It's been a miserable week or two for Sellaband.
First there was the report that Public Enemy had failed to scrape enough together to make an album via the site.
Part of the problem there was that PE were after quarter of a million bucks - a hefty budget to be seeking through Sellaband. And there were questions over the offer, as Billboard pointed out:
Given that the only benefit to come with a $250 investment that didn't also come with a $100 one was a free t-shirt, many might have wondered why they should invest the extra $150.
But Public Enemy also exposed problems with the model, too. Not least that Sellaband only markets within its own service - limiting the likely investors somewhat.
Then Sellaband went bankrupt:
On Friday February 19th, SellaBand AG requested provisional suspension of payments (moratorium). This was granted by the Court in Amsterdam on the same day. Yesterday, Monday February 22nd, this moratorium was changed into bankruptcy, with appointment of, Mr Paul Schaink, an amsterdam lawyer, as trustee. The trustee wishes to inform the 'Sellaband community' that, apart from a few technicalities, the completion of a transaction with a potential buyer of the business, is to be expected soon, in order to make a fresh start, safeguarding both the rights of Believers and Artists. More news will follow shortly.
The whole thing was picked up a buyer in Munich. The trustee sent this email to artists:
Yesterday I sold the Sellaband business and assets to German buyers in Munich. This transaction was approved by the Amsterdam Court. The contract will be signed today. The buyers have guaranteed that they will take over 100% of the obligations towards both the Believers and the Artists. So, both the monies owed to the Believers and the Artists are safe. The monies owed to the Believers will remain in an independent trust account (Treuhand) in Germany which is separated from Sellaband, as it was before. It is expected that the Sellaband website will open again no later than either tonight or tomorrow. Further developments will be published through the Sellaband website. It is important now for the ‘Sellaband community’ to calm down, because there should be no fear towards their investments. At this stage I will not give any information as to the background of the bankruptcy of Sellaband. In about 3 weeks an official report to the Court will be released, that can be found on www.curatoren.nl.
New owner Michael Bogatzki shared a brief message:
We will continue to advance this fantastic platform while acting in the spirit of the SellaBand community and its founders. We are thankful for the exceptional work of Johan Vosmeijer and his team.
Starting from today we proceed with this unique concept and maximize the potential of SellaBand with the trust and faith of all Artists and Believers. In personal I am proud to be part of this idea and I am aware of my responsibility for done work and successes. I will take care about the community and spirit of sellaband.com with your help and confidence.
It's too late, though, for many. As if the last couple of weeks' uncertainty hasn't been enough to shake confidence, Sellaband users like Matthew Ebel are starting to wonder why they need a clunking middleman in relationships like these.
Were I an artist or a "believer" (the cutsey name for investor), I think this is the bit where I'd do a lousy Duncan Banatyne impersonation and say "I'm out":
Sellaband holds onto believers’ money until the artist’s goal is reached, if ever. If they disappear, so does the money.
Seriously? Is it an investment or a gamble?