beatBread brings fractional investing to the independent artist funding scene

beatBread co-founder and CEO Peter Sinclair

You can now invest in independent music artists with as little as $1,000.

Music funding platform beatBread has launched a new tool that will allow investors to buy a share of the profits made from the platform’s funding of independent artists.

The move is likely to make a major impact on the amount of money that artists are able to access through beatBread.

Launched in 2020, beatBread allows independent artists to get advances on their music income without having to sign away control of their career to a label.

beatBread uses an A.I. algorithm dubbed ChordCash to analyze an artist’s streaming and social data to generate an offer. Its automated system means the advance can land in an artist’s bank account within days of applying.

The artist then repays the advance as a percentage of their revenue, over a period of time the artists can choose for themselves.

The platform currently offers advances ranging from $1,000 to more than $3 million.

So far, beatBread had been using seed funding to raise the capital needed to finance artists’ advances. It raised $34 million in a funding round in February of 2022, and closed a $100-million institutional fund with asset manager Variant Investments last November.

But fractional investing has the potential to increase vastly the amount of money beatBread can bring to the table.

For those not familiar with the term, fractional investing is essentially the same thing as buying shares in a company, except it involves investments other than companies.

For instance, there are fractional investing platforms for art and for real estate, which allow investors to buy a share of an artwork or property.

beatBread’s new platform – which it has named sliceNote – will allow investors to pick and choose the artists they want to finance, and will allow them to buy a share of the revenue beatBread collects in exchange for the advance they give to the artist.

Qualifying investors will be able to buy as little as 1% of any given deal that beatBread strikes, and will be able to invest as little as $1,000 or as much as $1 million into that deal.

“sliceNote brings smart capital to the music market, empowering not only independent artists, but also highly skilled music executives, independent labels and music companies who know how to build an artist’s career,” beatBread CEO Peter Sinclair said in a statement released Tuesday (April 11).

“We give extra financial muscle to these skilled professionals to help them compete with the majors. Unlike other music investment platforms that are focused solely on mature catalog buyouts, sliceNote allows investment in artists during the growth phases of their careers.”

Investors using sliceNote will have access to prediction tools that will allow them to make decision based on detailed data on an artist’s streaming, social and revenue history. These tools, called “soundInvestment,”  also deliver projections for future releases, along with likely financial outcomes for the investor.

“The data we provide [is] based on a market-tested model trained on hundreds of thousands of artists, and tens of millions of songs” sliceNote’s Head of Analytics and Data Science, John Haller, said in a statement.

“Our patent pending technology has successfully predicted artist income across catalog and unreleased music within a few percentage points on hundreds of deals for artists and labels.”

beatBread has been aggressively expanding its business over the past year, announcing its largest investment to date in June of 2022, a “seven-figure” deal with singer-songwriter Elley Duhe and her independent label and management company, Not Fit For Society.

It also launched an “exclusive investor network” last November, which allows investors to bid on providing advances to artists.

Artists who have been approved for an advance can highlight their plans, such as tour dates, marketing partners and other initiatives, to members of the network – meaning music professionals and companies, distributors and “high net worth” individuals – who can bid to provide an advance to the musician.

The initiative is designed to give artists better economic terms on their advances than they could otherwise get. If they don’t like the offers they get from these investors, they can always accept the initial offer given to them by beatBread.

The new sliceNote fractional investing platform seems to be a natural extension of that effort to bring an ever-larger number of investors into the artist-funding scene.

“In the legacy music industry, artists were forced to sacrifice control of their career and their masters to access growth capital,” Sinclair said last year.

“Our mission is to enable artists to access capital on their own terms.”Music Business Worldwide