The Weeknd (real name Abel Tesfaye) is not the only star to put money in Wave this year: The four-year-old streaming startup tells Rolling Stone that it has also recently won Justin Bieber, J Balvin, Jillionaire, and indie label Top Dawg Entertainment — which is home to major hip hop artists including Kendrick Lamar and SchoolboyQ — as investors. Wave declined to say how much Top Dawg and the new artists invested.
The successes haven’t come in a vacuum. When the pandemic upended live music in March, Wave rushed to lock in content partnerships with Warner Music Group and Roc Nation, air shows for artists like John Legend and Tinashe, swipe executives from rival tech firms like Netflix and Riot Games, and secure $30 million in funding from business moguls like manager Scooter Braun and retired baseball star Alex Rodriguez. The company is still on a hiring spree, looking for dozens of new visual artists, engineers and live event producers.
Against fierce and ever-increasing competition, Wave is determined to redesign the world of online concerts. “It’s really just about making the right decisions, getting the right people on board and building out our future,” Arrigo says. “It feels like the world is our oyster.”
Wave’s overnight rise seems like a pandemic-driven phenomenon — but to call it a quarantine story isn’t entirely accurate. Founded in 2016, Wave began as a virtual-reality company intent on giving users immersive shows in which they used avatars to interact with one another. It gradually turned into an animated streaming company for music. While the absence of live music in 2020 certainly fueled public interest, Wave closed its $30 million funding round months before Covid hit the U.S., and it had already been streaming shows for electronic artists like Galantis and Lindsey Sterling for years.
When top-tier musicians had to cancel their shows and started looking for new ways to perform and make money, though, Wave saw a new world opening up.
J Balvin says he was “blown away” by the creativity and thought of the Weeknd Experience and calls his recent investment in Wave a chance to have a stake in the future for the promising virtual concert space. “I am joining a group of music legends, performers and tech entrepreneurs that are on the cutting edge of amplifying concert experiences and fan engagement to audiences worldwide,” he says in a statement. “I am excited to be part of the movement and provide input that allows the company to help artists such as myself.”
Wave has several revenue streams it hopes will prove lucrative as the young company continues to refine its business model, including ticketed events, merchandise sales, and brand sponsorships and advertising — all of which are becoming more common in the concert-streaming ecosystem as a whole. Arrigo, who spent years in game development at Harmonix — the game company behind Guitar Hero, Rock Band and Dance Central — says the company’s long-term goal is to democratize its platform to allow artists of any size to put on shows.
Perhaps Wave’s most unique play is its willingness to partner with the gaming industry. While Arrigo declines to give specifics, he says that Wave is working with Roblox to produce concerts as Roblox looks to expand its virtual music event presence, and that Wave has active conversations with “virtually every 3D-gaming platform.”
“Building these experiences in third-party games allows us to leapfrog the challenge of user acquisition and convince the market and show them what a virtual concert is. We can go directly to where the users are, which allows us to build a business sooner,” Arrigo says. “Trying to recreate our own version of Roblox would take us a long time and ultimately is not what we’re best at, at least at the moment. What we can do is create mind-blowing experiences for artists.”
Arrigo calls Braun an “active” investor — as he does Zach Katz and Shara Senderoff at music-tech investment firm Raised In Space. Braun invested both individually and through Raised In Space, which he co-founded with Katz and Senderoff. The three executives talk with Wave on a near-daily basis; Braun helped bring his clients Bieber and J Balvin on as investors as well, and Katz and Senderoff have been promoting Wave to their industry connections. In a statement, Braun describes Wave as embodying “the future of music and technology coming together.”
Among the hundreds of companies Raised in Space has evaluated since starting last year, Wave is one of six the group had decided to fund. Katz, Raised in Space’s CEO and the former president of BMG’s U.S. operations, says the company waited about eight months before finally committing an investment — convinced by Wave’s multiple potential revenue streams as well as its more interactive scope compared to single-track livestreaming competitors.
“If you can make it interactive — you can invite fans to actually weigh in on the songs that are played, the colors of the show, to buy into merch — at its highest potential, this thing can be a game-changer for fans.” — Zach Katz, Raised in Space CEO and Wave investor
“There’s a magic to who Adam is, what he thinks and how he imagines and dreams, but there were questions we had before Wave checked off all the boxes you’re seeing today, but they’re quick to show results,” Katz says. “If you can make it interactive — you can invite fans to actually weigh in on the songs that are played, the colors of the show, to buy into merch — at its highest potential, this thing can be a game-changer for fans.”
Raised in Space is also involved in developing Wave’s future business model. Senderoff, the firm’s president, says: “We’re interested in ticketing. Can we ticket an after-party type of show? What’s the merch bundle? How do they aggregate data on their own stages versus other platforms?”
Many people still view concert livestreaming with a fair bit of skepticism, believing it will disband when health ordinances allow live music shows — the real deal — to come back. For Wave, which offers animation on top of streaming, that skepticism is both a threat and an asset.
Wave has made two very prominent hires in recent months, nabbing Netflix’s Tina Rubin — who headed marketing and strategy for flagships shows “Stranger Things” and “13 Reasons Why” — as chief marketing officer, along with Jarred Kennedy of Riot Games as chief operating officer.
Tina Rubin, Wave’s new chief marketing officer, hails from Netflix, where she led strategy for flagship shows like Stranger Things and 13 Reasons Why. Naturally, given her previous employer, Rubin is thinking big: She wants to turn Wave into a marketing destination for artists and brands by having it stream zeitgeist moments, similar to how Grammy veteran showrunner Ken Erhlich has talked of creating “buzzy” Grammy moments to draw in viewers. (The Weeknd’s show and John Legend’s show both had corporate partners and sponsors — so that vision is already taking shape.)
To build a loyal following around the platform itself, Rubin says, Wave will have to churn up organic interest from young people, especially Gen Z kids.
“Within every show, what is the hook? How do we position it so that people get excited so that they have to tune in live, that they’d otherwise miss out on a must-see moment?” — Wave’s chief marketing officer Tina Rubin
“Within every show, what is the hook? How do we position it so that people get excited so that they have to tune in live, that they’d otherwise miss out on a must-see moment?” Rubin says. “My job is to ask, what are those moments? There’s always a place for debuting new music and getting exclusive music, but we want to think beyond that. It could be artists talking about music and revealing information you’d never heard before. It could be a surprise interaction artists have with the audience. We want to make those moments that are clearly trackable.”
Wave’s other big hire Jarred Kennedy, who helped Riot Games’ League of Legends dominate the e-sports market, wants to expand Wave’s community engagement in his new role as chief operating officer. Concert streaming, Kennedy says, reminds him of the burgeoning e-sports world a few years ago — which enticed him to come to Wave.
“At the beginning with e-sports, the idea that people would watch others play video games at a higher level, similar to the way that they watch other professional sports, was not obvious,” he says. “It was deeply embraced by a passionate community, but it definitely didn’t enter the mainstream for a while. It’s become its own thing within professional sports, and I see Wave doing that for music experiences.”
To build staying power in music and gaming, Wave faces considerable competition from other mixed-reality concert platforms — mainly Epic Games’ Fortnite, which streamed Scott’s record-breaking show earlier this year and offers a similar concert experience for fans to an exponentially larger and more established audience. Some of the two companies’ goals overlap, too: Epic’s head of global partnerships Nate Nanzer previously told Rolling Stone that Fortnite wants its concerts to be must-watch events à la Saturday Night Live, and, like Wave, it wants to expand artist clientele beyond the biggest stars.
Still, Kennedy says he doesn’t see Fortnite as a threat. “There’s plenty of room, and not everyone is going to want to watch a show through Fortnite,” Kennedy says. “We think a lot of people will — but we think there’s opportunity to serve folks on other markets. We hope Fortnite will keep investing and keep winning because it helps define what this category is, and we think it’s here to stay.”
Wave is set to unveil more shows in the coming months. While Arrigo declined to confirm or deny if some of his higher profile clients will be on the bill for upcoming Wave shows, he says he’s excited for potential collaboration with his investors, adding that he sees Jillionaire in particular as a potential music tech advisor to the company beyond his investment.
As Wave’s profile grows from humble startup to major media company — it plans to ramp up its shows and will involve its new celebrity investors in some of its projects — perhaps the biggest challenge, Arrigo says, is having enough time to match. At the beginning, Wave was a few steps ahead in its technological visions for virtual shows. Now that the rest of the industry is game, for the first time in his company’s history, Arrigo wishes things could slow down.
“We need more time, we’ve hired something like 15 people over the past couple months, and now it’s a function of time, talent and execution. If someone can somehow pause time for our team to develop for three years and then we can come back into the market, that’d be the dream,” he says with a chuckle. “If you have a time machine, let me know.”