Life working in retail or hospitality usually means listening to a commercial radio station play the same Rihanna track 12 times a day or taking turns among coworkers to hook up your phone to the entertainment system and play your carefully curated Spotify playlist.
While it may ensure every track is gold, it turns out that hooking up a personal streaming account in a commercial venue is against the law, and that’s where Melbourne startup QSIC comes in. Founded in 2011 by Nick Larkins and Matt Elsley, QSIC is a commercially licensed music streaming service, allowing businesses to stream music legally into their venues.
“A single stream of a song at home is likely to reach an audience of a couple of people. When in a store or at a venue, the audience size is far larger and the royalty rate needs to be adjusted accordingly. Effectively, venues using streaming services licensed for personal use in Australia are doing so illegally,” Elsley said.
The idea for the service came from the pair’s experience starting their first company together in 2009. With the company, Easy Control, focusing on home automation, Elsley’s background in hospitality point of sale and computer networking and Larkins’ in audio visual engineering saw them installing solutions in large homes around Melbourne, where they found they were particularly adept at installing large multi-zone sound systems.
First cutting their teeth on streaming services here, they then went on to install large sound systems for hospitality venues and found out that it’s illegal to use the likes of Pandora and Spotify in these businesses.
“With a little research we also found out that there weren’t any streaming services on the market that could be legally streamed in a business. It took six months of talking about this idea before we decided we had to build this product for the industry; streaming is undoubtedly where the market will head,” Elsley said.
The pair worked on QSIC on the side for a while before diving into it full time. They self funded its development for a while before getting some investment from family and friends and then closing a seed round last year, with investment coming from its early customer base.
As well as managing a development team spread out across three different continents and therefore timezones, Elsley said a major hurdle the startup faced was streaming the actual music.
“Streaming music over the internet in itself isn’t difficult. What is difficult is making that audio playback seamless regardless of the quality of the internet connection. The bar is set very high with music streaming into businesses because if you get it wrong, everyone in the store or venue will immediately notice,” he said.
“There are a number of different audio formats for compressing and transporting music over the internet and all have their own strengths and weaknesses. As we’ve been streaming now for four years and used every method of streaming possible, we now have the benefit of experience under our belt. This has led us to a employ a mixed protocol approach and depending on the device our customers are using to play QSIC (PC/Mac, iOS or Sonos), we’ll dynamically change how we deliver the music.”
Over the last four years QSIC has developed its own complete technology stack, now running end to end on its own technology.
QSIC works by having customers simply sign up online or with a phone call. After they’ve got a username and password they can simply access the system how they would any other streaming platform.
The startup has an internal curation team that curates all the music that goes out on the platform. Customers can browse playlists by genre or mood, though Elsley said the startup encourages them to contact the curators directly if they want help finding the right sound for their business, helping them create a signature sound.
The startup also offers features including API access, music scheduling, consumer analytics, digital signage integration, advertising functions, head office control for businesses with franchises or multiple venues, and multi-zone audio.
With the business model of streaming services a hot button issue at the moment, Elsley said the fact that QSIC doesn’t have a free tier is what ultimately convinced the labels to give the startup a go – packages start at $120 per month.
On the customer side, meanwhile, Elsley said QSIC started getting clients on board the old fashioned way, simply knocking on doors, before word of mouth began powering its growth. Among the startup’s clients now are Boost, Toyota, and Mecca Cosmetica.
“We generally run at about a 50/50 split between hospitality and retail, even though we designed QSIC for the hospitality industry. These figures ebb and flow as we on board large retailers or hospitality groups but tend to even out again over time,” he said.
While there are competitors such as Nightlife and Mood Media in the space supplying music to hospitality and retail, Elsley said comparing them to QSIC “is like comparing BLockbuster to Netflix”.
“We are completely online and supplying intelligent music to customers. QSIC will even learn over time and suggest the right music for your business,” he said.
Looking ahead, QSIC’s focus is on growth. From a technical standpoint Elsley said everything is in place; what the startup needs to do now is let the market know it’s here and show them that there is a better option out there.
Image: Nick Larkins and Matt Elsley. Source: Supplied.