Create Music Group has acquired a minority stake in DistroKid, MBW can reveal.
Los Angeles-based Create – which is backed by Flexpoint Ford and Ares – made the investment earlier this year.
Create’s investment was executed adjacent to CVC Capital Partners’ deal to acquire a majority stake in DistroKid, which closed in Q3.
Create CEO and co-founder Jonathan Strauss confirmed his firm’s investment in DistroKid to MBW today (October 28), after our sources tipped us off about the transaction.
Strauss told MBW in a statement: “Create is home to some of the world’s largest and most storied independent record labels and artists, and DistroKid is where countless artists begin their careers.
“We’re excited to partner with CVC as a minority investor in the company and to support its continued growth.”
The move is the latest in a string of investments and/or acquisitions from Create.
Since March 2025, Create has acquired firms including Berlin-based label group !K7 Music, electronic label Monstercat, and UK dance music company Cr2, in addition to buying the deadmau5 and Mau5trap Records catalogs.
And in February 2026, Create agreed to invest more than $300 million in Vancouver-headquartered Nettwerk Music Group.
CVC announced its intention to acquire a majority stake in DistroKid via its CVC Capital Partners IX fund in July.
DistroKid’s longtime investor, Insight Partners, retains a “significant minority stake” in the company, according to that announcement.
Phil Bauer continues to lead DistroKid as President.
“We’ve been incredibly impressed by what Phil and the entire DistroKid team have built,” said Sebastian Künne, a Partner at CVC Capital Partners, in July.
“DistroKid has earned the trust of millions of artists by staying focused on what they need most. We look forward to partnering with Phil and his team, drawing on our experience across music, entertainment and consumer subscription businesses to help DistroKid support the next generation of artists around the world.”
Terms of the CVC deal were not disclosed.
MBW reported in January that DistroKid was holding talks with potential buyers, with a figure of USD $2 billion being discussed at the time.
Flexpoint Ford led a $165 million investment round in Create in June 2024, which valued the company at $1 billion.
In March, Create completed a funding round of more than $450 million in new equity and debt capital, at a valuation of $2.2 billion.
Following that round, Create remained majority-owned by its founders, with Ares Management, 2 Mile, and Flexpoint Ford each holding minority stakes.
Will Smith, Create’s Chief Financial Officer, said at the time that the new capital would “support continued acquisitions, strategic investments, technology development and global expansion.”
DistroKid was founded by Philip Kaplan in 2013 and is based in New York.
Kaplan moved from CEO to Chairman in January 2024, with Bauer taking over day-to-day leadership.
The company claims that it distributes roughly 40% of all new music worldwide.
DistroKid is currently being sued by Universal Music Group.
In a complaint filed in the US District Court for the District of Delaware on September 15, UMG alleges that “DistroKid is engaged in both deceptive trade practices and blatant copyright infringement.”
The complaint further alleges that DistroKid is “flooding platforms with AI-generated ‘slop’ that siphons revenue and listeners from the legitimate artists and rightsholders.”
DistroKid’s deadline to respond to the complaint is December 4.Music Business Worldwide
Create Music Group has recently acquired a minority stake in DistroKid, as confirmed by Create’s CEO and co-founder Jonathan Strauss. This investment was made earlier in the year and is part of a broader trend of investments and acquisitions by Create, which is backed by Flexpoint Ford and Ares. The acquisition of the minority stake in DistroKid occurred alongside CVC Capital Partners’ acquisition of a majority stake in the music distribution company, which was finalized in the third quarter of the year.
Create Music Group, based in Los Angeles, has been actively expanding its portfolio. Since March 2025, it has acquired several music-related firms, including the Berlin-based label group !K7 Music, the electronic label Monstercat, and the UK-based dance music company Cr2. Additionally, Create secured the catalogs of the artist deadmau5 and his label Mau5trap Records, and in February 2026, the company committed over $300 million to invest in the Vancouver-headquartered Nettwerk Music Group.
CVC Capital Partners announced its intention to acquire a majority stake in DistroKid through its CVC Capital Partners IX fund in July. DistroKid, which was founded in 2013 by Philip Kaplan, claims to distribute approximately 40% of all new music worldwide. Kaplan transitioned from the role of CEO to Chairman in January 2024, with Phil Bauer stepping in as President to oversee the company’s daily operations.
CVC’s investment is seen as a strategic move to bolster DistroKid’s growth and support its mission to assist independent artists. Sebastian Künne, a partner at CVC Capital Partners, expressed confidence in DistroKid’s management team and their ability to cater to the needs of artists, emphasizing the company’s dedication to supporting the next generation of musicians globally.
In terms of financial backing, Flexpoint Ford led a significant investment round for Create in June 2024, which valued the company at $1 billion. Earlier in March, Create completed another funding round that raised over $450 million in new equity and debt capital, bringing its valuation to approximately $2.2 billion. Although the founders of Create maintain majority ownership, Ares Management, 2 Mile, and Flexpoint Ford hold minority stakes.
However, DistroKid is facing legal challenges as Universal Music Group (UMG) has filed a lawsuit against the company, claiming it is involved in deceptive trade practices and copyright infringement. The lawsuit alleges that DistroKid is distributing AI-generated content that detracts from legitimate artists and rightsholders, accusing the platform of flooding music services with low-quality material. DistroKid’s deadline to respond to UMG’s complaint is set for December 4.
Overall, Create Music Group’s investment in DistroKid, paired with the majority stake acquisition by CVC Capital Partners, highlights the ongoing consolidation and investment trends within the music distribution industry, as companies seek to enhance their offerings and support independent artists.
