Brazilian indie distributor and music recommendation platform Magroove has announced a $1.6 million raise and set its sights on spearheading an ambitious international expansion.
Paris-headquartered Magroove, which Brazilian producer Vítor Cunha and web developer Fabrício Schiavo founded in 2019, unveiled the multimillion-dollar raise and the adjacent global-buildout plans today. Billed as “the partner independent artists have been looking for,” Magroove enables musicians to distribute their works to leading streaming services and create websites (including digital stores), according to its own website.
While website-builder subscription packages cost between $7.95 and $17.95 per month – the former option requires clients to pay a 20 percent commission on resulting sales, whereas the latter looks to be free of additional charges – Magroove’s distribution offering doesn’t have an upfront fee, the startup emphasized.
“Magroove simply retains the first $5 generated by each release (album, EP, single), and does not charge an upfront fee,” the company specified. “If the artist does not generate revenue, Magroove still keeps their catalog available on the platform.”
The four-year-old startup also indicated that it utilizes “proprietary AI technology” to recommend soundalike tracks through an app (which has an ad-supported tier and a $10-per-year paid option). After users search for an artist or a song, Magroove suggests 30-second snippets of similar efforts from an array of different acts, a cursory glance at the appropriate platform shows. Listeners can then save the presented music, which can be exported via playlists to Spotify, YouTube, and/or Deezer.
Back to the details of the $1.6 million round, however, a São Paulo VC called DOMO Invest put up the capital at hand, with which execs intend to bankroll an expansion into new markets and establish Magroove “as the premiere music distribution platform.”
On this front, the startup disclosed that the lion’s share of its artist and listener users alike reside in Europe and the US at present. “This investment will help us to accelerate our brand’s expansion and consolidation plan,” spelled out Magroove co-founder and CEO Cunha. “We are going to invest in our team and technology in order to increase our participation in the Brazilian and international market.
“Currently, 70% of users – artists and listeners – are in the United States and Europe, but we are also available in some countries in which we are pioneers. Among these countries is Togo, where artists earn up to 21.5 times the local minimum wage with releases on platforms,” continued Cunha, whose service is said to boast north of “850,000 artists and users.”
Besides ranking ninth on the IFPI’s list of the largest music markets as of 2022, Brazil achieved 15.4 percent year-over-year industry growth during the 12-month stretch, when streaming reportedly produced 85.4 percent of Latin America’s overall recorded music revenue.
Bearing in mind these 2022 stats, Spotify revealed today that Latin America’s share of monthly active users (MAUs) had for the first time surpassed North America’s share, while Rest of World (all regions except North America, Latin America, and Europe) accounted for 28 percent of all users during the quarter.