Case Study Number 9: SliceThePie / SoundOut
SoundOut is a crowdsourced foresight tool enabling companies to predict future trends when data has yet to be available.
Ariadne Capital began its involvement with Slicethepie in 2008 when one of Ariadne's Executives in Residence Paul Brown (formerly Commercial Director at Slicethepie, then MD of Spotify, and currently Vice President & General Manager, Disney Online and Disney Music Group, EMEA) introduced the founder David Courtier-Dutton to Ariadne Capital to help with both fundraising and strategic development advice. Ariadne supported the company through five fundraising rounds in which a total of £3.3m was invested in the company from a group of high net worth and strategic private investors.
As a pioneer in applying B2C2B business models to their portfolio, Ariadne Capital managed the partnership with Bauer Media, one of the largest publishers in Europe, which resulted in a number of trials with radio stations Kerrang and Kiss. The collaboration proved so successful that Travis Baxter, MD of Bauer Radio, went on to invest in Slicethepie during the company’s funding round in 2010.
SoundOut’s proposition was essentially crowdsourcing insights into new, unsigned artists. Courtier-Dutton thought the record labels would be interested in this new digital service. However, the record labels were not playing ball as fast as David needed. Travis Baxter, who became a Senior Advisor at Ariadne Capital, through his deep knowledge of the radio industry recommended an alternative route to market: invite the radio stations to break new artists with the use of SoundOut. Travis joined the Board of Directors of SoundOut. The involvement of Travis strengthened the SoundOut proposition and pitch to the radio segment for SoundOut to become a strong commercial product offer to broadcast radio.
Based on the success of SoundOut’s crowd analytic platform, Ariadne Capital shaped their proposition for adjacent markets such as retail. The company has teamed up with WGSN launching ‘WGSN StyleTrial’ in May 2015. This crowdsourced validation platform for the fashion industry utilises the power of big data analytics and consumer panels to predict the likely performance of items accurately and to identify best-sellers before they hit the shop floor.
SoundOut exemplifies Ecosystem Economics™ for the following reasons:
1. It is a digital platform predicting future trends through a network (effect)
2. The company partners with Goliaths including Sony Music, Warner Brothers and the BBC helping them to build digital revenues
3. It incentivises consumers in exchange for the use of their personal data thus building wealth for all involved – consumers, corporates and SoundOut