The music industry was hit hard during the pandemic, as was Nashville-based music licensing startup Jammber — but it didn’t take long for the company to change its tune.
“We were low on cash and I couldn’t raise any money during a pandemic,” CEO Marcus Cobb said. “We had to go where the money was. The one thing that’s moving a lot [in the music industry] is money, streaming out to the artists. What a lot of people don’t know is most of that money is moving via PayPal, wires and checks. So, we’re like, ‘What if we just replace PayPal?’”
Cobb and his team bootstrapped operations and began pre-selling a payment platform designed specifically for artists and creators.
Nearly three years later, Jammber's new product — called Mozaic — is a hit, with more than $2.4 billion in payment volume projected to travel through the platform in 2023, Cobb said. Jammber's average take rate on payments is 2.2%.
Based on those numbers, the startup could bring in more than $52.8 million next year.
“We couldn’t have anticipated how much it was going to take off,” Cobb said. “I’m blown away. It’s a much easier sell than anything I’ve ever sold in my life.”
Founded in 2013, Jammber began as an online toolkit for musicians and producers designed to solve long-standing industry problems. The music industry still largely uses paper and spreadsheets for its back-office functions, Cobb said, with thousands of artists owed compensation that can’t be delivered because of incorrect or incomplete information.
The company’s Splits app solved that by recording songwriter information at the moment of conception so that artists can later be paid.
It was that ability to split songwriting credits and royalties between artists that made Jammber unique, and it’s also what differentiates Mozaic from other payment platforms, Cobb said.
Splitting a regular payment is simple, he said, but Mozaic can split payments based on sales data from things like songs and podcasts, something he says no other platform can do. Mozaic can also payout across 200 countries, while automating taxation and international royalty compliance, and gives users a dashboard where they can track their various earnings.
“The nuance here, is that for these creatives, it’s not just a paycheck,” Cobb said. “Most of them had to work exceptionally longer in their craft to even earn money doing this. There is an appreciation for them that this is not just their earnings, it’s the maturation of their craft. When they log into their dashboards, they can see all their project work. It becomes this portfolio of everything they’ve created and the money that those projects are generating, in one place. That’s really emotionally powerful for these people.”
Cobb said Mozaic's first clients were music distributors, podcasters, gaming companies and fintechs. The bulk of their business now comes from “large corporations” who make mass payouts to artists.
Jammber counts multiple high-profile music execs as investors, including former Sony Music Nashville Chairman Joe Galante, Vector Management founder Ken Levitan and Spalding Entertainment President Clarence Spalding. Cobb said he wants to bring in two to three more strategic investors.
Jammber also named Rachel Knepp, who invested more than $200,000, as co-founder during the pandemic, Cobb said.
The startup is currently hiring for tech sales, operations and risk compliance positions, he said, with the expectation of reaching a headcount of 50 employees by the end of next year.
“Whenever you do something that you’re passionate about, the most important ingredient for that effort is a reward. You need that reward soon and you need them often. Especially at the beginning when an idea is fragile,” Cobb said. “The reward can be praise, accolades or it can be money. … Our theory is, if we can move people’s rewards to them as quickly as possible, as authentically as possible, they’re going to be encouraged to keep pursuing their passions.”
