It hasn’t quite hit Wall Street yet, but PonoMusic is already offering accredited investors the chance to invest in its Neil Young-helmed company for as little as $5,000. According to its Crowdfunder campaign, the pre-money valuation of the iPod alternative is $50,000,000, $6 million of which was already raised through a record-breaking Kickstarter campaign. The goal on Crowdfunder is slightly more modest at $2.5 million, but could easily hit a higher number since it’s 85-percent of the way there with more than two weeks yet to go.
In case you’re curious about what $5,000 gets you, a press release outlined a “Special Purpose Fund” meant to “house all these smaller investors into a single entity which invests as one investor in Pono.” So you’re basically buying into one large piece of the PonoMusic pie. Or as they put it, “Neil and the team at PonoMusic are excited about democratizing the financing process by giving their Kickstarter backers, and anyone who loves music, the opportunity to now invest and become an owner in PonoMusic.”
“It’s been pretty predictable,” Young said of PonoMusic’s success in a recent Rolling Stone interview, “because I’m a musician and I know how musicians feel about sound. The record companies made some bad choices and did not realize how big [MP3s] was going to be. And when that happened, there was no alternative to the cheap sound … We’re going to be able to play records back just like the artists made them — with absolutely no magic sauce, no DRM, no encoding, decoding, none of the things that screw with the sound and make it an intellectual property.”
A Pono product launch is expected this October, with an initial $399 player that’s able to house between 1,000 and 2,000 hi-def tracks. Check out a Forbes interview with Young about the concept behind his company below…