The advent of the iTunes store led to a monumental shift in how we consumed music and since then, the emergence of streaming services under a subscription model has further changed the music industry. Artists went from receiving royalties for individual album and singles sales to now receiving royalties per stream. Streaming royalties range from as low as $.0033 for Spotify per stream to $.013 with Tidal per stream. With such economics, any delay in payments for artists, especially smaller, independents, can be taxing. Paperchain is an instant payments platform that provides artists and creators with short advances of their funds from streaming platforms without any fees. Structured as a digital wallet, artists receive daily payments from platforms like Spotify, YouTube, Apple Music, Twitch, TikTok, and Patreon and can access these funds through the company’s branded debit card. Paperchain’s infrastructure to enable instant payments is built on Web3 with the company utilizing NFTs that represent aggregated creator content revenue streams and do not have any collectible or art value while its banking services are provided in partnership with Evolv Bank. The company was founded in 2017, completed the inaugural Alchemists Blockchain Techstars accelerator in 2019, and has raised $2M in funding.
AlleyWatch caught up with Paperchain CEO and Founder Daniel Dewar to learn more about the business, how the company improves cash flow for artists, strategic plans, and much, much more…
Tell us about the product or service that Paperchain offers.
Paperchain is an instant payments app for creators. The Paperchain app gives creators a wallet to get paid every day, they can see actual streaming income earnings, plus a debit card to access payouts immediately.
How is it different?
Nobody is changing the speed of payments. While other companies are increasing velocity of spend with credit cards and loans, Paperchain is increasing velocity of money.
What market does Paperchain target and how big is it?
Targeting the $30B music streaming industry. Independent creator growth makes up 50% of the record music market. 50M+ global creators. 1 trillion+ streaming hours. And it’s growing 26% YoY.
What is the business model?
We charge a fee on payout GMV. We charge this to the B2B layer (distributors, content platforms) and not the creators. Paperchain is a no-cost money app for creators.
What inspired the start of Paperchain?
I used to be a music producer and studio engineer. Access to content income to invest in production, marketing & promotion is critical for a creator to grow their career and inject cash at the right time. I saw that the music industry had become data-driven and the speed of consumption had increased, but the speed of payments hadn’t. So, I started looking at ways the data could be used to speed up payments.
What are your post-COVID office plans?
We’re a fully remote team right now, I’m the only one still in NYC. We’re hiring and will have a preference on NYC hires, but at the end of the day, we’ll hire the best person for the role regardless of where they are and will work on a plan to bring the team back to NYC over time.
What are the milestones that you plan to achieve within six months?
Q3 2022
- Onboard 4,000 waitlist creators to debit card
- Onboard 10,000 creators via UnitedMasters partnership
- Close partnerships in pipeline
Q4 2022
- Add web3 wallet support & web3 payouts
- Launch spend rewards & staking program
- $PAPER airdrop
End of Year: $10M GMV
What is the one piece of startup advice that you never got?
This can be a crushingly lonely journey at times. I think that got relayed to me in softer terms. Nobody really painted an accurate picture of the reality.
If you could be put in touch with anyone in the New York community who would it be and why?
Jay Z.
Why did you launch in New York?
Growing up in Australia, NYC always defined as the place for media, tech, and finance. That hasn’t changed. Every type of customer, every partner, and every potential hire is at your doorstep.
What’s your favorite outdoor dining restaurant in NYC?
Peaches in Bed Stuy. Or Brod’s jerk chicken spot on the street off Tompkins in Bed Stuy.
