Rethinking Music Education Through AI and Personalized Learning

Jakob

Somehow I have some apps that's that don't want to close. I wanna save my CPU here. I need to force quit some stuff.

Jakob

There we go. Perfect. Well I will start in five seconds.

Jakob

Hi guys, welcome back to the Sound Connections Podcast. Today we have Raul in the studio. Welcome.

Raul Rodrigues

Hello, nice to be here.

Jakob

We're gonna talk about something exciting today that I actually don't know too much about, which is education in music, and your company Upbeat. But for the people who don't know you, who are you and what do you do?

Raul Rodrigues

All right. I'm a Brazilian entrepreneur with background as a musician, a mission-driven person. Everything I do is a lot based on purpose and my mission. And right now I'm founder and CEO of Upbeat Studio that you mentioned. We build educational technology for musicians. Now focusing on drummers mainly, starting with the niche of drummers. That's what I do.

Jakob

Hmm.

Jakob

So you have a company that has, you know, significant reach in that space. But let's start with some questions and we'll go into your journey, we'll go into the company and the space in general. But what is it running a company in the music education space? Is it difficult? Like what's the biggest hurdles or opportunities there?

Raul Rodrigues

Sure.

Raul Rodrigues

It's pretty tough because when you when you think about education, usually you think about B2C. You think about an industry that has very low retention, education in general. When we talk about education in music, we talk about a sector with low tickets. We talk about a sector of high cack. 'Cause it's a long tail. So if you look at the unit economics on education industry and music education, it's pretty challenging to hack the system, you know, and to see okay if the CAC is high, so how can I get a good LTV if the ticket is low. So you really need to like play the numbers well and understand what's your in strength to get something that makes sense. So I think that the main challenge when you think about music education industry is unit economics.

Jakob

Mm.

Jakob

Yeah. And is that because people are in general not willing to pay enough or is it really difficult to find the user group? Like try to break that down a tiny bit more.

Raul Rodrigues

Sure, yeah. I mean, I think there are several things. One is that education changed through from being something that you learn with a teacher, maybe twenty years ago, right, to being content driven. So it went all to YouTube, right? So people learn with content today. And content is free. No, I mean you can have created content on platforms that you pay subscriptions to have created content, which

Jakob

General.

Jakob

Mm.

Raul Rodrigues

Now the premium version of YouTube is a place that you pay a subscription to have created content. But it doesn't really replace the replace the teacher's main value. It replaces the teacher's content, but not the teacher's main value, right? So now the amount people were willing to pay for education is the amount they're willing to pay for content.

Jakob

Mm.

Jakob

Mm.

Jakob

Hm.

Raul Rodrigues

And content is free. So so so the the the relative you have for how you can learn is YouTube that is free. So you're not gonna pay more than twenty, thirty bucks a month for something that you can get for free, losing some time looking for the video. You know? So the standard is very low. It's it's hard to compare and and and the other thing is is that the market has has a lot of offer. Right? So it it it's a it's it's a it's a

Jakob

Yeah, yeah.

Jakob

Mm. It's interesting. So we're starting we're starting with like the challenges and we'll get a bit more into it but because obviously there's also opportunities and there's certain ways to address it. But tell a bit about sort of Upbeat Studios, like what do you specifically do and how do you differentiate from free content on YouTube?

Raul Rodrigues

Okay, cool. Right, we build different educational tools, mainly focused on drummers right now. So we have, for example, one is a score creator. So you write music scores, but in your mobile, no one writes in paper anymore. So you have here, you write your score, you share with your student, your teacher, or you just save your scores for your band if you're full of practicing, create your playlists. Really straightforward, easy to easy to write. And on that what don't that app we focus on making it super simple. So people that don't really know how to write. Scores, they can write scores, and that's like the big barrier when you think about music writing, right? It's like I don't know how to I'm scared about the notes, so okay. That worked pretty well. And the other app we have is Drumcoach, that is an educational app that's like full into education. You download Drum Coach Drum Coach because you want to learn drums. And on Drumcoach, we are completely different than YouTube because we try to get the best of the teacher, not the best of the content. So this what teacher has is that they really know how to understand you, grab you by the hand and say, okay, next exercise is this one, and then the next exercise is this one. You know, so on drum coach we focus much more on being smart as a teacher and not just being a library as a YouTube.

Jakob

But obviously that must be with technology, right? You don't have coaches working. Like how does that work? Yeah.

Raul Rodrigues

No, no. No, it's AI, a lot of AI. A lot of drum educational knowledge behind it in order for it to make correct decisions. It's still very simple. Like, yeah. Every time I think I look at drum coach, I see wow in six months you're gonna look back and say, How dare w would we just launch that, you know? W it's really simple today, if you think the logic behind the customization we have today is really simple.

Jakob

Mm.

Raul Rodrigues

Someone's gonna change a lot, but yeah.

Jakob

Yeah, but as anything in life, if you are an expert of something, you know, you have the you have the skill to make it simple. Like you know, l having something simple presented is really, really difficult to do. So I get your point, but I'm sure that's

Raul Rodrigues

Yeah. And keep keeping it simple. Keeping it simple is super complicated. Right? You can you can start on its MVP and say, okay, it works, we understand the value, so now it's like growing here and growing here and growing here, I guess to a point where say, Wow. How right? How can I go back to the value? Because now I have this all these features and yeah, that's a challenge we've faced today.

Jakob

Yeah, yeah. That is really

Jakob

Mm. Yeah.

Jakob

So we'll get back to back to the journey because that's gonna be really interesting and also follow how technology is changing that, but to the sort of most important capitalistic question, like what is the opportunity and why are you even pursuing this space?

Raul Rodrigues

I think there are these are two different questions for me. The why is very much related to my personal mission and my story behind where I started, and we can go deep into that if you want. The opportunity, if we think more about capitalistic opportunity, you know, like the size of the market and what we can get and how we can grow on that.

Jakob

Yeah.

Raul Rodrigues

Still a lot to grow, and we decided to focus on the on the drums niche because it's underserved, completely underserved compared to piano, guitar. Like piano and guitar represents from 70 to 80 percent of the industry, the music educational industry. Drums around 7-8%. So it's short, right? It's not a huge market. But we have around from our calculations have around 20 million drummers, active drummers today, and 10 million drummers entering the market every year. So imagine 10 million entering, 20 million active. So the amount of active old drummers is very little.

Jakob

Mm.

Raul Rodrigues

It's a it's a market that is owned by beginners entering this year and leaving this year. Around seventy, eighty percent, ninety percent will abandon this year. So it's a it's a beginner's market.

Jakob

Yeah.

Jakob

Hmm. So that's kind of interesting also with the lifetime value of a customer. So you sort of built into the industry movements, you need to say, okay, these customers will only be here for a few months. Is that how do you because then you can't use like normal metrics of s like what are industry standards of churn because you're working within a different sort of how do you navigate that?

Raul Rodrigues

Yeah.

Raul Rodrigues

Yeah, that's a huge challenge because if think when you talk to an investor and say, Okay, what's your annual return rate? No retention rates, right? If you say that it's thirty percent, this is very low. If it says thirty percent retention is low, but in the industry in the in the markets, in the educational music education industry, if you have twenty five, you're great.

Jakob

Retention? Yeah.

Jakob

Yeah.

Raul Rodrigues

You know, so they have 30, actually five, five percent above market. Yeah, it's a complete completely different game. The way I play it is that we see our lifetime value as upbeat studio and not as one tool. And that's why we are building several tools. So we have the drum notation thing, we have the educational, we have a metronome, we have another one for songs transcription. Now they're building so there are several tools. That maybe you start learning in drum coach, but then you don't want to be using an app to learn anymore. Now I want just to write my score so I have the drum notes one. And then like our goal is to make this drummer be a drummer for at least 10 years. You know, and don't give up on the first year. If I manage for them to stay on the second year, it's already amazing. And that goes a bit beyond just the retention, but like I want more people to play drums. That's that's my thing. So 10 years go, you know.

Jakob

I that's really interesting. And I is it possible for you now already to see that there's sort of movement in between the tools you're building?

Raul Rodrigues

Yes, there is. We still didn't build that like a well-built structure behind each tool to create these cross-sellings. So now the cross-selling that we have is very organic, like emails that some you download a tool and then you get email saying, Hey, welcome to the drum notes, if you want, also check drum coach for like but it's very simple in a surface. Maybe we're gonna get there. But for now we see there's around thirty percent of the people that download one app doubles the other. Which is okay.

Jakob

Hmm.

Jakob

Yeah.

Jakob

Hmm. You know, I think an interesting an interesting discussion of this is, you know, you say yourself that comes in ten million new dramas per year. Obviously you need to then sell to them while they're buying. And that has something to do with, you know, being in front of the right audience, typically that's sort of digital marketing or very organic SEO and sort of so what's your mentality behind acquiring users when you know that it's quick in and out, but you need to also be there at the right time?

Raul Rodrigues

Yeah. I think that's the other big challenge, you know? The other big challenge is how you can acquire them in the right moment in a cheap price. If you think about the music industry, when acquiring people, you have to fight with long tail. Right. So if you think about organic All the drummers are out there now creating content and trying to get followers and sell their little courses. So going organic is fighting on a long tail or you have to be highly capitalized, which is

Jakob

Mm.

Raul Rodrigues

Mussara, no, Dromeo, for example, has been there since the before YouTube and they played really well, incredible their whole strategy, super high positions in organic, and then you have the long tail. So fighting in long tail, my approach is that we need to do it well, but we're not gonna win there unless we have a lot of capital. We just need to be well as a you know front.

Jakob

Yeah. Hmm.

Jakob

I think it's really interesting with the with the long tail. Again I'm sort of a to some degree a good example of a long tail. Like I used to play guitar and sort of took it seriously when I was fifteen and sort of downloaded ultimate guitar, I think that was is it still called that? And

Raul Rodrigues

Yeah.

Jakob

And when I, you know, when I'm playing at, you know, family parties and stuff like that, I'm still sort of going back to that. And I've purchased the app a few times for several different reasons. So this is a journey over eighteen years where like, yes, I downloaded eighteen years ago. I used a website. And now still eighteen years later where I'm no longer active position, I still go back and use them for every single occasion I need to do it. And so it's an interesting thought about sort of the long tail. Well Yeah, sorry? Question.

Raul Rodrigues

Mm-hmm.

Raul Rodrigues

Uh-huh.

Raul Rodrigues

Do you th do you do you think what's your LTV for Ultimate Guitar?

Jakob

I don't know. So I've paid probably two or three times, but that was a like short amount of time, maybe one or two months at a time. So I you know, I would imagine I've probably paid them, I don't know, fifty, sixty bucks over the eighteen years. So I'm probably not the most, you know, ideal customer for them, but

Raul Rodrigues

Okay.

Raul Rodrigues

Okay.

Raul Rodrigues

Huh, huh. Yeah. Okay. Yeah.

Jakob

But still it's back to mentality with the long tail, right? And the reason why I use them obviously is SEO, so when I search for chords and stuff like that, they show up. But then I also I know n I know the brand, so I recognize it from you know the last eighteen years of playing.

Raul Rodrigues

Mm-hmm.

Raul Rodrigues

Yeah. They have a really cool strategy, Ultimate Guitar. They are from the Muse Group. Muse Group has Muse Score, Ultimate Guitar, also Leopard the copyright publisher for scores. Like this, they're the biggest publisher of copyright of copyrighted scores in the globe. And they have a really cool strategy on they're very aggressive on SEO organic content. So what's make it our muse score, super, super like volume driven. So they have a lot of very cheap volume and very low conversion. Very, very low conversion, but which doesn't matter because they have so much volume, volume. The I was talking to one of them is like less than one it was it was super low and that's their game. So very aggressive promotions, huge volume and it works because they are the top volume in the market today.

Jakob

So is that sort of a strategy that you're trying to adapt to some degree? Like try to tell about too because you obviously you're a smaller player, and you have maybe let's call it a smaller niche. And you know, it's I could only imagine it's not as natural for a drummer to sit with a device and do something that it is for a guitarist where it's very easy to sit at your desk and play. So what's your mentality and strategy and how does that differ from what you just explained?

Raul Rodrigues

Yeah.

Raul Rodrigues

Yeah.

Raul Rodrigues

Yeah. Okay. So I as I was saying before, no, that there is this part that is content driven to get organic people coming in. I think that's something we need to do well, but we're not gonna win there. Then there is the funnel and paid marketing. That are two things that I think just about optimization need to work and optimize, optimize. And we can we can be really good. Depend on how much you put, but depend on how efficient you are. So, you know, so we are really strong now on paid, which means we weekly base optimize things and keywords and bits here and bits there and changing different ads and changing creatives all the time, you know, like so. I think this is a place we can win. Depends on how much money you put, obviously, but the more money you put, more expensive the download. So you need to get to a point where

Jakob

Mm.

Raul Rodrigues

you can get the amount of people that the market has, you know. And I think that's a place we can actually fight with the competitors, like, you know, hand by hand. And the third thing that for me is still related to acquisition is how good your product is. And then you get

Jakob

Yeah.

Jakob

Yeah.

Jakob

Mm.

Raul Rodrigues

referrals and then just you have higher probability for downloads because ASO increases because you have higher ratings. And that's our focus. So when we think about acquisition now, I say, okay, we need to be okay in organic. We need to like do a good job in organic, but we're not gonna be the number one in organic. We ha we can be like touch with the good ones in paid, but on product wise, we need to be the best. You know, that's like no excuse to be double than the others. And today we already have like the highest ratings in all the educational drum apps. Obviously it depends on the country. So maybe if you go to I don't know to Indonesia, maybe there is another one that is a little bit better, but in average when you see when you compare the tools that analyzes average ratings. We are above, so that's really cool. Like we're managing to keep above. So our ASO is getting really high compared to others. And that's our that's our fight to have a product that is better than everyone else.

Jakob

Hm.

Jakob

So you've been be doing sort of upbeat studios for nine years as far as I understand and have had like a sort of founder stint for a longer time as well. But like how long did it take before this actually made sense as a business?

Raul Rodrigues

Yeah, maybe seven years. Yeah, as again it started as a as a mission thing. As a hobby, as a mission. I was doing other things before and it was just running in the background. And my last professional experience I was in this startup here in Spain, like high position.

Jakob

Wow.

Raul Rodrigues

Really interesting position to say, okay, now let me jump to another corporate career because I was in a high position in the company and everything was like taking my career towards a specific direction that it would be nice and easy. But at the same time, drum notes, which is the score editor, we only had drum notes at that time. Had so many people using it and that we could we could understand what was happening. We could understand the users. We could have interviews every week with users if we wanna. And we started doing that and understanding, okay, there are there is still potential in the market. There is a whole part in the music education that is not served. And if we approach this industry from the technology perspective and business perspective, I think we can do it. And that was two and a half years ago. So I quit the other one. It was a hard to come back to the bottom, to the battle, come back to the ground battle and start again something from scratch. Some somehow from scratch because drum notes was really nice. We had so many people but i it's not it's not profitable till today. Like we don't see drum notes as a revenue it's not gonna give us the revenue to keep the company. Drum coach and educationals will, and then drum notes can help on the L T V and in the long term.

Jakob

Mm.

Jakob

Mm.

Jakob

So what's the financing of this journey trade so people can understand like how did you afford to build this over nine years, like a significant amount of investment of your time, but also the team? Like what how did how did you do this?

Raul Rodrigues

Yeah, I mean d during until t three years ago, I wasn't working full time on this. I've been working on other things. So I had this other startup here in Spain that I was working for. Then before I was I had I had several businesses so yeah. Before I had a music school that like brought me all to the to the business world, to the educational world in Brazil. And then I had A video animation studio when I was living in Argentina. Like a kind of a side moment in my life. And then I went to do an MBA in the United States. Like I was focusing on other things, and this was just like a back on the background. And then when I decided to go full-time into this project, I understood that I needed investment. So the first year was looking for investors. Like building, trying to get some more traction, launching the educational part, and finding investors, investors that took really, really long. It was really hard to get investment. Eventually we did. And now we are fine, like on we're still we still don't we don't we're not in breakeven yet. But we are fine because we do have long runway and nice team, so things are moving, revenue is growing, so we're getting to this point where if we continue the way we are, we can get to break even, we're not gonna die. Now is just the challenge of how we can actually make this times ten and not times two.

Jakob

Mm.

Jakob

Hmm. So you talked about sort of the market and sort of this influx of drummers. Like how big can such a company become if it's done well? Like in you obviously when you bring in investors, you also have an expectation of return on investment at one point. And obviously I would imagine your team and yourself, you know, would also enjoy a payday at one point that's more than the startup salary. So how big do you think this can become?

Raul Rodrigues

Yeah.

Raul Rodrigues

Yeah, that's a that's a really good question. Depending depend depends on if we stay on the niche or not. If we stay on the drum niche, we can get to 30, like if we really grow and become the f number one in the market, we can go to forty to fifty million ARR. Yeah, that's what r drum mayo has now. Mussora gets a bit more than 50 million ARR.

Jakob

Mm.

Jakob

That much.

Jakob

Mm.

Jakob

Hmm.

Raul Rodrigues

If we expand to other instruments, then it this goes to like Simply for example has around two hundred thousand AR.

Jakob

Hmm. Because for me, again, I don't know much about this space music education. I haven't spent too much of my focus there. For me, that sounds like a good amount of money. So what is the issue here? What's the dynamics of the sort of the incumbents, the big players? Are like is it a few different players that sit really heavily in the market? Like what's the dynamics?

Raul Rodrigues

Yeah.

Raul Rodrigues

Yeah there's the there's three big players. Uzician from Finland. Then there is Musara with Dromeo and Simply from Israel. Simply now 200 million, Uzician close to hundred.

Jakob

Mm.

Raul Rodrigues

But in troubles, they just had a massive layoff. Last year was the first year they were profitable because of the massive layoff. So they are in that situation. Then Mussora, I think, is maybe the best positioned because they zero investment, it's fully bootstrapped. And they are in between. We don't have exact numbers. No, these are all stimulations, stipulations that I do, but it's from 50 to 100 million. So they're well established. And then So if we see just the drum sector, we have Mossora, fifty million, let's say. The next one is Melodics, that is around two million. So the difference is huge. And Mossora is they raised a million and a half, I think. The founder was it's like really incredible guy from the music industry. So they started with Roland and I don't know. Other company there was already a partnership for distributing their software with their drums so they came already in a really high position there they have now two million and then comes us that we are like between 200 AR so the difference is huge no and below us there are one every week there's a new one.

Jakob

Hm.

Raul Rodrigues

So I'm a sure I know there must be maybe hundred really small tools to learn drums today that maybe they make a thousand to five thousand a month. Yeah. And then comes us and then comes Melodics and then comes and it's

Jakob

Mm.

Jakob

So what's the common denominator? Is that capitalization or the time to enter the market? Or like w what do you see the advantage coming from distribution?

Raul Rodrigues

Distribution. 100%. Yeah. 100% distribution. The way we try to hack distribution is having a better product because we don't have enough capital to compete with the distribution that they have. Well we were saying before, no, I think the only way we can hack it is having a real much better product and efficient paid marketing. Now we are exploring other channels, but yeah, like Melodics, they came already as a with their core strategy was B2B2C.

Jakob

Mm.

Jakob

Hmm.

Raul Rodrigues

So they started already partnering with other drum brands. So you buy a buy a drum set and you get Melodics for free for whatever. A OK product. And yeah, that's how they grew. And now but after one year they already spent it to piano and then to pads and so t the verticalization is if you if you raise capital, you have to verticalize.

Jakob

Mm.

Raul Rodrigues

Because if you not you get too short and you can't you can't s expand your evaluation more than if you don't become the number one, your evaluation will be always under ten. You know? So if you raise money, you can't sell that your evaluation will be under ten.

Jakob

Hmm. It makes sense. And what do what do you think is gonna be your direction to do this? Is that sort of stay nation, win the market on quality, and then grow a sensible company, or do you think you need to pivot to other verticals?

Raul Rodrigues

That's something I don't have a closed answer. Something that I'm exploring daily. For now we want to win drum niche. I think I still think there is a lot of put potential there. And with the resources we have now, the knowledge and the resources that we have now, I think we can get really high in the drum niche. I don't think we're gonna beat Dramao.

Jakob

Mm.

Jakob

Hmm. Yeah.

Raul Rodrigues

Because their distribution is insane and it's impossible to get that distribution. But we can beat on lifetime value, it can beat on conversion. So we definitely can beat on the main unit economics. And this can lead to more investments, or this can lead for more authority for us to go to other verticals. But I think if right now we just want to expand to other verticals with what we have, it's not gonna be enough. You know, we're gonna we're gonna die trying.

Jakob

Mm.

Jakob

So the interesting thing is, as you said, like the thousands of companies to make maybe a thousand a month, you know, possibly also because of AI and t technology is becoming cheaper, there's always these sort of the question about like how much do you need to grow in order to stay competitive rather than just, you know, win on quality and become a sensible, profitable business. Like where's your mind on that? Like d does these competitors, these small beginners, are they an actual threat or is it something completely different?

Raul Rodrigues

Yeah, I don't think those small ones are threats, no. I mean th they are obviously because they solve pains. You know, like you have a pain that you want a metronome that wants to help you, whatever. So maybe that's super cheap. You pay one dollar a month and you have that metronome and that can be a competitive for one of our little solutions inside our tool, right? But I don't think that hurts that much.

Jakob

Yeah. Sure.

Raul Rodrigues

I think that's actually could be even interesting because educate more the people to look for solutions, educational solutions in applications. So actually it builds more audience, I think. And then we become a standard of quality, which is which is interesting. Actually we're already seeing that a lot. We are seeing a lot of new apps coming out with something very similar to us.

Jakob

Hmm. Mm.

Raul Rodrigues

You can that with definitely see there is a print screen and then a vibe coding saying, Can you do something similar to that but with a different layout? It's crazy. Yeah, so I don't think the long, long tail is competing on the product side. You know, in marketing they were, but yeah, in the product size, I don't think so. Yeah.

Jakob

That makes sense. Mm-hmm.

Jakob

So the general music education space, what do you think is the opportunity there and changes there? Like I can only imagine that people are naturally leaning towards that AI can help the interactive process like where humans before were the necessary interaction in order to have that quality. Now AI probably not so now, but it's is you know probably in the future. Can be very interactive and can understand the playing, understand and give like actual feedback. So how do you think about this space? Is this gonna be a more attractive space? Is it gonna grow? Are people gonna pay more for this? What do you think?

Raul Rodrigues

Yeah, I mean the last question, I don't know if they're gonna play more for this. It's a actually a good question. We could talk now and see if we can get to a conclusion, but I definitely think it's gonna grow. I think this is the missing part in education. Was as we were talking before, education grew as a content-based offer and misses the quality of the teacher, which is the tutoring, it's grabbing by the hand, giving feedback, blah. And AI is enabling this part. So finally there is a layer between the user and the content that can give that customization. So I think the opportunity in education in general, not just in music, but in education in general in this decade is insane. Because I think all the educational platforms we have today will change to better. You know, and I think that Like the big ones, either they will have to transform their business to I mean adding this layer of customization of AI, what AI can do, or other small ones will enter in and gain the market. Like I'm very confident with that argument. I think all the big ones will have to change because of how AI can customize the learning.

Jakob

Okay.

Jakob

And is that because you think that they're not gonna be able to create products at scale that can be customized in the AI experience? Or like what's your argument for them being able not being able to change or maybe more difficult for them to change?

Raul Rodrigues

No, I think they can change. The bigger you are, the harder it is to change, right? And I suffered that on the previous company as well. But I think like if you think about a good teacher, they have three big things. They have a lot of content on their mind, they know things, right? Then they have a capacity, a human capacity to understand the student and understand how they are feeling today. If you can push more, if you can't push more, you can empathize. And then they have a third thing that is connecting the content that they have in their minds to the situation of the user right now. So a recommendation system. So a good teacher has like these three things really good: content, recommendation system, empathy to the student. Today all the online learning things are just content. AI can bridge this thing. So if I'm a consolidated company with a lot of content, I have miles ahead of anyone starting in the market. Because I already have one part. I just have to put a layer that understands the user and knows how to suggest my content. I don't I mean I think if the big companies don't transform it's

Jakob

Yeah.

Jakob

Hm.

Raul Rodrigues

Because they weren't looking at it, you know. Because they can. I think they definitely can.

Jakob

Yeah. So b back to the sort of the talk about what people are willing to pay because the association to content is YouTube and it's free, I can only imagine that the shift towards this engaging part of content is what argues that it's gonna be more attractive to have content that you want to teach. Is that correct?

Raul Rodrigues

Yeah. Yeah, I guess. I guess. I guess like a subscription to a platform that has this layer will be more expensive than a subscription to a platform that only has content. However, AI is really cheap. Like having a personal coach today, a GPT that is free and he sees some ads or Cloud is really cheap. So if I pay, I don't know, ten bucks to Claude.

Jakob

Mm.

Jakob

Mm.

Raul Rodrigues

Am I willing to pay 30 bucks to this musical cloud now? You know? So I'm not sure. I think I think the subscriptions for AI is so cheap for the power and for the what it offers that maybe can bring the market lower, prices lower. Because in the end, what am I gonna sorry, what am I gonna be as if you think like the future of for me music education?

Jakob

Mm.

Raul Rodrigues

Will be Claude, OpenAI, with all the musical analysis, managing audio, understanding what you play, and knowing how to listen to you and giving you correct feedback. In order to get there, there may be several years and a lot of training, a lot of content to be trained and to really be a good teacher. It will take maybe five years. It's not that long, maybe ten years.

Jakob

Yeah.

Jakob

Hm.

Raul Rodrigues

Luckily. So the missing part is just this how can really AI listen to you when you play and give you correct feedback, instant feedback, you know. So the difference between what you have today in cloud and this feature that I'm saying from the user's perspective is not that

Jakob

Hmm. But for me that naturally leads to two questions. One, do you think that these big AI players have an interest of tweaking their technologies so it adapts to a relatively small market? Maybe not. But e even if there's an element to let's say a smaller model maker would have that focus, what where does that leave you? When you have

Raul Rodrigues

Yeah, maybe not. Yeah, it's a good point, maybe not. Maybe not.

Jakob

But let's say again, we're just hypothesizing in five to ten years there's some sort of model that you can ascribe to that has ability of listening and giving quality feedback. Where does this leave you as a company?

Raul Rodrigues

Yeah, it's a really good point. I see several ways. One is you becoming the machine behind it. So How is Cloud going to analyze the audio of the user playing and know what to suggest? So I can I can, for example, create an API of drum coach and you can use any AI, connect to it, play your song, whatever, and send to through the API, and my system will tell what the your AI needs to tell you. So that could be an option. So you could you could make your GPT today be your drum teacher if you connect to this API paying 10 bucks a month.

Jakob

Mm.

Raul Rodrigues

So that's one pop one option maybe in the in the midterm. That's something for maybe one year, two years to heaven. The other one thing that I that I see, maybe I'm going too far on my on my view, but I think this is going to change and instruments will become the teachers. So I think a lot of instrument manufacturers can go towards a Nespresso or Peloton model, where I sell a very cheap instrument, but I stay with you in a subscription offering an incredible service. So it's gonna be better than Claude, better than Gemini, better than whatever. And you pay a subscription to have your drum set with LEDs with a huge widescreen thing that will tell you what to do and you know so it's it's the whole experience of learning and I think a manufacturer can build that way better than just an open AI thing. And that's a way for us also to support. So I can be the digital layer of that platform.

Jakob

Mm, mm. Interesting.

Raul Rodrigues

I totally see Yamaha drums selling a drums for a hundred Euros, but then a subscription of fifty.

Jakob

Hmm. So you know, in your mentality you are preparing yourself for the pivots that are necessary to stay relevant? Yeah. Yeah, of course, of course. That's the interesting part about AI in general. I think for me, the pivots necessary, music has been

Raul Rodrigues

Yeah. I think we o we always need to.

Jakob

Has been less evident. Like it's you know, even though a lot of things are happening in music, especially on the data side and then of course on the generation side, It's still gonna be quite difficult to see the real changes long term when it comes to how it changes music businesses. Be because you can see that very specifically in certain industries. I think because in music there are there are only a few big, big players that do these changes, there's not this sort of long tail of small businesses. Again, let's take Suno's example, right? Obviously the music now coming from Suno and V six is like i in insane quality. Like it's ridiculous. Like it I can't even wrap my head around it. But then there's really not that many competitors to that. And you know, I would argue many of them are very far and especially if you're you know, a small finance company that maybe only has raised five to ten, fifteen million, which obviously is still a significant amount of money, like forget it. Like you're not gonna compete at that level. So yes, Suno is a president, but I don't really see where business sis will exist that much other than maybe a B to B layer and but even, you know, I've seen some like I think yesterday I saw Masut announcing that they're sort of closing their BDC Pine of the company and they're sort of integrating into things. So even these companies are not necessarily dying but giving up the race. So that's the thing. So when you talk about how to pivot, it's still not very clear like what are the pivots necessary in the future.

Raul Rodrigues

Yeah.

Raul Rodrigues

Yeah, it's not. But it's not but I but I'm pretty confident on the possibilities. You know? Maybe I don't I we don't really know where it's gonna go, but I think there are this and this and this possibilities and I need to be ready for all of them. You know. I don't think it's gonna stay as it is. Like people will stop valuing paying twenty euros to have access to created content. Like that's that will lose value. You need the layer of this customization. Kind of that's a for me that's a certain way and that's where we're focusing. If the instrument model will become more as what I said, the peloton model where you buy a cheap instrument and have a subscription, maybe not. Maybe that's me being too far.

Jakob

Hm.

Jakob

Mm-hmm.

Raul Rodrigues

But I gotta be ready for that if it comes, right? One thing that I that I also think is gonna happen is that forever teachers will exist. Forever people will trust more the teacher that is a drummer friend of your cousin that will come to your house and teach you drums. And that's amazing. I think it should continue because that's where actually knowledge is created, not so much how we how I do. But it's gonna become more and more a gourmet thing.

Jakob

Hm.

Jakob

Mm.

Raul Rodrigues

Having a teacher. It's like, wow, you have a teacher, a human.

Jakob

I so you know, you know, I thought to ask you this, but then this is the natural time to ask this. Like you're on a mission to have more people learn how to play drums, but you also know by part taking that missing and following technology, the whole industry at large are making humans in that relationship less and less relevant. What's your reflections on that?

Raul Rodrigues

Yeah. I think I'm set. I mean I'm super AI person. I'm fully as I told you I have a podcast about AI. I have AI in my bloods where when I'm working, like everything's AI. But it's a conflict for me because I don't think we're going into a good direction. Even when we talk in a human direction, you know. I think that AI can bring a amazing outcomes to hum human and the planet. But when I think about the short term, I'm super concerned. Like there's about a hundred thousand songs being uploaded, AI songs being uploaded by month, maybe. So what's the value of a person creating? Like that's a really interesting research that my music teacher when I was a kid s did and he still does, so that's 30 years already, in the same school that he teaches. He asks the kids, what your are your references? What are your bands, your musicians that you have as references? He's been doing that for 30 years, every year. In my time, though, he was his first year working in that school was when I entered. We used to say, I don't know, retros the peppers. We would know the name of the bass player and the guitar player and the drummer. We knew all these people, right? And he told me that like from ten years to now, it's really, really hard that someone says a name of a band. No one knows names of instrument players. Just may some will say bands, but most of them will say YouTubers, Instagrammers. Now with music created by AI, maybe no one's gonna say a band anymore. So that's a part of me that is questions a lot the way we are going because

Raul Rodrigues

Wha what's the motivation to learn drums? What's the motivation to learn violin? You know?

Jakob

Yeah, that was my biggest question from you, from you giving that point now is like what is the purpose then? Like is it recreational? Is it self-expression? You talk about, you know, the majority of drummers are in and out in the first year. Is it already there now that it is a sort of recreational self-expression, that you learn a certain skill that you can bring into your life? Like what's your reflection?

Raul Rodrigues

Yeah. Let me go back quickly to why like the roots of this mission for me. And then I connect to my motivation now. This always started because I was in doing music research in a favela in Brazil, I was like living there and working there. And I remember talking to kids, a lot, that was a lot of the kids and playing with the kids and

Jakob

Mm.

Raul Rodrigues

And their reference of what they could be when they grow up was a policeman, a drug dealer, or a musician. Kind of that was the three possible outcomes they could see. They couldn't see anything else of that. Police and drug dealer in that context is pretty complicated. It's kind of the same, you know, it's not the same that we can't say that, but it's I don't think it's a healthy outcome in that in that scenario. A musician is the only outcome.

Jakob

Mm.

Raul Rodrigues

You know, that they can really get out of society in a good way, get out of that society or just get to know other things. And I happened to be with one group that came from there and traveling with them and they were incredible and they became a reference in the whole community because they were musicians. Anything that would happen, people would go for the musicians. And that for me brought this feeling of fuck, music really saves people, you know.

Jakob

Mm.

Raul Rodrigues

And that was kind of my mission. It's not drums or not drums, but I need to make people play music because somehow music has that power. You know, and maybe for a white guy in California, music means something completely different than from that person in that context, you know.

Jakob

Hmm. But so what you're describing is also attached to a person, right? So it's not necessarily music and it's what it what it is, it's a musical work, it's a person associated with that music. Correct? So

Raul Rodrigues

Mm-hmm. Yeah. But it's easy. Like it could it could be art. It could be graffitis, right? Any movement that makes people see something else b besides their day to day. In that case in music, I think music is very easy to become that in any context.

Jakob

Mm, mm.

Jakob

Mm-hmm. But if so the leverage of artists in the past has been obviously making great music and be culturally relevant and many other factors that I'm not an academic in. But when you when you take away the aspect of you being really, really good at your instrument because that's almost a self-given digital world that something is really, really good. Wha what is the what is the role of a drummer then? Like what is the role of a musician in the future, do you believe?

Raul Rodrigues

I don't really care much about that. Yeah. Like for me the like I'm I don't teach drummers for them to become great drummers. And I don't I don't I'm not preparing them to become a great drummer, you know? I'm trying to make them be a great person. Because I do think that the process of learning music is incredible.

Jakob

Yeah.

Jakob

Mm.

Raul Rodrigues

You have to deal with frustration every minute because you play something that doesn't sound as if fuck, how do you get this right? So there is the process is amazing. It's hard, but it's amazing. If they're gonna become relevant as a drummer in the future that I we don't know, that's up to them.

Jakob

Mm.

Jakob

So what's your approach to sort of digital marketing and copy and messaging when you talk about this? Like basically you become a better human. Like how do you sell your products with that in mind?

Raul Rodrigues

Yeah, it's really hard. It's really hard because what I'm telling you doesn't sell. So we do have to fake it a little bit into become a drummer, become a great drummer, you know. We are behind you to become a great drummer, but we do try to put a lot of effort on the idea of discipline about creating habits and not selling that you're gonna play your first song in a week. No.

Jakob

Do you know?

Jakob

Mm.

Raul Rodrigues

We do argue a lot against it. So if you do the onboarding drum coach, you're gonna already gotta get a message of don't buy into these bullshit courses that tell you they're gonna learn in a week. You're not gonna learn in week. So but stay with us that we can hold your hand and take you through the process.

Jakob

Mm.

Jakob

So do you work a lot with affirmation in that process that you tell people like great job? Or like what's your process like in app?

Raul Rodrigues

Yeah, we do. Yeah, we do. Th there are three things. There's a really cool research explaining motivation for students. And the first that keeps people motivated is them feeling that they can do it. You know? So you do need to create affirmations. You know, you just play the one note per beat.

Jakob

Mm.

Jakob

Mm.

Raul Rodrigues

And you're gonna finish and you're gonna say, Whoa, you're crazy, good, you know? Because you did it. The person needs to feel that they can do it. No, then they need to be a bit challenged, but they need to feel that they can they can do it. And the second thing on this research or the second thing in this research is them feeling that they own the process. So it's not just someone telling me what to do, but it's I can choose where to go, you know? That's the second biggest motivation and that's really, really cool.

Jakob

Mm.

Jakob

Mm.

Jakob

Because this plays into what is good education in general. It's not just technology, right? It's not just endorphins from some sort of like notification. It is like the process of it. I had a really interesting experience because I'm a I'm a very practical guy and I generally speaking hate affirmations as like a standard thing. Like really creeps me out. But I was you know I was opening Duolingo just for fun and I was trying to teach myself Mandarin for some for some odd reason. And you know I was like, I'm so good. Like I'm getting perfect all the time and became like a really thing and I just caught myself like Jacob you hate affirmation.

Raul Rodrigues

Mm-hmm. huh.

Raul Rodrigues

Cool. Mm-hmm.

Jakob

But like this is so addictive that you keep getting perfect scores. And maybe I was better than most students. I don't know if it's just a trick Duolingo does. But for me it was just a really wake-up call. Like I'm a person that does not like affirmations as a default. Like the you know, without culture offending anyone, like this very American high energy thing. But it really worked for me in the in-app education space. Is that per default that's just like the go-to, you need to treat

Raul Rodrigues

Yeah.

Raul Rodrigues

Mm-hmm.

Raul Rodrigues

It works.

Raul Rodrigues

N yeah, I think so. I think so. And that it's not just in apps, but you see several methodologies. For example, my girlfriend works in Montessori school as a teacher, and that's one of the things they have at the default as well. You know, you don't you don't say you're doing bad, you wait them for to do well and then you say you're doing good.

Jakob

Yeah.

Jakob

Yeah. Which is very interesting for me. I coach a lot of startups and I do this way too badly. I don't I don't give affirmations and okay, I need to work on this. So thank you for it's a human thing.

Raul Rodrigues

Ha It's good. I think it's a human, it's a human thing. It's not we need to feel good. Indeed, the third thing on that research, I'm sorry, the third thing on that research is feeling the social part of it. Feeling that you were not alone when you're doing it. So if you if you come with this affirmation, not just saying

Jakob

Yeah.

Jakob

Mm.

Raul Rodrigues

you are great, but saying, actually you are you are learning ten percent faster than others. You already feel that there are others with learning as well and you are kind of building that doing something that others do, so you accomplish the three things if you do a good affirmation.

Jakob

Mm.

Jakob

Hmm. This is really interesting. And the unknown factor here, with which we've already covered, is what is the future of this? Like what is the future of education? And that's sort of where you and competitors and other players in the space need to be ready to pivot. But can you do you in general believe that this is a growing market? Like there will be more money and more opportunity in the space, or do you believe it's gonna be a Completely pivoting market so you don't know for sure like what's your outlook on the market in general.

Raul Rodrigues

I think the education market in general will grow a lot. It's crazy. I don't have numbers, but I think it's gonna transform more than grow initially. And then it's gonna grow because it's gonna be much more accessible for everyone and f and cool to learn, whatever, you know, learn about planets in a really cool way. so my view is that it's gonna transform and then it's gonna grow in general.

Jakob

Mm.

Jakob

Mm.

Jakob

Mm. Yeah.

Jakob

Mm.

Raul Rodrigues

Music education, I have my doubts because I think it's gonna be more accessible, it's gonna be fun, so it's gonna be more on the hands of everyone. But I'm not sure if more people will be willing to learn an instrument in the future because they have less references now of

Jakob

Mm.

Raul Rodrigues

You know, be becoming the drummer in your school isn't a really cool thing anymore. You better become a TikToker. You know, so the motivation is lower, although the thing is more accessible. I'm not sure how we're gonna go with this, although it's been growing around like six, seven percent a year. So

Jakob

Mm-hmm.

Jakob

Hmm. But you know, there's also an argument like, again, sorry if I'm offending any people in the simplicity of my view here, but y you can let you know, let's just say TikTok or social media as an example. You can ha probably have a natural talent for that. Like you understand trends, you understand subcultures, you understand these things. So a person that's really well exposed to something can probably become quite good at that really fast. But it doesn't really work like that as a musician. Like no matter how naturally gifted you are mus musically, the time it takes to become good at it is significant.

Raul Rodrigues

Yeah.

Jakob

So there's the whole process of like knowing nothing to being fairly good, that whole process is probably not gonna be as recognized and esteemed in society. Because we expose to everything is gonna be so good, you know, at an instant, the journey itself is gonna be more embarrassing maybe, or like if that makes sense.

Raul Rodrigues

Total, yeah, yeah. It's frustrating. It's super frustrating. Learning music is super frustrating. Until it's not until you like until you manage to enjoy it. You enjoy that sometimes it's hard, but then you can get it and you trust yourself that you can learn. I think yeah, it's based on little learning cycles, you know.

Jakob

Yeah. Yeah, I'm slightly.

Jakob

Yeah.

Jakob

Yeah.

Raul Rodrigues

And dealing with frustration, then giving the amazing great gratification because you managed to learn it. And then frustration and how you how you grow. yeah, but I think it's a challenge for the this generation, like for our generation, even for us, because my main audience is people from 25 to 50 already. I'm not I'm not focusing so much on teenagers, I'm focusing on our generation.

Jakob

Mm-hmm.

Jakob

Mm.

Raul Rodrigues

Yeah, and we're already less patients.

Jakob

Mm.

Raul Rodrigues

So it's gonna be a challenge. So this means I need to gamify more. Not gamify in the way of giving you little stars, but showing you these little cycles. you just learned something. You were here in your map of knowledge. Now you're here. You wanna learn this song, so you have to do this, and this. You know? Let's go. Step by step. Keep you hooked.

Jakob

Mm.

Jakob

Mm.

Jakob

this has been such an interesting talk, and thank you for being generous also with your openness and analysis of it. And these are the talks I love on the podcast where we get to learn things that are really hard to get to know unless someone that's deeply embedded in it tells about it. so what do you think will be the outcome for a company? Maybe as a last question, like realistically, is that

Raul Rodrigues

Mm.

Jakob

you'll grow to somewhere that's profitable and that's gonna exist for a long time. What do you think you're gonna go to a certain size and because of the market you're forced to sell and sort of to someone who consolidates? Like what do you think is going to be the most likely endpoint of your company?

Raul Rodrigues

Mm-hmm.

Raul Rodrigues

Mm-hmm. No. I think we have three outcomes. one is to die, which is always there. Most startups have that really present.

Jakob

Yeah.

Raul Rodrigues

But that's not gonna happen. We try not to think about it. and then the other two is we grow to a point that would be if we continue as we are and finding these opportunities and grow to a point where we have a stable ARR and that means between five and fifteen.

Jakob

Mm.

Raul Rodrigues

That we can keep a good team working and keeping innovating. If we're less than five million ARR, I don't think we can build a structure that's is strong enough to keep innovating and keep it on top of the market. You know? Maybe, maybe I'm being too much. Maybe, maybe more than two, three million is already you can have a good team with really brilliant people working on that. And the third outcome is merging with a bigger retailer or a bigger brand that has distribution already.

Jakob

Mm-hmm.

Raul Rodrigues

So we become the digital layer of that brand or that the retailer. So imagine you sell a drum set, but at the moment this user, this customer opens their drum set and have a QR code, then it's our responsibility to keep them engaged, to make sure that don't they don't return the drum set because they know how to set it up, they know how to play it, they know how to be happy with it. So it that's then the other possible outcome that we are exploring. Indeed, now I'm going to China and to US

Jakob

Mm. Mm-hmm.

Raul Rodrigues

in October to explore partnerships of manufacturers, retailers and so that's definitely an outcome that can live together with the second companies. Yeah.

Jakob

Mm. Well, thank you so much for being on today. Thank you for sharing your knowledge and your perspective.

Raul Rodrigues

Thank you for inviting and for the questions. See ya.

Jakob

Foxin.