- Listed music company Jaxsta’s (JXT) shares have spiked nearly 300 per cent on a five-year deal with Songtradr, a privately owned music licencing business
- Under the deal, Jaxsta Pro members will gain access to Songtradr’s collection service, which helps artists identify where their sound recordings are being played in order to collect royalties, known as neighbouring rights
- Globally, the neighbouring rights market is valued at US$2.6 billion (around A$3.58 billion)
- In addition to the deal, Songtradr has backed Jaxsta with a $1.42 million convertible note investment
- The cash injection will provide much-needed working capital as Jaxtsa commercialises its professional platform
- Following the news, Jaxta shares have spiked a whopping 285 per cent to trade for 10 cents each
Listed music company Jaxsta’s (JXT) shares have spiked nearly 300 per cent on a five-year deal with Songtradr, a privately owned music licencing business.
Under the deal, Songtradr’s neighbouring rights collection service will be offered to Jaxsta Pro members. Essentially, the service helps artists identify where their sound recordings are being played, allowing them to collect royalties — known as neighbouring rights — and generate revenue.
Globally, the neighbouring rights market is valued at US$2.6 billion (around A$3.58 billion).
The deal
The commercial agreement comes with an upfront licensing fee, which means Songtrader will immediately hand over $500,000 to Jaxsta. Additionally, Jaxsta is entitled to a 20 per cent stake in any revenue generated as Jaxsta Pro members use the Songtradr service to collect their neighbouring rights.
Speaking to the deal’s foundation, Jaxsta said Songtradr was attracted to the company’s robust user growth. Currently, Jaxsta’s platform boasts a 60,000-strong user base, jumping by around 146 per cent month on month since April. All up, the contract carries an initial valuation of $1.92 million.
If the commercial deal is a success, Songtradr can extend the contract for another five years.
“We are thrilled to be partnering with the team at Songtradr. We believe this new revenue-generating product will also drive increased adoption of Jaxsta Pro subscriptions,” Jaxsta Founder and CEO Jacqui Louez Schoorl said today.
“It’s been an ambition of mine to work with Paul and his team at Songtradr since we first met at SxSW in Austin Texas in 2017. As fellow Australians, and founders of music tech companies, we share a global vision for a more connected and data enriched music industry,” she said.
Songtradr Founder and CEO Paul Wiltshire also commented on today’s news, praising the impact of Jaxsta’s platform.
“Many artists and musicians around the world have been impacted by the loss of earnings from live performance, and this partnership allows us to significantly increase our capacity to collect unidentified and unclaimed revenue during these unprecedented times,” he stated.
$1.42M cash injection
In addition to the deal, Songtradr has backed Jaxsta with a $1.42 million convertible note investment.
The cash injection will provide much-needed working capital as Jaxtsa commercialises its professional platform.
The company’s Jaxsta Pro database helps artists and music professionals showcase their work and song credits like a digital resume. Significantly, all users can track how their media is charting across the globe — a feature which only Jaxsta provides.
Following the news, Jaxta shares have spiked a whopping 285 per cent to trade for 10 cents each at 2:00 pm AEST.