(CelebrityAccess) — In the wake of renewed and widespread reports that music crowdfunding service PledgeMusic had fallen behind on payments to multiple artists who had launched projects through the service, the company has issued a statement addressing the matter.
PledgeMusic has been dogged by reports of financial turmoil for months after multiple artists told Variety that the crowdfunding service was behind on payments for projects funded via Pledgemusic. At the time, CEO Dominic Pandiscia attributed many of the problems to changes in the company’s fulfillment system, but rumors persisted.
Those rumors came to the fore again when earlier this week, prominent industry pundit Bob Lefsetz reported that the service had fallen behind on payments to the band Fastball, prompting an outpouring of similar stories from Lefsetz’s readers.
The story prompted PledgeMusic to address the matter with a statement, assuring its clients that accounts will be paid in full in the next 90 days, and hinting that strategic investments or even a possible sale of the company may be in the offing.
The statement in full:
PledgeMusic has always been committed to serving artist and fan communities. It was established by artists and was born of a need to change the way in which the traditional music industry operated. It was designed to help artists and their teams at every level, and we believe that PledgeMusic has become an essential part of the evolving landscape of the music industry.
That said, we deeply regret that recently we have not lived up to the high standards to which PledgeMusic has always held itself. We acknowledge that many artists have and continue to experience payment delays. These delays to artists are unacceptable–not only to them but to us.
Since its beginning, PledgeMusic has successfully serviced over 45K artists from emerging acts to some of the biggest names in the industry. We’ve supported 60 Grammy-nominated artists and helped springboard 100s of unsigned bands to successful careers. Our efforts have assisted over 375 artists with chart position on the Billboard Top 200. Our platform has provided close to $100m of revenue to its artist community.
Mid 2017, new investors came into PledgeMusic with the goal of strengthening the company and improving the value proposition for artists and fans. After substantial investments in the business over the past 18 months, we believe we have made good progress to that end, but it hasn’t been enough. That said, the company has cut its operating expenses nearly in half over the past year. We’ve overhauled key parts of our financial and operating systems, while adding talent to our roster and making enhancements to the platform like our Vinyl Store, D2C artist store-fronting and our data analytics.
While the company has made progress, we still haven’t reached our goals. PledgeMusic has been in discussions with several strategic players in the industry who have interest in the PledgeMusic platform. We are evaluating a number of transactions with those potential partners, and we plan to announce details of this in the next 60 days. It is our expectation that payments will be brought current within the next 90 days.
We accept responsibility for the fact that we have been late on payments over the past year. PledgeMusic is working tirelessly on this issue, and we are asking our community for their continued support and patience.
At the same time, company co-founder Benji Rogers issued a separate statement to Medium.
To the Artists, their teams, managers, labels and fans, and to all who have been negatively affected by the issues at PledgeMusic, I am truly sorry.
When I conceived of Pledge, and when the co-founders and I started in on building the platform we thought of little else but of how it could help artists. We benchmarked the company’s success on how well our artists’ campaigns did. We didn’t sleep a whole hell of a lot as we put in the hours to make things work and build the features that our artists needed. In one sense artists drove the innovation and we viewed the platform as a place from which they could connect with their fans, make money and retain ownership over their data. As I had it in my head, Pledge was meant to be the home from which they could launch something amazing into the world, and thousands of you did just that.
Even though I handed over day-to-day control of Pledge as its CEO for the second time in April of 2016 and left the board last February, the fact that this trust is now broken is unacceptable to me personally and I am truly sorry to all of you who have been affected by this. I have emailed a lot of you from my personal email account, as I no longer have a Pledge email address, and have tried to help where I can, but it’s not enough.
As such I have been in touch with the current board and management team to offer my help both strategically and practically. If it is asked for, I will commit to doing all that I can to ensure that this wonderful engine that we created does not cause any further harm, and can grow into something even better for all who would use it.
Lastly, I would like to acknowledge the incredible team, which includes one of my co-founders, who have been battling to get the right people paid under immensely difficult circumstances both professionally and personally. They are feeling the heat, as they are on the front lines of this and are doing their very best to help you. Of that, I have no doubt.
Once again I am truly sorry to any and all of you who have been harmed as a result of what I made. Please know that I will do all that is within my power to make it right and to fix what I can if given the opportunity to do so.