Digital Music Company Believe to Raise Over $600 Million in an Upcoming IPO

By Adriaan Brits Monday, May 10, 2021

Digital music company Believe announced its plan to go public on the Paris Euronext stock exchange to raise roughly €500 million ($608 million) through the initial public offering (IPO) in a bid to fund its business growth.

Earbuds laying on a computer screen.

Taking Advantage of Strong Business Growth

The French company, which also owns the US digital music business TuneCore, generated €728 million ($885.4 million) in digital business revenues and €441 million ($536.4 million) of consolidated business revenues last year.

The IPO news doesn’t come as a surprise, given that Reuters reported its IPO plans last year. The media outlet said that Believe was valued at about €2 billion ($2.4 billion) at the time.

The IPO is expected to be completed after Believe’s prospectus gains approval from regulators and is subject to “favorable market conditions.”

“In the last decade, streaming has changed how people discover music, paving the way for the rise of independent artists and labels,” said Denis Ladegaillerie, founder and CEO of Believe.

“Believe is ideally positioned at the core of this transformation with a unique model to provide solutions best adapted to meet the evolving needs of each independent artist and label, at all levels of development, in the digital world. Believe has the technological platform, the global reach, and the people on the ground to be at the forefront of this new cycle,” he added.

Believe’s market debut will be managed by Citi, JP Morgan, and Société Générale, who will serve as both Joint Global Coordinators and Joint Bookrunners, while BNP Paribas, Goldman Sachs, HSBC, and UBS act as Joint Bookrunners.

The Paris-based digital music company was founded in 2005 by Denis Ladegaillerie, a former Vivendi executive. Since the end of last year, the music company ran its business in over 50 countries and served more than 850,000 artists either directly or through their labels.

Believe represented over 100 billion Spotify streams and accounted for 375 billion YouTube views in 2020.

“It’s no longer the traditional music model based on a huge amount of services for a very small pool of top artists,” Ladegaillerie added.

Today, the company said its digital music sales between 2018 and 2020 soared by more than 54% to €728 million ($885.4 million), which accounted for a compound annual growth rate (CAGR) of 24%, compared to the CAGR of 7.6% for the recorded music market.

Consolidated business revenues in Q1 2021 came in at €124 million, up 26% from the same period last year. Last year, about 18% of the company’s consolidated business revenue came from France, 22% from Germany, 28% from other parts of Europe. The company is also active in other parts of the world.

Believe’s Brooklyn, New York-based digital music business arm TuneCore is currently paying artists more than $400 million every 12 months. Additionally, Believe is also the parent company of in-house labels All Points, Naïve, and Nuclear Blast.

Summary

French digital music company Believe announced it is planning an IPO to raise around €500 million ($608 million) to fund its growth. Last year, reports suggested that an IPO could value Believe at about €2 billion ($2.4 billion).

About the Author


Headshot of Adriaan Brits

An analyst of global affairs, Adriaan has an MSC from Oxford, with diverse interests in the digital economy, entertainment, and business. He is a specialist trainer in advanced analytics and media.

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