Turntable.fm
The social listening site where users took turns playing DJ in virtual rooms
- Founded
- 2011
- Closed
- 2013
- Lifespan
- 2 years
- Total funding
- $7 million
- Peak valuation
- $35 million
- Country
- United States
- City
- New York
- Sector
- Media and entertainment
- Founders
- Billy Chasen, Seth Goldstein, Joseph Perla
- Investors
- Union Square Ventures, First Round Capital, Polaris Venture Partners, Lowercase Capital
- At its peak
- More than 600,000 users and around 1 million songs a day in September 2011
- Cause of closure
- Business model failed
What did it do?
Turntable.fm was a social media site where users listened to music together in virtual rooms. The DJs in a room took turns playing songs, while listeners, represented by avatars, voted on the tracks and chatted. The service was born of a pivot after the team's first product, Stickybits, failed.
Why did it shut down?
Because the service relied on the DMCA's provisions for non-interactive radio rather than striking deals with record labels one by one, it was initially available only in the US. In March 2012 it signed licensing deals with the four major labels, but the cost of running a music service remained high. According to Comscore data, by September 2013 the site had fallen to around 89,000 unique visitors a month. Saying it could not cover its costs through revenue and savings, the company shut the site on 2 December 2013 to focus on Turntable Live.
The story
In January 2011 the Stickybits team faced a hard truth: their app, which let people scan barcodes that brands stuck on their products and earn rewards, had drawn interest from some brands but had failed to win over users. So Billy Chasen, Seth Goldstein, Joseph Perla and a few teammates tried something completely different: a music site where people took turns playing DJ in a virtual room. It was called Turntable.fm.
Launched in May 2011, the site went viral within weeks. Users entered rooms as avatars, stepped up to play a song if a DJ seat was free, and listeners voted the tracks up or down; a DJ who collected enough negative votes was skipped. By the end of June active users had reached 140,000, and by September 2011 more than 600,000 people had used the site, with around 1 million songs being played a day. In July 2011 it raised USD 7 million at a USD 35 million valuation in a round led by Union Square Ventures; Lady Gaga and Kanye West were among the investors.
But the model had weak spots. Rather than striking deals with record labels one by one, the site initially relied on the DMCA's provisions for non-interactive radio, which is why it could only be used from the US. It signed a licensing deal with ASCAP in July 2011 and with the four major labels in March 2012. Users, meanwhile, drifted away; according to Comscore data, by September 2013 the site was down to around 89,000 unique visitors a month. Chasen said removing the music upload feature saved around USD 20,000 a month, but it was not enough.
On 22 November 2013 the company announced it would close Turntable.fm, saying the music service was too expensive to run and that it could not offset this through revenue and savings. Over two years, more than 400 million songs had been played in roughly a million rooms. The site closed on 2 December 2013; Turntable Live, the live concert platform chosen as the new focus, was also short-lived. In 2021 former executives Chasen and Perla set out to revive the brand with two separate new versions.
Turntable.fm shows that a product being loved is not the same as it being sustainable. As TechCrunch observed, people mostly listen to music in the background; the need to spend time actively in a room never became a lasting habit beyond a loyal core audience.
Lessons for founders
- If your licensing costs grow with usage, work out your revenue per user before viral growth arrives.
- An experience that demands active participation may not become a lasting habit for a kind of content that is usually consumed in the background; measure frequency of use early.
- Famous investors and the buzz of the first few weeks are not proof of product-market fit; look at retention data a few months later.
Sources
- Turntable.fm (Wikipedia)
- Turntable.fm Shutting Down So Company can focus on Turntable Live Events Platform (TechCrunch, 2013-11-22)
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