Neil Young’s Startup Hits $5M Mark on Kickstarter

By Small BusinessFOXBusiness

Neil Young’s startup PonoMusic is rocking out on Kickstarter, to the tune of $5 million and counting.

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This weekend, PonoMusic’s campaign surpassed $5 million in pledges on the crowdfunding platform. The startup, which launched March 11 at SXSW in Austin, Texas, aims to bring a high-resolution music player to music fans tired of low-quality mp3s.

CEO John Hamm says Young has been working on bringing PonoMusic to life for the past three years.

“His idea was to let music be heard the way the artists made it. They are creating great music in the studio, and half is getting dropped on the sidewalk,” says Hamm, who joined PonoMusic last year. Aside from the Kickstarter funding, PonoMusic has raised $2.5 million from individual investors, including John Tyson.

Hamm says the outpouring of support on Kickstarter shows the PonoMusic team it has struck a chord.

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“I think we really hit a nerve of an unmet need. We’ve got people thanking us profusely on the site,” says Hamm. By Monday afternoon, PonoMusic had raised $5,140,442 from 15,186 backers, with 14 days to go. PonoMusic’s initial goal was $800,000. In the first three days on the site, PonoMusic raised $3 million.

Hamm says the money is exciting, but more than anything, he’s thrilled about the attention PonoMusic has received thanks to the crowdfunding site.

“It means to me a critical mass of interest that really changes the bigger conversation for the world. That’s what I wanted out of Kickstarter … I don’t know any other way to have this impact on awareness,” says Hamm.

The first run of PonoMusic players are scheduled for delivery in October. Hamm says the first batch of 10,000 players has sold out, and another 20,000 units will be made available in time for the holiday season.

PonoMusic’s player is similar in functionality to early iPods. Hamm says users will have to connect the player to a computer in order to download hi-res music from PonoMusic’s website. Users will have access to the libraries of the three major record labels, Sony, Warner and Universal, and an album will cost between $14 and $22.

While Hamm acknowledges that PonoMusic is not as “convenient” as the smartphones many consumers use today for music, he believes the audio quality will sell itself.

“The minimum quality level is CD quality, which has five times more data than mp3. The worst digital copy [on PonoMusic] is still a lot better than what most people are listening to now,” says Hamm.

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