The Edtech Unicorn World Tour: Israel
A series in Collaboration with Alberto Arenaza of Transcend
HolonIQ keeps a meticulous list of the global Edtech unicorns (private companies valued at over $1 billion dollars), and as an Edtech observer, it’s always been a fascinating list and an interesting look at the relative size of different Edtech markets.
Over the next months, Alberto Arenaza, a phenomenal Edtech journalist, mentor and investor, and I will be doing some deeper dives on some of the companies on the list, starting with some that Western audiences may not be as familiar with.
Alberto kicked it off last week with GoStudent, the Austrian company that has become Europe’s first Edtech Unicorn- the first of many, based on the excitement in the European ecosystem.
For my entry, I wanted to explore Israel’s only Edtech unicorn. Israel is a hotbed on innovation in tech- and has been dubbed “Startup Nation”, due to citizens there founding the most tech companies per capita in the world. It also is known for building unicorn companies and had a record year in 2021, with $25 Billion Raised and a record number of Unicorns, Mega-Rounds, and Acquisitions.
But so far, only one of these unicorns is in the Edtech space- the music education startup Joytunes. Without further ado, here’s an overview of Joytunes, a fascinating company that has really found a powerful niche that resonates all over the world.
JoyTunes (the only Israeli Edtech unicorn)
Joytunes is an Edtech company based in Tel Aviv, Israel, which focuses on mobile-first music education. According to the Joytunes blog on Medium:
“JoyTunes is a music learning start-up building the “Netflix of music learning and playing”, bringing music to homes around the world as we reshape the way families spend their active time together.”
“JoyTunes is reinventing the way to learn, play and experience music, making it possible for anyone to learn to play a musical instrument. To do so, we combine music education methods and note recognition, with our MusicSense™ acoustic engine, to help millions learn piano, guitar, singing, or any instrument they always dreamed of playing.”
The company has approximately 110 employees, just about all of whom are Israeli, with the notable exceptions of Jack Nicholson (bottom left) and Waldo (upper right).
The claim to fame for this startup is the “MusicSense™ acoustic engine” a proprietary piece of technology that allows users to turn their phones or tablets into listening devices that can tell with great accuracy what a user is playing on their home instruments, all with no additional devices or connections.
“By combining music methodologies with the latest in gaming features and our MusicSense Engine, players use real instruments that are auto-magically detected by our apps - no wires needed.” - Joytunes App site
This ‘no wires’ note is key (all piano puns intended); while most other music training software requires additional hardware to physically connect an electronic instrument, such as a MIDI keyboard, electric guitar or microphone, to a computer or device, Joytunes’ apps allow users to play instruments unencumbered. This means that they can use analog or digital pianos, acoustic or electric guitars, or sing with no microphone (other than the one inside their devices).
”Using our patented acoustic note recognition engine, the device listens to what you’re playing through the [phone or table] microphone in real-time to give immediate feedback. Multiple notes are recognized better than any other apps, even with background noise.
We utilize the latest features in UI/UX, audio processing, 2D rendering and deep learning, across all mobile platforms, to deliver the best learning experience to millions worldwide.”
As a result of this proprietary and easy to use technology, along with a strong dedicated Design and PM culture which emphasizes gamified UX, Joytunes’ suite of apps have become cultural phenomena in the music education space, with over 10 million downloads worldwide and over 1 million songs played per day.
Let’s look at Joytunes’ apps in turn, as they cover a range of different models, audiences and instruments.
Direct to Consumer Subscription Apps
Simply Piano is designed as a direct to consumer learning product with subscription pricing; after a 7 day trial, Simply Piano costs $10-20/month ($119.99 per year, $89.99 for six months, or $59.99 for three months).
Simply Guitar also uses the D2C model, and uses the MusicSense engine, but is designed for guitar training, another wildly popular instrument around the world. As of this writing, Simply Guitar is the 27th most popular education app on the Apple App Store. It currently sells at a lower subscription cost ($89.99 per year vs. $119.99 for Simply Piano), which may reflect higher price sensitivity on the behalf of guitar players globally.
Subscription App for Consumers and Educators
Piano Maestro (iPad only) is designed explicitly for piano teachers— although any of the Joytunes apps could be used in conjunction with a live teacher. The app includes piano teaching books in its “Methods” section, provides weekly progress reports to teachers, and allows teachers to assign “Home Challenges” for students to complete between lessons.
Joytunes claims on its site that 10% of piano teachers use its apps, and one Joytunes Facebook group designed for Piano Maestro users has over 4,000 members.
Piano Maestro also offers educator pricing along with consumer pricing options:
“My Studio” ($9.99/month annually or $12.99 a month) unlocks the app to be used on a piano teacher’s own iPad with multiple students
“Studio + Home” ($14.99/month annually or $19.99 a month) unlocks the app to be used on a piano teacher’s own iPad and on all of their students’ iPads.
In-App Purchases, Direct to Consumer
Joytunes also offers fully gamified piano learning apps Piano Dust Buster and Piano Dust Buster 2, in the style of music games like Guitar Hero and Rock Band.
In Piano Dust Buster, the user helps Granny defeat germs and dust creatures as they land on piano keys by playing notes in time; there is a sheet music notation mode called “Staff Master” and a simpler ‘germ attack’ mode without music notation.
These were Joytunes’ first apps released from the early 2010’s, and include in-app keyboards along with the option to play real or digital pianos. These apps sell in-app ‘song packs’ ($4.99 each) rather than a subscription; I would posit that only a small amount of Joytunes’ user base and revenue comes from Piano Dust Buster, given the crowded market for music and gaming apps and the wild success and higher price points of the Simply series.
Free Apps
Simply Sing, just released in 2022, is a free app designed to find the vocal range of a singer and adjust popular songs to that range. It seems likely that, given the size of the market for karaoke and other singing apps, Joytunes may be working on a version of their MusicSense™ algorithm that can accurately track voices and provide instant feedback.
Simply Tune (and Simply Metronome) are free tuner and metronome apps that allow users to tune their guitars, basses or ukuleles, or to keep time. They are supplemental apps made for musicians with only mild educational elements.
All Joytunes apps are offered in a wide variety of languages, built mobile first (in fact, they are not available on computers), and incorporate elements of gamification.
Simply Piano
Of all of Joytunes’ apps, Simply Piano has been the biggest breakthrough; it is not only the most popular piano app in the world, but has broken into the top ten education apps overall in 2018, and risen ever since.
This puts it squarely in the admirable company of public Edtech companies like Duolingo and Kahoot!, or giants like Byju’s, Google Classroom and Photomath.
Sensor Tower's State of the Mobile Education Market 2021 Report
Moreover, the share of education spend on Music apps in Europe almost tripled between 2017 and 2020, eating into the language market as a percentage of sales.
To be clear, language is still dominant; not only does it constitute the plurality of app revenue in Revenue, but its revenue grew 50% between 2019 and 2020- good news for Duolingo, Babbel, Cake. That said, the music category grew 121% in that time, twice as fast as online classes.
Currently, Simply Piano and Simply Guitar sit next to each other at #26 and #27 on the Apple App store’s list of top educational apps, perhaps having dropped since the return to traditional schooling.
The Simply Piano Experience
Simply Piano is also an illustrative example of a modern Joytunes product; it is cleaner and much less illustrated and cartoonish than Piano Maestro or Piano Dust Buster, but still contains gamified elements and structured learning.
Simply Piano’s learning interface is simple and clear, allowing users to focus on the music itself- but it also includes a gamified progress bar and options for tempo changes. Black notes are unplayed, correct notes turn blue, missed notes red, and delayed notes yellow.
Simply Piano’s course progression includes two parallel paths- Soloist (blue) and Chords (red)- this provides an element of choice for learners at all times. Elements of the platform include video courses, practice lessons, progressions, and songs. Simply Piano has 25 courses for different skill levels and hundreds of different songs spanning multiple genres.
Courses are sequenced and unlocked like game levels, and learners pick up ‘skills’ as they go. Also note that the call to action for each course, “Play”, is a verb shared by both music and gaming.
Crucially, Simply Piano, unlike many piano teachers and other musical apps, does not assume that piano learners are necessarily looking to learn the classical genre; while there are classical lessons and songs available on the platform, many do not, and popular figures in rock and jazz are used as illustrative elements.
The “songs” section of Simply Piano is a Netflix-like interface that recommends popular songs in a variety of genres in relation to the course progression and level of the learner.
Joytunes As A Company
Founders
Joytunes was founded in 2011 by Yuval Kaminka (CEO) Roey Izkovsky (CTO) and Yuval’s younger brother Yigal Kaminka (Musical Director). Yuval and Roey came from the technology side, having been in the same elite intelligence unit of the Israeli army and having Master’s Degrees from the Weizmann Institute, one of the top science research institutes in the world, while Yigal came from the music side; he is the first oboe in the Jerusalem Orchestra, and holds a Ph.D in music from the Academy of Germany.
Funding History:
Joytunes’ funding history has been strikingly even over the years, almost like a mathematical (or musical) equation: .5, 1.5, 5, 10, 25, 50.
2012 - $500K Angel Round
2013 - Seed round ($1.5m)
2014 - Series A ($5m) led by Aleph and Genesis Partners
2018 - Series B ($10m) led by Insight Partners
2019 - Series C ($25m) led by Qumra Capital (bringing total to $43m)
2021 - Series D ($50m) led by GV Ventures, the venture capital arm of Alphabet, bringing total funding to $92m.
Revenue:
According to Israeli newspaper Calcalist’s reporting, Joytunes revenue had reached $20m by 2019, and then jumped 5x to $100m in 2020, likely due to a combination of pandemic fueled user growth and perhaps a ‘tipping point’ in which Simply Piano and Simply Guitar became the go-to apps for aspiring musicians and piano teachers.
2019: “JoyTunes now has more than 200,000 paying subscribers and has surpassed $20 million in annual revenues, JoyTunes founder Yigal Kaminka said at Calcalist’s conference on music and technology in May.” - Source
2020: “The Israeli startup's revenue in 2020 surged to around $100 million, although the company is still believed to not be profitable.” - Source
Key investors and mentors have included:
Eden Shochat, Aleph VC
Ron Tamir, Kaedan Capital
Gil Canaani, Hearst Ventures
Head of Yahoo Creative Innovation Center Eran Shir
Palantir co-founder Joe Lonsdale
Dana Messina, former CEO of Steinway
Jeremy Stoppleman, CEO, Yelp
Zohar Gilon, Tamar Technology Ventures
Noa Korman, Qumra Capital
GV Ventures
Ofer Lazovski
Ziv Yanous
Competition
As with most app categories, there are many other music teaching apps on the App and Google Play stores; some are other Guitar Hero and Rock Band copycats, some are piano teacher’s helper apps, and others are UX-friendly direct to consumer products. Some are listed under the education category and some under the music category.
None of them outside of the Joytunes apps break the top 50 education apps.
Some of the more popular ones include:
Yousician (#51 in the Google Play education rankings) and its tuning app, GuitarTuna
Yokee Piano Academy (#54 in the Google Play education rankings)
Piano School (#62 in the Google Play education rankings)
Smule’s family of apps, particularly Smule Karaoke Studio (#11 on Music in Apple) and Magic Piano
Ultimate Guitar (#30 in Music), which recently introduced video courses
Piano for iPhone (a free top #50 app in Europe)
Corporate Philosophy
Joytunes is serious about emulating the model of successful media companies like Netflix and Spotify. Their educational design mirrors the clean, simple and device-dependent user experiences of Netflix- but they also model their corporate philosophy after the autonomous, and flat structure of Netflix and ‘squad/tribe/chapter’ model at Spotify.
This philosophy comes all the way from the top.
“We were inspired by Spotify and Netflix at the level of the approach to their work, which emphasizes people’s abilities and extreme decentralization of responsibility,” says (Founder and CEO Yuval) Kaminka. - Forbes.is
This means that a smaller percentage of Joytunes employees are developers than you might think (only about 25 of 110+) and that people, including musicians and music educators, are hired for their unique abilities and then allowed to pursue problems that suit them.
This isn’t just talk; the Joytunes culture is clearly valued by a variety of operators in different functions.
In her blog post, “How Can Joytunes have 7 Heads of Design?”, Joytunes designer Danielle Ratzabi reflects how Joytunes uses Netflix-like pods to maintain extreme agility and shared ownership.
“In our pod system, we preserve the way a very small start-up works. We’re a small team that has full context and autonomy working towards a common goal. We see ourselves as co-builders of the product, in every respect, sharing the responsibilities of both the successes and the failures.
This high degree of ownership encourages us to work fast and be creative problem solvers. We avoid unnecessary processes and we don’t waste time answering to a chain of command. Unlike hierarchical organizations, at JoyTunes, it’s up to us to not only identify the challenges but to also find the answers ourselves.”
...Our special working culture revolves around small task forces, a flat hierarchy, and an impact-driven attitude… As a designer in a pod, you’re functioning as the head of your mission. You have the full context, responsibility, and autonomy to achieve your goal in whatever way you and your team see fit.”
Similarly, in his blog post about the founding of Simply Guitar, Joytunes PM Yoni Livne describes the pod structure in relation to product discovery:
“We work in small cross-functional teams called pods. This is a method popularized by companies such as Netflix and Spotify, and we adapted it to our own flavor and needs. In JoyTunes we take this very seriously and every person in the company belongs to a pod (even the CEO). These pods are equipped to be self-sufficient and highly independent.”
“When JoyTunes decided to build a guitar product, we created a new pod with all team members who were needed for this task — a designer, a developer, a musician, and a product manager (myself). Yes, four people. We had complete autonomy and freedom to define what we wanted to build and how we were going to do it. The only constraint was the pressure to deliver something as quickly as possible that will serve as the company’s next growth engine.”
Joytunes has a ‘pod’-driven corporate structure that emphasizes autonomy, impact and self-sufficiency
Photo Credit: Shomi Yosef, Source: https://forbes.co.il/e/joytunes/
While Joytunes is Israel’s first unicorn, the only Edtech Unicorn specializing in music education space, Israel is a hotbed of startup activity, and there are many other companies vying to be Israel’s next unicorn (such companies are sometimes dubbed ‘soonicorns’), including:
Annoto (Engagement and collaboration tools)
Amplio Learning (Special Education platform)
Arcadia (Math learning platform)
Alpe Audio (Audio course platform)
ClickTo (Cohort-Based learning platform)
ThriveDX (Digital skills training and online bootcamps)
Sense.ai (AI-powered scalable grading)
Jolt (Training for tech industries)
Tiny Tap (Educational Gaming made by teachers)