Nigerian Afrobeats star, Oliwatosin Ajibade, popularly knows as Mr Eazi , has raised $20 million for his Africa Music Fund (AMF) to invest in the careers of African music talents.
This was disclosed by Mr Eazi in a statement issued to CNN. According to him, the fund was led by 88mph, a firm that invests in African Businesses.
He explained that his intention was to create a new platform to fund the music entertainment ecosystem in Africa adding that the entertainment ecosystem is not understood by intuitional investors in Africa and leads to limits in funding the industry.
There has been no investment of this type or magnitude in the Nigerian music space before.
“Artists cannot go to banks to get money for their music because financial institutions don’t understand how to secure intellectual property. They get it for physical properties but not for music. So, because not a lot of people understand the music business, there is no finance product for musicians,” he told CNN.
How it works: Artists, who already have a foothold in the continent, are expected to join the platform, and their data would be gathered to see how much they are fully earning from music streams. Upfront payments would be made on the revenue for the artists, which gives them more capital to expand their creativity.
The upfront payments would be paid back in installments by the artists as the investments on their earnings rise.
“Let’s say we have a two-year contract with someone. In those two years, we will be their representative, helping them manage their music, and as they grow we will be deducting the initial investment from their earnings,” he said.
Why it matters: AMF would enable African creatives have access to a larger audience through streaming platforms and technology, which will enable them have access to festivals and shows for their music. Mr. Eazi himself has gathered more than 5 million streams on music streaming platforms like Spotify.
He announced that the AMF will partner with Vydia, music technology company, and both will launch a music distribution platform called Cinch Distro. The platform would help upcoming creative upload their songs for 500 naira.
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“The way it works is that they register on the platform and make their music. It has an AI-based tech that will filter their possible revenue based on the number of streams they get on the platform alongside a couple of other metrics,” he added.
He added that the platform would help artists have their music distributed and their progress gets tracked through AI, enabling Cinch Distro make data-backed decisions on further investments.