Beatport has been gussied up, then stripped down, turned into a streaming service and then retreated back to its key mission of selling MP3s to DJs. All of this was to find a buyer for the service, but now SFX no longer wants to sell.

This is a stark turnaround from just two months ago, when company staff were dispatched to address a nervous clientele of DJs no longer certain that Beatport would survive. The first plan had already failed – to spin off Beatport in an auction from bankrupt parent company SFX. A similar transaction had been “successful,” in execution if not in financing, when SFX completed a auctioned off Flavorus, a ticketing outfit which SFX purchased for $17 million in 2014 and sold last month to Vivendi for just $4 million.

The second plan was to remove the catastrophic Beatport Streaming service and return to a key mission of servicing DJs… while still searching for a buyer.

The new new plan? Apparently Beatport agrees with me: the best way to fix the company is to make money. It’s a simple goal that the company has quite possibly never achieved in its long, complicated history.

In other words: Beatport’s glory days were not exactly glorious for everyone. Even with “week over week” sales growth, the company perhaps always paid out more than it was pulling in.

This is Beatport’s fundamental problem, from which all other problems stem. Beatport doesn’t need to “refocus on DJs” to save its business; it needs to find a profitable model to attract investment in the first place.

The indicators are up, however. The following is SFX’s statement on their decision to keep Beatport under their umbrella based upon its “dramatically improved” financial health:

Our renewed focus on the Beatport Store, following our announcement of platform changes in May, 2016, has been well-received and successful. The changes we implemented have laid a strong foundation for Beatport that have dramatically improved its profitability.

As a result of these improving trends, SFX has determined that retaining ownership of Beatport is in the best interest of the Company and has withdrawn its motion to sell Beatport through the Chapter 11 process. We look forward to emerging from Chapter 11 in the next few months, as strong and vibrant business, positioned to pursue both organic and strategic growth options. The dedicated Beatport management team is committed to continuing to serve our core DJ customer base and enhancing the quality of our customer experience.


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