Koor is an app for over 100 million people who sing in choirs.
Business overview
Business highlights
- Winner of £175,000 Sustainable Innovation Award
- Ranked 28th in Tech South West's Top 50 Most Innovative Startups
- Established recording unit in Islington
- Partnered with Stay @ Home Choir and Royal Philharmonic Orchestra
Learn more about convertible campaigns.
Idea
Introduction
Koor enables choral singers who have trouble reading music to learn their parts by interacting with high-quality recordings of professional singers, and in the near future, will help them improve their vocal technique by interacting with personalised online guidance driven by machine learning-based algorithms.
Over three-quarters of people who sing in choirs say that due to their inability to read music fluently, they struggle to learn their parts.
Koor helps choral singers to practice their parts joyfully and improve their technique through engagement with interactive recordings of repertoire sung by professional singers.
We are developing AI functions that will help singers improve pitch, sound quality, breathing and pronunciation. These advanced functions will form the backbone of our premium subscription.
Substantial accomplishments to date
At the start of 2020 we raised £110,000 on SEEDRS.
At the beginning of March we started work on our MVP. In response to the COVID-19 lockdown, we managed to reduce our development schedule from four months to five weeks.
We released our MVP at the end of April.
In June we ranked 28th in Tech South West's Top Fifty Most Innovative Startups.
In the middle of July we rented Unit 1.1 Islington Studios and began setting up our recording unit
In August we won a £175,000 Sustainable Innovation Grant from Innovate UK.
At the end of September we had our first week of recording in our Islington Studio. The setup worked as planned and we managed to complete recordings of more content than anticipated.
In November and December we are running a series of online workshops, one of which is in association with the Royal Philharmonic Orchestra and John Rutter.
Monetisation strategy
As the company grows we anticipate many revenue opportunities for Koor, but initially we are focused on the strong revenue potential offered by:
- premium subscriptions
- advertising
- branded content
- data sales
Premium subscriptions
We are planning to offer three types of subscription when Koor’s premium functions come online.
$12/£9 per month - a month-to-month subscription that can be cancelled at any time.
$115.20/£86.40 per year ($9.60/£7.20 per month) for users who sign up for an annual subscription.
$96/£72 per year ($8/£6 per month) for an annual group subscription. This rate is available to affiliate choirs who exceed a registration threshold of 20 subscriptions.
We are also exploring institutional pricing for schools, universities, businesses, etc.
Advertising
Advertising revenue from freemium user usage will come from the monetisation of three regions within the app; the launch screen, a block while audio is loading, and a banner at the top of the audio player.
Use of proceeds
It is highly unlikely that choirs will return to normal until September of 2021 at the earliest. Until then, choral singers are actively looking for online solutions to provide rewarding, inspiring experiences.
Koor is responding to this need by providing services and building functionality that will support choirs for as long as COVID-19 is with us. And, by doing so, we anticipate that we will dramatically increase our acquisition numbers over the next twelve months.
At the same time, we are taking this opportunity to scale the company and our services intending to become the go-to solution for choirs when they do return to normal activities.
The investment from this raise will go to
- taking on more software engineers so that we may speed up development on premium functionality
- recording the most commonly sung choral works
- acquiring more users through presenting online activities for as long as the coronavirus stops choirs gathering.
Key Information
Loans
Koor has an unsecured loan of £100,000 provided as part of the government's COVID-19 response.
Interest on the loan is 2.5%, the term of the loan is up to 60 months with no penalty for early repayment.
Payments are due to begin in May 2021.
Funds raised as part of this round will not be used to repay this loan.
Convertible key terms
This investment round is being raised by way of a convertible equity investment structure, in this case an "advanced subscription agreement".
The key terms that apply to the Company’s advanced subscription agreement are set out below. See also attached Key Terms document for further details.
Discount – conversion at a 20% discount to the valuation set by a Trigger Event.
Valuation cap of £4,000,000.
Conversion is triggered by "Trigger Events":
An Equity Fundraise – defined as the Company raising investment capital of at least £500,000 from one transaction or a series of transactions, in exchange for the company issuing of shares;
A Change of Control of the company (transfer of more than 50% of the share capital); or
An IPO – being a listing of the company’s shares on a recognised stock market or secondary market.
Longstop Date is 6 months from the date of the advance subscription agreement.
If conversion has not been triggered by the Longstop Date shares will be issued on the longstop date at the Default Share Price, which is the lower of:
(i) the lowest price of any share issued after the date of the agreement; and (ii) a price per share of £0.06 (based on the share price of the company’s last funding round)
The convertible would also convert to equity at the Default Share Price in the event of winding up or liquidation of the company.
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