Stem Raises $20 Million To Help Music Artists Get Paid - dot.LA

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Kristin Snyder is an editorial intern for dot.la. She previously interned with Tiger Oak Media and led the arts section for UCLA’s Daily Bruin.
Stem, a music tech startup focused on helping artists with distribution and payments, has raised $20 million in a new funding round.
Fintech-focused venture capital firm QED Investors led the funding and was joined by Block, the Jack Dorsey-led payments tech company formerly known as Square. Block notably paid nearly $300 million last year to acquire a majority stake in TIDAL, the music streaming service backed by rapper Jay-Z.
Existing investors Slow Ventures and Quality Control also pitched in on Stem’s new round, which takes the Los Angeles-based startup’s total funding to around $40 million.
Since launching in 2015, Stem has merged financial management tools with music distribution capabilities, working with independent record labels like Big Loud as well as major artists like Wiz Khalifa. Its dashboard includes tools for artists, managers and labels to oversee their revenues, split funds with collaborators and receive automated payments. While only Stem-distributed artists can currently access its financial tools, the new funds will go toward expanding the platform’s existing royalty accounting features to other music distributors.
Stem co-founder and CEO Milana Lewis told dot.LA that she launched the startup based on her experiences as a talent agent for industry heavyweight United Talent Agency—a role in which she saw firsthand how difficult it was for artists trying to aggregate multiple revenue streams. Stem was born out of Lewis’ desire to streamline the process.
“Getting into music has always been hard for anyone that works in music,” Lewis said. “There’s this notion of a starving artist for a reason: It’s because the business is really complex, and it’s gotten more complex.”
With avenues for music monetization—from streaming platforms to home devices—constantly expanding, Stem aims to provide artists with a “financial backbone” allowing them to plan their projects and income, Lewis added.
“Our belief is: What if we build a system that can become the system of record for who gets paid what and how?” she said. “It makes it possible for other really interesting economic things to happen for artists.”
Stem is among a new generation of startups that are turning L.A. into a music tech hotbed—a trend that makes sense given the city’s status as a global entertainment capital and home to major labels like Universal Music Group. Last week saw Trac, another startup distribution platform for music artists, raise $2.5 million in new funding, as dot.LA reported.
While streaming has helped the music business evolve its revenue model, that hasn’t always been to the benefit of artists: Spotify recently revealed that most artists earned less than $10,000 through its platform in 2021. In turn, some independent musicians have protested against the streaming giant over its low royalty payments.
Kristin Snyder is an editorial intern for dot.la. She previously interned with Tiger Oak Media and led the arts section for UCLA’s Daily Bruin.
Christian Hetrick is dot.LA’s Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.
After disrupting the film and television industry, Netflix is about to undergo some disruption itself.
The streaming service announced Tuesday that some big changes are on the way after a disastrous first quarter that sank its share price in after-hours trading. In response, the company vowed to crack down on password sharing—a longstanding issue that Netflix has largely ignored until recently—and co-CEO Reed Hastings all but confirmed that it will finally add an advertising-supported subscription option. The company is even “pulling back” on its spending growth to reflect its new financial reality.
“When we look at the last 20 years…we’ve gone through a lot of changes, and we’ve always figured them out one by one,” Hastings said on Netflix’s earnings call Tuesday. “We have a bunch of opportunity to improve, but coming out the other side, I’m pretty sure we’ll look at this as really foundational in our continued journey.”
Netflix shares cratered after investors learned that the streaming platform had lost subscribers for the first time in more than a decade last quarter—with its stock price down nearly 26% in after-hours trading, to under $259 per share. Netflix not only shed 200,000 subscribers from January through March, but said it expects to lose 2 million more in the current second quarter.
Part of the problem was that the company lost 700,000 subscribers after suspending its service in Russia, in protest of that country’s invasion of Ukraine. But even excluding its Russian retreat, Netflix would have added only 500,000 paying customers last quarter—well below the 4 million it added in the year-earlier period, as well as the 2.5 million it had previously projected for the first quarter.

Netflix management told shareholders Tuesday that COVID-19 had clouded its outlook; the pandemic turbocharged growth in 2020 as consumers were stuck at home, leaving company leaders believing the subsequent slowdown was only a pandemic hangover.
Now, Netflix is acknowledging what many observers have long speculated: The original streaming giant has been battered by the streaming wars. After being caught flat-footed by the rise of streaming, legacy media giants like Disney and Warner Bros. Discovery have joined the market that Netflix essentially created, offering content and pricing that is often as good, if not better.
In a letter to shareholders, Netflix placed much of the blame on password sharing, estimating that 100 million households may be using accounts without paying for them. (The company has 222 million paying customers globally.) Netflix management said it sees a “big opportunity” to monetize those non-paying households.
The problem is “not a new thing,” Hastings acknowledged. Indeed, account-sharing as a percentage of its paying membership hasn’t changed much over the years, Netflix reported Tuesday, and may have even helped fuel its growth by getting more people to use the app. But coupled with other factors, Netflix now believes it is a major headwind—and with new user growth now at a standstill, the day of reckoning for password-sharing may soon be arriving.
The same can be said for Netflix’s resistance to advertisements. Despite other streaming services luring customers with cheaper ad-supported options, Netflix hasn’t budged when it comes to commercials—until now.
“Those who have followed Netflix know that I’ve been against the complexity of advertising and a big fan of the simplicity of subscription,” Hastings said. “But as much as I’m a fan of that, I’m a bigger fan of consumer choice, and allowing consumers who would like to have a lower price and are advertising-tolerant get what they want makes a lot of sense.”
Other changes may also be on the way. Netflix may have popularized “binge-watching” by giving consumers entire seasons of shows all at once, but some industry observers believe that approach fuels cancellations, since consumers can plow through a show then ditch the service before their next monthly bill.
Netflix plans to release the upcoming season of the fan favorite “Stranger Things” in two parts, which could keep some customers subscribed to the platform for a bit longer. Co-CEO Ted Sarandos described the approach as “satisfying for the binger or the one-at-a-time viewer as well.” He also spoke positively of Netflix releasing some unscripted shows in “mini-batches” on a weekly basis.
One place where Netflix doesn’t seem ready to budge is live sports, though Sarandos didn’t completely close the door on that one, either.
“I’m not saying we’d never do sports, but we’d have to see a path to growing a big revenue stream and a big profit stream with it,” he said.
Christian Hetrick is dot.LA’s Entertainment Tech Reporter. He was formerly a business reporter for the Philadelphia Inquirer and reported on New Jersey politics for the Observer and the Press of Atlantic City.
The founder and CEO of Italian battery manufacturer Italvolt announced plans today for a new $4 billion gigafactory in Southern California’s Imperial Valley that should produce enough batteries to supply 650,000 electric vehicles annually.
Italvolt CEO Lars Carlstrom said he’s formed a new company, Statevolt, that will build the 54-gigawatt-hours (GWh) facility with the help of Controlled Thermal Resources (CTR), a California-based lithium extraction company that will supply the factory’s lithium and geothermal power. Statevolt is still “undertaking due diligence” on the exact location of the facility, which should be “one of the largest” battery factories in North America upon completion, it said.
“The development of lithium-ion batteries is crucial for the U.S. to meet its goals to transition to net zero [carbon emissions],” Carlstrom said in a statement. “Today, we face a significant shortage in the amount of lithium that is required to meet the demand for electric vehicles.”
Carlstrom added that Statevolt’s partnership with CTR is “pioneering a new, hyper-local business model,” which said “will offer Statevolt a significant advantage in producing lithium-ion batteries at scale.” CTR will supply the gigafactory’s lithium from its nearby Hell’s Kitchen Lithium and Power development, which is slated for completion in 2023.
That would give the battery maker an advantage at a time when lithium prices have climbed due to a global supply chain squeeze exacerbated by Russia’s invasion of Ukraine, as well as growing demand for electric vehicles—and, in turn, lithium-ion batteries to power EVs.
Instead of traditional open-pit mining or evaporation ponds, CTR extracts lithium from geothermal brine—extremely hot, salty water located in abundance underneath the Imperial Valley’s Salton Sea. The brine is pumped to the surface and then purified to extract lithium-containing salts. CTR says the process, when done correctly, could have “near-zero” carbon emissions.
Kristin Snyder is an editorial intern for dot.la. She previously interned with Tiger Oak Media and led the arts section for UCLA’s Daily Bruin.
Libs of TikTok, a series of social media accounts that have gained popularity among conservative groups, is in the spotlight after a Washington Post report revealed the identity of the person behind them.
The Post reported Tuesday that Chaya Raichik, a former real estate salesperson, operates the account, which reposts TikTok videos and other social media content that is often critical of the LGBTQ community. Raichik previously utilized a number of profiles on various social media accounts to perpetuate conspiracy theories and QAnon rhetoric before reaching a wider audience with Libs of TikTok.
The publication’s decision to reveal Raichik’s identity has sparked a fierce backlash from conservatives on social media, who have accused the Post of “doxxing” Raichik—revealing her private information to shame her. Taylor Lorenz, the Post journalist who wrote the article, defended her work as an investigation into the account’s influence on right-wing media.
Created in April 2021, Libs of TikTok has millions of followers across mainstream platforms like Twitter, Instagram and YouTube as well as right-wing social media sites like Rumble, Gab and GETTR. According to the Post, the account frequently targets members of the LGBTQ community, labeling adults who discuss the topic of sexuality with children as “groomers” and “abusive.”
The account’s impact extends beyond social media. The Post reported that Florida Gov. Ron DeSantis’s press secretary was influenced by the account’s content in the lead-up to the state’s controversial “Don’t Say Gay” bill. Fox News also features content from the account—Raichik herself anonymously appeared on Tucker Carlson’s show last week—while popular podcast host Joe Rogan has cited it multiple times.
Ari Drennen, LGBTQ program director at media watchdog group Media Matters, told the Post that the account has become a news source for right-wing media and has “been shaping public policy in a real way.”
In the wake of the Post’s report, Libs of TikTok has posted and retweeted inflammatory comments about Lorenz, the article’s author. Conservative figures such as Donald Trump Jr. and Ben Shapiro also expressed their support for the account on Tuesday.
Concerns over social media’s role in spreading political misinformation have heightened in recent years, with platforms like TikTok having been used to spread propaganda supporting Russia’s invasion of Ukraine as well as conspiracy theories about President Joe Biden’s election.
Kristin Snyder is an editorial intern for dot.la. She previously interned with Tiger Oak Media and led the arts section for UCLA’s Daily Bruin.
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