Update: On Tuesday, Sellaband posted a statement on its Web site that indicated the company has obtained a trustee to guide it through its bankruptcy. In addition, the company indicated it expects to find a potential buyer. No indication was given exactly when such a transaction might occur.

Sellaband, a Web site that allows bands to seek investments from their fans, filed for bankruptcy in an Amsterdam court on Monday. A report at Hypebot includes an English translation of a court document that indicates its status as insolvent. The company’s Web site currently notifies visitors it is down for maintenance.

Sellaband launched in August 2006. The company, registered in Germany and operated in the Netherlands, received a $5 million investment from PrimeTechnology Innovation. Prior to launching Sellaband, CEO Johan Vossmeijer was an executive with Sony Music. Over $3 million has been invested in artists through Sellaband.

While dozens of artists had met their funding goals, not all Sellaband participants were a success. Just last week, Billboard.biz reported that Public Enemy’s fan-funded album had failed to reach its $250,000 goal and had lost investors in the last two months.

Along with SliceThePie, a UK-based company that is still in business, Sellaband launched to much media attention and expectations. That was a time when do-it-yourself, fan-funded projects were seen as the perfect alternative to a corporate-lead music industry. Direct-to-fan technologies have improved in the last four years, but the jury is still out on whether or not an entire business can be built on fans’ up-front funding of bands’ albums.