Back in March, developers attempted to harmonize music and technology in one killer app during a hackathon hosted at The LAB Miami, one of several co-working spaces that have sprung up around South Florida in the last few years. At the end of 24 wearying hours of key clicking and screen staring, the hackathon turned into a jam session, with members of music-related startups getting up on a makeshift stage to perform decidedly low-tech ditties like the Violent Femmes’ “Blister In The Sun.”
Billed as a “Startup Battle of the Bands,” the event was more a celebration than a contest. It tied into the inaugural Miami Music Summit, hosted at the New World Symphony’s high tech South Beach home. “Where Silicon Valley and Miami Rock Together” was the Summit’s tagline, and it was the latest sign that Miami was no longer content with its postcard-flat sun-and-fun reputation.
Galvanized by the advent of Art Basel, one of the biggest and most prestigious art fairs in the world, Miami’s arts and culture community has been growing in stature for years. The city’s tech industry is at a much earlier stage of development, but it has been gaining ground since 2012, a year in which Miami had the highest rate of new business formation among the 15 largest U.S. metro areas, according to a report from the Kauffman Foundation. Another recent study, from Endeavor Insight, reported that the number of “micro-businesses” (2-9 employees) in Miami more than doubled between 2000 and 2012, even as the ranks of the larger businesses plateaued. The stats suggest what high-profile events like the Miami Music Summit and Start-Up City Miami (another large-scale conference) make clear: Miami wants some of Silicon Valley’s startup success.
Of course, there is no shortage of cities with the same aspiration, and conferences do not necessarily lead to billion-dollar exits. But Miami believes marrying technology and the arts will distinguish it from the rest of the pack, and the city’s rich music history, from TK Records to Gloria Estefan to Ultra Music Festival, suggests that melody may lead the way.
One of the Summit’s organizers was Demian Bellumio, COO of Senzari, a data-crunching music-recommendation engine that powers the personalized radio service wahwah. Born in Buenos Aires, Argentina, Bellumio has been in Miami for more than 30 years. A former investment banker, he left a job at Barclay’s and eventually joined Terremark to help the Miami-based company transition from the real estate business to providing enterprise IT infrastructure and security services. It proved to be a profitable pivot: In 2011 Verizon bought Terremark for a reported $1.4 billion.
The experience convinced Bellumio that he did not have to leave Miami for the West Coast to succeed in the technology industry.
“No logic would tell you that [Terremark] would be so successful,” he says. “It was a tech play in Miami, started in the middle of the crisis of the financial markets. The main client was the government. And if there was no tech talent in Miami, there was even less top-secret-clearance talent. So that company really proved that Miami could build a really hard business. It was a great school for me. And it definitely showed me that you can never say this is impossible.”
Still, Bellumio concedes the city’s disadvantages in the music industry: “The power to make big decisions in licensing is not here,” he says. On the other hand, he says there is no shortage of tech talent – a major issue in other would-be tech hubs – and that the relatively small size of the industry actually has its advantages. “I don’t have to be looking over my shoulder that a competitor is trying to steal my team.”
Above all, he says he appreciates the lack of a “herd mentality” in a place still finding its niche in the tech industry. “We’re building a company . . . that we think is going to become a world leader in a very competitive space, and the fact that we’re in Miami actually is a reason we’re able to do this,” he says. “Being in the Valley and not being sucked into the system is really hard.”
Senzari is probably the most prominent music tech company in Miami, having raised $13 million since launching in 2011 and acquiring wahwah in late 2012, but it is hardly alone in the space. There’s also Kompoz, a collaboration platform for songwriters with 60,000 users, 250,000 tracks uploaded and 33,000 songs in its archive, including one that was used by the NBA for its 2014 draft broadcast. Then there’s BeatBuddy, a guitar pedal-drum machine hybrid that blew through its Indiegogo crowdfunding goal of $75,000 in 24 hours and went on to raise nearly $350,000 before the campaign ended.
BeatBuddy founder David Packouz, a guitarist who comes out of the Miami music scene, is proud of his company’s hometown ties. The BeatBuddy’s nameplate reads, “Designed in Miami, assembled in China,” and its promo videos all feature local artists. “I do that to give back to the local Miami music community, which has created me as an artist and music entrepreneur,” Packouz says. “And there’s just so much talent in Miami. I think it’s quite underappreciated.”
Choose Digital is another Miami-based tech company on the rise. Recently acquired by Viggle for $9 million, the company offers a digital marketplace featuring music and various other types of media that can be integrated into loyalty and incentive programs. Clients include United Airlines, Marriott and Viggle itself.
Born in Cuba and raised in Miami, Choose Digital co-founder Mario Cruz says the city’s milieu of Caribbean, Latin American and European cultures – the oft-cited “melting pot” – naturally produces music- and arts-focused companies. “It’s in our roots,” says Cruz, a drummer who plays in a cover band named Switch. “Art, music, dance … that’s all in the vibe of Miami. So if you’re doing a tech company around that, it’s not that hard to find people that are passionate.” Besides that, Miami boasts “relatively cheap” rent, Cruz says, and its postcard-worthy weather is an asset when it comes to attracting and retaining talent.
Even so, as music-tech companies like Choose Digital and Senzari thrive, Miami’s idyllic weather increasingly becomes the backdrop to the city’s lofty ambitions rather than the cash cow of a provincial tourist town. Miami may always draw vacationers in hordes, but the city’s entrepreneurs are hustling to put their hometown on the map for more than mojitos. And in their desire to build their own seaside version of Silicon Valley, they’re not making or taking any excuses.
As Bellumio says, “For an entrepreneur, it’s up to you to make it happen or not.”
Melnick is a freelance writer in Miami.
Photo by Robert Giordano
2014 Ultra Music Festival