In the world of Instagram and TikTok, where you can’t find who first choreographed that trending dance due to lack of credits, Jaxsta (ASX: JXT) stands out. It gives credit where credit’s due and will now do so via social media. 

A database of music credits, Jaxsta has acquired the musician social networking site Vampr for about $5 million. This acquisition bolsters the Company’s growth strategy, giving it access to over a million creators. It is also crucial to Jaxsta’s build-up to its online music marketplace: vinyl.com. 

Jaxsta’s CEO, Beth Appleton, stated, “The acquisition of Vampr represents a rare opportunity to accelerate our B2C expansion through the launch of our e-commerce platform, vinyl.com. We continue to focus on driving revenue growth and profitability capitalizing on the bedrock of the Jaxsta platform and the moat we have built through our industry-leading music data solution.”

Jaxsta will acquire Vampr in exchange for 88,734,476 shares in Jaxsta, i.e. about $4.7 million, given a share price of $0.054 at the time of writing. Plus, it will pay up to $364k and any other cash consideration within a year of completion. The Company will also cover Vampr’s legal and accounting fees of up to $21k. 

Vampr Founder and CEO Josh Simons will don the hat of Jaxsta’s Chief Strategy Officer with a minimum two-year term comprising a base salary of $180k plus superannuation and entitlements.

Simons added, “Combining our grassroots network with the definitive official music credits database is both a highly strategic and logical combination which we believe will provide great value to Vampr and Jaxsta’s users as well as our mutual shareholders. Our team cannot wait to get started and to support Jaxsta in realising their Vinyl.com vision.”

Vampr’s creator user base of 1.3 million grew by 23% over the last year and is expected to drive growth in Jaxsta subscriptions. The social networking site makes money via paid subscriptions, ads, royalty collections, and a freemium business model. This acquisition is a good deal for the companies and their musicians and advertisers, getting them greater recognition. 

Non-Executive Director of Jaxsta, Ben Katovsky, commented, “Jaxsta has been built on recognizing and supporting music creators. Jaxsta’s music credits database and community already built to power this will be key enablers of Jaxsta’s strategy to create a unique community-powered music discovery experience on Vinyl.com.”

What’s more? This acquisition is not just a social media buzz; it’s also about tapping into the growing vinyl-buying audience. Millennials and Gen-Z are turning back the clock and ruling the roost when it comes to vinyl sales. Vinyl growth reached 43.46 million units in 2022, with sales revenue reaching $831 million in the first half of 2022.

According to Paul Wiltshire, CEO of Songtradr, this collaboration essentially puts the two companies at “the top of the funnel”. It could also signify more significant revenue seeing how the combined unaudited revenue in H1 FY23 would be over $608k. Put in perspective, Jaxsta brought in about $200k in revenue in the first half of FY23.

The Company’s share price has increased by 10.4% since the announcement, increasing to 5.30c per share. In fact, its price has been growing nearly consistently over the past six months, signalling confidence among shareholders.