A stealthy startup led by Tidal's former COO plans to turn throwback tracks into modern hits - The Verge

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Duetti is looking to buy catalog rights from independent musicians and then monetize that music with data and social media marketing.

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It’s payday for some of music’s biggest names: Bruce Springsteen sold the rights to his catalog for a reported $550 million last year. Bob Dylan struck a similar deal for an estimated $300 million in late 2020. Paul Simon’s catalog changed hands for $250 million. And in early 2022, David Bowie’s estate secured at least $250 million in a deal encompassing titles from nearly 30 albums.

This music rights gold rush is due to both the explosion of music streaming and tunes on TikTok as well as an ever-growing need to supply global video services like Netflix with soundtracks to their shows and movies. Now, Duetti, a stealthy startup co-founded by two former streaming execs, wants to flip the practice on its head. Instead of giving big-name artists huge paydays, the company is looking to cut deals with small artists and help their old songs blow up.

Duetti is helmed by Lior Tibon, former COO of Tidal, and Christopher Nolte, who spent two years acquiring content for Apple Music after doing the same at Tidal. The duo launched Duetti in stealth this summer and began quietly approaching artists about buying the rights to their songs in recent weeks.

The proposition: Duetti will buy the rights to songs that it has identified as already performing well on streaming services. The company then further milks those songs with the help of playlists, influencer partnerships, and other forms of optimization and, over time, buys rights to additional songs from artists it partners with.

“Our goal is to financially enable all artists to further pursue their professional or personal aspirations,” Duetti explains in internal documents reviewed by The Verge, which state that the company is “democratizing access to catalog monetization opportunities.” Duetti did not respond to requests for comment.

Duetti’s plans to unlock the long tail of music rights are as ambitious as they are indicative of broader changes in the music business. Not too long ago, bands and their labels were solely focused on their latest releases, with older albums collecting dust on shelves. Now, those throwback tunes have the potential to become real moneymakers.

Duetti raised $7 million and is promising artists “serious cash”

Duetti has been operating under the radar ever since Tibon and Nolte launched the company this summer, with a bare-bones website simply promising musicians to get fairly paid for their back catalog, “one track at a time.” The duo’s LinkedIn pages only identify them as co-founders of a stealth startup, without direct links to the company’s equally minimalistic LinkedIn presence.

Public records show that the company was first registered in Delaware in May, followed by registrations in New York and California in August. A filing with the California Secretary of State lists Tibon as CEO and CFO, while Nolte officially serves as secretary. A related entity, Duet IP Inc., registered trademarks for Duetti in July. Duetti raised a $7 million seed funding round in July, according to company documents; funders include Hollywood-based Presight Capital as well as an unnamed music company.

Duetti’s staging website explains what the startup offers to artists.

While Duetti’s public presence is clouded in mystery, the startup has been more forthcoming to potential partners and employees. In the documents reviewed for this article, Duetti describes itself as a music fintech startup “aiming to provide independent artists with new and empowering financial solutions.” In those same documents, the company states that it’s “building a world-class team that will create new ways to source, price, acquire, aggregate and monetize music.”

A publicly accessible staging website for the company is a bit more frank in its pitch: “Duetti exists to give artists serious cash for their catalogs.”

The key to monetizing catalogs is data

Duetti has already begun to court select artists. It’s offering to either buy the rights to select songs outright or pay for a significant percentage of ownership. One of those artists, whose name The Verge is withholding due to the private nature of these discussions, said that the company was interested in one particular song from their back catalog, which already has been performing well on streaming services. A Duetti representative suggested that song alone could be worth a five-figure amount to the company and indicated that it may be interested in buying rights to additional titles down the line.

Right now, Duetti appears to be using third-party tools to identify songs that rack up many millions of plays on streaming services as potential acquisition targets, but the company has plans to take this type of data gathering in-house. Nolte has been looking to hire data scientists and data engineers on LinkedIn, explaining that “our data team ... is core to everything we do.”

Duetti not only wants to use data to find songs to acquire but also to monetize them. In a job listing that hasn’t been widely circulated, the company has been looking for an optimization lead who would be tasked with “the execution of new cutting-edge strategies to improve the performance of Duetti’s song catalog on music streaming platforms, alongside other revenue generating opportunities.” 

Getting those songs more plays could include “organic and paid media campaigns, playlist and other placements, influencer marketing and other social media opportunities,” according to the listing.

Duetti also appears to have plans to make some of its data tools publicly available and help artists get a sense of how much their catalog may be worth before striking any deals. “These are tools that will be used to provide artists with detailed information about the value of their work,” the company said in a job listing for a designer. “This high value information doesn’t exist anywhere for artists today, and Duetti aims to become the de facto industry standard.”

Kate Bush and 420doggface show that anything is possible

Back catalogs have become a serious moneymaker for some artists. More than $12 billion was spent on catalog acquisitions in 2021 alone, according to Midia Research. Some of these deals, like the one struck by Bob Dylan in 2020, only cover the rights to the composition of a song. Others, like the Bruce Springsteen catalog acquisition, include the rights to the actual sound recording as well.

One reason for this gold rush has been the changing nature of the music business, explained Midia music industry analyst Tatiana Cirisano. Not only did record stores have far less shelf space than Spotify but also the industry’s reliance on album sales came with its own limitations. “You only monetized that first sale,” Cirisano said. When fans played an album years after buying it on CD, artists gained nothing. 

That changed with streaming services like Spotify, where old catalog titles can bring in some serious cash over time. “The revenue profile of a song can extend far longer” on streaming services, Cirisano said.

And it’s not just music fans that rediscover decades-old songs. As video streaming services like Netflix invest billions in original content, these companies also need an ever-growing catalog of music for their movies and shows. That can translate to direct income for rights holders as well as a real snowball effect on Spotify. 

Streams for Kate Bush’s “Running Up That Hill” were up 8,700 percent earlier this year after the song was featured in the most recent season of Stranger Things. If an artist’s song gets featured on a Netflix show, streams for the rest of its catalog also double, according to a joint study by the two companies.

A Netflix placement is not the only way for catalog titles to find new audiences. Sometimes, all it takes is a dude on a longboard, vibing and chugging cranberry juice.

When TikToker 420doggface208 went viral in late 2020 with a video featuring Fleetwood Mac’s “Dreams,” the song resurfaced in the Billboard charts 43 years after its initial release. And after Mick Fleetwood himself responded with his own TikTok video, “Dreams” went on to top the Apple Music charts. “If there is anything that TikTok has taught us, it is: anything goes,” Cirisano said.

Up until now, most catalog sellers have been white, male, and famous

That message hasn’t entirely sunk in with many of the buyers of these music rights, who tend to focus on big artists like Springsteen, Dylan, and Bowie. “Most of the big deals thus far have been old, white, male, and US- / UK-centric,” Cirisano said. 

However, spending hundreds of millions of dollars on albums that were massive hits when they first got released decades ago may not actually be the best way to monetize music for the TikTok generation. Not only can streaming data be a better indicator for future success than yesterday’s radio charts but also social media and algorithmic playlists have been shifting music listening to the long tail. The number of new artists topping the charts has declined for years, and some industry observers are ready to declare that TikTok killed the pop star.   

“The music industry is changing rapidly,” Cirisano agreed. However, this shift to long-tail listening also is a chance to monetize hidden gems from smaller artists, she argued. “There is an opportunity for companies to focus more on niches.”

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