Andy wrote about our investment in Sofar yesterday on the USV blog.

That is our practice. We publish our investment rationale on our blog every time we make an investment. It creates a permanent record of why we made the investment. It is interesting to go back and read them five or ten years later, regardless of whether they worked out or not.

Sofar is a company we have been following for seven years. We have been intrigued by this global community that has been building around the themes of meeting others in the real world, a shared love of music, and intimate spaces (often personal homes).

The Sofar community is large and sprawling.

The scale of the Sofar community, to us, is an example of “unspoken” value that Sofar has created for over one million people in 430 cities across 65 countries including London, Paris, New York, Sydney, Bangalore, Buenos Aires, Cape Town, and Seoul. In fact, more people will attend a Sofar in 2019 than will attend Bonnaroo, Glastonbury, and Coachella combined (also, 13 Sofar artists are playing at Coachella this year).

I just took a look at Sofar to see what events are happening in NYC in the coming weeks:

You can see the Sofars in the coming weeks near you by going here.

Sofar reminds me of our investment in Meetup, which we made twelve years ago. As Scott Heiferman, the founder of Meetup likes to say “use the internet to get off the internet.”

Sofar adds the element of music, performance, and intimate spaces. Andy describes all of this as the “Sofar container”:

Each Sofar has a few known constraints that make the show feel familiar: it will be in a unique space where you wouldn’t expect to see live music, an MC with a loose script will encourage you to get to know your neighbors, three performers will each play three to four songs, the address will only be revealed a day before the show, and the show will end early, by around 10:30 pm. This is what we call “the Sofar container”. The natural outcomes of the container are less tangible; for example, you will hear great music, you will feel safe and comfortable, you might make a new friend or you can attend solo, you won’t be judged. By bringing people together and creating spaces where music matters, Sofar broadens access to well-being – a core part of our investment thesis.
The beauty of creating a simple container, with known constraints, is that what goes into the container is dynamic. You don’t know who the artists are, who you’ll be sitting next to or what the venue will be like, but we believe that the essence of Sofar lies in trusting the container.

At USV, we are drawn to bottom-up networks instead of top-down centralized services; Etsy not Amazon, SoundCloud not Spotify, Wattpad not Kindle, Crypto not Fiat, and now Sofar not LiveNation.

I am excited that we finally found our way into the inside of this company/movement/experience. It feels so USV to me.


Comments (Archived):

  1. William Mougayar

    You left out, OpenBazaar not eBay ;).

  2. sigmaalgebra

    ForAt USV, we are drawn to bottom-up networks instead of top-downcentralized services; Etsy not Amazon, SoundCloud not Spotify, Wattpadnot Kindle, Crypto not Fiat, and now Sofar not LiveNation.I am excited that we finally found our way into the inside of this company/movement/experience. It feels so USV to me.Gee, sometimes learn something new! To me, that’s a very new way to evaluate projects! I’ll try to understand that way, but so far it makes no sense to me!

    1. Matt A. Myers

      Re:”Crypto not Fiat”I’m confused how @fredwilson:disqus thinks fiat is top-down? Currency was formed by governments, governments are formed by the people – voted in by people – and the same bad actors that try to influence government, fiat, and markets are certainly at play in the cryptocurrency world.Not sure how he can disconnect that logic.

      1. pointsnfigures

        Fiat-managed by a centralized authority, and backed by a centralized authority

        1. Matt A. Myers

          And we vote in that central authority – that our public is undereducated, under engaged – though Trump-Russia is exposing the west reminding us of tyranny and its ruthless, heartless tactics, is waking us up again – is a separate issue. Ignoring logic to make an argument isn’t reason, reasoning, reasonable; regulatory capture is a problem too leading to being badly managed – there are possible solutions to prevent gaming of these systems between nations and greedy individuals manipulating for-profit – however a Ponzi-Pyramid scheme structure isn’t required for that — it certainly has the most support, exposure, has traction due to the growing army of HODLers though.That it’s believed there won’t need to be centralized authority to oversee decentralized transactional platform for money is propaganda, misinformation being perpetuated – and by those incentivized, the army of HODLers, who will financially gain by these unchecked systems. There are bad actors and we need to – and by not having oversight then supporters are ignorantly and blissfully, blindly supporting the actions of bad actors.

      2. Girish Mehta

        I don’t think Fred meant top-down or bottom up in that manner. What he means is centralized vs decentralized.

      3. Richard

        Crypto on the brain

  3. Angel L.

    Congratulations on your investment in Sofar. I am a firm believer that technology should be used as an enabler to build, connect, and cultivate networks of people but real world experiences is what we should strive for and not just LIKES. I am following the same model with FinTech Connector. Maybe in 7 years or less we will be on your radar.

  4. Matt A. Myers

    TechCrunch did a piece that didn’t make it look like this was net positive for most bands? I can imagine the breakout successes it benefits – however not the majority if they’re not being paid reasonably to begin with. Any clarity available on this?”Tired of noisy music venues where you can hardly see the stage? Sofar Sounds puts on concerts in people’s living rooms where fans pay $15 to $30 to sit silently on the floor and truly listen. Nearly 1 million guests have attended Sofar’s more than 20,000 gigs. Having attended a half dozen of the shows, I can say they’re blissful…unless you’re a musician to pay a living. In some cases, Sofar pays just $100 per band for a 25 minute set, which can work out to just $8 per musician per hour or less. Hosts get nothing, and Sofar keeps the rest, which can range from $1100 to $1600 or more per gig — many times what each performer takes home. The argument was that bands got exposure, and it was a tiny startup far from profitability.” –

    1. Lance

      Congratulations! I’ve hung around professional musicians my entire adult life, and can say this from experience – the opportunity to play their original music to strangers, and not cannibalize their regular paying gigs, would be a net positive for many, pay notwithstanding. I know plenty of jazz musicians who are at the absolute top of their craft, that regularly play for $50-$150/night for a 4 hour gig, and in places where the audience is barely listening. This would be refreshing for many of them and I’m sure for anyone looking to expose themselves to a new global audience. So much talent, so few places to play. That’s the reality. Sofar is fantastic.

      1. Donna Brewington White

        Also know a lot of musicians. Always surprises me how little pay they will sometimes play for, for the love of the art. Some see it as a way of giving.Maybe it’s the circle I’m in, but sometimes the most successful are the most humble.

    2. zelebob

      A lot of so called musicians on sofar gigs are ridiculous copycats. Even 100$ for them is too much!

  5. Joe Lazarus

    I don’t know much about their business, but this is one of my favorite USV investments “so far”, if for no other reason than I love live music and I know you and Andy do too. Congrats!

  6. pointsnfigures… Bummer, no events in NOLA where I am headed today. I wonder if in smaller towns like NOLA (pop 326k) where there are a lot of musicians playing in lots of clubs Sofar doesn’t work as well? Pretty clear NOLA has one of the best music scenes in the US. Whereas a city like Austin or Nashville with thriving music scenes have more people.

  7. jason wright

    if it gets people off the sofa…all well and good.n.b. i’d never heard of Sofar before reading this post.

  8. Jeremy Shatan

    As a lover of live music, I’ve been following Sofar for a while – mostly for FOMO purposes, LOL, but I hope to get to a show soon!

  9. awaldstein

    too cool honestly.seems right on so many levels at first glance.small group live music as someone who grew up in the tiny club, pre-stadium, pre-theatre era in NY, and who worked with a tiny cooperative venue while an undergrad in the midwest, this is quite delectable.

  10. aminTorres

    Not making the same mistake twice. Re: airbnb 😉

  11. Vasudev Ram

    Just checked out one for India, and it was quite good, both the singing and the guitar:…Thanks for sharing, Fred.

    1. Girish Mehta

      Much musical talent in India. Listen to this lady sing (apparently at her brother’s wedding).…p.s. If you don’t have 6 minutes, check out the end starting at 5:23 mark.

      1. Vasudev Ram

        Will check it out, thanks!

      2. Vasudev Ram

        Checked it, was good.

  12. Salt Shaker

    This is so cool on so many levels. What a great way to meet like-minded individuals and create local artist exposure in an intimate setting. Being a home host admittedly seems a little weird and intrusive, but I love the social and exclusivity aspect of the platform.

  13. Richard

    Feels a little early part of the decade and your investment in home dinner parties / chefs.

  14. Billy

    probably a 3-4x return investment. Not a big total addressable market that doesn’t add significant value to the world. Seems like a niche, “pet” investment…

    1. fredwilson

      These comments also are permanent and fun to go back and read five to ten years later

      1. JohnExley

        If you believe music is the world’s shared language, then Sofar could start to look like an IRL communications network.The upper bound of Sofar’s potential could be even greater than the opportunity represented by unseating LiveNation’s incumbency… instead, I wonder if Sofar could become the analog answer to what disrupts the dominant holding company of digital social networks: Facebook.That TAM is certainly the inverse of “niche”.

      2. Billy

        Boomers gonna boom…

    2. Matt A. Myers

      It depends on if competition forms with an equally strong and transitioning network due to primarily less value extraction, more going to the artist and/or venue.

  15. Donna Brewington White

    Can sense the excitement.What a cool concept and yes so very USV. The fun side.Congratulations!

  16. Jeffrey Warshauer

    So pleased to read about this investment. I hope the consumer pendulum will swing from festivals back to these small intimate experiences. I can envision an expansion of this model supporting an explosion of culture that has been homogenized by entrenched big business.

  17. Francesco Barbera

    What a cool company – kudos for supporting this wonderful vision

  18. Banet

    Great idea but for a company that’s been around seven years I can’t believe how broken their homepage is.If I type in “Brooklyn” or “New York City” they tell me they’re “not in my city yet.” The only know of “NYC”. (But they don’t know if LA or SF — for those cities you have to spell it out.)I mean, c’mon… this is pretty basic. I hope they’re spending some of your money on a product person. 🙂

  19. vanessaliu

    I’m so excited to see USV behind Sofar. I went to my first Sofar event in 2012, and have gone to many since. And it’s a family affair – my husband is on the Virgin Group team :). Congrats!

  20. Salt Shaker

    This is such a cool concept, though I share your concerns about artist exploitation. Wonder if there’s a way to model this so artists are compensated a bit more when there’s a sell out and/or if/when they get booked for a subsequent (and even additional) Sofar gigs. Artist compensation is then performance based (pardon the double entendre, as applicable as it may be.) Not sure what % of artists do repeat performances, but it’s easy to see how a relatively unknown up and coming artist can benefit by building a local in-market following, which is pretty hard to do. The artist ultimately determines the value prop by participating, with really no downside risk.

  21. Vasudev Ram

    Yes, I had not read up on the artist comp – my comment about a performance in India was only about the quality of the music. Thanks for pointing out all that. Thinking about it …

  22. Lawrence Brass

    The gig economy will get better when the players burn all the VC “grow stage” cash and begin to compete. Not the same but the cab apps around here (Uber, Cabify + Easy) are cutting now 25% aprox. from the historic price of the rides. Makes them so soft targets. They are killing the cow.What’s the average cut for the bands on live performances?What I like about Sofar is that is seems to create new spaces or reinvigorate existing ones, lowering the barrier of entry.

  23. Regina

    Valid point. Does the Groupmuse model do it better? (It’s focus is classical music.) I’m a Groupmuse member, and we’re encouraged to pay the artist directly at their performances or send them something via PayPal or Venmo.

  24. Mike

    Very very cool business concept. Fom an investment perspective this answers one of my initial questions on the unit economics and margin dollars per event. If they are able to keep a significant portion of the event revenues vs, artist, venue costs etc., and can scale the event model, then quite interesting. It seems that they are able to do this. Musicianship is a tough business but the market works like any other, supply and demand.

  25. Lawrence Brass

    Must be cool seeing Willie Nelson around. Love his songs.