Music Tech CEO Troy Carter on Predicting Hits and Music's Future

Sam Blake

Sam primarily covers entertainment and media for dot.LA. Previously he was Marjorie Deane Fellow at The Economist, where he wrote for the business and finance sections of the print edition. He has also worked at the XPRIZE Foundation, U.S. Government Accountability Office, KCRW, and MLB Advanced Media (now Disney Streaming Services). He holds an MBA from UCLA Anderson, an MPP from UCLA Luskin and a BA in History from University of Michigan. Email him at samblake@dot.LA and find him on Twitter @hisamblake

Music Tech CEO Troy Carter on Predicting Hits and Music's Future

Troy Carter, 48, knows the modern music business well. The Philadelphian-turned-Angeleno has managed Lady Gaga, John Legend and Eve, and formerly led creator services at Spotify. Carter, who also oversees the entertainment assets of the late artist Prince, has been an advocate for artists and called for greater artist-ownership of their copyrights.

In early 2019, Carter launched Q&A with longtime collaborators Suzy Ryoo and J. Erving. The music-tech company aims to help artists and labels navigate everything from royalty payments to creating hit music through a combination of services and software. One of its first moves was to merge with Erving's Human Re Sources, a distribution and label services company that Sony acquired this December. But its most-watched move is a tech spin on talent management, including a new product that uses music enthusiasts and AI to test whether songs can become hits.

Earlier this month, the company launched Venice Innovation Labs, a division that's developing the predictive software, along with another product to help record labels distribute music, manage their artist roster and keep track of financial splits and payments. It counts Grammy-nominated Ant Clemons and Baby Rose among its early clients.

Carter has been an active early-stage tech investor through his angel fund, AF Square, which has invested in Spotify, Dropbox and Uber, along with L.A.-based PlayVS, FazeClan, Blavity and Thrive Market.

dot.LA caught up with Carter to talk about the future of the music industry and how technology is continuing to shift its balance of power.

What do you see as the main problems facing the music industry?

Artists have more options now than they've had in the past because of technology and capital sources. Before, the types of deals were limited, because it was essentially one capital source: record labels. That's no longer the case. Technology has created lower barriers to entry. Artists can release music on their own and they can start building buzz. If I was starting a label today, I would be looking at: how do I future-proof my label before I get disrupted by other models? Even if labels got a perpetual piece of the revenue stream, if the ownership and control of those rights went back to the artist as the label recouped or reached a profit, that's a model that could work.

Why do you consider that as a model for labels to future-proof themselves?

Otherwise, if the choice becomes I (as an artist) have to give up 80% of my upside in exchange for a $250,000 advance, and that ties me into three to five albums, which is probably eight or nine years of my life – maybe that $250,000 isn't worth it if this (alternative) capital source over here is much less restrictive and gives me the freedom to make different types of decisions. That becomes the differentiating factor.

How are you beta-testing songs?

A label traditionally looks at post-release analytics, which isn't that helpful after you've already invested hundreds of thousands of dollars into a song or project. This is about pre-release analytics, to inform you whether or not you should invest into that particular song or project. In a software business, there's a lot of A/B testing; you're figuring out what works and what doesn't work. And you're investing in things that work, and killing products or features or things that don't work.

The music industry has been such a gut-driven business. If you're in a studio, you like a song, it goes to the record label, everybody gets excited, and you put it out onto digital service providers (e.g. Spotify, Apple Music). But if you find out that fans aren't reacting as much as you thought they would , yet you've already invested in the music video, you already invested in the lyric video, you spent money on photo shoots for the artwork – that's a significant investment.

So when you're A/B testing a song pre-release, how do you assess its viability?

You have real listeners on one side that are giving you real feedback. We know a lot about those listeners and their listening habits. They're giving feedback on the specific songs, whether it's through sentiment analysis, through actual rankings of the songs themselves. It's not coming from just software; it's coming from a combination of software and listeners as well.

How do you identify that initial pool of listeners?

We really did a good job of curating. I think it's over 1,000 sign-ups at this point, and a waitlist as well. We won't give away our secret sauce, but we got a great group of music listeners on the other side. For the cohorts that are in right now, the focus is primarily around pop and hip-hop. And the idea is then to spread it out from there.

So you'll sort of re-curate the cohort as the supply-side evolves?

Exactly. It's not even re-curate as much as it is bringing on. If we decide, you know, country music is the next vertical, it's making sure that we go out and recruit there. If it's classical music – the listeners are specific to the genre.

How do you balance software with human intuition in order to gauge the strength of an artist or a song?

I don't believe software will replace humans in terms of finding great artists. I think (with software) you can identify what people are reacting to and it can give you information on the types of things that people are reacting to. But, in terms of being able to identify who a star is, before there's any data available, that's what great entrepreneurs like Berry Gordy (founder of Motown) or Jimmy Iovine, or people who've started these fantastic labels over the years do.

Our job is to be able to give them tools to help them run those companies and make smarter decisions. Is it this song, or is it that song? Is it this piece of artwork, or is it that piece of artwork? So I don't think it replaces the intuition, and I don't think it replaces the creativity. I think it just helps inform decision-making after they've made those intuitive decisions.

How do you think a young Berry Gordy would be different if he operated today?

The only difference would be the musical tastes would have changed. But in terms of the core principles of what he would be looking for in an artist, they wouldn't change. That's the difference with Berry Gordy and with real artist-development executives.

You have some executives (now) that basically will look at "what's the velocity of this artist on TikTok or SoundCloud, or YouTube," and that's how they spot talent. Not to say anything's wrong with that, but it's a different approach when there's no data, and you just see, "okay, this person has an incredible voice, and a quality that lights up the room when they walk in; I can help shape this person to be a superstar." It's a different quality that a person like Berry Gordy has, making decisions in the absence of data.

Isn't adding data taking out the very qualities in artist-development executives that you celebrate?

My job, with software, is: Can I help them choose which song they should release first? And what that reaction would be around that song. Can I help them deliver that content from A to Z seamlessly? Can I help them with their project management software as they're going through each step in that creative process? So it's not to replace the creative process, it's to organize the creative process.

A recent article by a past colleague of yours at Spotify, Will Page (former Spotify chief economist), suggested that we've hit 'peak streaming' in some markets. Is that right?

Music is the soundtrack to people's lives. I don't know if we're ever going to hit a peak, in terms of the way people engage with music. If anything, people are going to engage with music even more because you have more television shows which sync music now. When you look at the amount of content on TV, you look at the amount of games, the amount of short-form video that's being made, you look at TikTok videos – I think engagement is going to continue to grow. It's too early to be able to say whether we've hit peak or not. We went through a really interesting year, where a lot of behaviors changed, and we need to see what normalization is going to look like. We can probably answer that question better a year from now.

Looking forward, what do you think the role of livestreaming and livestreamed concerts becomes?

We're at the very, very, very beginning of what we're going to see in the livestreaming space – specifically around AR and VR. The live concert experience is limited to who can be in a room. And there's only a small percentage of really great seats in the house. Right now you're capped at a capacity, plus the amount of wear and tear on artists to do 150, 200 tour dates throughout the year, and the level of expense that comes with that as well; we can figure out much better experiences. Not to say it's going to replace it, but I think it's going to be very complementary and I think we're at the very, very, very beginning stages right now.

When do you think live events return?

I think in the U.S., we'll see that this summer we'll be back up and running with live. Probably not at full capacity, but I think by the end of 2021, we'll be back full-capacity.

What's ahead for Q&A and Venice?

We have things coming down the pipeline that we're excited about. But our thing is: Can we become the operating system for the music industry? If you look at what our workflow looks like right now, people are still sending music in Dropbox and Box, or WeTransfer; lyrics are written in people's notes on their phone or on Google Docs or on texts; you may have something on your email at the label but somebody else may have something else on their email. There's no central source of truth when you're managing a project. So the way we're looking at it is, for creative projects and labels, can we become the central source of truth?

This interview has been edited for brevity and clarity.


Sam Blake primarily covers media and entertainment for dot.LA. Find him on Twitter @hisamblake and email him at samblake@dot.LA

🏰 Disney's Epic Investment Stands Out Amidst Gaming Industry Layoffs

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

🔦 Spotlight

In the midst of widespread gaming industry layoffs, a glimmer of positive news emerges as Disney announces a significant move: a $1.5 billion investment in Epic Games. 🏰💰🐭

Image Source: Disney

Disney's $1.5 billion investment in Epic Games, disclosed late Wednesday, signals a strategic alignment aimed at expanding the success of "Fortnite." The deal enhances Epic's growth prospects after financial setbacks, including layoffs, and strengthens the partnership between the two companies. With Disney gaining a larger equity stake in Epic, the collaboration will broaden the integration of beloved Disney franchises like Marvel, Star Wars, Pixar, and Avatar into the game, potentially boosting its appeal and longevity. This significant investment underscores Disney's commitment to interactive entertainment and signifies a shift towards games as a primary revenue stream, aligning with the growing trend of digital engagement among younger demographics. Moreover, the potential for crossover sales of physical Disney products within "Fortnite" and the exploration of new content distribution channels are just some of the opportunities arising from this partnership.

For LA tech, the Disney-Epic Games partnership represents a validation of the region's burgeoning tech and gaming ecosystem. The substantial investment in Epic, who maintains a large Los Angeles office with 1,000+ employees (according to LinkedIn), reflects confidence in the LA’s talent pool and innovation potential. Additionally, this partnership between two industry giants fosters an environment for further collaboration, investment, and growth within LA's tech sector. As Disney and Epic Games deepen their ties and explore new avenues for content integration and distribution, it not only elevates the prominence of LA as a tech hub but also stimulates economic growth and job creation in the region. This partnership highlights LA's unique position as a hub where technology and entertainment converge. With its ability to integrate diverse industries, LA is driving innovation and expansion in digital entertainment. 🚀💸🎮

🤝 Venture Deals

LA Companies

  • ProducePay, a financing and marketplace platform for the fresh produce market, raised a $38M Series D led by Syngenta Group Ventures joined by Commonfund, Highgate Private Equity, G2 Venture Partners, Anterra Capital, Astanor Ventures, Endeavor8, Avenue Venture Opportunities, Avenue Sustainable Solutions, and Red Bear Angels. - learn more
  • Blush, an invite-only dating app that drives users to local businesses on dates, raised a $7M Seed Round from individuals like Naval Ravikant. - learn more
  • Mogul, a startup founded last year that provides an overview of an artist's royalty earnings and identifies areas where money is owed but has not yet been collected, raised a $1.9 million seed round from Wonder Ventures, United Talent Agency, AmplifyLA, and Creator Partners. - learn more
  • Avnos, a hybrid direct air capture startup, raised a $36M Series A led by NextEra Energy and joined by Safran Corporate Ventures, Shell Ventures, Envisioning Partners, and Rusheen Capital Management. - learn more
  •, startup whose mission is to help retailers enhance the online shopping experience by providing consumers with virtual try-ons and personalized fashion recommendations, raised a $3.6M Seed Round led by Neo. - learn more
  • Suma Wealth, startup that aims to demystify financial topics and provide culturally relevant content, virtual experiences, and resources to help Latino users navigate financial challenges and opportunities, raised a $2.2M Seed Round . Radicle Impact led, and was joined by Vamos Ventures, OVO fund and the American Heart Association Impact Fund. - learn more
  • 222, a startup that helps users discover their city and meet new people through unique social experiences, raised a $2.5M Seed Round. Investors included 1517 Fund, General Catalyst, Best Nights VC, Scrum Ventures, and Upfront Ventures. - learn more
  • LimaCharlie, a security operations cloud platform, raised a $10.2M Series A led by Sands Capital. - learn more
  • Polycam, an app that uses a smartphone’s sensors to capture 3D scans of objects, raised an $18M Series A co-led by Left Lane Capital and Adjacent, and joined by Adobe Ventures and individuals like Chad Hurley and Shaun Maguire. -learn more.

LA Venture Funds

Actively Raising

  • ReelCall, Inc., an entertainment technology company focused on powerful apps and platforms that help build and maintain the professional network of connections vital to career growth, is raising a $850K Pre-Seed Round. - learn more
  • CZero, a startup building software to decarbonize logistics for logistics businesses and goods business through a vetted marketplace and optimization software. - learn more
  • Couri, a technology startup addressing last-mile delivery issues, is raising a $450K Pre-Seed Round at a $2.2M post money valuation. - learn more
  • Sweetie, a marketplace to help people plan date nights, is raising a $1.5M Pre Seed Round. - learn more
  • StartupStarter, an investment platform that provides real-time data and analytics on startups, is raising an $850K Angel Round. - learn more

If you’re a founder raising money in Los Angeles, give us a shout, and we’d love to include you in the newsletter!

Venture Waves, Climate Tech Wins, and Silicon Beach's Ongoing Evolution

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

Anduril Seeks $1.5B in VC Funds

Defense company Anduril Industries Inc., based in Costa Mesa and founded by Palmer Luckey, is seeking to raise $1.5 billion in fresh funds to boost its valuation to $12.5 billion or more, according to sources quoted by The Information. This fundraising effort, if successful, would mark one of the largest venture capital rounds of the year.

Image Source: Anduril

Anduril recently secured a contract to develop and test small unmanned fighter jet prototypes under the Air Force’s Collaborative Combat Aircraft (CCA) program, beating out major defense companies like Boeing, Lockheed Martin, and Northrop Grumman. Alongside General Atomics, Anduril will design, manufacture, and test these aircraft, with a final multibillion-dollar production decision expected in fiscal year 2026. This program aims to deliver at least 1,000 combat aircraft to fly in concert with manned platforms and is part of the Air Force’s Next Generation Air Dominance initiative. Central to Anduril’s success in this contract is the Fury autonomous air vehicle, acquired through the purchase of Blue Force Technologies. This victory underscores Anduril's rapid advancement in the defense sector, aligning with Luckey's vision of building faster and more cost-effective defense assets. - learn more

Los Angeles Ranks Number 1 in Emerging Climate Tech Hub

The 2024 Emerging Climate Tech Hubs Report by Revolution highlights Los Angeles as a burgeoning center for climate tech innovation. LA's growth in this sector is driven by its diverse talent pool, strong research institutions, and a culture of environmental consciousness. The city's unique mix of legacy industries, such as entertainment and aerospace, alongside emerging tech companies, positions it as a pivotal player in the climate tech landscape. This shift reflects a broader trend of decentralized climate tech funding across the U.S., reducing the historical dominance of California's traditional hubs. - learn more

Silicon Beach: Looking Back, Moving Forward

Assessing the overall health of the startup market is challenging, especially as venture capital funding has decreased by an average of 61% from 2021 to 2023 across the top VC markets in the US. Markets with robust ecosystems in AI, SaaS, Biotech, Healthtech, and Fintech appear to be weathering the downturn better than those focused on Consumer and Gaming industries, areas where Los Angeles traditionally excels.

Percent Change In VC Funding By Region

CB Insights

LA Times paints a rather bleak outlook on the Los Angeles tech scene noting venture capital funding in Greater Los Angeles plummeted 73% from 2021 to 2022. Silicon Beach, once a vibrant tech corridor, currently faces high vacancy rates and lacks late-stage financiers, especially in the AI sector. However, there are positive signs, including growth in aerospace startups and increased venture capital investment in early 2024, suggesting a potential rebound for LA's tech ecosystem.

While LA may not be exceeding expectations during this period, its tech ecosystem warrants a nuanced evaluation, given the broader market dynamics and its strong performance in specific sectors. Reach out to us with your thoughts.

🚀 SpaceX gears up for another stellar year, active raises, and more

Christian Hetrick

Christian Hetrick is dot.LA's Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.

Happy Friday Los Angeles! You made it through the first week of 2024!

🔦 Spotlight

Elon Musk may be a divisive (albeit entertaining) figure, but the continued success of SpaceX is pivotal for the aerospace industry in Los Angeles and more broadly around the world.

Image Source: SpaceX webcast

What happened with SpaceX in 2023?

  • Elon Musk challenged Facebook founder, Mark Zuckerberg to a cage fight.
  • SpaceX launched 96 successful missions with its Falcon series of rockets, a 57% increase over its previous annual record.
  • SpaceX conducted two test flights of the largest and most powerful rocket ever built, Starship.
  • Roughly two-thirds of SpaceX's launches in 2023 were devoted to building out Starlink, the company's satellite-internet megaconstellation.
  • Isaacson’s Elon Musk biography was published in September including everything from Musk’s tumultuous relationship with his father to his work ethic and “demon mode”.

Moving forward what can we expect from SpaceX and its controversial founder? Continued innovation pushing the aerospace industry to new limits? Yes. More drama? Without a doubt.

Here is some of what is to come in 2024:

🤝 Venture Deals

Just Announced

Check back next week!

LA Exits

  • CG Oncology, an Irvine, CA-based developer of immunotherapies for bladder cancer, filed for a $100M IPO. It plans to list on the Nasdaq (CGON) with Morgan Stanley as left lead underwriter, and has raised around $317m in VC funding. - learn more
  • McNally Capital agreed to sell Advanced Micro Instruments, a Costa Mesa, CA-based maker of gas analyzers and sensing technologies, to Enpro (NYSE: NPO). - learn more

Actively Raising

  • ReelCall, Inc., an entertainment technology company focused on powerful apps and platforms that help build and maintain the professional network of connections vital to career growth, is raising a $850K Pre-Seed Round. - learn more
  • CZero, a hard-tech startup that is developing a technology for decarbonizing natural gas, is raising a $1.5M Seed Round. - learn more
  • Couri, a technology startup addressing last-mile delivery issues, is raising a $450K Pre-Seed Round at a $2.2M post money valuation. - learn more
  • Sweetie, a marketplace to help people plan date nights, is raising a $250K Angel Round. - learn more
  • StartupStarter, an investment platform that provides real-time data and analytics on startups, is raising an $850K Angel Round. - learn more

If you’re a founder raising money in Los Angeles, give us a shout, and we’d love to include you in the newsletter!

📅 LA Tech Calendar

Sunday, January 7th

Wednesday, January 10th

  • Startup Cafe: Networking with a Kick - Entrepreneurs, Startups, and Tech Enthusiasts join together to meet and connect with like-minded people, industry professionals and investors, while enjoying a nice cup of coffee in Venice at The KINN. This week’s interactive discussion about AI’s evolution in entertainment will feature Dr. Sam Khoze and Rachel Joy Victor.
  • Venice Tech Happy Hour- Join Startup Coil and FoundrHaus Wednesday evening and enjoy the sunset from the rooftop, grab a bite overlooking Abbot Kinney, and mingle with other tech enthusiasts and entrepreneurs by the bar on the patio.

Have an awesome event coming up? Reach out to be featured on next week’s Newsletter!

📙 What We’re Reading