The secret of Hungarian music startups

10.11.2011, Startups, by .

In recent weeks, I noticed a flurry of news about various music startups in Budapest. I decided to look into it further and try to find out whether there is a unique driver behind music innovation in Budapest.

I took this question to 3G Multimedia, Dragontape, Mixgar and Noispot, the four startups in question. There was a consistent theme across all of their answers: Hungarians are very entrepreneurial and the music industry is very broken – of course there are people trying to fix this!

In the words of David Zsigó, co-founder of Noispot: “Give a Hungarian kid a laptop and you’ll get a service a day later that eases your everyday life.” Music is “part of our emotional infrastructure,” according to Dániel Molnár from 3G Multimedia, and consumers, artists, as well as other stakeholders, all face all sorts of problems, which the music industry is too slow to react to. Tamas Szakal, the founder of Dragontape, also thinks it’s logical there are many people trying to fix the problems around consuming music, since the music industry is very unlikely to fix them. Kristóf Bárdos of Mixgar joked that perhaps the explanation could also be found in the fact that Hungary has so much terrible music. In other words, these are all people who love music and followed their passion to fix what’s broken.

To further add to the interesting coincidence of music startups in Budapest, it turns out that three of the four companies have offices within 5 minutes of each other. Rumor has it they even eat in the same canteen, though they swear it is not a conspiracy. If you’re in Budapest, you can catch the Hungarian music mafia at Oliva Bogyó sometime.

You might be curious about the ambiance in a Hungarian music startup office. Is it all Hungarian underground, or heart-breaking piano? Well, I asked the guys what was playing in their offices right then. Dragontape were blasting “Excuses” by Bibio from this Dragontape mixtape. At 3GM, we had dubstep, 16th century A’capella polyphonic masterpieces, mathmetal, and blues – not at the same time. Mixgar was productive despite Distractions from Zero 7. At Noispot, there was a silence, but “if you listened carefully, you might notice the symphony of code.” I myself am listening to actual Hungarian music while writing this article.

While I didn’t uncover what the canteen serves that makes you want to take on the music industry, I learned more about four really cool music companies. And I still think there’s a certain Hungarian nem tudom mit behind this.

3G Multimedia
3G Multimedia provides turnkey white-label music streaming solutions to businesses, delivering a huge database of music relevant in CEE and EMEA and a host of mobile solutions, supported by contracts with the music rights holders. In other words, a one-stop-shop music service.
Launch: Finished their first product family at the end of 2010 and launched the first client solution in June 2011.
Team: 12 fulltime and many contractors.
Funding: $1.7 million in Series A from PortfoLion.

Dragontape lets you create mixtapes using online videos. They believe creating and sharing mixtapes is a natural form of self expression and want to make it extremely simple.
Launch: public beta one year ago.
Team: 5 fulltime and some freelancers.
Funding: Backed by individual investors and seeking seed money.

Mixgar is a common ground community music streamer, finding music that most people at a given venue like. It can determine the music tastes passively when people log in, but also allows the participants to vote on what they want to listen to. The idea was born out of necessity when the team, all working at the Digital Natives agency, was stuck listening to progressive house all day due to a short speaker cable.
Launch: May 2011, open beta since July 2011.
Team: 7 employees of Digital Natives, where the project is incubated right now.
Funding: Digital Natives, seed investment by the CEO, Gerszon Huszár, and currently seeking seed funding.

Noispot is an interactive background music service, allowing customers at a venue to manipulate the playlist. It aims to solve the age-old problem of being stuck listening to some guy’s old mp3s.
Launch: Development started in February 2011.
Team: Just the two founders, László Márai and David Zsigó
Funding: Looking for it.

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2 Responses to The secret of Hungarian music startups

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