“Mad Geniuses” Take on Pandora in Quest to Create Online Radio Magic

Xconomy Boulder/Denver — 

Here’s a challenge: Turn off Spotify, Pandora, or iTunes for a minute, and try to remember the last time you really loved listening to the radio. What made it special? Was it the particular time in your life, or a crew of disc jockeys who had a sixth sense about introducing you to the perfect new bands?

It can be a little hard to remember the virtues of traditional terrestrial radio in the iPod/streaming music/SiriusXM era. Technology has empowered listeners to become their own programmers, and the consolidation of the radio industry has created a lowest-common-denominator blandness.

But some people remain true believers in radio. Eric Neumann, founder of Mad Genius Radio, is one of them, and he thinks that he and his startup will convince you to be one, too.

Mad Genius Radio is a Denver-based company that just launched a new streaming music service available online and on Android and iOS. The company’s goal is to combine the power of new technology with the ineffable magic of great radio stations.

“There’s this ability to take the things radio does really well, and take the technology, and bring the two together,” Neumann said.

Creating a new streaming music service in 2014 might seem a little, well, mad. Just look at the competition. Pandora (NYSE: P) has 76.5 million active listeners (and is about a $4 billion company), Spotify claims more than 40 million, virtually everyone has their favorite playlists stored on their smartphones or computers, and Apple, Amazon, and Google all are trying to break into the streaming music game.

None of that daunts Neumann, who is a serial entrepreneur and a radio industry vet. He thinks those companies make good products, several of which he uses, but their business models, technological approach, and understanding of what makes music special are off.

It starts with the human element, Neumann said. People have eclectic tastes, and even if they spend hours and hours creating well-curated collections, they still want variety, to discover new acts, and also to hear deep cuts that rarely get played from musicians they love.

Neumann feels existing solutions fall short. Playlists lack the wonders of surprise and discovery, while relying on streaming music’s algorithms can yield choices that are predictable and unreliable, Neumann said.

“People are eclectic, and that’s because people’s musical tastes are based on an emotional connection and not a mathematical correlation, like all these other apps are putting out there,” he said.

Screenshot of Mad Genius Radio's appMad Genius has its own algorithm, but Neumann said the idea behind it is different. It’s not based on asking listeners to make binary thumbs up/thumbs down decisions and then trying to create correlations.

Neumann describes his startup’s approach as “rotational,” and it sounds a bit like the classic radio method of relying on DJs and programmers to create the right mix, only that it lets listeners take an active part. That’s crucial, because no matter how good stations can be, music lovers are a prideful crowd.

“Just ask anyone, and they’ll tell you they have the best taste in music, so we’re here to give them the right tools to get the best possible radio for themselves,” Neumann said.

New users start by picking from about 100 genres, ranging from country to dub step to classic jazz, with the songs in each category picked by human “radio curators.” Listeners then create “presets” that mix up to seven genres while also selecting the frequency songs from each genre appear. They also can rate artists and songs to determine how often they’ll play.

That will create an “infinite playlist” that is naturally personalized to each user, Neumann said. At the moment, Mad Genius Radio has more than 23 million songs from hundreds of thousands of artists in its repertoire, the company said.

I did a quick test of the product, and while I couldn’t verify those numbers, it did live up to the others. Songs from bands I love were mixed in with ones from new artists that I’ll check out, and there were surprises from bands I had lost track of. Of course, there were a few duds mixed in—one way or another, U2 will make you listen to its new album, dammit!—but that’s what the skip button and alternate presets are for.

If Mad Genius Radio has a shortcoming, it’s that its catalogue is oriented to the types of music that have dominated radio since the Baby Boomers came of age, along with a couple of niche genres. There’s a good deal of Classic Rock and some Motown, but only a little Jazz and no Classical that I could find.

Along with the presets listeners can create, the site also has some other cool features, like a special “guilty pleasures” channel. So far, that features dozens of songs you might not want to add to your playlist but have a soft spot for, like Cutting Crew’s sappy ballad “(I Just) Died in Your Arms.”

For Gen Xers and Millennials on a nostalgia kick, there’s also a “time machine” feature that will blend into the mix songs from genres such as Top 40 and urban soft hits, with the catalogue going back to the early 1990s.

When I tried it, it did the trick. After telling Mad Genius to play alternative rock hits from the winter of 1994, it immediately called up a few semi-forgotten tunes from Pearl Jam and Radiohead that were among my favorites back then. A deep cut from Peter Gabriel that I had never heard followed, along with tracks from bands like Teenage Fanclub and The Jayhawks that like-minded friends rave about but I’ve never before given a listen.

The goal of the time machine is to “recreate a soundscape,” Neumann said, and I take that to mean more than rehashing the handful of played-out hits that are staples of radio flashback shows. If that’s the intent, Mad Genius Radio succeeded. And even when the time machine “failed,” it was fun, although maybe unintentionally. After all, who can resist the chance to hate Stone Temple Pilots all over again?

So, will a couple of cool features and neat ideas be enough to enable Mad Genius to grab ample listeners—and paying customers—to become a viable business?

Neumann thinks so. First, the company is going to use a subscription model that asks users to pay $5 a month, or a reduced rate of $48 for the year if they sign up for the annual subscription. That’s cheaper than what Spotify’s 10 million-plus subscribers pay for its premium service and on par with what Pandora’s 3.5 million subscribers pay.

But the vast majority of those companies’ listeners don’t pay anything. The tradeoff is they have to listen to ads—sometimes a lot of ads—and that’s the one part of the radio experience almost no one is nostalgic about. They also lose features like the ability to search for songs or can only skip a limited number of tunes they don’t like.

After an introductory period, Mad Genius Radio won’t offer a free option, betting listeners will be willing to pony up for a full-featured product with no advertising. It also spares the company the challenges and costs of courting and retaining advertisers.

“It’s tough making a living on an ad model,” Neumann said.

He also said that the model should enable Mad Genius to give artists and songwriters more in royalties, which is a huge issue between the music industry and streaming music services.

That still leaves Mad Genius Radio the challenge of getting listeners. It’s just coming out of its beta trial, where about 2,000 people used it.

Neumann said Mad Genius’ listener counts don’t need to be nearly as high as its competitors’ total active listener counts for the company to be sustainable. But it does need to convince people to pay, which even Pandora and Spotify have found difficult.

That doesn’t faze Neumann.

“We [will be] profitable at just a few hundred thousand listeners. We don’t ever have to be bigger than Pandora, or beat them, or be chasing them in the No. 2 slot,” he said. “We can afford to be a player that might only have a million or two million listeners and be as profitable as Pandora is today.”

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2 responses to ““Mad Geniuses” Take on Pandora in Quest to Create Online Radio Magic”

  1. Philip Landau says:

    Mad Genius. Hardly. This is a flat out Rip-off of Radical.fm. Right on down to cherry picking the narrative and flat out stealing the exact player that Radical developed years ago. Unreal. Michael, you really need to do your research!!! Mad Rip-off, you need to come up with your own ideas instead of stealing!

  2. Tony Loro says:

    Tried. Gork. Will not use.