Business

Japanese Music Group Avex Launches US Operation

Tarina Doolittle

From left: Avex USA executives Andrew Hawthorne, Lucas Thomashow and Naoki Osada.

The new recording and publishing arm, Avex USA, will be led by president Naoki Osada.

Japanese music and entertainment giant Avex Group is expanding into North America with the launch of new recording and publishing arm Avex USA, the company announced Wednesday (April 28).

Led by president Naoki Osada, an Avex Group veteran of more than 10 years, Avex USA is comprised of three core divisions: Avex USA Publishing, a record label called SELENE and the Future of Music Investment Fund, which supports innovative startups in music, tech and finance. Avex USA is headquartered in the newly-opened, 6,500 square-foot Avex House in West Hollywood, Calif., which houses four recording studios and a production facility.

"Given the paradigm shift in the music industry that has been accelerated by technology innovation, we felt now was the perfect time to establish a new model for launching, developing and breaking creatives and artists," Osada tells Billboard. "We want to cross over music, tech and finance with a boutique approach and leverage our strengths in the Japan/Asia market to further innovate in the music business."

Often considered the fourth major record label in the Japanese music industry, Avex Group held an 8.6% share of the Japanese music market as of 2019, placing them third place behind Sony Music and Universal Japan. The company had plans to scale down its business in recent months, including selling its 18-story building in Tokyo and laying off some employees. But Osada says those moves were not about downsizing, "but instead about shifting focus to invest in new opportunities and types of IP and to empower a new class of passionate executives."

The executive says Avex has always had its sights set on global expansion, and sees opportunity in bridging the gap between the music industries in the U.S. and Japan, which is the world’s second-largest music market according to the IFPI. "Avex USA is a key part of these new opportunities that the global company is looking to invest in."

Prior to his new role overseeing Avex USA, Osada held several positions at Avex Group stretching back to 2007 including head of innovation and strategic partnerships; chief producer, corporate venture capital and associate manager, international business development.

Meanwhile, Avex USA Publishing is poaching Defend Music's Christy Saguanpong as vp of publishing administration, as well as Primary Wave's Andrew Hawthorne for the role of vp of publishing A&R.

Avex USA Publishing has also entered a joint venture agreement with the publishing arm of Brandon Silverstein's S10 Entertainment to sign and develop writers and producers together. That begins with the signings of producer and longtime Justin Bieber collaborator Bernard "Harv" Harvey and Internet Money producer Cxdy. "Naoki and his new team’s creativity and vision are catapulting the Avex business in the U.S. and we are proud to be developing and signing such amazing talent with them," says S10 vice president and head of publishing Josh Hallbauer.

The new signings join a roster at Avex USA Publishing that already includes superstar hitmakers like Bryan-Michael Cox (who has produced for the likes of Usher, Mariah Carey and Mary J. Blige) and Patrick "J. Que" Smith (Britney Spears, Beyoncé, Ariana Grande). Off the bat, Avex USA Publishing holds stakes in Bieber's "Peaches," Cardi B's "WAP" featuring Meghan Thee Stallion and Grande hits like "Positions," "thank u, next" and "7 rings."

Next, the company's record label SELENE will be led by newly-appointed Avex USA vp strategy/operations Lucas Thomashow, a former head of music at Brat TV and strategist at Google. Thomashow says the label will focus on U.S. artists and music, including initial signings Zach Hood, DIRTYXAN and Sophie Holohan. However, "We will leverage Avex's strengths in the Japan/Asia market to better serve our creatives and provide unique opportunities to expand their reach," he adds, and in the near future, Avex USA will also help break Japanese artists in the U.S.

"Our priority is creating synergy across an A-list publishing roster, new record label and music tech investments to empower, develop and break the top creatives and next generation of young impactful artists," he says.

Finally, Avex USA’s Future of Music Fund is led by Osada alongside vice president, head of finance Ryusuke (Ryan) Kamada, formerly of JP Morgan's Investment Banking division.

The fund will focus on music-tech startups creating new IP, music experiences and revenue models, with initial investments in virtual concerts company Wave, which has put on shows with artists like John Legend and The Weeknd, and virtual artist record label Spirit Bomb, the brainchild of production company Strangeloop Studios.

"We’re very bullish on the metaphysical and digital world that we think will be as important as the physical space around us," Osada explains. "The digital world provides another dimension for the music industry. We want to focus on technologies that would become a key part of that world and create new IP, experiences and revenue channels for it."