7digital Group provides an end-to-end, white-label digital music platform and access to global music rights that enable its clients, which include businesses in the radio, electronics, social media and telecoms industries around the world, to offer music streaming and download services to their own customers.
Post the debt for equity swap and subscription raising £2.0m in total, Magic now holds 39.1% of the equity and SKH a further 30.6%. Tamir Koch has been appointed non-executive chairman and David Lazarus has also joined the board as a non-exec, while CEO John Aalbers and CFO Julia Hubbard are to step down after a handover period, with COO Paul Langworthy moving up to the CEO role. The FY18 accounts show revenues ahead by 19%, with an adjusted EBITDA loss of £2.5m (FY17: £1.8m). The group needs to raise a further £4.5m, of which the consortium ‘may’ subscribe £2.5m, by 31 July 2019. Ongoing strategy (subject to the successful completion of the fund-raising) will focus on being a leading music streaming solution provider, using the blockchain expertise of Mr. Koch’s eMusic concern.
Streaming has revived the music industry and with only 2% of the world’s adult population paying for such services the opportunity remains significant. The market is dominated by a few global platforms, but there are many other opportunities for music to reach audiences, such as via connected devices. 7digital provides the back-end technology and catalogue to companies that may want to act as alternatives to these major platforms.