Portland streaming music startup Vadio says it’s looking to sell the business, winding down after a flurry of activity that made it one of the city’s hottest young tech companies.
Bryce Clemmer, who started the company with Elliot Swan and Matt Polzin, said Vadio couldn’t secure adequate investment.
“We didn’t raise enough money out of the gate,” Clemmer said in a written statement Tuesday. “The economics are somewhat unique to the music business, which requires quite a bit of upfront investment to secure the rights from the labels globally.”
Vadio, which employed 20 at its peak, has eliminated most of those jobs. It has been been trying to raise more money or sell the company since the holidays, according to Clemmer, thus far without result.
The Portland Business Journal first reported Vadio’s plans. The company emerged from the Portland Seed Fund and Portland Incubator Experiment.
Vadio sought to enable video advertising to accompany streaming music, producing a new revenue stream for artists and labels and creating a new outlet for video ads. The company reported nearly $12 million in funding, including a $7.5 million round in 2015.
Vadio developed ties with key players in the music and advertising markets, including Yair Landau, previously Vice Chairman of Sony Pictures Entertainment and President of Sony Pictures Digital Entertainment. He became Vadio’s chairman and chief operating officer.
Vadio also had deals with CBS Radio, Vizio, Warner Music, AOL and Shazam. Clemmer said the Portland company needed more funding to license music from other major labels, though, and couldn’t find the venture capital to continue.
“The fundraising climate has changed and it takes more investment than many VCs are comfortable with today,” Clemmer wrote. So he’s put the company up for sale, seeking a buyer in the streaming music, media or online advertising markets.
“Vadio needs a home with financial prowess and patience, with a strategic view of the business over the long-term,” Clemmer said. He said there’s a chance a new owner might revive the Portland office.
“Some potential acquirers may find value in both the team and technology,” he said. “or some may find value in just the team.”
Portland’s startup scene, which emerged from the Great Recession with a boost in funding for a half-dozen prominent young businesses, has hit an extended lull.
Venture investment in Oregon companies fell sharply last year, and though Oregon tech employment continues to grow most of the hiring is at large, out-of-state companies with substantial outposts in the Portland area.
— Mike Rogoway; twitter: @rogoway; 503-294-7699
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