Nashville-based CEO Tyler Lenane believed he and his co-founders had the industry chops to build a successful streaming music platform. Six years in, they had launched two apps, attracted investors such as iHeartMedia (Nasdaq: HRT) and were generating revenue at a $1 million-a-year clip.
It wasn't enough.
Lenane is shutting down Gimme Radio Inc. on April 29, he announced in a listserv email and a Medium post. Lenane's announcement on Medium goes into some financial detail of the company's performance, in which he also shares extensive lessons learned.
Lenane and his cofounders collectively have executive-level experience at companies such as Apple Music, Beats Music, Napster and Google Play Music. They started Gimme Radio in San Francisco and later moved to Nashville. More than 1,600 artists hosted shows or otherwise appeared on the platform. Fans could support those artists through tips and buying merchandise and vinyl subscriptions.
Gimme Radio, which has six full-time employees, created channels named Gimme Country — which had a heavy Americana influence — and Gimme Metal. The company corralled $6 million in a funding round disclosed at the end of 2021, welcoming new investors such as iHeartMedia as well as a venture capital arm of Telefónica, a massive European telecommunications company.
"Even though we proved that engaged communities could generate real money at a higher average revenue per user than other music platforms, we unfortunately find ourselves in an economic climate where we have been unable to raise the financing needed to support the streaming services and grow Gimme to reach all music fans across all genres," Lenane wrote in his announcement. "… We have failed to close funding and will be shutting down Gimme Radio."
Here is some of what Lenane said in his Medium post:
"We launched Gimme with a lot of knowledge and a strong point of view about what was missing from the digital music experience and somehow, with only $75,000 in pre-seed money and a lot of conviction, we did it.
"I am proud of what we built for fans, and for artists. I’m grateful for the support we got from the industry … and from the individual angels, families and friends. But we always struggled to attract the venture capital that a media tech business like Gimme needs to thrive and grow.
"We thought that by hitting a $1 [million], 12-month run rate, achieving enviable fan engagement metrics, and by proving we could build real community, we would be in a much better position to raise the kind of capital required to scale this business to unbelievable profitability. On that, we were wrong. We found product/market fit, but we never cracked product/investor fit.
"But make no mistake … we were right that communities matter. They are hard to build — you cannot just throw money at artists, build a product and expect a community to form. It takes time, care, cultural understanding and deep subject-matter expertise, but when you get it right, communities are powerful, stable and extremely valuable. We proved this in two seemingly niche areas — Metal and Americana — but it applies to all music fans and fans passionate about any subject matter."
