D.I.Y.

Gumroad’s 19 Year Old Founder Raises $8.1 Million For Music eCommerce

image from www.google.comGumroad wants to empower musicians, in fact everyone, to “sell” as easily as they "share"; and so far its 19 year old founder has raised $8.1 million to make his goal a reality. After angel funding og $1.1 million in February, Sahil Lavingia – already an ex-member of the Pinterest team – just landed another $7 million in Series A round led by Kleiner Perkins Caufield & Byers. 

Mike Abbott is joining the board. CrunchFund, Raymond Tonsing, and all of Gumroad's initial seed investors also joined the round.

image from www.google.comGumroad turns any link – including on Facebook, Twitter, etc – into a dead simple transaction opportunity. The digital content must be priced between $1 and $1000, and the company charges 5% + 25¢ of each transaction.

While not just about selling music, Brendan Benson, Martin Sexton, and MNDR have all run release campaigns using Gumroad to sell direct to fans.

Right now Gumroad has just three employees. They'll use the money raised to grow the team to 10 or 12 by the end of 2012.  The financing will also allow the company to move out of the 19 year old founder's house and into an office. Here's how Gumroad works:

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7 Comments

  1. Great story here Bruce. This is a very interesting concept. I can see this becoming a interactive approach to quickly selling content via Facebook & Twitter. It seems easy to sell as well. Great job over there at Gumroad!
    Kevin Rivers
    CEO, Xeinge Group

  2. 25% seems like a lot to take, what do other eCommerce sites take? To be honest this seems like it is just sharing a link which you could already do on Facebook, twitter, websites and so on.

  3. Did they hold a competition to find the least attractive possible name?
    I suppose it could be worse – maybe Snotify. Or Spitter. Or Fecebook.

  4. So, I hate to say it, but as streamlined as they’re trying to make things, they’re just going to deal with a ton more fraud, and it looks like they’re already thinking of how to distance themselves from any real responsibility…scroll down to “fraudulent items not covered”.
    https://gumroad.com/about/buyer-protection

  5. I cant see that this is anything else as a simple shop cms?
    “Gumroad turns any link – including on Facebook, Twitter, etc – into a dead simple transaction opportunity.”: So does every shop cms if done right 🙂

  6. I guess I don’t really understand the benefits here. What problem does this solve? Artists I work with us nimbit and topspin, Bandcamp or just make their own store and use pay pal. All of these have social integration, provide embedable stores, make it easy to market music, great analytics etc etc. Would love to here from the artists mentioned on how it significantly changes their ability to sell or increase sales.
    We don’t really need yet another account to update. So I need a better sell than that video to consider using it.
    8 million dollars would be better served helping musicians financially support themselves on a tour, where they are growing their fan base, creating day of sales, future sales and a sustainable career. Or better yet, donate it to help feed kids that are going hungry everyday. There are better uses for that 8M… but good for him for convincing people to invest.

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