The assets of Chicago-headquartered sync music licensing company Music Dealers, which suddenly went out of business last July owing countless global artists on its roster, have been acquired by BrandSpins of Las Vegas.
Exactly what those assets are was not described in the announcement made by BrandSpins’ CEO Billy Tuchscher, a music media entrepreneur who is also involved in various technology ventures. But they are presumed to be Music Dealers’ massive pre-cleared music catalog, which boasted being the world’s largest, with more than 180,000 songs by artists from 85 countries and continuing relationships with famous Fortune 100 brands.
These assets will be a big boost to two-year old BrandSpins, whose model includes the construction of “brand-customized” online digital stores for eCommerce sites and offers famous music artists for brand promotion, marketing campaigns and special appearances.
“We’re changing the world of music,” Tuchscher said about his company on his LinkedIn page.
Music Dealers was launched in 2008 in Chicago by cofounders CEO Eric Sheinkop, his brother, executive director Jonathan Sheinkop, and COO John Williamson, who all left the company before 2016.
It ultimately had a network of 18,000 musician / composers whose work was licensed to a client list of more than 40 TV networks and movie studios, 50 ad agencies and 200 brands that included McDonald’s, Disney, Budweiser, Sony, BMW. Nike, Visa, the Olympics Games, YouTube, broadcast and cable channels and many more.
In 2011, Coca-Cola brought a minority stake press-billboard-announces-music-dealers-and-coca-cola-partnership/ in Music Dealers for an undisclosed investment, to be its global music partner for all Coke brands, for an initial period of three years.
By 2015, Music Dealers had hit revenues of $15 million in licensing fees. With the company’s success came the opening of offices in Los Angeles and London and the addition of many new staffers. It was on Inc. 5000 List of Fastest Growing Media Companies.
This year, however, its fortunes suddenly changed. The company lost its biggest undisclosed client, said to be Coca-Cola, when in June it abruptly terminated its contract because they had changed how they were going to do business with music.
The loss “resulted in a significant impact on liquidity, future revenues, and the resignation of several key employees,” was noted in a letter sent to potential creditors.
Music Dealers was awash in debt of $9.93 million, due to several years of operating losses, overexpansion and unmet payments to untold numbers of artists.
In late July, Music Dealers filed for bankruptcy protection under Illinois law. At the time it said it would liquidate to pay debts “so far as possible.” The liquidation was offered by High Ridge Partners of Chicago. It was reported at the time by Digital Music News that “bits and pieces were essentially being auctioned off for any reasonable price.”
Now four months later, BrandSpins has picked up the pieces to add to its growing business. It has a catalog of 57 million digital songs, said Tuchscher, “and we’re building a music distribution business that helps artists to sell more music, become more famous and make more money.”
Sidebar: Eric Sheinkop is onto his next venture, the new online shopping list, desirelist, which he co-founded last August with Judith Snyder, a long-time executive with Music Dealers’ former partner Coca-Cola.
For a comprehensive story about Music Dealers’ demise, click here.
