Earlier this year, rap sensation Iggy Azalea became the first artist since the Beatles to secure the No. 1 and No. 2 spots on the Billboard Hot 100 simultaneously with her first two charting singles. That was no surprise to Next Big Sound, which had Azalea on its end-of-2013 list of artists most likely to hit the Billboard Hot 100 in 2014.
In collecting data from more than 15 social media sources, Next Big Sound has given the slumping music industry a vital new tool to understand how "these social signals relate to the underlying business," says Alex White, who founded New York-based Next Big Sound with his Northwestern University classmates Samir Rayani and David Hoffman.
The trio's original vision for the company was quite different; they wanted to create a fantasy music league in which participants could build their ideal record label. That concept got them accepted to the Techstars accelerator in 2009, but on the first day in the program, they realized their objective wasn't sustainable. It did have its merits, however. "What had gotten us really excited about the [fantasy league] was the data and what we could do with it," White explains. So with Techstars' guidance, the three shifted gears and created a business app to measure fans' engagement around their favorite acts.
"We realized consumers were voting on who they liked on Facebook, YouTube, Twitter, Soundcloud, Rdio, etc.," White says. "If we could add up all these interactions, we could, on a global scale, really understand which artists were going to become popular."
After making a number of smaller deals for use of its data, Next Big Sound reached a turning point in 2010, when it linked with Billboard to compile data for the magazine's Social 50 chart, which ranks artists' popularity using a variety of metrics, including Instagram and Wikipedia views. "Each deal was a step in credibility, so we weren't fighting to justify to the industry why they should be paying attention to these new numbers," White says. "The deal with Billboard was huge."
In 2012, Next Big Sound raised $6.5 million in Series A funding, led by IA Ventures and Foundry Group.
Fast-forward to the first half of 2014, and Next Big Sound was following more than 1 million acts and tracking 3.3 billion fan-to-band connections, slicing and dicing the data to help labels determine which social interactions are leading indicators for ticket, merchandise and download sales.
More recently, the company partnered with Spotify to provide information for the streaming service's artist dashboards; with YouTube to collect detection data; and with Tribune-owned digital music data service Gracenote to incorporate Next Big Sound's social media analytics.
Next Big Sound is now tackling the publishing industry in a similar way--it launched Next Big Book in May. White expects the company to eventually track movies and video games as well. "Each industry will wrestle with the change in fragmentation and consumption and needs to understand how these new data sources tie to their core business," he says. "Our technologies set us up nicely to support [them], as each needs that data to navigate an increasingly complicated world."