Trailblazers is an MBW interview series that turns the spotlight on music entrepreneurs with the potential to become the global business power players of tomorrow. This time, we meet Robb McDaniels, CEO of Beatport. Trailblazers is supported by TuneCore.
Beatport was in a precarious position when Robb McDaniels took the helm in 2017.
Its parent company, SFX Entertainment, had just emerged from bankruptcy proceedings, and the electronic music industry was entering a period of significant transformation with streaming services disrupting traditional revenue models.
Over seven years later, with McDaniels still at the wheel, Beatport is claiming continued and impressive growth: mid-to-high teens revenue increases in 2024, with streaming subscription product growth increasing by more than 30% – “about twice the industry average,” according to McDaniels.
Even more remarkably, the company reports that downloads continue to grow at a 5-10% annual rate, bucking the global industry trend.
“It might be the only place on the planet where this is happening,” McDaniels tells MBW.
Prior to joining Beatport, McDaniels founded Ingrooves Music Group in 2002, pioneering digital distribution long before it became the industry standard.
During his 13-year tenure as CEO, he grew the company substantially, securing a crucial partnership with Universal Music Group in 2008 (UMG would later acquire Ingrooves in 2019, with the company now forming part of Virgin Music Group).
After departing Ingrooves in 2014, McDaniels launched Faction, a technology-driven management company aimed at disrupting the talent industry. He candidly describes the venture as “like getting yellow cab drivers to switch to Uber”.
“So I pivoted to taking the helm at Beatport in 2017 just after the bankruptcy of their parent company, SFX Entertainment,” he says. “The fun ride continues!”
Today, McDaniels is focused on positioning Beatport for the future, envisioning a broader role for DJing in music consumption.
“I believe that the overall music experience for consumers is moving from a lean-back, passive one to a more interactive and immersive one, and that DJing is one of the ways the consumers will start to ‘play’ with music,” he explains.
This vision has implications beyond electronic music.
As McDaniels puts it: “While not everyone can become a touring DJ, many more consumers will start to learn how fun and social DJing can be, and so we’ll see a much larger addressable market.”
He adds: “I want Beatport to serve DJs of all types and sizes – from the hobbyist to professional. I also want to ensure it’s not just about electronic music, but music of all genres.
“If you change the traditional definition of dance music to music that simply makes people dance, it is actually more than 80% of the industry. That’s a big opportunity for us.”
Below, McDaniels tells MBW about Beatport’s business model evolution, its growth strategy, and that the company pays streaming rates that are “25x what Spotify pays” – all while explaining why, in 2025, downloads remain crucial to professional DJs…
How is Beatport positioned in the global music business today?
For more than two decades, Beatport has distinguished itself as the home for DJ culture and this is what has allowed us to stay competitive against the biggest companies in the world.
“We are deeply grateful for the harmonious relationship we have with the global DJ community, and take our role very seriously.”
DJs buy and sell their music on our platform, and Beatport has become the best barometer for their success as a DJ, producer and even label owner.
We are deeply grateful for the harmonious relationship we have with the global DJ community, and take our role very seriously. We know we are critical to the ecosystem and want to make sure that we are providing great tools and services, even as a relatively small independent company.
How has Beatport adapted its business model in recent years to stay relevant and thrive in the music industry?
I think the most important thing is what we haven’t changed: our focus on the DJ as the customer. That said, we have introduced new tools and services to increase our overall value proposition to this unique customer.
This includes a patented streaming integration with DJ software and hardware to customers can have that playlisting experience with access to millions of songs for a subscription fee, the creation of the Hype Promo Program for smaller labels to get visibility on the store, the acquisition of Label Radar to help labels manage the demo submission and remix sourcing processes, and a distribution offering through Beatport Amp to help labels reach more traditional digital retail outlets.
What trends are you seeing in the market that we should know about?
Well, other than the aforementioned trend to a more active music experience, we are seeing an amazing amount of new sounds and music coming from emerging markets like South Africa, Latin America, and the MENA region and it is really energizing producers, DJs, and fans.
We are also seeing more flexibility from our label and publishing partners to license new models and use cases for their repertoire, which is always a welcomed evolution.
What are the biggest challenges Beatport faces in the music industry today?
When I started out in the industry in 2002, the greatest challenge was competing with free, and that’s still a big problem. For some reason, there’s a segment of consumers that believe they are entitled to steal someone else’s creative work without proper compensation, and there are governments that allow this to happen. It boggles my mind why someone who obviously appreciates creative work, also exploits it unfairly at the same time. We are left to do all we can to build better products to compete with free, and we’ll continue to do that to the best of our ability.
Where do you see the most significant opportunities for growth and innovation?
We are focused on two primary areas: emerging market expansion and more interactive music experiences to draw more people into the DJ ecosystem.
Beatport reported last March that its revenue had tripled in the prior six years. What were the key factors driving this growth?
We have invested a lot into our infrastructure, new product development (like streaming integrations), global expansion, and more IRL engagement with the DJ community through our Beatport Connect and Community events and our 2023 acquisition of the IMS conference (which takes place each April in Ibiza and now each November in Dubai).
But perhaps more than anything, we have invested in our great team at Beatport and they are incredibly passionate about the work they do every day. This has been the foundation of our growth since I arrived.
It was also reported last year that Beatport generated $100m in 2023. Could you give us an update on the company’s revenue figure for 2024 and projected revenues for 2025?
The business continued to grow in 2024 and we saw mid-high teens revenue increases. This was led by the growth in our streaming subscription products that grew over 30% in 2024, or about twice the industry average.
We also pay a per-stream rate that is 25x what Spotify pays, so you can see the impact of a more immersive and active music experience for consumers.
Could you give us an update on any other stats, for example annual downloads etc?
Yes, believe it or not, downloads continue to grow at a 5-10% rate each year for us. It might be the only place on the planet where this is happening and illustrates the unique characteristics of our DJ customer.
At the end of the day, many performing DJs want to own the music in high quality either for their collection or to remake it in their own style.
There are various strands of the Beatport Group network from streaming to distribution. Where are you seeing the biggest growth across the wider Group?
Since my arrival at Beatport, we have systematically built a complete ecosystem around dance music, one which serves artists and DJs, the industry and, of course, the fans. It’s clearly working, as seen with our consistent streaming growth and the download business.
The distribution and label services products are also growing north of 20% per year and we think there is lots of room for more upside. Our Producer Group, which includes Loopmasters, Loopcloud, and Plugin Boutique, had a solid year in what was otherwise a very challenging time for companies in that segment of the industry as everything rebalances post Covid (can’t believe we are still talking about that!).
What are your predictions for the future of the electronic music business?
We are at the beginning of a very exciting chapter for electronic music and DJing worldwide. As everyone unlocks their inner creative potential, DJing and producing will become even more popular and the rising tide will lift all boats!
Our internal analysis of a Beatport download traces the ongoing public performances of that song and all the additional royalty value it generates, and it’s at least $40 per download.
This is just a very unique element to Djing and the positive impact of electronic music.
If there was one thing you could change about the music business, what would it be and why?
There has got to be an easier, more efficient way to license repertoire and fairly compensate everyone in the value chain. Oh wait, there is a type of chain where this can happen…the blockchain! Now look at what can of worms I have opened…
Trailblazers is supported by TuneCore. TuneCore provides self-releasing artists with technology and services across distribution, publishing administration, and a range of promotional services. TuneCore is part of Believe.Music ComeOn
