The Kind Of Music Startups One Venture Capitalist Would Like To Fund

Y combinator with logo And His Unusual Way Of Turning Them Into Businesses

Y Combinator a revolutionary venture firm that speciializes in funding early stage startups. 40 or so young entrepreneurs spend months together boot camp style developing their ideas into businesses.  In addition to support from each other, they are surrounded by advisers and visited by experts who help focus their efforts.

Paul Graham, the founder of Y Combinator, sold his company Viaweb to Yahoo in 1998 and has since developed a large following for what the New York Times calls "lucid and contrary essays in a geek community more comfortable expressing itself through programming code than coherent paragraphs". One essay "How to Start a Startup" has become a call to arms for anyone contemplating starting a company.

12 months ago, Graham wrote about the kind of companies he'd like Y Combinator to fund and music topped the list.  His music startup wish list includes:

Y "A cure for the disease of which the RIAA is a symptom. Something is broken when Sony and Universal are suing children. Actually, at least two things are broken:

the software that file sharers use, and the record labels' business model. The current situation can't be the final answer. And what happened with music is now happening with movies. When the dust settles in 20 years, what will this world look like? What components of it could you start building now?

The answer may be far afield. The answer for the music industry, for example, is probably to give up insisting on payment for recorded music and focus on licensing and live shows. But what happens to movies? Do they morph into games?"

A year later, know one has found the "final answer" that Graham called for and  and many of the (non – Combinator) startups who tried are being sued or over-charged by rights holders into oblivian.  But despite that bleak picture and a struggling global economy, Y Combinator pushes forward.  This year its' increasing the number of tech startups it is bringing into its unique program to 60.

FOOTNOTE:  Can you imagine a music business centered Y Combintor-like venture fund and startup program? I certainly can and wish I had the funds to seed it. Perhaps you do…

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  1. I have a cure for the disease of which the RIAA is a symptom. It is the http://ContingencyMarket.com – a way that the lovers of music can exchange their money for the music of those musicians whose music they would love to have, with those musicians who would love to have their money.
    There is however, one huge problem I haven’t solved: figuring out how to convince anyone I can produce the cure without having to produce it to demonstrate that I can. :-}
    When everyone believes it is impossible to fly, the only thing that’s going to persuade anyone it actually is possible is to build an aeroplane to prove it.
    And that’s why venture capital is no good for solving ‘impossible’ problems, it’s reserved for projects that are at least plausible.

  2. I’d like to see the same thinking applied to the concert ticket industry. Why, when the music industry is going through an online revolution, are tickets safely in the hands of Ticketmaster/Live Nation? The technology to generate/print barcodes are around. I’m sure there are issues like fraud to deal with, but nothing that a smart startup couldn’t handle.

  3. I agree with monsur. The ticketing industry is at the center of how the business is going to evolve for music. I think its becoming clearer now that the live shows, and building community around shows is what looks like the future, and guess what, ticketing is going to be at the forefront of this.

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