MBW Reacts is a series of analytical commentaries from Music Business Worldwide written in response to major recent entertainment events or news stories. Only MBW+ subscribers have unlimited access to these articles.
Superfan monetization and D2C expansion continue to be strategic priorities for Universal Music Group.
In his annual memo to staff issued last month, UMG Chairman and CEO Sir Lucian Grainge confirmed as much. “In 2026, we will accelerate these efforts both by working with our established DSP partners on the launch of enhanced premium tiers for superfans, as well as by working with emerging platforms that are focused on special events and products for superfans, both virtually and in the physical world,” Grainge wrote.
UMG is already seeing results from its D2C push. The company’s physical music revenues jumped 23.1% YoY to €341 million (USD $398.31m) in Q3 2025. On the Q3 earnings call, Chief Operating Officer Boyd Muir revealed that “somewhere in the region of two-thirds to 75%” of vinyl sales are now coming through UMG’s own managed stores.
According to Luminate‘s 2025 Year-End Report, in the US last year, direct-to-consumer channels drove 78% of first-week physical album sales in Pop, and over 50% in R&B/Hip-Hop and Rock.
It’s against this backdrop that UMG just acquired a minority stake in superfan platform Stationhead following the app’s merger with Mellomanic.
Stationhead is a social audio platform that lets fans host and join live listening sessions powered by their Spotify or Apple Music accounts – live, interactive radio run by fandoms. Artists including Billie Eilish, Zayn, and Nicki Minaj have used Stationhead to host release parties and engage directly with their most dedicated listeners.
As superfan monetization gains momentum, here are three things you might have missed about UMG’s minority stake in Stationhead — and why the move is perhaps more significant than you might think…
1. Via its stake in StationHead, UMG is now aligned with the app’s other investor, Sterling Partners, a PE firm with a track record in scaling music-adjacent businesses
The private equity firm behind the combined Stationhead entity has a track record worth noting.
Back in 2009, Chicago-based Sterling Partners invested in music education platform School of Rock when it was a small, emerging business. By the time Sterling exited in 2024, School of Rock had grown to serve over 180,000 students worldwide annually – claimed to be the largest music education franchise in the world.
Sterling has also been investing in the superfan technology space for years, backing the companies that eventually became one half of the merged Stationhead.
In November 2023, Sterling invested$8 million into We Are Giant, a music community platform founded by Andy Apple, a former investor at Sound Ventures and Wavemaker Partners. The platform was built around licensed listening parties, exclusive livestreams, and direct-to-fan monetization tools.
Less than a year later, in September 2024, We Are Giant rebranded to Mellomanic and raised an additional$6 million from new and existing investors including Sterling, bringing total capital raised to $13.8 million.
By then, Mellomanic had grown to over 400,000 monthly active users – an increase of 13,000% since January 2024 – and had secured partnerships with Atlantic Records, Def Jam, Big Loud, Elektra, Sony Music Nashville, and Virgin Music Group.
With Sterling now holding what MBW understands to be a controlling interest in the merged Stationhead entity, the firm is positioned to potentially scale another community-centric music business into something significantly larger – this time with a major label as a fellow investor.
2. UMG isn’t just investing – It’s signed a commercial agreement to use the technology
A minority stake alone would be a modest bet. But the deal includes something pretty significant: a commercial agreement for Universal to use Stationhead’s technology.
This appears to follow a pattern of investing in a platform, with the intention of using it. In February 2024, the major acquired a stake in youth media platform Complex as part of a takeover by live-video shopping company NTWRK – a deal UMG said would “create a new destination for ‘superfan’ culture that will define the future of commerce, digital media, and music.”
A month later, UMG invested in HYBE’s Weverse, the K-pop giant’s superfan platform, as part of an expanded 10-year distribution agreement. UMG artists including Gracie Abrams, Alexander 23, and Jeremy Zucker have since joined the platform.
“Collaborative, artist-centric, super fan-focused innovation like this is essential to the future of our industry.”
“At Universal Music Group, we see tremendous potential in technology innovation that brings artists and their biggest fans more closely together, and Stationhead’s independent platform exemplifies that opportunity,” said Michael Nash, Executive Vice President and Chief Digital Officer at Universal Music Group.
“We’re pleased to enter into a commercial agreement and make a strategic investment alongside Sterling Partners as these talented entrepreneurs build a platform that fosters creative new ways for artists to connect with audiences and activate social engagement. Collaborative, artist-centric, super fan-focused innovation like this is essential to the future of our industry.”
UMG’s rivals have also been making moves in the superfan technology space. In early 2024, Warner Music Group was reportedly building a superfan app, but it has yet to launch one publicly a year later.
3. UMG now has a commercial agreement that lets it use a WORKING, SCALED SUPERFAN PLATFORM
UMG now has a commercial agreement with a platform that already has 20 million users, proven commerce conversion, and works across both Spotify and Apple Music.
It’s also worth noting that prior to the Mellomanic merger, Stationhead was already well-funded with prominent industry backers.
In July 2022, the company raised $12 million in a Series A round led by Buttonwood Group Advisors, with participation from Diplo, Red Light Management, TMWRK, Round Hill Publishing, Avex Entertainment, Craig Kallman and Julie Greenwald, Kevin Liles, and Jason Flom of Lava Records.
Stationhead and Mellomanic were complementary businesses. Together, according to the companies, they offer something more complete. The combined platform can now identify superfans via behavioral data, engage them in real-time events, and monetize them through direct-to-fan commerce.
“This merger creates the ultimate direct-to-fan platform the industry needs.”
David Rappaport, Stationhead
The company claims the deal “creates a single, category-defining service designed to connect artists and fans more deeply and authentically while unlocking meaningful new revenue opportunities for all stakeholders across the global music ecosystem.”
The new Stationhead also benefits from leadership drawn from both companies and investor Sterling Partners.
David Rappaport, head of Mellomanic and former Chief Operating Officer of Global Touring at AEG Presents, has become CEO. Ryan Star, Stationhead’s co-founder and a recording artist, will serve as Chief Creative Officer. StevenTaslitz, Chairman and Co-Founder of Sterling Partners, will serve as Stationhead’s Chairman.
“This merger creates the ultimate direct-to-fan platform the industry needs,” Rappaport said. “By bringing Stationhead and Mellomanic together, we’re building an additive, ecosystem-wide solution that drives real business and data for artists, record labels, music publishers, and streaming services.”
Goldman Sachs, in its 2025 Music in The Air report, identified superfan monetization as a significant opportunity for the music industry, estimating a potential annual revenue uplift of $4.3 billion based on 2026 projections.
The question isn’t whether that opportunity is real. The question is who owns the infrastructure to monetize it. UMG just made another significant move to do so.
