The Rise of Audio Storytelling

May 27, 2020

The IPO market is slowly making a comeback. After a brief pause due to the volatility in the public markets caused by COVID-19, the IPO market is returning with new issuances. Six companies have filed plans to float in the US in the past two weeks, surpassing all the filings in April. The list includes online car dealer Vroom and fintech provider Shift4 Payments, and bankers say a smattering of other large companies could soon join them.

Warner Music Group said on Tuesday it is aiming to sell up to $1.82B in stock in its U.S. initial public offering, potentially the largest New York IPO so far in 2020 as the market for new stocks rebounds after the COVID-19 pandemic put many debuts on hold.

The music industry is seen as more resilient to weakness in the broader economy, though Warner Music has cautioned the virus outbreak has hurt revenue streams and delayed the release of new recordings, motion pictures, and television programs.

Spotify signed Joe Rogan. Barstool signed Call Her Daddy. Their many competitors are not far behind. Amazon is also looking to invest heavily in the podcast space. According to Axios, Amazon is also shopping for podcast deals. Amazon is looking to possibly tap into a more localized ad market by serving local ads adjacent to that hyper-personalized audio content. Meanwhile, Audible, a subsidiary of Amazon, is also expanding its audio original series. It is looking to potentially separate the audiobook and audio series segments so non-subscribers can purchase original series as well.

Podcasting will surpass $1B (+30% YoY growth), which is still tiny compared to recorded music ($21B) and the radio advertising market ($42B). But at the rate at which listenership is growing, the industry should expect podcasting to cut heavily into share of audio.

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SaaS Companies that Services the Audio Economy:

Patreon is a membership platform based in the United States that provides business tools for creators to run a subscription content service. It allows creators and artists to earn a monthly income by providing exclusive rewards and perks to their subscribers, or "patrons".

Vydia provides an end-to-end solution to empower the next generation of music creators, managers, and labels. Its cutting-edge technology provides the digital infrastructure for audio and video distribution, content protection, rights management, advanced payments, and data tracking from one easy-to-use platform.

TuneIn streams live sports, music, news, podcasts, and Internet radio from around the world on any device.

Smule is a music creation and sharing app that takes a social approach to karaoke. It allows users to connect, discover, and interact on the platform.

Funding & Deal Highlights:

Virtual events startup Run The World, a year-old startup that is based in Mountain View, CA and has small teams in China and Taiwan, nabs $10.8M from a16z and Founders Fund. Run The World takes 25% of ticket sales in exchange for everything from the templates used, to ticket sales, to payment processing to streaming, and so forth.

Statespace, the platform that trains gamers, raises $15M. Statespace recreates the physics of popular FPS games to help players practice their aim and work on their weaknesses. Statespace was founded by neuroscientists from New York University and goes beyond the mechanics of aim itself to understand and measure several parts of a player’s game, from visual acuity across the quadrants of the screen to reaction time.

Magic Leap has reportedly received a $350M lifeline, a month after slashing 1,000 jobs and dropping its consumer business.

Big Sky Health — the creators of Zero, one of the most popular and highly-rated fasting apps — announced it launched Zero Plus, a premium version of its service that provides adaptive fasting plans and science-backed content for helping guide users on their health journeys.

Sphero just announced that it has spun off another company. While still a robotics company at its heart, the underwhelmingly named Company Six will create robotic systems designed for first responders and other humans whose work requires them to put themselves in harm’s way.

PathSpot, an NYC-based creator of a real-time hand hygiene management system that protects against the threat and spread of illness with a hand scanner that tracks handwashing frequency and effectiveness, closes a $6.5M Series A funding round.

Roche acquires Stratos Genomics to expand nanopore sequencing technology.

New York-based IBM acquires 7% stake in blockchain-enabled trade finance solution, we.trade.

SoftBank-owned investment group, Fortress, acquires Krystal Restaurants.

Waterland Private Equity has invested in Integrated Medhealth Communication group through a primary investment that will support ambitious plans to create a leading independent provider of global healthcare communications and consulting.

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