Web3 startup Spaceport announced today that it has raised $3.6 million in pre-seed funding to build a blockchain-based protocol to streamline IP licensing and make it easier for creators to receive royalties.

Here, Web3’s native venture fund Decasonic and Crit Ventures, the venture capital arm of game developer Com2uS, co-led the funding round. Other investors who also joined the round included Cozomo De Medici, Diaspora Ventures, Infinity Ventures Crypto, FBG Capital, Nextview Ventures, Republic Asia, and Valhalla Ventures.

Tech entrepreneurs Le Zhang and Lida Tang founded Spaceport to tackle the complicated and legalistic paper-and-pencil industry of IP licensing to help creators, brands, and agencies monetize their IP and gain better exposure through Blockchain technology and Web3.

Web3, also known as the decentralized web, uses cryptographically protected transactions on blockchains to track and execute peer-to-peer contracts between parties that can be used to provide a programmable way to exchange intellectual property rights. Blockchains also create the foundation for cryptocurrencies, with prominent examples such as bitcoin and Ethereum, which can be used for monetization.

“We built Spaceport to give creators and brands the ability to monetize their intellectual property faster and easier than ever before,” said Le Zhang, Co-Founder and CEO of Spaceport.

A big part of the problem, according to Spaceport, is that small creators are being squeezed out of the market due to the overhead associated with managing intellectual property rights. Using the protocol and Spaceport’s first application, Spaceport Core, monetization of IP will be greatly simplified as your catalogs will become Web3 assets and from there you will be able to use smart contracts to establish deals and receive royalties through the app.

“Spaceport unlocks a key challenge for creators to embrace Web3 by aligning value creation with their intellectual property. Their licensing infrastructure is affordable, easy to use and generates growing revenue,” said Paul Hsu, founder and CEO of Decasonic. “Today I see great potential for smart contracts to improve the licensing process and contracts.”

Media licensing and royalty management companies have been exploring blockchain technology in a bid to save costs and attract new audiences in the hope that it could help alleviate decades-old pain points. Examples include Anote Music’s royalty investment platform, which allows artists and labels to license their music rights to investors and manage royalties to raise capital, and Tech’s blockchain-based rights and contract management system. Mahindra using IBM Corp.’s Hyperledger Fabric. IP management.

Music streaming service Spotify even jumped on the bandwagon with its acquisition of Mediachain Labs in 2017, albeit only to track down attribution and licensing details.

Spaceport currently offers its protocol and application privately through a number of major partnerships with media, gaming, and consumer goods companies.

The company said it intends to use the fundraising to continue recruiting talent, reach more partners with prominent intellectual property portfolios who want broader exposure, and build on the company’s public launch of its products.

Image: Spaceport