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Selection to showcase its 'social commerce' platform at MIDEM in late January is a big deal for Wellington Internet start up MusicHype.

MusicHype has spent the past year perfecting its business model, which reward fans for support and interest in a band through conversations they have across various social media platforms such as Facebook and Twitter.

In turn, through exclusive deals with the bands themselves, fans are able to use MusicHype's online shop to purchase concert tickets, digital downloads, USB and vinyl recordings, and T-shirts and other merchandise related to the band.

A recent campaign example was allowing fans to select, and talk to each other through social media, about their favourite Crowded House live song from a recent American tour. The most popular songs were put onto a USB memory stick, only available through the MusicHype online store.

MH is one of only 30 music related digital companies invited to MIDEM. Mitchell is to pitch to MIDEM's live audience, as well as a panel of international judges. The six day event attracts over 7,000 delegates, across 60 pavilions, with 120 conferences, 3,200 companies and over 400 journalists.

Having tested and tweaked its model in the New Zealand market, now's the right time to scale globally says managing director, Jeff Mitchell.

"Our platform and widgets and tools allow us to pull band campaigns together quickly," he says.

MusicHype's connections with merchandise partners (such as producers of USB sticks and T-shirts) mean that a warehouse of products doesn't have to be provided. Billing and shipping can be carried out seamlessly.

Once a campaign starts running, to all extents it runs on autopilot. "We turn it on, and then let the fans run it," he says. "For the past two months, we've had six overlapping campaigns. The reason we can do it is because everything's pre-built, and run through 'The Appreciation Engine'." (See previous sticK explanation of the company's 'secret sauce' here)

Naturally, MusicHype's been talking to some senior music industry people, "all of whom can see the potential of our idea," says Mitchell.

The company's already generating significant revenue, with Mitchell being absolutely clear in his mind that the business model "has to be about revenue."

Feelgood experiences may be good, "but there's a middle space where a band's fans are happy and prepared to pay, and the band gets the exposure it needs and also gets paid."

To get to scale, MH needs to get to the U.S.A and European markets - the places with volume. This is where exposure at MIDEM could provide a valuable leg up to those markets.

MusicHype would like to develop relationships with some high tier bands and run campaigns in conjunction with them.

The company's open to its long-term options, which could be being acquired by a large new media body, setting up an IPO, sale to a large distribution company, or continuing to do it all themselves and growing organically.

Ironically, the old-school record label companies could also be interested.

"Things are happening very quickly in the social media space," Mitchell says. ”Labels know they have to adapt, and they’re interested in what we’re doing”.

Wellington start-up MusicHype scales up at world's largest digital media conference

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