As reported by Music Business Worldwide, Suno, the AI-driven music creation app that has been garnering attention for its remarkable music-making capabilities, has successfully secured a substantial amount of funding. The company announced that it has raised a whopping $125 million in a Series B funding round.
The investors in Suno include VC firm Lightspeed Venture Partners, known for its investments in Stability AI and Everyrealm, the metaverse firm backed by music icons such as Nas and Lil Baby. Additionally, other notable investors in Suno are VC fund Founder Collective, tech executive and investor Nat Friedman, and Daniel Gross, who previously led AI development efforts at Apple and served as a partner at Y-Combinator.
Mikey Shulman, Co-Founder and CEO of Suno, expressed his enthusiasm about the company's progress, stating, "We released our first product eight months ago, enabling anyone to make a song with just a simple idea. It’s very early days, but 10 million people have already made music using Suno. While Grammy-winning artists use Suno, our core user base consists of everyday people making music — often for the first time."
According to sources cited by The Information, the funding round has propelled the Massachusetts-headquartered company to an implied value of $500 million. The newly-raised funds are intended for expanding the company's staff, which currently stands at 12 employees.
Suno's rise in popularity was further fueled by a Rolling Stone article earlier this year, highlighting the AI tech's ability to create authentic-sounding music that even unsettled some of its creators. The algorithm utilizes OpenAI’s ChatGPT to generate lyrics and proprietary algorithms to create music and vocals.
However, concerns have surfaced regarding Suno's model, with speculation that it may have been trained on copyrighted music without proper licensing. Ed Newton-Rex, founder of Fairly Trained, pointed out uncanny similarities between music generated by Suno and copyrighted songs, raising questions about potential copyright infringement.
Suno’s founders have emphasized that the platform does not allow users to request music in the style of specific artists.
Despite this, early investor Antonio Rodriguez expressed awareness of potential lawsuits from music labels and publishers, acknowledging the inherent risks associated with the investment.
He called it "the risk we had to take... because we're the deep pocket that gets sued..."
He also said "if they had label deals from the start, I wouldn't have invested. They needed to build without restrictions."
AI's popularity has brought a wave of copyright infringement lawsuits. Universal Music Group just sued Anthropic AI for allegedly ripping off song lyrics.
Others claim AI copied books and articles.
But AI devs like Google and some investors say there should be a "fair use" loophole for training AI, like there is for educational materials.
Music industry entities and Newton-Rex disagree, saying AI that competes with what it trained on should not be eligible for exemption due to its ability to contend with the source material.
Courts haven't ruled on AI training and copyright yet.
The EU's AI Act says devs need permission to train on copyrighted materials, but it has exemptions (such as for research) and "general-purpose AI", but the definitions remain unclear.