Vancouver-based Beatdapp, which develops fraud detection technology for the music industry, has revealed $22.9 million CAD ($17 million USD) in growth financing and three new partnerships with industry players.
A spokesperson for Beatdapp told BetaKit the all-equity, all-primary funding round closed in the fourth quarter of 2023, and was led by Saltagen Ventures, as well as angel investors Larry Fichtner and Jamie King, with participation from existing investors.
“We must ensure we are supporting legitimate artistry, and deterring those who seek to abuse the open, global music industry.”Michael Nash
Fichtner and King have joined Beatdapp’s board following the deal. The round brings Beatdapp’s total funding to roughly $20 million USD.
“This new funding allows us to deploy the most sophisticated fraud detection models, built on an industry leading data set, and further enhances our reach to meet growing market demand for our capabilities across all corners of the globe,” Beatdapp’s co-CEOs Andrew Batey and Morgan Hayduk said in a joint statement.
Founded in 2018, Beatdapp aims to help digital service providers, music labels, and music distributors discover fraudulent streams. The startup claims it analyzed more than 2 trillion streams and 20 trillion data points in 2023, and claims to have a false positive rate below 0.001 percent. The startup was bootstrapped until 2019, when it raised $3.2 million and launched out of stealth.
A core focus for the startup has been expanding its roster of partners in the music industry. This week, the startup announced it had partnered with Universal Music Group, as well as royalties distributor SoundExchange and streaming service Napster.
According to the company’s spokesperson, Beatdapp will work with Universal Music Group, one of the world’s largest music labels, to gain a deeper, data-driven understanding of the problem of streaming fraud.
“We must ensure we are supporting legitimate artistry, and deterring those who seek to abuse the open, global music industry,” Michael Nash, chief digital officer and executive vice president at Universal Music Group, said in a statement.
Napster and SoundExchange, on the other hand, are using Beatdapp’s fraud detection technology to ensure the integrity of their reporting to their rights holder partners. Beatdapp’s spokesperson stressed that Beatdapp looks to be a neutral third party in the fraud detection segment of the music industry, and therefore takes no strategic money from music companies.
These partnerships come several months after Beatdapp teamed up with generative AI music startup Boomy to analyze Boomy’s entire distributed catalogue. That came shortly after Spotify took down tens of thousands of tracks off of Boomy’s platform over concerns the tracks were being used by scammers.
According to Beatdapp’s spokesperson, the new capital will be used to invest in hiring senior leaders, expand the startup’s data science and technical teams, and enter new markets, including Asia, India, and Europe.