Difficulty in Utopia? As company offloads Sentric to Believe, tax financial obligation looms and workers go unsettled in Sweden
Is problem developing at Utopia?
Today (March 30), MBW broke the news that the business had actually offered music publishing platform Sentric Music Group [67 articles]href=”https://www.musicbusinessworldwide.com/companies/sentric-music-group/”> Sentric to Believe [286 articles]href=”https://www.musicbusinessworldwide.com/companies/believe/”> Believe– simply one year after Sentric was itself obtained by Utopia.
The sale of Sentric marks the 2nd time this year that Utopia has actually unloaded a business that it formerly obtained within the previous 18 months: last month, Utopia offered music market directory/data platform, ROSTR, back to its creators Mark Williamson and Adam Watson.
Paradise is supposedly being taken legal action against by United States music innovation business SourceAudio, with the latter company implicating the previous of reneging on a predetermined acquisition offer.
Contributing to this story: at the top of 2023, we found out that Utopia was parting methods with veteran CEO Markku Mäkeläinen, following a round of layoffs in November that were believed to have actually impacted 20% of the business.
Now, according to a bombshell report from Scandinavian news outlet Breakitsome Utopia workers have actually just recently gone overdue, while a considerable tax financial obligation– likewise supposedly unsettled– towers above the business in Sweden.
What’s more, MBW is hearing reports that Utopia is presently thinking about a fast sale for 2 more of its UK-based current acquisitions: Appropriate and Cinram
Breakit reports that Utopia’s Swedish business Utopia R&D Tech owes over 8 million SEK (approx $768,400to the Kronofogden, the Swedish Authority in charge of financial obligation collection and the enforcement of court orders in the nation (i.e. the bailiff).
The report includes (equated from Swedish) that “there are an overall of 19 payment orders [to Utopia from] the Bailiff, needs which have not yet end up being a recognized financial obligation. Those requirements differ in size from a couple of thousand kroner approximately millions”.
In addition, 3 ‘insolvency applications’ have actually supposedly been directed at Utopia by workers through their trade union, Akavia, over overdue pension premiums.
One worker informed Breakit that they have not gotten their income from the business just recently, nor have actually gotten their pension premiums ‘for numerous months’.
Breakit price quotes that round of redundancies in November affected 20% of Utopia’s labor force.
A Utopia representative informed Breakit: “We truly say sorry to all impacted staff members and tension that we are taking this matter really seriously. All late payments have actually been recognized and will be fixed in the coming days”.
Breakit reports that Stockholm-based Utopia R&D Tech was formerly called ISPY Group prior to it was purchased out in 2018.
The Swedish business’s turnover, according to Breakitwas SEK 67.3 million in 2021, with an operating earnings of SEK 3.6 million and a labor force of 44 individuals.
MBW asked Utopia for a remark about the scenario with its business and staff members in Sweden.
A representative informed us today (March 30): “Utopia has actually grown incredibly quick in 2 years. Our Swedish entity alone grew 5x in staff members, which is one out of numerous of our advancement workplaces.
“We dealt with more than EUR300 million in 2015, and continue to grow really quick. Now we’re adjusting our company to market shifts to make sure that we can continue to develop our company in a sustainable way.
“All payments pointed out in the post have actually currently been recognized and are being solved. We have actually established procedures and structures to make sure that this will not occur once again.”
Paradise got US-based ROSTR and Austria-based music information analytics platform, ForTunes, in December 2021, leading the way for the facility of Utopia’s Creator Services system in 2022.
That acquisition formed part of a purchasing spree at Utopia in the last few years, with a string of UK-based acquisitions consisting of: physical music supplier Cinram, Absolute Label Services, Liverpool-based music publisher and publishing administration business Sentric Music Group, and UK-based supplier Proper Music Group, amongst numerous others.
In April, Ulf Zick left his function as Managing Director, International at Universal Music Group [3,042 articles]href=”https://www.musicbusinessworldwide.com/companies/universal-music-group/”> Universal Music Germany to sign up with Utopia, the acquisitive Switzerland-headquartered fintech company directed by Markku Mäkeläinen.
6 months after signing up with Utopia as Chief Marketing Officer, Zick revealed he was leaving the Swiss business for a task back at Universal Music Group [3,042 articles]href=”https://www.musicbusinessworldwide.com/companies/universal-music-group/”> Universal.Music Business Worldwide