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Google Makes Another Media Bet, With a Venture Investment in Music Publishing

Kobalt raises $60 million; Michael Dell is in, too.

Peter Kafka covers media and technology, and their intersection, at Vox. Many of his stories can be found in his Kafka on Media newsletter, and he also hosts the Recode Media podcast.

Google used to steer clear of the content business. Back when Google was a search engine and not much more, the company pointed Web users to other people’s content, and left it at that.

That has changed over the years, as Google has become a content investor and a content retailer.

But I think it’s still interesting to note when Larry Page puts money in the media business, so here you go: Google’s venture arm is leading a $60 million funding round in Kobalt, a music publisher that has grown rapidly in the past few years. The rest of the round comes from entities controlled by Dell founder Michael Dell.

Kobalt isn’t a media company in the traditional sense, since it doesn’t sell a product to consumers. Instead, it represents songwriters and other people who own music publishing rights, and helps them collect fees from a variety of outlets.

Kobalt’s pitch is that it does a particularly good job navigating all the new digital outlets that have cropped up, and that it provides song owners with a much more accurate and transparent view of the way their assets are performing. The company says it works with more than 8,000 songwriters, from Paul McCartney to Skrillex, and says that on average it represents the owners of 40 percent of the top 100 songs in the U.S. and the U.K.

Since one of the new digital outlets that song owners need to keep track of is Google’s YouTube, which leans heavily on music videos, it seems like Kobalt might expect that the investment will make it easier to work with Google’s video site. Which is what Kobalt CEO Willard Ahdritz says: “It’s very clear that it would be helpful with YouTube.”

But Bill Maris, Google Ventures’ managing partner, says any connection will be at arm’s length, and that the deal isn’t supposed to be a strategic one for Google. He says the investment is more likely to help Kobalt by letting people at Google know that Kobalt exists, because “not a lot of people know about Kobalt, and I think it will help get them excited. We think it will separate signal from noise for Googlers.”

Kobalt had previously raised $66 million; Ahdritz says a small portion of the current round represents secondary sales by investors who backed the company in 2001.

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