Creators often work with different partners for different projects. And splitting payments with others is one of the biggest challenges for creators. Mosaic (formerly Jammber) is trying to solve this problem through its series of solutions, including APIs and Chrome extensions.
The company has raised $20 million in Series A funding from Volition Capital. Mozaic has raised more than $27 million to date from investors including Rise of the Rest, Maverick Nashville and music industry executive Joe Galante. The startup was founded by CEO Marcus Cobb and SVP of Growth Rachel Knepp in 2015 with the goal of developing tools to manage different parts of the music business, from credit management to ticketing.
Cobb told TechCrunch that while the company initially decided to focus on the B2B aspects of music, Mozaic decided to shift to building a collaborative payments product using its experience managing music projects in 2020 due to the pandemic.
“To test the potential product/market fit, we created a PowerPoint sales pitch in about 2 days and called 200 music distributors. When 60 LOIs (Letters of Intents) came in within 30 days, it meant that the pivot was the right choice. We committed to the new direction and the early beta went live about 16 months later in January 2022,” Cobb said.
The idea was to move creators away from solutions like PayPal, CashApp, Venmo, and Zelle, which might not work if their partners were in a country where those solutions don’t exist.
Mozaic’s core product is its API, which can easily connect to platforms like Spotify, YouTube, Twitch and other custom solutions. Jason Hadshian’s Made By Us Music and Creative Space & Events — which has worked with artists such as 50 Cent, P Diddy, The Clipse and Rihanna — uses Mozaic’s solution to automate payments to clients.
How does this work?
Cobb said typically a song has three to five collaborators, and only the creator gets paid right away. Then they have to split the money. Many times, splitting payments was also a design problem, as there was no way to define these splits with rules. He said that Mozaic has smart contracts based on JSON (not the blockchain type), which automatically send payments to different partners based on the rules of this project.
Artists receive direct payments and reports for different projects on the platform. If they do not have an account, they will need to register with basic information to start receiving automatic payments. Mozaic receives a commission of 1.99% + $1 per transaction (capped at $25) for its services.
A music industry executive told TechCrunch that record labels and distributors have their own systems, but they are laborious in nature and many reports are manual. This is tiring for associates as they have to follow up multiple times with very little transparency in the process. So something like Mozaic could be a good solution. But for wider adoption, the startup’s API will need to work with legacy tagging systems.
Future roadmap and challenges
Modern distributors, such as DistroKid and ByteDance’s SoundOn, build automatic rights allocation algorithms into their solutions. However, Mozaic believes that due to its cross-border competence, its solutions will be well adopted.
Cobb said that labels and artists who want to be competitive in the space will have to adopt modern solutions to pay artists on time. Otherwise they risk losing them.
While Mozaic has worked extensively with the music industry, he said the startup’s solution would work well with creators ranging from YouTubers to Twitch streamers and newsletter writers. To make it easier for creators to split payments, the company is launching a Chrome extension and an invite-only mobile app in January, with plans to make them available to all creators later in Q1 2024.
Image Credits: Mozaic.io
“What I’m personally most excited about is a Chrome extension that lets you add splits to anything. This Chrome extension will work on YouTube, Etsy, Spotify and GitHub. And it’s as easy as tagging your friends on product pages,” said Cobb.
Mozaic is also working on a website for businesses to better report and share revenue or affiliate sales.
The company is cash flow positive as of this year and even after plans to expand its team through new capital, it plans to remain close to profitability.
Larry Cheng, co-founder and managing partner of Volition Capital, said the growth-stage venture firm has worked with many brands with lead creators, and the problem of splitting payments weighs heavily on them. He said even some established artists don’t have their accounting or finance team to handle all the intricacies.
Cheng, who also sits on GameStop’s board of directors, added that since alternative creative industries like YouTube Gaming are gaining ground, Mozaic is well-positioned to take advantage of this trend.
