020: Music Fans get $$$ to Listen to New Songs with Mike McCready

Background on Mike McCready:

Mike McCready has experienced success as a musician, and separately as an entrepreneur, but has found his true passion by combining music with business. As a signed musician, he achieved two hit singles. As an entrepreneur, his companies have been featured in Success Magazine, The New Yorker, and other media.

As CEO of Music Xray, he has led the company through its challenging start-up phase and through it's angel and institutional rounds of investment. Music Xray has become what is probably the largest online community of music industry professionals in the world.

Time-Stamped Show Notes:

[0:49] Music Xray was founded 10 years ago and launched in early 2009. They realized they have the wrong product, went back to the drawing board and re-launched in January of 2010.
[1:38] Music Xray provide access to all the music industry’s decision makers, music supervisors, etc.
[2:20] The company is more about skill and talent for the musicians and less about who you know
[2:35] Musicians would just open a free account on their website, upload their music and it will be matched to music industry’s professionals.
[3:29] Their real product is they developed an effective filter so that the industry professionals are hearing mostly good music.
[4:29] The musicians uploaded music will undergo a process called diagnostics which cost $10.
[4:40] The song will be sent to 5 industry professionals and 20 fans who will give feedbacks.
[5:00] Fans will receive an alert that there’s a song that matches their taste profile, and will be paid $.10 after listening to the song.
[6:45] “We really try to show the artist a realistic gauge of what their chances are and show them how competitive the professional music market is.”
[8:32] The company’s revenue is about $2million and all of it comes from musicians, songwriters and fans that are seeking access to the industry.
[9:44] They’re building up another line of revenue to the company now. If the musician’s song is discovered by an industry professional, through the magic of the company’s software, then they will be entitled up to 20% of the revenue of the deal.
[10:35] Started with a team of about 23. After automating a lot of things over the years, they are now down to a team of 7.
[11:33] He left the traditional music business and took the job as Marketing Director for a digital music company in Europe
[11:56] The company closed down and he left without a job.
[12:09] He found a company outside of Barcelona which developed a music analysis software that could cure and understand what the songs sounds like.
[13:00] They offered a software to music retail stores that will recommend other songs that fits the costumer’s music taste.
[14:23] They couldn’t sell the software, same with their competitor Savage Beast now Pandora, so they went back to the drawing board.
[15:19] Hit Song Science was born, it concerns the possibility of predicting whether the song will be a hit in the current market.
[15:25] Music Xray is the continuation of the vision of Hit Song Science.
[16:52] In 2008, he and his wife left Barcelona and went back to New York.
[19:11] After developing Hit Song Science, his partners want to go in a different direction than he did and at that point he founded Music Xray.
[19:38] Starting the company was tough because he doesn’t have any investors.
[20:05] An Angel Investor gave him $50,000 to invest in the company.
[21:15] In the first 11 months of the company, they had to raise money that he didn’t receive any salary.
[26:06] His first real hire was his Chief Technology Officer.
[29:45] “Always know where your next round of capital’s coming from and keep cultivating relationships that ultimately might lead to your exit if your plan on selling to a larger company..”

Fabulous 4 Questions:

📖 📚 Favorite Book(s)? N/A
🙌😎 Favorite Amazon.com purchase? N/A
🌱💸 Favorite Tool that's GROWN your Business? N/A
💭💡 BIGGEST Challenge keeping your Business from GROWING? N/A

Key Points from the Interview:

“Always know where your next round of capital’s coming from and keep cultivating relationships that ultimately might lead to your exit if your plan on selling to a larger company.”