Kobalt, a 19-year-old, London-based music services company that operates as both a music publisher and a service-based music company — among other things, it helps artists collect the royalties owed them — is reportedly raising a new round of funding that could surpass $100 million.
Music Business Worldwide (MBW) reported on the round yesterday, with Kobalt founder and CEO Willard Ahdritz confirming that the news is directionally correct without divulging precisely how much capital Kobalt is closing on currently.
The new funding comes about one year after Kobalt closed on its most recent funding, which valued the company at roughly $800 million, as TC had reported at the time.
A large part of Kobalt’s appeal to investors, as well as the artists, publishers and labels that are among its customers, is the content management system it has created and that makes it far easier and more transparent to capture the millions of incremental plays happening across streaming platforms like Apple Music, Spotify and Soundcloud — then to collect money where it is due.
The company is made up of numerous parts, however, including Kobalt Music Publishing; Kobalt Neighbouring Rights; a recorded music division called AWAL (it was once called Artists Without a Label) into which Kobalt sunk $150 million last year to expand the business; and a collection agency that Kobalt acquired in 2015, AMRA. That’s short form for what was previously called the American Mechanical Rights Agency.
Kobalt also oversees Kobalt Capital, an acquisitive fund managed by KMG.
Kobalt’s investors to date have included GV; Section 32, whose founder, Bill Maris, was previously the CEO of GV; Hearst Entertainment; Balderton Capital; and MSD Capital, a private investment firm that exclusively manages the capital of Michael Dell and his family.
According to MBW, Kobalt is currently talking with investment banks to pull together its mega round. Though Ahdritz would not state the express amount that Kobalt is targeting, he told the outlet that the fresh capital will be used to grow Kobalt’s presence in each of its verticals.
He added that its record vision, AWAL, is particularly eager to challenge traditional and, as he sees it, outdated, record labels that tend to benefit a limited number of artists at the expense of so many others.
AWAL, as described last year by the Financial Times, offers musicians marketing and promotional services but lets them keep the copyright to their material, and has already drawn both new and established artists, including Nick Cave and De La Soul. Though they maintain ownership of their royalties, they share revenue with Kobalt in return for its services.