3LAU's Royal raises $55 Million for the Royal Music Royalty Platform
Silicon Valley's Andreessen Horowitz (a16z) led the fundraising round, which included investments by electronic duo The Chainsmokers, Kygo, Joyner Lucas, Disclosure, and influential rapper-entrepreneur Nas.
3LAU's project, Royal, is a platform that apportions song royalty rights and offers them as crypto tokens, available for anyone to purchase and trade. The platform is an alternative way to generate money outside the traditional major label system.
While artists can't use Royal to raise funds for unreleased songs, 3LAU said it allows fans to participate in one essential facet of the music business—distribution.
Powered by NFTs, Royal enables the distributed collection of royalties from the blockchain and essentially delivers them as real-world profit through crypto, monetizing the music cycle.
Royal's infrastructure is composed of Limited Digital Assets, called LDAs.
An artist will decide how much of their royalty share they'll reserve for LDA investors and how many individual pieces of content they'll mint for a release.
Then, the LDA tokens are minted and sold through the platform, generating cash for the artist and future passive income for song holders.
"Most agreements in the legacy music world are really just sheets of paper. There are payment issues frequently, discrepancies of rights registration with third party collection agencies, and a boat load of problems that blockchains can solve," said the artist in a medium post.
"In the future, artists will be able to use Royal's contract architecture to assign all kinds of rights, but we felt an easy first step was focusing on streaming rights, a category that is directly influenced by listeners & easily accounted for."
Whether or not Royal will shape the future of music assets on the blockchain remains to be seen, but what can be said is that the latest round of funding will undoubtedly aid the project's framework and development in building the new future of music ownership.