Nikhil Shah and Nico Perez first met at Cambridge university. After graduating, they both went into the music industry, presenting radio shows and DJing on the club scene. But the pair were frustrated by the lack of visibility for radio shows online.
"It was really annoying having to trawl through the web looking for great mixes," says Shah. "You’d have to use FTP sites to download the content. They would invariably fail the first three times or tell you to wait 30 seconds to try again. Nico and I decided there had to be another way."
The young entrepreneurs researched the market and found a real niche for online radio mixes. They set about designing a website to make radio shows searchable and accessible online. Earlier this year they both quit their full-time jobs to concentrate on the startup.
The beta version of the site launched a few months ago, allowing first-time users access to the site on an invite-only basis. The response was phenomenal. "The site is user-generated," explains Perez. "DJs and fans can upload shows and watch existing content. Over 1,000 ‘content generators’ have signed up, including Diesel Radio, former BBC Radio 1 presenter Chris Coco, leading music blogs such as Curb Crawlers and great record labels such as Border Community.
"Over 2,000 shows have been uploaded so far," he continues. "And our stats show that 40 per cent of our users come back to Mixcloud ten times per month on average to seek out new mixes."
Mixcloud runs all its content from the Amazon cloud, which makes it accessible on demand, anywhere – hence the name: Mixcloud. This has given rise to the coinage of “Cloud Radio” and the content as “Cloudcasts”.
Perez and Shah hope that the public launch of the site will attract 100,000 users by the end of the year. "We’ve already got 25,000 users a month and that’s before the official launch," says Shah. "Once we hit 500,000, we can start monetising the site."
The revenue model will be 50 per cent advertising and sponsorship and 50 per cent premium content and affliliate led. "Given the current state of the ad industry, we didn’t want to rely on one medium," says Perez. "We’ll offer premium access accounts and things like concert ticket sales once the sales platform is live."
But the young entrepreneurs don’t have to worry about making money just yet. "We’re concentrating on growing the user base first," says Perez. "But we don’t take a salary, we live very cheaply in a warehouse and we’ve bootstrapped the whole way."Want to find out how these young entrepreneurs launched their new startup with minimal funding” Check realbusiness.co.uk tomorrow for our bootstrapping guide, Mixcloud style.