The bulk of the sources’ testimonials pertain to SFX’s acquisition and ownership of Beatport, so it helps to know some background on the company. The conception of Beatport dates back to around the turn of the millennium and emerged out of passing conversations between Eloy Lopez, Jonas Tempel and Brad Roulier – the latter of whom would go on to found Beta Nightclub in Denver and tour around the world as one half of DJ duo Manufactured Superstars. Lopez originally approached Tempel in regards to a now obsolete DJ software called Final Scratch.
During an exclusive interview, Roulier told us:
Eloy went to Jonas at The Church [Nightclub in Denver] and said, ‘Hey, this software is really cool, but it’s stupid that I have to record my records into MP3s. Why don’t we build a website that just sells MP3s?’ They kind of hashed over the idea and thought, ‘Oh, well we don’t really know anybody.’ They brought me in because I was a promoter and had a lot of relationships with DJs and labels and artists and things like that.
Around the same time, Pioneer had just begun selling the CDJ 1000s – and enticed by the prospect of not having to lug crates of vinyl from gig to gig, DJs across the world ditched vinyl in hordes. Roulier recalls Josh Wink and Carl Cox to have been among the first major electronic music artists that he saw perform on the new hardware, at which point he realized that a market for MP3s would soon emerge.
Beatport 1.0 was officially launched in January of 2004 and boasted tracks from 79 different music labels. Its early team consisted of contributors like Lloyd Starr, Wyatt Jenkins, Liz Miller and Shawn Sabo – the latter of whom now performs with Roulier as the other half of Manufactured Superstars. Unlike its competition (fly-by-night online resources that went by names like Tracks To Burn, Track It Down and DJ Download), Beatport started out with strong branding elements and forged business relationships that would prove advantageous in the years to follow.
Among Beatport’s early partners was Berlin-based DJing hardware and software developer Native Instruments, and the service also locked in exclusive distribution deals with labels like Get Physical as well as with artists such as Richie Hawtin and deadmau5 (who owes much of his success to distribution deals struck with the online marketplace). Fortunately for Roulier and company, 2004 would also mark the year that Berlin eclipsed London and emerged as the leading exporter of electronic music – and Beatport had a Berlin office. “We became Berlin cool before anyone knew that Berlin was cool,” Roulier likes to brag.
Six years, four updates, and a laundry list of new features later, Beatport had cornered the market for electronic music downloads – and the contemporary EDM movement’s breakthrough into mainstream consciousness (due in no small part to the proliferation of streaming services) allowed the company to usher in its most prosperous era. Dance music quickly became an all-pervasive force in entertainment, and many of those whom had rooted themselves in the earlier iterations of its culture reaped the rewards.
However, as the very streaming services whose trajectory ran parallel to electronic music’s growth began to siphon away Beatport’s customer base, its profits began to plateau. In 2012, the company made revenues of somewhere between $15-18 million, but incurred losses of $2 million. “We brought in a full executive team by then – new CEO, CFO, CMO, all those things,” Roulier says, “so everyone was kind of preparing themselves to let somebody else take it to the next level.”
The new Beatport CEO, Matthew Adell, was forced to choose between downsizing or seeking out investment capital to reinforce the company’s assets, and it just so happened that during that time SFX Entertainment was buying electronic music brands with reckless abandon. In February of 2013, SFX reportedly purchased Beatport for just over $50 million.
