How BeatConnect Is Changing Music Production

Jakob

Hey guys and welcome back to Sound Connections podcast. We have Alex and Nick in the studio, welcome.

Alex

Thank you for having us.

Nicholas

Thank you, thank you.

Jakob

You guys are, I hope I do not butcher the description, you're basically making a DAW in a very different way, a digital audio workstation, a way to work with music. And I think it's really, really interesting. As I told you, I have been working music production for a while and my last connection with collaborating online was like seven years ago when Pro Tools launched like some sort of online collaboration tool, which was really, really bad. But obviously a lot of things have happened since then. Nick and Alex, for the people who don't know who you are, who are you and what do?

Alex

So I'll kick us off. I'm Alex, CEO and co-founder. My role within the business, like if you were to split the business in two from, you know, tech and admin organization, I am on the admin and organization side. So legal, marketing, fundraising, which takes 99 % of any startup's life. That's on me. But obviously I help my partner here with kind of like soundboard and product roadmap and development, but very much, know, on my side of the business there.

Nicholas

Yeah, thanks Alex and I'm Nick, I'm CTO, co-founder, visionary of Beat Connect, but no, I'll eat some humble pie, but this is, it's been in my mind for a very long time. I'm the music guy of the bunch. I guess we'll get into the whole story of it, but yeah, we met Alex and I at... job that we both hated actually and it was at the beginning of the pandemic and there was an opportunity to maybe start to realize this vision you know and yeah it's been a crazy journey ever since.

Jakob

Amazing. If you could give me like a one minute pitch, what is Beat Connect? And Alex, I guess you're the one doing pitching the most. So, can give it a go?

Alex

Yeah, for sure. The one-liner is Beat Connect is a collaborative platform for musicians to come connect, make music together. It is essentially dog-gnostic. As you said, we built our own DAW. We do everything in there. And the twist is that we're actually a platform that kind of gamifies the creative workflow. We're the first platform in the world to use the Unity game engine to really create the interface. Our goal is essentially to change the way musicians perceive music creation. Not so much about the outcome, but about the journey and how you do it. And we think that taking a few pages out of the gaming industry to get there is the way to go for music as well.

Jakob

Hmm. That's a great pitch. And, and let's actually start the conversation there. Like a lot of the conversations I have about the future of engagement or monetization or whatever you want to call it within music, often refers to gaming. And the reason is very simply, they've done much better in growth and retention and, purchasing from users' perspective in gaming that has done music for a decade plus. And the difficult thing about talking about gaming is how to transfer their success into music, which is also what I've been struggling with concept-wise. So if you were to make it super simple for me and the listeners to understand, what is it in particular you've taken from gaming that you believe would and can be successful in music?

Alex

Yeah, Nick, you want to start?

Nicholas

Yeah, I could talk a little bit about this. I think that there are two very different conceptual philosophies between the gaming and the music industry that really shape a lot of the decisions what happens. I believe the music... I'm going to flip it. I believe the gaming industry is more interested in getting new users, new people to experience gaming, more people to play games. And the evidence of this are things like cross play so that you could be on Xbox. I could be on PlayStation, but we could still be playing the same game. There are modding communities. There are crazy tools like Unity, which encourage people to build and create new things. And there's a fostered sense of come and try. It's okay if you don't like it. You can also leave, but we play nice with everyone. Rest conversely, and I'll speak the music production scene it is the complete opposite is about keeping people and not getting new people so no DAW works with each other none of the file formats work with each other nothing changes in fact most of the software you still need a USB key to run which you don't even have on MacBooks anymore and the business models are

Jakob

Mm-hmm.

Nicholas

equally outdated but designed in such a way to keep you stuck in that ecosystem versus encouraging you to explore and play nice with others. And I think that mindset completely trickles down and affects very much the engagement and the growth that you'll see within the industries.

Jakob

Mm.

Alex

Dude, it's such a deep rooted thing as well. Like we went to a conference last year in, sorry, where was it? Nick again, can you remember? No, sorry, in Europe.

Nicholas

Awesome.

Nicholas

it was in Belgium.

Alex

Yeah, in Belgium, sorry. And essentially, I vividly remember when they lost me at that conference because there was a guy, like a very, very boomer kind of gray ponytail guy that came on stage and he didn't have anything to present. He was just asking people, you know, let's solve the music industry. Tell me what's wrong with the music industry. And everybody who tried to raise their hand and answer, you know, really trying to help and support, he would answer, wrong. That's not how you do it. this, and he was kind of like going on and on about how It should be. I was like, oh my God, this gatekeeping that you're doing right now, this is what's fucking wrong with the music industry. Sorry, can I swear on this podcast? kind of. All right.

Jakob

Yeah, absolutely. It's most encouraged. Hmm. Very interesting. Yeah. And again, going back to music production, again, I'm just referencing old data from, from whenever I was there. But like, if you look at Pro Tools or Avid, like Avid, like those whole systems, ecosystems, they're, you know,

Nicholas

I was thinking that too.

Jakob

They're extremely expensive, you build whole studios around them, you can't really exchange them. And I see that sort of mindset is not prevalent in gaming. And that sort of interchangeability of technology, of platforms or whatever is very, important even like for even gaining market share. Like if you want to make things easier for people, that's how you can actually reach the potential. That's very interesting. Let's go a bit to the journey in two seconds, but I have my own curiosity to fulfill first like building a DAW I Can imagine it's quite complex? Yeah, guys need to host a lot of like VST three plugins from different manufacturers and small companies and I guess I don't know to what extent everything works with you guys, but I can imagine that's a pretty big technological puzzle to put together Has that been very difficult?

Nicholas

Of It is a source of half of my gray hairs. And it's a double edged sword because when you're building a DAW, people just compare it to another DAW. And I say, but that one's better. Why should I use yours? And that's obviously a huge hurdle that we need to go over. And also I would say the mentality of the audio industry.

Jakob

Mm.

Nicholas

to just keep using what they've been using. Right? Like when I don't produce as much music right now, because I've just been trying to build this DAW, which is a little ironic, because I went into this for music. But in like 2008, when I was doing a lot, the hottest VSTs out there was Omnisphere. Now we're like...

Jakob

Mm.

Nicholas

15 years later and Omnisphere is still mentioned at the top and there's no new things kind of coming through the pipeline. Like you see little gadgets and stuff but it's the same thing recycled over and over and over and it's like music producers are so used to it and like they're just in their mindset of this is the way it is. That not only do we fight technological kind of barriers but you have a lot of people who just like this is the way it is and it should not change and they've been indoctrinated in that sense and it's been tough. Whereas gamers are

Jakob

Yeah.

Jakob

Hmm.

Nicholas

more open I would say to trying new things and to experiment and to go kind of further. There's a lot of people in music, especially those who've been doing it for a while, who are just really set in their ways, which of course presents additional challenges for us.

Jakob

Hmm.

Jakob

Mm.

Alex

And know, technologically speaking, you know, one of the barriers that we had beginning was we were a plugin. Like when BeConnect first launched, we were a plugin that would essentially load up in whatever, you know, DAW you're using and would act as like the sandbox environment where it would connect everything together. And it was a nightmare because just again, you know, the different DAWs wouldn't play nice with one another. Every time we needed to do a new release or a patch, you needed to... Do quality assurance on like, okay, I'm going to load up Ableton and now I need to validate that it works with FL with, you know, studio one with all of that. So let's say there's 12 big dogs out there. Well, you do this kind of reverse QA for all of them like that. was unsustainable. And we were opening up ourselves also strategically to just being very exposed in terms of like, let's say one player doesn't want to support us for one reason or another. There were ways that they could have actually, you know, kind of. make this whole thing crash. So we took a very, I think, wise decision in kind of like building our own thing there.

Jakob

Hmm. No, yeah, I can imagine. It is sort of like a nightmare, even as a producer, just trying to navigate that space, just, you know, playing you just switching dogs and workflows. Okay, so what was the moment that you guys decided to address this? You said you met in COVID and you wanted to do something. Like what happened?

Nicholas

Um, well, I was, we were both working, uh, for Rézou Canada, which is part of CBC, the Canadian broadcasting company. And we got brought in for a special project and hated it from like one weekend and day one and just government workers who just didn't get stuff done. And I was just losing my mind.

Alex

from day one.

Nicholas

And I went to Toronto to the head office and I hated it even more. And I got back to Montreal and we had, remember we had a coffee together and I was so depressed. And I was like, I can't, I can't do this. Like I love tech cause I like to build things. It's fun. You know, it's like, it's like construction work, but you don't need to buy nails and stuff. just think of things and type a little bit and then boom, stuff happens. And he told me I should maybe try to start something and said, well, I have this idea. Cause I used to make music with, with my friends a lot. Well, actually we still did at the time, but I hate traveling to like, cause they're like out of town. have to drive for an hour have to drag all my crap and I get stuck in traffic and I show up and I forgot something damn it that's screwing up the weekend You know like I just want that Magic of being able to make music with someone, but I want to do it during the week without this hassle without these problems And I'm like how come I can game with them during the week right we could do anything the gaming It's so easy as you as a friend who a little chat list we can hop on a quest whatever it is You know like good to go with music well got to open an email client, but I can't actually send that wave file because there's nothing more unmusical than an email. Okay, it's just like the worst and I'm like, it's got to be a better way. And Alex encouraged me to work on it and I got stuck at home at some point, well, like everyone, but without any developers on my team. So I probably shouldn't say this in a recorded broadcast. I was working really hard for their projects and it inspired me on my off time to pursue my passion. And that's the true story right there.

Jakob

Mm-hmm.

Alex

You

Alex

You

Alex

yeah, I can attest to that. That's exactly how it happened.

Jakob

We've got it documented now, that's how works. Okay. And Alex, did you get inspired by that journey, or how did you tag along?

Alex

Hahaha

Nicholas

Truth is out there.

Alex

Well, essentially we were kind of like looking at it through different lens. He was trying to see if technologically was possible. And when he told me about this passion project of his, I could not believe for a second that it hadn't been done before. So obviously like my first thing that I did, of course at home on my own time when I wasn't being paid to do something else, was to just look it up and do a lot of research and kind of start building, you know, just a business plan, just high level. feasible. That's okay. Next they can care. It hasn't been done before. Is the business model viable? What's happening? And like, I could see so many companies that tried in the past and failed and there was nothing on the market that was really kind of scratching that itch. And it was just the perfect timing of us starting this thing at the very, very beginning of COVID. So it was like, okay, if somebody's got to do it now's the right time. You know, we need to like, be a leg up here and start building this thing so that we can release it for people who are stuck at home.

Jakob

Hmm. It's interesting. I've worked in publishing for a while and I had a publishing company during COVID and I don't know if you guys were probably direct competitors with audio movers when you started, but that's sort of the platform we use or try to use. It was, again, as far as I recollect when we did it, like the best solution that was like popular, but still kind of didn't work very well. What happened in that space technology wise when he launched? the first product, what happened in the market, but what in particular were you doing?

Alex

Well, the approach of like most of the softwares out there specifically for collaboration is real time collab. Like they all focus on that kind of like golden goose of getting this algorithm that's going to account for the lag, for latency, the ping and all that, and that desynchronize everything. And we saw some fundamental flaws in that flow. were...

Jakob

Hmm.

Alex

Essentially the way you work on BeConnect is of course you can do sync, but you can also do async. You put your part down, you let people come in, you kind of adjust. It's all real time in that sense, but it doesn't need to like synchronize everybody, you know, do three, two, one, boom. And then you start recording on group. So for us, when we saw people go in that direction, like the different products go in the direction, we saw it as a very good sign for us. We were kind of like the only one innovating in that direction. And we got some like some pretty, pretty good feedback from the industry, from like the big players who were looking into that tech. So it was just honestly reinforcing that we were going in the right direction.

Jakob

And I got a bit ahead of myself because you guys didn't talk about how you decided to do this together. I just had a comment where I seemed a tiny bit clever. So that's why I wanted to say it. But if we go back again, Alex, you saw sort of what Nick was working on and did you decide to quit your job or did you continue outside of work hours and build this? Like how did that come?

Alex

Hahaha Now we were working outside of work hours a lot, know, so many hours through the night. And I know that like we met essentially and started working on this around February of 2020. I went full time, like officially full time left my job in September of the same year. And I was like the first employee to do so. I'm fortunate enough that I could like essentially work on BeConnect full-time without a salary for almost a year and a half. Like I was fully, fully dedicated to this. It's like, it's kind of a personal dream of mine. I've always wanted to be an entrepreneur, build, you know, half the business and all that. And it's, it's a freaking journey. Like it's, you've been there, everybody that we talked to, it's not like the, the perfect kind of dream life of, know, everything's going to pick up. Now it's a struggle and you really need to brace yourself for it, but that's what I wanted and I knew exactly what I was getting into. So I decided to go as soon as I could into this life.

Jakob

And did you have any moments in there like what when you went full-time what exactly were you joining?

Alex

We essentially didn't want to do like a pre-seed in terms of like fundraising. We wanted to build enough value on the product so that we could do a proper round with Montreal investors, Quebec investors. So I would say that 99 % of my time at that point, I was like doing pitch competitions. was like writing grant. I was getting loans from bank. I was like going to everything in Quebec and in Montreal to finance us. We managed to essentially get just north of half a million in non-dilutive money to support like hiring our first developer, get Nick on a half decent salary so that he as well could start, you know, work full-time on this. So it was very much just a, let's create every penny that we can find. And luckily, I don't know if you're aware of this, but like Montreal is one of the best place to start a business for that because there is so much money that you can get through like the government. provincial and federal level that doesn't require you to just completely dilute your business. Yeah.

Jakob

Hmm. Amazing. And how fast did it go? Like, has this been a step-by-step journey or did it go fast? Can you talk about the journey? How did it happen?

Nicholas

boy. I don't know, it's like fast forward but then fast backwards and then fast forward. It is essentially a roller coaster of ups and downs of which you don't know it's gonna be up or it's gonna be down. But it was quite interesting because I had built a prototype, tried it, sucked, scrapped it, built another one which was more like a drum machine that was shared, sucked, scrapped it. We ended up with this da na da. as Alex had mentioned, plugin that started to work and be kind of decent. So Alex created a website for us. It was on WordPress. And, know, I'm going with this the day before the release, you know, we're all excited. I wake up in the morning. I go on the website and like, it's like a blank page. There's like nothing happening. Like Alex, what happened? And he goes, I stayed up all night making a new website, but I deleted it by accident and now it's gone. So he had to redo it. And he did though, you a week later we launched for real. Users, they're very fickle, especially in the music industry as we were chatting about before. You put anything, it's like a pebble in their way and they don't want to have anything to do with you. Our flow, you have to sign up on our website, okay? You have to put your address, including postal code and stuff like this, in order to create the account and download the plugin. Now once you're in the plugin, you needed to make a second account because the two databases didn't talk to each other. Only then were you permitted to use vConnect. And somehow... despite this and I can't name names but there was a very prominent member of the music tech industry who was our first user ever who reached out and it's been kind of wild ever since I was like

Nicholas

my goodness. like, I can't believe first of all, someone went through that. And second of all, that it was this person. How did they even find us? And they told us that what we were doing was unique in the industry. They were looking for something like this for a long time. We were solving problems and we had a couple opportunities like that in a very short moment from again, like just in the industry of music tech, tech or music itself. And it was wild. And then we, we digitally went to the NOM conference, which was, you know, all online at that time. And it was crazy. We did a little presentation that we put together and we had like 60, 70 different companies or like show up. Like we had more people than like other huge established brands watching our little stream. And then we had universities contacting us to do educational stuff. And I was just like kind of wild. And then that's, that's the up part of the roller coaster, by the way. Then tick, tick. Then it started to like, we actually had to. deliver on some of these promises, then it was like, nope, turns out the product is still crap and it was crashing and it wouldn't work in this DAW and Apple's like, screw you, we're not gonna let your Apple loops work on your product. Then it's just been down, then had to rethink of things anyway. I could ramble about this for a while, but it's been definitely a difficult journey of first having a lot of acceptance and then the realization that the product was not where it needed to be, reworking the product and multiple iterations of this cycle over the years.

Jakob

Mm-hmm. Did you get paying customers? What was the model of whatever you were releasing?

Nicholas

Yeah, go Alex. Well, it started with a SaaS model. We're like, okay, well, you we want to make money every day, right? And like, we're like, it's fair that if you use a service at a service, you pay for it.

Alex

But yeah.

Nicholas

So we're like, oh, 10 bucks a month should be fair, but people hated it. They hated it so much. They were very vocal because we were not only forcing them to pay $10 a month, but because it's about collaboration, we're forcing them to go harass their friend to pay $10 a month so that they can make music together. So it was a massive amount of backlash. And this is again where kind of we took some cues from the gaming industry. Alex, maybe if you want to talk about that a little bit.

Jakob

Yeah.

Alex

Yeah, sure. Honestly, to this day, I live and die by that one. We switched to a completely freemium model. like, you want to use Vconnect, it's 100 % free. You can invite whoever you want. There's no feature flag, but for like anything that you use in the product. The only way that we do make money is we have a marketplace where like we sell assets. like... Plug-in sounds and whatnot. it's very much in line with our philosophy of kind of like making it easier because the assets that we're selling there are a lot cheaper than what you're going to get from the most of the marketplace because we just want to get people going. Right. There's, there's a way to do this. that doesn't involve spending thousands of dollars before you've hit a single note. And that's our approach. There's like, it's, it's a volume game, right? You want to, you want to do a lot and.

Jakob

Mmm.

Alex

The strategy is that you get enough data on how people are kind of like using these to kind of go to a big player like, you know, isotope, a instrument and say, look, your instruments would work super well in Bconnect where everything's collaborative. And by the way, you talked about plugins earlier, you know, incorporating the plugins in this. Our plugins are a hundred percent collaborative. So if you move a knob or if you switch, you know, something in there, it's going to move for you as well in real time.

Jakob

Hmm.

Alex

But we also have the capabilities for some of the plugins that we support. Like you have the exact same version of a plugin, there is a way for you essentially to same thing, turn that knob and it's going to appear on the other side. It doesn't need to be a P-connect plugin. So that's a value prop that we go and see, you know, manufacturers and we tell them, you know, come on, be connect to all your stuff. It's just, it elevates kind of like the value prop that you offer to your users as well.

Jakob

Anyway.

Jakob

And how do you plug-in creators sort of approach this? Do you have like some documentation they need to follow or like are you guys taking care of that or what's happening there?

Nicholas

There's nothing to do, it just works out of the box. Almost, does a caveat of course, like it depends on the plugin. I talked about a lack of standards before, they're all built a little bit differently.

Jakob

Okay. Cool.

Jakob

and

Nicholas

But if a plugin exposes a parameter, then we can sync that parameter, whoever's in that session. So it's great because it really allows people to do sound design together. It's super interesting, new experience, and people aren't used to, for example, their Valhalla plugin, all of a sudden someone else is twisting the knob. Like it just, I don't think anyone else has that feature, so it's pretty cool to be able to do that. And it's, again, fantastic for education. If you want to teach someone how to use a compressor, the best way is on their music with their tools, you know.

Jakob

Mm.

Nicholas

so it's, it's cool to be able to offer that.

Jakob

So I am a bit confused again, I'm coding actually most of like whatever Cursor came out six months ago, I really started coding full time. So that's yeah, pretty much what I'm doing like at least 30 hours a week. also I run a company but. So I'm just researching lot of things and this is very new, I might be wrong, but as far as I understand, like most VSTs I've built like juice C++, is that correct? So in theory, like it shouldn't be very difficult to make all of these things compatible. Like what is it exactly standing in the way for these things working together, the DOS plugins? Okay.

Nicholas

it is, it is, definitely. Imagine we were in a session together and we wanted to use a sampler, okay? And you dragged a sample into the sampler. That sampler plugin, it's not gonna send me that sample, right?

Jakob

yeah, okay, sure.

Nicholas

So it's not gonna work. There are some plugins at Well that have things on the screen that are not exposed as parameters. You may even notice sometimes in a DAW, like you can't automate everything that's in a plugin because devs, they just don't care. They'll do whatever they want. They won't follow the API standard. And when they do that, it's fine. It'll work in the context of just that plugin, but it does mean we don't have that hook to be able to send the information to the other users to sync things up. So it becomes always a matter of, did you just stick to the standard or are you doing

Jakob

Mm.

Nicholas

some funky stuff on your own.

Jakob

Okay.

Alex

And there's actually a, like maybe taking a step back from music, there's actually a very interesting precedent for that in the market in the last couple of years, which was Figma and kind of like Adobe that tried to acquire them. Because everybody at that, during that time period was trying to do collaboration, right? Oh, let's just tack on collaboration on top of our existing product in tech stack. It doesn't work that way. Like it's, it's just too hard when you have all of these flows and functionalities that are structured in the way. And then what happens is that your collaborative feature or just half-assed ideas that dilutes the very meaning of what is collaboration, which is something that happened to us all the time. You, you Google, you know, collaborative music making platform and plugins and all that. And you get these like backward plugins and backward dogs that are just kind of like, sinking versions of like, Dropbox and whatnot, but they're not true collab. That's not the flow. You're not. Ideating with one another. You're not, you know, bouncing and idea and pitching and iterating. It's very much just this one thing. So the fact that Figma had this from the get-go, they were a collaborative platform for designers, made them invaluable in the moment where everything was about collaboration. Which is, which is us, like from the foundation, what we do is collaboration and the rest is obviously music making, but like it stems from there.

Jakob

Hmm.

Jakob

Mm. I have a blunt question. You know, we've mentioned gaming, Unity, Figma, all these kind of stuff. Things that are, first of all, worth an incredible amount of money, but also are in attractive industries. You guys are in the music production space of the music industry. What do you say to investors? Like, what are they getting into? What's the upside?

Alex

I'll take that one, The idea of what we're doing is not that we're targeting this very niche sub segment of music production. It's content creation. It's the content creation economy because our product, as you've seen, if you've tried it, it is not a DAW that's going to compete with Ableton. It is something that is tailored to be more broader access, low barrier to entry, more accessible. And what we're doing is we're bridging, sorry, the gap between professional and amateur in an environment that is compatible for that. So what it means is that content creators out there who are, you know, making music on Twitch, on their, YouTube, TikTok and whatnot. I think it's the industry that is the least well-served by the recent event in technology because it remains to this day content being produced by them and consumed by their audience. Without ever having an opportunity to go back up from the audience to the content creators. There's no interaction. It is always, always asynchronous of just, I'm doing something and you react to it. Our goal is to have an environment that's going to enable these content creators to just go out there. It's bringing in their most engaged users into a session, making a beat, flipping music, or just interacting on reviewing what the audience has made. But at the very least, you're opening the door to a new type of content that's never been done, that's never been really exposed. And like one of the reasons we use Unity again is for that, because if you look at a DAW, it's boring as fuck. Like most of the time you go on Twitch, you look at that, it's man, it's just different shades of colors and like it's very hard to be engaged with that. You mostly listen to it, you don't look at it. So it needed to be visually stimulating and interesting. So different approach to... how we're actually kind of growing the market. It's not necessarily production.

Jakob

Makes sense. Obviously the bari-t entry of creating music has been quite high since forever and that is sort of changing as technology evolves these days. What do you see happening with the creation of music? Like what kind of people going into this and how easy will it be to start making music in the future?

Alex

Mm-hmm.

Nicholas

It'll get easier. I think there are, there's a lot of glimmers of things changing a little bit because you got these kids like 15, you know, they're on Roblox or on Fortnite and they get excited by some stuff. But even these huge platforms in the gaming world are offering musical services there, but they don't look like a DAW. They look a little bit different. They give you less options, but with less options means you're getting kind of faster to making a note. I think the world is realizing sometimes a piano is scary. People associate a piano keys with work when they look at it. There's that the whole history of it. DAWs are scary and technology is advancing that way. AI is certainly interesting, course. You see a lot of those AI kind of song creation stuff, which is what it is. Like it serves a niche of you need whatever kind of content to fill. Fine. But it skips. It's very hollow as a feeling. If you've ever tried it, you know, just type a few words and boom, you get an outcome. Think people make music because they want to make music. They enjoy the act of creating it.

Alex

Yeah.

Alex

It's a good gateway drug, if you will. Like you go on Suno, you get the feeling that, shit, I just created something. Let me look a bit into it. You know, what could I do to maybe add my touch or do something and then boom, you're into this world, right? I think that's part of like the interest. I also went to a conference just a couple months back in Montreal for like the Canadian essentially. Representation of artists and you know how the rights are being managed and all of that. And I think a lot of the Canadian industry at the very least, not to generalize it, is seeing it the wrong way. They're trying to kind of like sue after the fact and they're going to have to demonstrate damage and all of that, which is like, I'm not going to go too much into it, right? It's a topic that's been over-talked about. But they should see the upside, which is exactly what Nick is saying. I think it is. Growing the pie rather than shrinking it. There is so many opportunities for new people to get into music in many, different ways. What we're doing is just one way, but like AI is not a great opportunity.

Jakob

Yeah, I think it's really interesting. I used to work with music full time. I ran a music studio. Even produced in my small country. I produced a few hits. So I was more than usually good at producing. But my biggest problem was I wasn't an instrumentalist, which means I was always dependent on other people to do a lot of the hard work. And even to this day, I've worked in music for 12 years. I've had, I have the highest degree in audio engineering you can have in the world. I have really worked with music. I'm a tone mic, so I've been deep in it and I could not with confidence say that I can go today and make what I believe good music alone, which is insane. I've been a part of... Big projects blow up and creatively, like I know music really, really well. I should be able to express myself in the way I want through music. And I cannot, even to this day, I don't believe that there's appropriate tools. And for me, it's very perplexing. We talked a tiny bit about BandLab, where I mentioned it before we started this recording, was obviously is a platform that... It has some sort of similarities to, to how they approach things as you do. But even that, you know, I sat down with their dog on an iPad like a year ago and it's like, I know what I'm doing and I'm not really feeling it. I have a hard time getting this, you know, off, off the ground. So I think there's, there's just so much to be had and created in music that Makes that easier like I don't believe creativity should be such a struggle for many people I appreciate the art of creating music. I appreciate instruments. I appreciate that whole theory but again Does it really have that big a part of the future in any other industries? Like do I need to know how a computer works to play a game? Like can't I just start playing? Um, and I think we're missing out on a lot of things in music by not having that mindset

Alex

Couldn't agree more, man. Could not agree more. I think, like, if you look at the... I hate doing this kind of like self-patting on the back, but like, if you look at our latest release, we are scratching the surface of exactly that. Like, you're talking about inspiration. I think the biggest thing that we're tackling is the essentially the blank page syndrome that some people have of not knowing what to do when they start.

Jakob

Yeah.

Alex

Our latest release is focused on essentially allowing people to share their music and jump into their project to finish, to flip, to maybe just get inspired to start their own version of what's being produced. Like the issue that you're describing here and you go on BandLab and you see some of the people are posting music for people to kind of like branch off. They don't allow the same level of granularity to go into it. And oftentimes it's just finished music that people are promoting kind of like under the guise of, flip my music, which goes against the very purpose of the feature that they tried to implement. It's, there's a bit of a disconnect there.

Nicholas

There's also the tendency of DOS and digital music, and we can be guilty of this too, of just, I talked about it before, doing the same thing again, like knobs, like knobs on a plugin. So annoying. Like you're supposed to drag the mouse up and down or left and right. It's different. It's unintuitive. We're modeling ourself after legacy hardware, which is unfamiliar, especially for the younger generation, right? Like that are touch screen digital first, but we don't have... digital first interfaces that reflect this, we're still modeling studio equipment from the 70s, you know, and you see plugins come with little tape machine decks and kids these days, they don't even know what that is. So I think we're a little bit stuck in our way sometimes and games are imaginative too, right? Like they break rules all the time. They don't look like traditional apps. They'll turn things sideways, 3D, they just have fun with it and they allow users to sometimes play and express themselves differently.

Jakob

Hmm.

Jakob

Thank

Jakob

Mm.

Nicholas

Then Previously and they're not scared to offer emergent gameplay or sandbox gameplay and let people kind of do what they want And I think the music industry boy, we're so formulaic, right where it's like, okay first you Compose a song and then you mix it and then you master it and then, you know, You release it and then you're going through a publisher and it's like you have this conveyor belt of what a song is supposed to be Going forward and it's just always all these set little paths and little stones that you're gonna hop through but that's not really how music is even made and I don't think it's how this is how the industry is gonna change and it's difficult because there's money to be made you could bleed that song for five percent ten percent thirty cents on the dollar over here and over there whereas if they start branching out and doing things themselves like you see with gaming or I could be an indie dev and I can upload something on itch or just deploy it on Steam or whatever it is even on the switch now you could just go straight to the publisher and skip these middle managers well the music industry is an old industry of making money off of these things doesn't want it to happen that way so

Jakob

Hmm.

Nicholas

It's difficult to move away from that.

Alex

I will say the one thing, there is some hope. Okay, like I'm not talking about us here. I don't think I can disclose, but we are working with some pretty big players right now to try and bring this kind of like fresh flavor to how the whole system flows. And beyond that, if you look at companies like Universal Music Group, they have this program in place where they are trying to shift how... the monetization of the music is made. You know, they had this big issue with TikTok this summer because they are unable to actually see how their music is being monetized on the platform and they always have to litigate after the fact. So they created this kind of program, incubator program for startups who would be in a good position to find new ways to just take all of these assets, all of these songs that they've been stockpiling involves for years. And find ways for people to make music with it and pay them essentially for that without having to go through the distribution phase and like monetization of rights and all that, which I think it's a very good indication for the industry because they're obviously one of the biggest players out there.

Jakob

Yeah, I see a lot of willingness. Though I'm actually less hopeful and it's not sort of to... Yeah, yes, that's true. And the reason why I'm less hopeful, actually I was discussing this with a professor like Hope, I guess that's gonna be released in, well, before this one. And he's more optimistic than me, but I'm still not so hopeful for the reason that...

Alex

You said you were Danish, so that's the...

Jakob

Any big change needs to be driven by a lot of consumers and users. And I don't see that happening very fast. So as much as there's willingness to innovation, I believe that any company, how great they might be in how they think of things, will be on a very long journey just because the whole macro environment is not going to allow for this super amount of adaptation really fast. You know, gaming, has a big enough user base to find a new thing that becomes a niche that's still viable to pursue. In music, that is not really the case. Like again, I don't have numbers, you would have the numbers, but like even if you were to attract a good number of users compared to what is producing music right now to whatever you're doing, that still wouldn't compare like in any way to what a good feature in gaming would be. So There's the additional struggle of being first movers in an industry where there's just not scale and someone needs to pay the bill. Who is gonna pay the bill as you start putting this into the market and bringing something better to the table?

Alex

Short answer, I'll leave you the long one, Nick, but like, this is gonna be the SVC or like essentially the companies, as I said, like the Universal and whatnot. The people who will foot the bill is the people who benefit from gaining an advantage in an industry that is trying to kind of split the same pie differently. Yeah, go Nick, sorry.

Nicholas

That was really well said. I have to kind of like rethink my answer a little bit over here. I will say that it's about splitting the pie and a lot of what we're talking about is trying to make the pie a little bit bigger, right? Like with our own... It's interesting when you compare to the gaming stuff because for example, Path of Exile 2 just released, big popular game. I look at their concurrent numbers on Steam, I'm like, wow, 100,000 people online right now and that's their low, you know, of people playing that game. That's wild. Like those are big, big numbers. But...

Alex

Ha

Nicholas

There's a huge gap between games that are successful and not successful at all. You do have the AAA studios that garner a lot of money, the FIFA, you know, and the EAs and the Ubisofts. And you have some indie companies, AA studios, we can call them, that are not really indie, right? They have like hundred employees still considered indie by that standard who are doing well, like The Path of Exiles and like a few other notables. And then it just falls off a cliff and there are zillions of games being made because the barrier to entry is quite low.

Jakob

Mm.

Nicholas

And the tools are amazing, that don't make any money at all. And you could see that in a lot of the game development forums and the struggles. And we hire people sometimes from the gaming industry, and it's not going well. In general, most of the studios are closing. There's a reconciliation of the bubble that's been happening over there. So it's not always roses. I will say, however, that the business practices that you're seeing

Jakob

Mm.

Nicholas

In the gaming industry are growing the pie and that is what I hope that we can achieve. Just look at pricing. Man, like $200 for a DAW, $80 for a reverb, like that stuff is, it's a lot and in a world that's increasingly expensive, you have to adapt your model.

Jakob

Mm-hmm.

Nicholas

That may mean that you're not able to get $500 a year off of someone. Maybe you're going to get $50 a year off someone. Then that's the reality of the business that you need to be looking forward to. But it does mean more people are going to be able to access this.

Jakob

Hmm.

Jakob

Yeah, but like just a small comment. Again, you know, I started using Waves back in the day. I guess that must have been like 15 years ago, whatever. And every single time I want to go back to some of my projects and I need to upgrade my Waves version from...

Alex

Maybe, sorry.

Jakob

From whatever 15 versions that they've had now, need to pay for it. It's just impossible to, even as a professional consumer, jump back into music. The price point is just so high, just having fun. And sure, I can start over somewhere else, but again, I've paid $2,000 throughout the years for the things I have, and they're not, I can't use them. And it's digital products, for God's sake. It's incredible.

Alex

Yes.

Nicholas

Yeah.

Alex

It's super annoying. It's obviously part of the reasons we started this. There's so many things that are backwards. And to kind of go back to your point of optimism versus pessimist, I think one of the reasons I'm optimist is because one of the things that made gaming what it is today is the kind of consolidation of distribution. When you look at Steam as an example, the rise of Steam and the rise of gaming kind of go hand in hand.

Jakob

Yeah.

Jakob

In

Alex

Because they standardized for both the users and the developers how the interaction was going to happen, how the process was going to be made, and then just went on from there. So you still have the game manufacturers doing their thing, which is the equivalent today to the manufacturers of DOS, plugins, sound, name it. The thing that I see that is about to change is the steam part, which is... the social community distribution side of thing that is consolidated into a platform that's going to allow for the explosion and democratization of music. So you can't look at Dawes because Dawes are going to do what Dawes do and they're just going to create silo. You have to look at the players that are trying to bridge those different experiences into one environment that connects everything.

Jakob

Hmm.

Jakob

Okay. I think it makes perfect sense. I'm just gonna ask a direct question. You guys recently raised some capital. You've probably been doing that in several rounds. Haven't really researched that. Again, you've raised some capital, is, like for the music tech industry, pretty good. But again, telling the narrative of being first movers in this space must be difficult. How do you foresee this happening? Like how much... How much do need in the future? How big do need to build it? And do you think someone is gonna support that whole long journey? Because as you talk, there's very little I disagree with, if anything. And I feel very hopeful for the mission. My big question mark is who's gonna buy into it? What's your sense of it? What do you guys need and do you think you can get it?

Alex

Yes. Short answer. No, to be serious about it, it's obviously like one of the hardest industry to raise money in. Like no questions asked because for all of the reasons that you listed. But one of the good thing though about music is even though the return on investment is not the highest out of all the startups that you can see out there if you build a portfolio. There are a lot of passionate individuals building funds with regards to music. So some people made obscene amount of money and they created fun with a very clear thesis on how they were going to spend that money. So the specialization of VC is one of the things that happened over the course of the pandemic, actually, like that you can clearly see a trend of specialization, which helps obviously, startups like ours in the music industry to just go directly to them, look at their thesis, look at the different investment that they made in portfolio and see if there's synergies between the different companies that have been invested in. Then it is kind of like together, know, that the highest value and the highest return can be achieved. So I'm not gonna deny that it's freaking hard to raise money in music, but it's not like there's not a path to do it. And it's not like there's not investors out there that are actively looking for startups that are trying to change this whole kind of like ecosystem. And it only takes one success story for kind of like this whole paradigm to shift in a direction where music is gonna become a good investment.

Jakob

Hmm. Yeah. And again, you know, I've been studying music, financing a lot. And shout out to myself there. Have three articles on LinkedIn. Can go read about it. But there's definitely potential. Yeah. It's, definitely potential. It's just, it's really difficult to sort of communicate at scale. Like both shout out and also like

Alex

Hahaha

Nicholas

You must be a gold member, I can tell.

Alex

Yeah.

Jakob

To what's called modern music, which is like analytics and data on music tech financing. Looking through those lists, I recently joined that platform. It's just, even though it's really good overview, like it's not even a tenth of what I know is like being invested out there. Like it's just not very transparent. We don't have data on it. Like, you know, the place to go for this data is modern music right now and maybe a few other gatekeep data sources. But it's not even showing like this tiny bit of the truth. I don't know what we're referring to, but she comes out with reports every single year. And I think last year there was like 219 different investments and something like that. And then I looked at like angel investments, nine. I just like, I literally like myself know of a hundred. But again, if that's not transferred, if that's not shared, if that sort of passion and knowledge is not transferred. It's going to be really difficult to communicate that. There's so many boundaries you guys need to pass in order to get there. What I do love about you guys is you have a very... sober and clear understanding of the problem, which can actually be really hard to have because of it's in a passion industry. And also the music production space, in my opinion, is rather blind on itself. Like there's very few disruptive players out there that actually is doing something that I think is incredibly interesting. Very few. And I don't know why that is. Think, you know, now I'm doing a monologue, but to be completely honest,

Alex

You

Jakob

The space that you guys are in are traditionally speaking a very small niche. So no one with actually a sane mind would go into it with the purpose of making money. Luckily you guys have a tiny bit different approach but again, that's also why I would assume why it hasn't happened like we can we're seven or eight years since I referring to that Pro Tools, whatever they have for unlike collaboration that sucked very bad to now and still not have that adopted at scale really speaks to the unattractiveness of the thing you're doing at large. Sorry, that was a bit of a digress or sort of run up to the conversation. But what I think is interesting with that you guys do is that you're pursuing it with a different mindset. Which isn't necessarily hard, I think it's just hard to survive with a different mindset. Like there's a lot of barriers you need to break through.

Alex

100%.

Nicholas

I mentioned earlier that our first trade show was Numb. That was digital. We had a lot of people show up and it was great. You know, we made so many connections, nothing of which could like kind of panned out, but it was awesome that like it happened at all. And I remember the last part of the show is they were showing the companies that presented that were the most innovative. And I was like, wow, do you think like we're actually going to get mentioned? Like this would be amazing. And I remember we lost to a saxophone strap.

Jakob

Yeah.

Nicholas

And then I, that's, yeah, that's when I realized, yeah, that was my, one of the first sobering experiences I remember having for like what the audio industry is like. I'll never forget that.

Alex

There's the end of Num.

Jakob

It must have been revolutionary, that strap.

Nicholas

It like

Alex

I mean, I have one at home right now. I use it every day, you know? I never leave the house without it.

Nicholas

Yeah. I remember that and I remember the runner up being an upgrade for a DAW, but the judge was the VP for that DAW. And I was, you just got the whole sense of the industry out of that, that whole thing. I was like, boy, they all know each other. They're all just patting each other on the back for doing the same thing that they've been doing. There was nothing new. There was nothing fresh going on, at least when, when we were exploring and checking things out. And it's been like that with most of our

Jakob

Amazing.

Jakob

Mm.

Nicholas

Interaction with that industry. I agree, you know, it is a hard road. It's difficult to change people's minds, both from the business and the consumer standpoint.

Alex

Takes time and capital. You, you nailed it, man. It's like, unlike other industries where you can just have a, like a good product and then it's going to take off and it's going to be the new thing like Tik Tok or whatnot. This needs at least, you know, a lot of early adoption. To convince investors to get money to kind of like go up on that curve and then get more money. It is very cash intensive to get anything off the ground in it. Like that's where 99 % of all the businesses in music tech, they either die or they get acquired. That's, we're lucky to be there.

Jakob

Yeah. And you guys are, as far as I understand, sort of going for a scale business model. Again, you're not charging for a primary service. It's the everything around it. Guys, I appreciate this talk. Again, I can recognize the problem. I can also recognize the solution is very sane and good and innovative. So I hope you succeed and thank you for sharing the journey. How are you guys, maybe the last questions now, like you guys are...

Nicholas

Mm-hmm.

Jakob

Sort of let's call it midway of the journey. You've been going on for five years, you have launched something that's significant, you've raised capital, you've built stuff, you have users. How are you guys doing? What's your motivation? Do you feel like this is still the right choice? And the obvious question is yes, because there might be investors listening. But let's talk about the personal thing. Where are you guys personally right now in that journey?

Alex

Hahaha

Nicholas

You The ups and downs, as I say, sometimes it can be really challenging. We could spend months on a feature and release it, expecting it to change the world, just to have it bomb absolutely completely and to have no feedback from people. Other times it's the other way around. One of our marketing guys last year just grabbed one of our videos, posted it on a platform, completely bombed. And then two in the morning said, why not? Why shouldn't I upload this on TikTok? And then did. And we woke up to a million views. The thing went viral. So many people flooding the platform. And thousands all in one day and it's because they were looking for change they were looking for something different you know and like they were excited about that stuff and when things like that happen and they've happened rarely but they do happen events i'm like boy i can tell we're doing something right maybe we don't have it right now i've often felt it's like a spiral where like There's like a golden center of truth of like what this could actually be. And each iteration we get like a little bit closer. Sometimes we whiz past it, you know. Every time we do it gives me, it gives me like a lot more wind in my sail personally to keep going because it is of course a sacrifice and a grind, but we could see sometimes that we're really heading in the right direction and it would just be awesome. Yeah, for us, obviously, like if the company went forward. But I think about myself when I was younger, if I had something like this, that was exactly like if I close my eyes, how perfect could this be? And I open it and I was like 19 again. That'd be awesome. I hope we can provide that experience for people, you know, that's motivating.

Alex

Definitely kind of aligned with Nick there. It's any, I'm sure you've had like tons and tons of founders say the same thing, you know, for, that question on your podcast, but it's really like being able to manage your, your expectations, and kind of like not looking. The forest for the trees. Like you just take one step forward, always kind of like rationalizing what you're doing because it is easy, easy as a founder to kind of get lost into everything that you're doing. The fact that there's never a clear path forward as to what should be the next step, what to do, where am I going to be in 12 months from now? And just remembering that you're doing this for the fun of actually, you know. Owning a business, building something that people have never experienced and having fun with it. Because if honestly, like it's not about the money, you've said it then music industry is the warring industry to go in if you're trying to like make a big buck. So when we do, you know, get a ton of like, kind of like that quality feedback from people on discord and you know, on the videos and all that makes it all worth it, man. But it's not an easy journey.

Jakob

Mm. And I think, sort of to round this conversation off, I think what would be beautiful and perhaps to some degree realistic is that in 15 years from now, you could go to music for making money. Like you could go to music technology for money, the same way that you would pursue other creative industries that are doing better than music in that area. And I think that's the journey I'm very curious about. As I said to you guys and a few, few ended to a few times with the podcast, I am on my way out of music as a singular purpose for the reason that I'm 32. Have done been an entrepreneur for 12, 13 years. I have three beautiful kids I need to feed and I'm still going to be here in music. I still have companies on this space and I'm continuing to do the podcast. But I need to go to other places that pays me a lot more as a company to then be present here and hopefully in 15 years get the same amount of potential than in other industries. And I think that's what I've come to realize. Like, an initiative like yours, if they succeed, is going to make that a able. As of right now, you can't go here for money, but I hope it will happen in the future. And I hope that you guys will play a part of that.

Alex

Thanks so much. Hope for ourselves as well.

Nicholas

Thank you. But you know, should think about investing in saxophone straps. I've heard those things are like really all the rage these days.

Alex

Ha!

Jakob

Love it, yeah, that is innovation. Amazing. Thanks Alex, thanks Nick. This was great. I hope guys check out your platform and then follow you on your journey, I definitely will.

Alex

That's where the money's at.

Nicholas

There we go.

Nicholas

Awesome, thank you so much, really appreciate it.

Alex

Thanks so much, man. It's been a pleasure.

Jakob

Love it. Thank you.