With their website closed down by the owners PledgeMusic reportedly froze artists’ funds and misspent hundreds of thousands of pounds of musicians’ and fans money to keep the site going for as long as they could before going to the courts to wind up the complany.
In a message clearing the company of any liability over artists’ losses, One executives wrote
“To the Artists and Fans of PledgeMusic.
“As many of you know, PledgeMusic suspended operations a number of months ago. The company continues to work with outside counsel on the most appropriate next steps, and we will update you with those specifics as we get more information.”
co-founder Benji Rogers (Rogers founded the company with Jayce Varden in 2009 as a platform in which artists can sell everything from music to personal concerts directly to fans) After being widely chastised on social media for breaking his promise to return artists’ money, Rogers wrote,
“I went back into [the company] 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.”
It appears the company’s changed its mind over the right course of action. Instead of heading into administration, Pledge took the sneaky turn of filing a petition to wind up PledgeMusic in The Gazette. The Execs remained anonymous and Rodgers left the company in 2016 and started his current company CSO to Dot Blockchain Media.
Pledge’s CEO and another executive who chose to remain anonymous attributed many of the problems to an unexpected change in the company’s payment fulfillment system, restated their commitment to the company and its crowdfunding model, and insisted the company was “working through” the problems. That was almost a year ago. t CEO, Dominic Pandiscia, stepped down, but the company reshuffled its senior management and pointed to new investors.
If they’d headed into administration, it would have allowed musicians, fans, and vendors the opportunity to officially speak out against the company’s behavior, PledgeMusic has simply closed the platform through the High Courts. therefore kinda just walking away.
The RCOJ granted Pledge their winding-up order and appointed an Official Receiver (OR), who will liquidate all of the company’s assets. The official Receiver has commented via tweets I guess a clearer picture will be made as to what course of action they will take but maybe parties affected should follow their twitter account to keep up to date with the state of play. Sadly I guess the artists will go to the back of the queue behind the government (or HMRC) who always get paid in full and the fans will go behind the bands in the pecking order. Most will have already written off their product as a bad job after artists gave their own updates to their individual predicaments. I wouldn’t have thought the company had many assets that can be sold on due to the platform it ran but I guess seeing the Execs being prosecuted would be a just desert and the guilty parties being brought to book, but its scant consolation to the all the bands, studios, labels, musicians and fans who are left out of pocket.
Not everybody will get involved no doubt but some have spoken up on behalf of artists such as UK Music who spoke out about the order. In a letter to Business Minister Kelly Tolhurst, Deputy CEO Tom Kiehl urged the government to step in.
“Many musicians across the UK relied on crowdfunding website PledgeMusic to deliver payments from patrons, to pay for album recordings, and other costs. The winding up of this company represents an entirely unsatisfactory development for the many music fans and creators who have invested so much into projects through this scheme.
“I ask you to again consider the merits of a ministerial referral to the Competition and Markets Authority to investigate what went wrong with this case.
“I would also like to ask you to consider taking up the case with the Financial Conduct Authority, which holds responsibility for regulating certain types of crowdfunding, to consider the activities of PledgeMusic and whether there have been any regulatory breaches.
“Furthermore, I would like to ask for a meeting with you to consider further possible Government interventions to ensure the issues which have arisen from PledgeMusic can never happen again.”
One band L7 vowed to take the former company’s executives to court. Calling the crowdfunding platform a fraudulent scheme, the band wrote,
“To give a brief summary for those not familiar with the Pledge Music scam, in a nutshell, the funds that many bands and their supporters raised through the crowdfunding platform were absconded by the company with zero accountability and unreturned legal appeals. Their site is no longer live and they are filing for bankruptcy protection in the U.K.
“It’s been a disappointing, time consuming, and expensive mess for all artists and fans involved with this Pledge Music FIASCO.”
they also commented,
“We do not wish to further comment on this situation as we do not want to be the face of being screwed over. L7 are bigger and mightier than this mess. The only time we will speak of this again will be in a courtroom.”
This might play out for some considerable time yet but once they do get to the bottom of just what went on we’ll hopefully have some news to give both fans and artists. Don’t hold your breath though it might be some time. Other artists are joining together to see if a joint action can be taken but time will tell what will come.