Revelator wants to distribute royalties faster using blockchain.
Revelator raised $2.5 million this week by promising to efficiently track music rights and distribute royalties to rights owners.
To do that, the startup is using blockchain best known as the technology behind Bitcoin to get money to musicians and managers more quickly.
A blockchain is a shared ledger that can record almost any kind of transaction. For Bitcoin, the blockchain keeps a public record of financial transactions made using the digital currency.
The key innovation is that blockchain doesn’t require any central control.
Revelator is harnessing that technology for the music industry. The immediacy of blockchain’s record-keeping allows Revelator to track uses of digital assets and get royalties of any size to those owed as fast as possible.
Normally, artists and others who own rights to music wait months to receive royalties. It’s even more complicated when multiple people split the rights to the same song.
Revelator says almost half of royalty payments aren’t getting to the correct owner because of outdated systems.
“If you have data every day, why can’t we make payments every day?” Revelator founder and CEO Bruno Guez told Mashable. “If you had 1,000 downloads, I can pay you $700 tomorrow.”
That speed is thanks to blockchain, Guez said. Revelator is targeted toward rights holders, who can use the technology to license and distribute their music or other content. It’ll track downloads, streams on Spotify and other services, and more.
“The blockchain technology does provide a truly disruptive technology for the music industry,” he said. “It’s not the only thing that matters and it won’t solve all the problems in the industry, but I do believe our current offering introduces new features for music.”
The way Revelator is using blockchain can be applied to assets besides music. The Israel-based startup just finished a project for WBUR, Boston’s public radio station. The company developed a music library for a new podcast project and coordinated all the rights for any NPR member station to use it.
“By experimenting now with a small proof-of-concept music library, we’re going to be able to open new windows of opportunity for public radio in the future, through experimentation on blockchain,” Meg Siegal, who heads the innovation group Public Radio BizLab through WBUR, told Mashable.
In its recent Series A funding round, Revelator raised $2.5 million led by Exigent Capital. Exigent was joined by Digital Currency Group, which invests in Bitcoin and blockchain companies.
Other companies are using blockchain for rights management, too. Blockai, for example, has used blockchain to manage rights for mainly visual art.
Revelator started with music not a surprise, since Guez is a former record label executive but sees itself moving further into other forms of content in the future. For now, it’s trying to solve a problem that has affected the music industry since songs were first played online, outside the jurisdiction of strictly regulated movies and radio stations.