Kobalt Music Group has raised $75m in a Series D funding round led by media giant Hearst Entertainment.
The investment also saw participation from existing Kobalt backers Balderton Capital and MSD Capital.
The news comes just over two years after Kobalt secured $60m in funding, in a round led by Google Ventures.
Kobalt said it will use the new funding to further scale its royalty collections platform.
Hearst Entertainment’s parent recently posted $10.8bn in revenues for 2016, with record profits. The company owns TV channels including HISTORY and ESPN, in addition to newspapers such as the Houston Chronicle and the San Francisco Chronicle.
It also owns nearly 300 magazine brands including Cosmopolitan, ELLE, Harper’s BAZAAR and Car & Driver – and has previously invested in the likes of BuzzFeed, Vice, Complex Networks and Awesomeness TV.
Meanwhile, Hearst Entertainment has produced and/or distributes a movie library representing nearly 200 films and 400 half-hour animated series.
“From the start, my vision for Kobalt has been to transform the music industry and help take it into the digital age,” said Willard Ahdritz, founder and CEO of Kobalt Music.
“With the high growth of streaming and the billions of microtransactions that take place per song, the music industry is more complex than ever.
“Guided by core principles of transparency, technology, and putting creators first, I have never been more sure that our platform, combined with our global creative team, is the right one to serve creators and rights owners in the rapidly evolving digital music environment.”
“We are excited to welcome Hearst as a new investor in Kobalt. They share our passion for making sure creators are paid and fully informed.”
Willard Ahdritz, Kobalt (pictured)
Kobalt Music Group posted annual revenue of $260m in the 12 months to end of June last year – a year-on-year jump of 15%.
Documents filed at Companies House in the UK last month revealed that the business also saw its operating loss decrease significantly, down 32.4% to $16.7m from $24.7m in FY2015.
Within this filing, the company admitted that it was ” in advanced negotiations with new and existing investors in order to ensure that the Group has the resources to support its plans for rapid growth”.
Now we know exactly which investors it was referring to.
“The music industry is growing revenue again and it’s due to the meteoric rise of music streaming on services like Spotify, Apple, Google, Amazon and Pandora,” said Neeraj Khemlani, president of Hearst Entertainment.
“Willard has brilliantly positioned Kobalt to be an important company at the center of this booming industry by building an invaluable platform for artists, songwriters and third party labels and publishers looking to have complete, real time transparency into how their music is being consumed and thereby collect royalty revenue more efficiently and faster than ever before.”
Ahdritz added, “We are excited to welcome Hearst as a new investor in Kobalt. They share our passion for making sure creators are paid and fully informed. Hearst is a prominent content owner with exciting investments in new forms of entertainment for the next generation of consumers. We welcome them on the board of Kobalt.”
Kobalt’s Music Publishing, Neighbouring Rights, and Recordings/AWAL divisions serve over 25,000 songwriters, 600 publishers, and 20,000 independent artists, including The Chainsmokers, Kelly Clarkson, Miles Davis, Dave Grohl, Dr Luke, Zayn Malik, Max Martin, Paul McCartney, Stevie Nicks, Pitbull, Elvis Presley, Skrillex, Sam Smith and more.Music Business Worldwide