, 20, 30 plus years old. And they're often looking at deals themselves, individual deals that are tens of millions of dollars. So maybe you could walk through just how different the product is that you to the two types of private equity companies and firms are putting out there. Just given the. The asset classes on the surface, similar, but it's so different.
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C
No, absolutely. D is really a company. We're not a fund. What does that mean? It means that when we raise equity capital, and as I mentioned, we've raised a lot of it, that money sits on our balance sheet and we can use it to hire a team and develop products and services internally. That's very different than a fund. When they raise equity, the vast majority of that money is earmarked only for the acquisition themselves. And so their ability to raise and develop and build systems and infrastructures is less so than what we have. And so that goes back to kind of the answer to your question, which is that the only way that you can actually do the type of deals that we do. Right. That are, as you said, maybe smaller than some of these other mega funds that are out there, is that you really need to have a very robust data and infrastructure that allows you to really dig deeper efficiently. Right. And also kind of make certain assumptions and kind of simplify the entire acquisition process so you can frankly do a bunch of them every month. And as we announced, we're doing over 80 deals a month right now. In order to kind of get to enough volume, which justify kind of the size and scope of our platform, I
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assume that a lot of that needs to be automated in some way to be able to do 80 deals a month, two, three deals a day. Can you talk about what parts of that process are more automated versus what parts of the process may still need some human touch on the due diligence side?
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C
Yeah, absolutely. I think. I think first and foremost, what we're not automating and what's the most important thing for us is that the conversations we're having with artists, with songbar, that's with creators, are always with members of our team that have a very deep understanding of the music market and of the needs of creators. Right. Like that's. That's the first touch point. And we do have a pretty intense process of handholding and of explaining what's going on at every single stage. And we never want to be in a situation where the artist or the songwriter is dealing with bots or machines or anything like that. This is a very nuanced and a pretty difficult process sometimes, right. For many different reasons. And so whatever you sell a $20,000 catalog or a $2 million or a $10 million catalog, we want to make sure that there's a member of our team that's talking to you and walk you through every step of the way. So that part of the process is not automated. And we are strong believers in the human element here. At the same time, we have to automate a lot of other parts. Right. And so those humans that go through, our members of our team that are going through all these different aspects and kind of think through each and every deal, they do have a lot of kind of tools at their disposal, right? Going from even identifying the artists, the songwriters, the songs that could be relevant for Dwight and what our investors kind of looking for, and through the prediction analysis, putting prices, giving a range of different options all the way through once the acquisition actually takes place, how do we make sure we collect all the. All the royalties that are due. How do we make sure we find the right marketing opportunities for the, for the songs and the, the masters that we're involved with? And throughout that chain, in one of
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B
your recent reports, you had your music economics report, but then you also co release that new index with Billboard as well. One thing that stuck out, you talked about the expected growth of the sub $1 million transactions for music rights, but also the sub $5 million transactions for music rights as well. And because you do a number of these deals, maybe just to give the audience an idea, what does a sample deal look like? You already spoke a little bit about the catalog age itself, but what does a sample or typical deal look like?
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C
Yeah, so I would say that we've said publicly as well, We've done over 1100 deals so far. The majority of those have been with artists and songwriters and producers that decided not to sell everything. They decided to maybe sell a few tracks, maybe parts of tracks. And it's really, you know, I would say the typical case that we see, right, where we operate and really of creators that are still, I would say, the prime of their career, right? They're maybe in their 20s or 30s, they're creating, they're out there, they're doing stuff. And it's really all about finding a different type of financing and marketing and support solution, right. Which we provide as well as part of the deal that we do to really kind of help them move into the next stage in their career, right? So I would say that's the typical case and what we see the most. And with that being said, there are a lot of other cases, right? Folks with great tracks and compositions from the 90s and the early 2000s that maybe did not achieve kind of a level of notoriety of a multi, multi million dollar catalog. But think now is a good time to get some liquidity there. But the typical case, as I said, is of. Of someone who is still pretty much in the game creating and are looking for another liquidity solution.
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B
And when these artists or songwriters are looking for liquidity solutions, do you find like they're often evaluating duetti compared to other royalty financing options? Are they also looking at the next label deal creator funds? Do you feel like there's a common pattern in terms of if they're looking at duetti, they're probably looking at this other type of opportunity?
- [36:09]
C
Yes, I would say the sub kind of low seven figures, right. Those folks would be probably considering daily versus other type of financing and marketing options. And so ultimately it can get to a place where, you know, you can do a duality deal, which means that let's say you have, and I'm kind of simplifying 10 tracks from a few years ago. And so you can go and decide to do a duitty deal and then maybe you, you, you sell only five trucks and you keep five. And the five trucks you sold, you do need to get comfortable if that's the right solution for you, that you sell them in perpetuity, but you're probably going to make to get a nice amount of money for it, right? And equally you can go and do an advance. If you do an advance with a record label or maybe with a new financing company and there's a few out there, you probably need to put the entire 10 records that you have under the advance arrangement. Which means that sure, it will be maybe for a shorter time frame, but you need to kind of separate yourself from the catalog, from the entirety of the catalog for a number of years, right? So it's kind of like comparing apples to oranges a little bit. And so, you know, I think, I think that's what we're trying to do, right? We're trying to provide another option and another kind of point of reference for people to kind of think through as they're trying to make the decision. The final point I would say, if you compare what we do versus an advance or kind of a, kind of a more pure financing deal, is that we, as I briefly said, we invest a lot in marketing and management of the catalog once we get involved. And so. And why do we do that? We do that, frankly, because it benefits us. If we own something, we want to promote it, we want to market it, we want to make sure that it's out there and more and more people can tune in and listen in. And usually if you compare that to an advance or a loan solution, because it's shorter term, whoever is giving you that loan or advance, it's probably going to be less incentivized, if at all, to invest in the long term marketing of that record, right? And so that's another, I think, really important consideration for folks that, yeah, it's a perpetuity deal, which is not for everyone. But the flip side is because we're becoming long term owner of pieces of that catalog, we are actually investing on our own dime. There's no marketing budget or anything like that to make sure that it's being promoted appropriately.
- [38:49]
B
And given the transaction size of these deals in general, is there a particular type of marketing that you lean a bit more towards? Whether it's performance marketing or direct response YouTube channels. What does that look like for you all?
- [39:02]
C
Yeah, exactly. So I think, I think, you know, just given the breadth and the number of artists and creators we work with, first and foremost we're talking about digital first solutions. And you mentioned performance marketing, you mentioned YouTube channel management and a lot of other things that we do. And so that comes first. Right. And so we're trying to figure out ways to scale and have really kind of a data driven marketing muscle, right, that is spread out and can actually help a lot of folks that work with us to see more streams. And we do that with different ways. We have a ton of playlists that we run and manage and we spend a lot of time looking at what audiences would be interested in in order to build playlists that we think can do really well commercially. But we also go further than that. Right. And we have, for example, a very robust remix program whereby we actively pitch songs that are in our catalogs, whether it's on the master side, on the composition side, for new artists to kind of have a look at those and potentially create a remix, of course, with the appropriate approvals and kind of almost breathe kind of new life and expose that particular track or composition into new audiences. Another. Another example that's been very successful is working with influencers. And there, again, it has to be very data driven because what we found is the most successful strategy is to look for those tracks that started to trend, whether it's on TikTok, on reals or other platforms, and then invest very heavily, very quickly with influencers and kind of spread the world. So that kind of initial trend can kind of grow to something a lot bigger. And we've done it in multiple different occasions and it's been very, very successful.
- [40:57]
B
And speaking of influencers themselves, obviously they are a channel to market the assets you own, but is there any future interest on your roadmap of financing them specifically given the income streams that they have access to, whether it's their own YouTube, their AdSense, their own revenue streams that are predictable, or other forms of multimedia entertainment that may have some similar economics to what you all currently offer with music Specifically?
- [41:25]
C
Yeah, yeah. So right now the short answer is we're not looking at any of that. Right. I don't know what the future holds, but I think in the next year, few years, our focus is pretty much music. We believe that this is a very unique and interesting kind of vertical to specialize in, and we think there's a lot more to do before we start spreading ourselves into other sectors of the economy. So that's our focus for now which makes sense.
- [41:52]
B
Well, Lior, I appreciate you coming on sharing this.
- [41:54]
C
Thank you very much Dan.
- [41:58]
B
And that is a wrap for today. Thank you again to Mag Rodriguez. Thank you to Leor Tibon for both of you joining us on this episode. Thank you again to our sponsors who helped make this episode possible. Thank you to G and Eric for everything that you do on the audio and video side to help make Trapital possible and thank you for listening. Like we always say, if there's one person you know that would really enjoy Trapital and get a lot out of it, then send them a link to the show. Word of mouth is still the best way to grow and we are available on all platforms and if you have a moment, leave a comment, leave a review that helps the algorithm do its thing and make sure that trapital reaches the right people. Thanks again. Talk to you next time.