Denis Ladegaillerie has had time to assume.
Within the months it took to orchestrate the complicated equipment required to take Consider non-public – by way of a joint consortium with TCV and EQT – the CEO has been observing. Analyzing. Drawing conclusions not nearly his personal $2 billion firm, however concerning the basic dynamics reshaping the worldwide music enterprise.
The outcome? A sequence of knowledgeable takes that problem standard knowledge at each flip.
On market construction: With 70% of report business revenues now coming from exterior the High 200 in most markets, Consider has constructed a complete enterprise philosophy round what Ladegaillerie calls “middle-first” pondering – basically completely different instruments, offers, and methods than these designed for celebrity economics.
On the Common/Downtown merger that’s presently exercising regulators and a few indie rivals? Ladegaillerie is relaxed.
“Do I believe that’s going to alter something for us? I can’t communicate for the business, however as an organization, we really feel excellent about our capacity to compete,” he says flatly.
The European Fee, he suggests, ought to maybe spend extra time pondering why algorithmic suggestions are creating an Anglo-American monoculture throughout non-charting streams in most EU markets.
“The primary problem for EU/UK lawmakers might not be the Downtown merger,” says Ladegaillerie. “It’s 28% of streams being from native artists within the UK, 36% in Germany, 41% in France.”
On the know-how that basically issues: Neglect AI panic (“marginal income alternative, marginal menace”). Ladegaillerie is much extra targeted on Spotify‘s Discovery Mode, which he claims Consider is utilizing “at a bigger scale than anybody else” – with 98% of tracks exhibiting constructive monetary returns.
Once I meet up with Ladegaillerie in London, Consider has simply accomplished its transition again to non-public possession, valued at round USD $2 billion.
The corporate that began in 2005 as a digital distribution pioneer now operates throughout 50+ international locations, serving everybody from bed room producers by way of TuneCore to established unbiased labels and artists searching for subtle advertising and marketing companies.
The timing of our dialog is especially revealing.
Whereas bigger rivals are saying substantial cost-cutting applications, Ladegaillerie says Consider’s headcount is rising. Whereas others fear about streaming saturation in mature markets, he sees “loads of progress” forward. And whereas segments of the enterprise obsess over consolidation and market focus, he’s quietly constructing a machine that thrives on the precise reverse rules.
“We’re in a brand new period of Consider,” he says, outlining a 10-year strategic plan dubbed “From Entry to Success”.
“The previous decade has basically been about leveraging know-how to democratize market entry, which is what we’ve seen with increasingly unbiased artists capturing market share. However entry doesn’t imply success,” he says.
“The years forward will probably be outlined by how, on this new panorama, report labels drive their artists to success. That’s concerning the high quality of the music, the manufacturing, the standard of [your] movies, and the way subtle you will be round all the digital viewers improvement levers.”
What emerges from our dialog isn’t simply Ladegaillerie’s pleasure over the way forward for the “center tier” or unbiased distribution. It’s a complete worldview about the place worth lies in trendy music — one which sees the business’s present evolution not as a menace to be managed, however as a chance to be seized…
What are the important thing priorities you’re taking a look at inside Consider’s ‘entry to success’ technique?
Primary: We’re going to proceed investing in scaling our artist companies enterprise. Previously three to 5 years, we’ve created 15 imprints — report labels like KithLabo in Indonesia, PLAYCODE in Japan, and All Night time Lengthy in France. We’re going to proceed doing this.
Precedence quantity two is accelerating, increasing, and deepening our label companies. As a result of the world is extra complicated than it as soon as was, as a result of our labels have to reduce by way of the noise with their artists, the extent of companies they require goes far past easy distribution and financing.
“We need to deepen our partnerships with the DSPs, whether or not it’s Spotify by way of Discovery Mode, Marquee, or Showcase, or TikTok, or YouTube.”
Now you even have to supply skilled strategic recommendation: What market alerts do you want [in order] to function? What kind of contract? How do you execute advertising and marketing?
Precedence three is scaling our publishing enterprise [following the acquisition of Sentric]. We’ve performed a whole lot of work constructing an answer that we expect is now a major aggressive benefit in assortment.
We additionally need to deepen our partnerships with the DSPs, whether or not it’s Spotify by way of Discovery Mode, Marquee, or Showcase, or TikTok, or YouTube. It’s all about placing these partnerships on the middle of monetizing catalog and creating artists. There’s a significantly better alignment that should occur within the subsequent 10 years with the DSPs.
Our fifth precedence is individuals. We have to upskill everybody, in learn how to do [more sophisticated] digital advertising and marketing, to ship higher worth to the artists and labels – and construct the instruments to make that occur. There’s a whole lot of work to do in constructing the software program that our inner groups use to serve their shoppers.
Geographically, the place are you focusing for progress?
We’re constructing on our present power in Europe and Asia after which making first-level investments in three particular areas: the US, the UK, and Japan – the world’s largest markets, the place we have now invested lower than we have now in different markets [to date].
In Japan, TuneCore Japan is already the third-largest participant by way of native market share. We’ve additionally signed a take care of Teichiku and some giant labels to distribution [deals], and we’ve launched the artist companies imprint PLAYCODE round hip-hop.
“We’re making first-level investments in three particular areas: the US, the UK, and Japan.”
Can we break the highest artists in the US and UK tomorrow, as we’ve performed in different territories? Sure, I’ve little doubt about that as a result of we have now all of the levers [required] on the Spotifys of the world, YouTube, TikTok.
Radio and tv at the moment are much less influential in these markets. It’s only a matter of time.
You’ve mentioned beforehand that you just felt there was a definite lack of acquisition alternatives within the UK at scale.
That’s appropriate. Our DNA as an organization is to assist the buildup of native ecosystems, so once I see that within the UK, native artists in 2024 represented simply 28% of streams – that’s a killer for me.
If the UK had the identical fee of native artists as you see within the US, Japan, or Brazil at 60-70%, you’d nearly triple the market measurement. Which means extra jobs, extra native labels, extra individuals. That offers you greater [domestic] firms, extra affect, and the flexibility to market.
“Once I see that within the UK, native artists in 2024 represented simply 28% of streams – that’s a killer for me.”
Individuals say it’s okay that the UK market is small as a result of it exports so much. However guess what – in some unspecified time in the future, in case your home market isn’t robust, your capacity to export turns into weaker; you’ve got a more durable time breaking artists domestically.
The UK must get away of that mindset. It’s good to strengthen your native market.
Earlier You talked about Consider’s use of Spotify Discovery Mode. It’s a platform that’s SPLIT OPINION within the enterprise, however presumably you see it as useful to democratization?
We’ve performed a whole lot of work with Spotify round this. I’m advised that we function Discovery Mode at a bigger scale than anybody else, extra profitably than anybody else.
Over 98% of the tracks we have now in this system have [provided] considerably constructive returns; that’s monetary returns, not simply progress of streams.
We transfer tons of of 1000’s of tracks each month out and in [of Discovery Mode], and that course of is only AI-driven. You must perceive how the system works to pick the proper tracks – it’s super-technical.
“Over 98% of the tracks we have now in Discovery Mode have considerably constructive returns; that’s monetary returns, not simply progress of streams.”
It’s a core driver for all of our labels globally. We predict we’re extra environment friendly than anybody at driving digital catalog revenues on Spotify, partially by way of Discovery Mode.
Discovery Mode’s limitation isn’t its capacity to drive revenues and discovery; it really works effectively. It’s its capacity to really assist new artist improvement, hanging the proper steadiness between catalog and frontline artists. That’s the dialogue we’re having with Spotify for the time being.
It seems to be to me such as you, TCV, and EQT every personal round a 3rd of the brand new, non-public Consider. How do you steadiness management, and past capital, what do they carry to the desk?
When it is advisable to increase financing capital to make acquisitions in music, you want buyers who’re sensible.
EQT has performed a whole lot of work round music—they checked out [a potential, pre-IPO] acquisition of Common a number of years in the past and are buyers in Epidemic Sound. TCV has been an investor in [Believe] since 2014 and can be an investor in Spotify and Netflix. They’re undoubtedly sensible.
The second secret is strategic alignment. Earlier than taking the corporate non-public, we did a whole lot of work to make sure everybody was aligned on the technique.
“On the general public market, Consider was considerably undervalued, which prevented us from elevating cash [at the right price] to make giant acquisitions. That’s now not a difficulty.”
The final aspect is that you really want shareholders who can deploy capital on the proper valuation. On the general public market, Consider was considerably undervalued, which prevented us from elevating cash [at the right price] to make giant acquisitions.
That’s now not a difficulty.
Your query about steadiness of energy is attention-grabbing. My view as a founder is it doesn’t matter whether or not you’ve got 10, 20, or 30 [percent ownership]. These non-public fairness funds make a enterprise out of supporting entrepreneurs and administration groups. So long as you might be aligned on technique and that technique means that you can create worth, you’re in management.
You begin shedding management the day you’re now not creating worth.
Are you grateful {that a} sure aggressive takeover try from Warner Music Group final yr in the end WENT AWAY?
Sure, we’re glad. I’m not anti-major; I believe unbiased labels will be served very effectively in a significant report label setup. The Orchard and Sony have demonstrated that very effectively.
However once we [mapped out] this new section of progress, I advised TCV we don’t need to promote to a strategic purchaser as a result of we expect there’s extra worth to be created right here. So we’re glad it didn’t occur.
I like Robert [Kyncl]. His staff is sensible, and there would have been some strategic worth [from a merger]. But it surely was not what we needed to do.
The place do you assume the following section of distribution and artist companies goes? Listening is turning into extra dispersed and superstardom is turning into more and more uncommon.
I used to be simply trying on the SNEP figures for H1 2025 in France.
We’re truly main the High 200 as the largest report label [by chart market share in France]. However the High 200 in France accounted for under 19.7% of the overall market by worth.
In most territories, the [Top 200] accounts for 25-30% of the market, which implies the [biggest] worth is actually within the ‘center’ – exterior of the highest chart.
“In H1 2025, the High 200 [tracks] in France accounted for under 19.7% of the overall market by worth.”
We’re a ‘middle-first’ firm. That’s our DNA – 70% of the [industry] revenues are within the center. We’ve been working in these segments for some time, and we all know how they work. I really feel actually good about our positioning.
However there’s additionally a chance for us to maneuver up and serve extra artists on the prime. You must construct a mannequin that gives the proper degree of service, with the proper offers which are completely different at every degree.
Consider has not historically served the ‘higher tier’ of artists. Three firms specifically would possibly say you’ll by no means be capable of provide what they provide – have a look at all of the individuals they’ve and the cash they will provide upfront. Are these dynamics altering?
I have to discover a higher phrase for this, however we thrive with ‘digital artists’. A ‘digital artist’ is only a common artist who creates music, besides the way in which that artist connects, interacts, and will get viewers discovery is digital.
That’s what’s opening up the chance for us [with charting artists] as a result of the market is turning into much less concentrated – it’s much less about radio, it’s much less about tv, it’s extra about partnerships with digital companions, digital advertising and marketing.
Due to that, we’re in a position to problem the standard labels on the prime now in a really completely different approach.
What about warding off the menace from the majors within the ‘center tier’, although? They’re reaching into your territory simply as you’re reaching into theirs.
Once we take into consideration how we construction offers with Spotify, YouTube, what instruments and companies we develop, we expect ‘middle-first’. That’s very completely different from main report labels – they assume ‘prime’ and ‘world prime’ first.
It implies that when main report labels function in that [‘middle’] market phase, after they do [artist deals] at a smaller scale, they don’t at all times know learn how to function with the proper economics, with the proper financial mannequin vs. the proper degree of service.
To some extent that creates confusion out there. Quite a lot of time, we see [megastar] artists being served by the groups on the prime with [label services] economics – the economics of the ‘center’, which we all know don’t make sense.
The truth that main labels at the moment are scaling their enterprise [into the middle tier] will pressure them to assume: What economics do I really need to realize right here? How a lot capital do I even need to deploy there versus the [top]?
For us, it’s good as a result of that course of is in the end going to make the market more healthy.
Sony lately confirmed that it OWNS MINORITY STAKES in round half of The Orchard’s prime 20 shoppers. What do you make of that pattern?
It’s sensible and really pure. We do the identical factor!
The labels we’ve seen develop the quickest [at Believe] are the labels the place the high quality of partnership is the very best – the place the extent of [collaboration] with the groups round technique, learn how to develop artists, what market segments to enter, has been the very best.
Once we can strike these partnerships which are actually shut from a industrial standpoint after which rework them into minority investments or majority investments, relying on the state of affairs, we will ship most worth and cement these relationships.
The proposed Common/Downtown merger is getting a whole lot of consideration in Europe, with the EC evaluating if it’s anti-competitive in any approach. The place do you stand on it as a contest problem?
I’ve two solutions.
My first reply by way of Europe, together with the UK, is that the primary problem [for EU/UK lawmakers] might not be the Downtown merger. It’s 28% of streams being from native artists within the UK, 36% in Germany, 41% in France.
What the authorities in Brussels or politicians ought to be taking a look at is that this: Europe is the largest market from a [music] publishing standpoint. There’s no motive why it shouldn’t be the biggest market from a recorded music standpoint. But it surely’s not.
“Do I believe [UMG buying Downtown] goes to alter something for us? I can’t communicate for the business, however as CEO of Consider, we really feel excellent about the place we stand and our capacity to compete.”
We should always have politicians targeted very strongly on: What situations do we have to create to enhance [Europe’s] place? How can we foster the event of a powerful native ecosystem? That’s way more highly effective.
Do I believe [UMG buying Downtown] goes to alter something for us?
I can’t communicate for the business, however as CEO of Consider, as an organization, we really feel excellent about our capacity to compete.
I believe that we will ship a superior high quality of service to our artists and labels.
To be 100% clear, in the event you get up tomorrow and Common has totally acquired Downtown, you’re not shedding any sleep?
As I mentioned, we really feel excellent about our capacity to compete.
You talked about market share points with native repertoire. I believed with the rise of unbiased hip-hop specifically, native language music was dominating greater than ever in European nations?
That’s the notion, not the truth.
Take a market like France. The primary market phase is local-artist hip-hop. However the quantity two market phase by way of revenues and streams? Worldwide pop. Quantity three? Worldwide rock. Quantity 4? Worldwide hip-hop. Quantity 5? French pop.
Now take into account that French pop is one-fifth the scale of the bigger market segments. So [in terms of the total French market] you’ve got round 60% of the streams which are worldwide music.
“Once more, have a look at the SNEP figures in France: The High 200 is 70% native artists. However as quickly as you go beneath the High 200 or High 500, you go from 70% native to 80% worldwide.”
In Germany, it’s the identical. You’ve gotten native hip-hop as the largest market phase, however that’s the one native phase you’ve got [amongst the most popular genres]. Schlager isn’t even within the prime 5.
Against this, while you have a look at China, Japan, Brazil, you see 60-70% of streams from native artists. That’s double the market alternative [for local artists] than we see in European international locations.
It’s tremendous essential for Europe to rebuild that – it’s instantly tied to employment, together with [tax] income and cultural affect.
Once more, have a look at the SNEP figures in France: The High 200 is 70% native artists. However as quickly as you go beneath the High 200 or High 500, you go from 70% native to 80% worldwide.
The highest artists are very effectively supported by the native DSPs throughout all territories. However the backside [sub-Top 200] is being pushed by algorithm-based advice, which isn’t as localized correctly. That’s what’s driving a whole lot of the Anglo-American content material.
What will be performed? Name up the EC and say: ‘Neglect UMG/Downtown, nobody cares. Put thresholds on streaming playlists for native artists!’?
I’m not calling for regulation. This isn’t about playlist quotas.
It’s so simple as asking the DSPs to publish, a few instances a yr: ‘I’ve delivered XYZ algorithmic suggestions. What number of had been native? What number of had been worldwide? To what market [genres]?’
The DSPs will then be capable of ask themselves questions. I believe they’ll need to develop into good residents of the world [by protecting local artists in their algorithms]. In my expertise, that may be sufficient to affect and transfer the difficulty by way of regular industrial and human incentives.
We’ve seen unspectacular progress in streaming subscriptions in H1 2025 in mature markets just like the US, Germany, and France. Do you’ve got any issues for the way forward for the enterprise?
With my Consider hat on, no. We’re positioned in a few of the fastest-growing markets. If we had been extra weighted to the US, UK, or Scandinavia, sure, I’d be extra involved as a result of paid streaming adoption is [growing] slower.
There’s loads of progress within the present markets for us as an organization, and the truth that a few of these giant markets are ‘new’ territories for us offers us loads of progress alternative.
I additionally assume there’s loads of progress potential in streaming pricing, each by way of segmentation, the ‘supremium’ tiers, and normal worth will increase.
There’s at all times a dialogue round AI music. Is there hazard coming from Suno/Udio/Anthropic and many others. or is that this going to be a novelty problem?
My tackle that is unchanged: marginal income alternative, marginal menace. All the knowledge I’ve checked out helps this.
Sure, there are increasingly AI tracks being distributed on the platforms. The newest knowledge from Deezer reveals 28% of tracks [being uploaded to the platform] are totally AI. However these tracks are solely producing 0.5% of complete streams.
“You possibly can produce as many gen-AI tracks as you need – if there’s not one thing distinctive about them, it’s not going to hit [meaningfully] into the revenues of artists.”
You possibly can produce as many gen-AI tracks as you need – if there’s not one thing distinctive about them, it’s not going to hit [meaningfully] into the revenues of artists.
I’m not too involved about it. I believe all the tech gamers have an curiosity in behaving correctly.
I’d be frightened if I believed Spotify or one other service was going to make use of this to decrease their content material prices. But it surely’s nearly inconceivable for them to do this as a result of their enterprise relies on working with artists.
Music Enterprise Worldwide has run quite a lot of headlines prior to now 12 months about cuts at bigger music firms. Is Consider transferring in the wrong way?
Sure, we’re investing. In 2024 there have been a number of international locations the place we made changes, however globally, our headcount continued rising. And it’s going to develop once more in 2025.
That’s being pushed by market progress. Now we have alternatives in publishing, so we’re hiring individuals on the publishing aspect. And as I mentioned, we’re constructing new label imprints because the markets develop into extra digital.
“Globally, our headcount continued rising in 2024. And it’s going to develop once more in 2025.”
The largest distinction between us and the foremost report firms is that the Consider mannequin was created initially as a world mannequin. Our accounting, authorized, monetary groups – all of our tech methods – are already totally built-in and streamlined.
Main labels had been constructed as basically monetary holding firms of native companies, at a time when CD manufacturing logistics had been principally native. They haven’t but performed the transfer of actually streamlining their companies [to be global]. In addition they haven’t totally addressed: What’s being generated by catalog? What’s the actual profitability of my frontline label? What ought to the steadiness be?
While you’re rising actually quick, you’ll be able to cover that. While you develop slower, it’s way more tough.
Common is suing you within the US; the primary allegation is that a considerable amount of uploads by way of TuneCore have infringed copyright. Do you’ve got an replace on that state of affairs?
We don’t touch upon pending litigation. [Believe has previously said it “strongly refutes” UMG’s claims, and “will fight them”.]
If I might provide you with a magic wand to alter one factor concerning the music business right this moment, what would you alter?
I’ve been anticipating this query.
The report business already has the magic wand in its hand. We’re already shaping the way forward for music – we’re shaping it once we’re having conversations with Spotify, YouTube, and others.
Now we have sufficient affect collectively as an business to have the ability to guarantee that the way in which these applied sciences are being rolled out will probably be in a approach that creates worth.Music Enterprise Worldwide
