NEW YORK (TheStreet) -- Johan Lagerlof is making real money with a way-untrendy digital music business idea: What humans want is not tunes coldly conscripted into musical service by robots, but songs lovingly curated by other living, breathing humans.
"We have the tech tools for distribution and management and the boring stuff. But we have humans do all the fun stuff," said Lagerlof, the engaging and surprisingly blunt CEO of X5 Music Group, a Sweden-based digital music distribution and marketing company, over the phone from Stockholm.
And at least so far, the musical bots at Pandora's Music Genome Project and whatever intelligent preference engines that drive Spotify, Facebook and Google appear to have something to worry about. Not only have investors begun to debate the true power of machines automating the musical experience; the 30-employee X5 saw $12 million in revenue last year. Sales are growing by 30 percent year over year, mostly through the sweat and blood of roughly 40 paid independent music curators who hand-pick X5's tracks and mixes.
"We work with music nerds from around the world that create playlists, select anthologies and craft music collections," Lagerlof said. "And then we distribute them on various digital platforms."Like many musical entrepreneurs, Lagerlof started off as a songwriter and producer. But the downturn in music revenues caught up with him, and his business collapsed in the early millennium. "It was fun sitting in the studio," he said. "But it was sad because your costs were not covered."