How The Vinyl Record Value Chain Is Being Digitally Transformed


Dreaming of your favorite music on a vinyl record? A venture-backed startup called Qrates (game of words for “curates,” sounds like “crates,” like crates of vinyl) allows artists and labels to digitally aggregate global demand for vinyl, crowdfund production and press records on-demand. The net result is a vinyl enthusiast’s dream come true: Availability of vinyl records of your favorite music, with fast global delivery.

How It Works

CEO Yong-bo Bae and his executives combined bring 40 years of industry experience, including in music tech companies, record labels, and music production, to enable small-scale production of vinyl records, as follows:

First, using a web service called, music fans request a vinyl version of select tracks they listen to on a music service. Right now it’s limited to SoundCloud, but it can be implemented on any service. The service aggregates pre-orders from fans until a minimum of 100 are received, triggering a notification to the track’s rights owner, who then turns to Qrates to generate the order for pressing. Artists can realize a profit without any initial investment as soon as pressing costs and a 15% Qrates fee are deducted from sales.

Artists and labels can finance the production of their vinyl through Qrates’ crowdfunding platform, or they can use other platforms like Indiegogo or Kickstarter. For production, the company has made agreements with high quality pressing plants located in Europe and Asia, developing supply-chain processes that shorten order-to-delivery from typically four-five months to six-eight weeks. Qrates is planning to start production in the U.S. this fall.

Crowdfunding is nothing new for creative artists. It is common to see emerging musicians requesting contributions in Kickstarter and other platforms. But the beauty of Qrates is that it integrates crowdsourcing of demand via, crowdfunding and on-demand production to digitally turn the vinyl value chain on its head, from a push-based model (production drives sales) to pull-based (demand drives production).

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