Rock’n’scroll
Interview | Boyd Farrow Dutch entrepreneur Martijn Tjho hopes that his revolutionary software programme for the music business will prove a sound springboard for international success WITH HIS PEACE-love-andunderstanding vibe, his fullstrength Marlboros and his artfully mussed hair, Martijn Tjho gives the impression that he really, really wants to be a rock star. However, the 33-year-old Dutchman has developed a [...]
Interview | Boyd Farrow
Dutch entrepreneur Martijn Tjho hopes that his revolutionary software programme for
the music business will prove a sound springboard for international success
WITH HIS PEACE-love-andunderstanding vibe, his fullstrength Marlboros and his
artfully mussed hair, Martijn Tjho gives the impression that he really, really wants to
be a rock star. However, the 33-year-old Dutchman has developed a software programme for the music industry
that may turn him into a major technology star instead.
Tjho, a self-confessed geek, has made business-tobusiness
supply chain management sexy enough to excite
the leather-trouser brigade. Through his Amsterdam-based
outfit Independent IP (IIP), he has launched a
digital platform that every record label
can use to store its entire catalogue
in one virtual warehouse. Simply put, Tjho’s proprietary
software, Fuga, can then manage, license, move and track
music anywhere in the world on behalf of its rights’ holders.
Just a few of clicks on their laptops and record label
executives can find out which of their artists are selling well or
badly, in almost real time, and in what territories. It can make
sure that distribution of back catalogues is in place via iTunes
or another cyber-retailer when a band is on tour. And, as well
as enabling the storage of millions of files, Fuga, says Tjho, can
convert media formats with professional quality.
“So far, eight major companies have signed licence
agreements,” he reveals. “And we are converting fast now
– around four new contracts a week. We can revolutionise
digital music distribution by connecting and empowering
the music industry in the most effective manner,” he
claims. “We can manage their entire supply chain and
never lose control over their digital assets.”
Sitting in the bar of Amsterdam’s most expensive hotel,
the not yet quite completed Grand Amrath, Tjho – whose
father was a hotel entrepreneur before founding a charity for
drug addicts – has strong opinions on the furnishings. It soon
transpires he has strong opinions on everything,
not least the music industry’s business model.
“Songs should debut as ringtones for mobile
phones, then they should be downloaded,
then finally released as CDs”, he sighs. “The
music industry business model should be: hear,
like, buy, in that order. But the record companies
get it wrong most of the time.”
Tjho is convinced that the timing is
perfect for Fuga, which has raised
€1.6m (£1.15m) in two funding
rounds from Dutch and Chinese-
Singaporean investors and is
now being dangled in front of venture
capitalists. “The music industry is everything that
involves recording, touring, television, merchandising,
etc,” he explains. “When people say the music industry is
in decline, what they actually mean is that CD sales are in
decline. CD sales are collapsing by 25% a year but digital
sales are slower than they should be because of the difficulty
in getting music online. New companies start every day
– there are 25,000 digital music services – yet only 10% of
revenues are from digital sales. In 2010 digital music will take
off and revenue will account for more than 25%.”
This, he says, puts IIP in a terrific position. “We will free up
record companies to concentrate on finding and signing new
talent and leave us to convert formats and independently
manage sales and distribution. Look at Radiohead, who have
just released their new album online themselves. They can’t
tour 365 days a year – they need to get paid and we can
handle licensing and royalty collections.”
Tjho says Fuga can earn money by taking between 2%
and 10.5% of revenues from smaller labels and charging a
licence fee for larger ones. “We can be the global standard
for digital content.”
Although he could still pass for a student, Tjho has
racked up more than 14 years of experience in technology,
interactive and entertainment industries – with varying
levels of success. In 2001 he launched mobile gaming
company Overloaded Pocket Media, which was acquired
by Dutch entertainment powerhouse Endemol two years
later. Tjho ran Overloaded for two more years, trying to
drive up business and develop product, but he laments that
the market was not ready for mobile games.
The transition from “buying bespoke suits and flying
business class” to starting out and hustling all over again has
been good for him, he reckons. “That is why I have waited
five years, working with the record industry, before I launched
Fuga. There is no way I wanted to be too early again.”
Now is crunch time for IIP he acknowledges, as the
company ramps up from being R&D focused and
attempts to become marketing and sales focused.
Tjho forecasts that in 10 months IIP will be able to
convert all labels into paying customers. “In the third
quarter of 2008 we will be cash neutral. This is a big
challenge but it is doable. In future we will be able to
expand the system to handle videos, then games.”
While passionate about Fuga: “We want to be an
independent link between the intellectual property owner
and the distributor,” Tjho is also committed to his other
business interests. He manages two of Holland’s biggest
musical and TV artists, Ruben Nicolai and Sophie Hilbrand
– who are both long-time friends – and is hatching plans
for a members’ club for the creative industries in central
Amsterdam. He would like this to be in partnership with
Nick Jones, the British entrepreneur behind the Soho
House private club empire, who is planning a European
network. “Amsterdam would be perfect,” he believes.
“I have the right property. There are so many creative
people here and everyone knows each other anyway.”
Tjho says his business and life philosophy are the same:
“We have to add value onto whatever we do. That’s the
essence of capitalism and too many people have lost that.
Surely that’s why people go into the music business?”
Visit www.independentip.com
for more information.
