Audiomack, the New Wave
Posted by Forbes, In 2012, David Ponte and Dave Macli had an itch to take advantage of an open market in music streaming that wouldn’t last long.
The window of opportunity prompted them to provide artists with a “free and unlimited way to share their music,” according to Macli. Late nights and countless weekend hours netted them and their three co-founders Audiomack, a free platform that allowed budding musicians who couldn’t yet afford to pay the monthly or annual membership fees required by distribution companies to upload songs onto streaming sites.
Keeping costs low for everyone involved was integral to the company’s business model.
“We funded the company with $5,000, which covered some of our initial costs, and we just grew it from there,” said Macli, who also founded the hip-hop editorial site DJBooth. “It’s a story of taking small bites.”
Audiomack’s founders cultivated a simple and niche value proposition: find artists that were looking for additional fans. To do that, the company built and refined its platform to scale as a free service by monetizing off of ad revenue, while also ensuring the quality control of their catalogue by implementing a playlisting feature and song ranking system.
Since its inception, the site has become a hub that hosts the latest albums, bubbling singles and nostalgic mixtapes, specifically ones that can’t be found on Spotify or Apple Music. It’s been embraced by youth and hip-hop culture — 70% of their audience is under 34 years old — but is expanding into other genres including reggae, Latin and Afrobeats.
It has grown 300% year-over-year, with more than 1 million daily active users, and surpasses 1 billion song plays each month. In August, they introduced a subscription model that has since grown to over 10,000 members shelling out $5 per month.
“We figured if we just got a little bit of an audience, and provided them with enough value to keep them coming back, then we’d be able to make some money,” Ponte said.
The team also puts emphasis on brand awareness. Their latest YouTube series, Trap Symphony, is a marketing vehicle that showcases rappers performing over orchestral renditions of their songs played by classical musicians. Past episodes have featured Migos, A Boogie Wit Da Hoodie and Chief Keef. A handful of videos have garnered over a million views each.
Next on the Audiomack agenda is opening up its monetization program, AMP, to all users. For now, the program is an invite-only affair that allows artists to participate in streaming revenue. It’s a strategy that further positions the company as an essential part of an artist’s marketing campaign and income source.
But Audiomack doesn’t ignore the direct competition with streaming giants such as Apple Music and Spotify. The latter has deployed a number of tactics to help the fledgling musician, from opening up a playlist submission feature to offering deals to independent artists. In April, Spotify went public at $165.90, boosting their valuation to $30 billion. But Audiomack prefers to focus on their niche rather than competitors with seemingly endless financial resources.
“We want to give artists a way to actually find new fans and also reach them,” says Audiomack’s director of product management, Charlie Kaplan. “Our objective is that any artist under any circumstance can share their music, unlimited.”