Music crowdfunding service PledgeMusic has officially gone into administration (bankruptcy). The service has been in dire trouble for the past several months after it was revealed that they were out of money and were unable to pay out the money artists had raised. They searched for a buyer and none was found, so now the company is heading to administration.
PledgeMusic co-founder Benji Rogers, who left in 2016, but then re-joined a few months ago as a consultant to try and save the company, revealed the news in a Medium post.
“I went back into PledgeMusic just over three months ago as a volunteer to try and help the board and team turn around and sell the company, but I am sad to report that this effort has not met with success and that PledgeMusic will shortly be heading into administration,” Rogers writes.
It is estimated that PledgeMusic is an estimated $1-$3 million in the hole, a remarkable ponzi scheme-like hole they built up.
Now begin the apologies about what went so wrong.
“I cannot begin to appreciate how all of you affected artists are feeling about this and I am deeply sorry for what you have been through,” Rogers writes.
“I ask all of the fans to please understand the awful and near impossible situation that this has put the artists that you love and supported in, and as such I ask you to bear with them as they do their best to make any obligations to you right. I am also sorry for all of the labels, fulfillment companies and other vendors affected.”
The forthcoming bankruptcy will leave many artists and fans in a bind. It will likely be sold off to the highest bidder and that likely won’t cover all of the costs & debts associated with the company. There is hope some of the creditors will get paid, but it will be a wait and see game now.
The reaction from artists has been swift and angry.
Charlie Faye of Charlie Faye & The Fayettes wrote via Hypebot, "This announcement only confirms what we already feared - that Pledgemusic is going under, and all the artists who are owed money will never be paid.
When Pledge wouldn't give me the money I was owed six months ago, I still had to order CDs and vinyl, prepare for the record release, and pay hundreds of dollars in shipping to get the rewards items promised through Pledge out to my fans. So I put everything on a credit card… and unfortunately I’m still sitting on that debt, trying to catch up.”