Sad news this morning; Dawn Raid have gone into voluntary liquidation, following rumours of financial difficulties surfacing in the Sunday Star Times a few weeks back.
"They cite, a downturn in the label's revenues as the reason resulting from a shift in the local urban music market, compounded by the label's high overhead structure and increased activity in illegal downloads."
Dawn Raid did a lot of good for the folks of South Auckland, so it's a shame to see them go under. I had the pleasure of interviewing Dawn Raid founders Andy and Danny several years ago for NZ Musician magazine - I took a bus out to Papatoetoe to meet them at their office/studio. They were both very enthusiastic, but also very serious -they met while doing a business course. They had both been involved in the Proud compilation of South Auckland music, but that had been done in a central Auckland studio. They wanted something that the local teens could use, so, after one particularly sucessful Xmas season selling their t-shirts at the markets, they found themselves with a pile of cash, going, what do we do? Let's open our own recording studio! Great way to develop local talent for the label. Now that's all gone. What went wrong? It seemed like they had a lot of knowledge and advice at their disposal.
Rev Mua Strickson-Pua was interviewed about the collapse on Breakfast (TVOne) this morning (he is one of the organisers of the Pacific Island Music Awards late next month). Pua noted that the company had done a lot of good for the community in South Auckland, but that they seem to have over-extended themselves. Check TVNZ's site for a video of the interview later.
From a statement released by the company... "The music industry has experienced rapid change in the last two years with the new digital-driven content formats. Unfortunately we were expanding into Australia at a time that we should have be consolidating our local operation," states Andy Murnane.
NZ Herald reports that "A liquidator said it was too early to say how many unsecured creditors were owed money and whether they would see any funds. The Inland Revenue Department - which has previously applied to liquidate the companies - is the preferential creditor, with a number of secured creditors next in line for any payout from assets.
Liquidator Peri Finnigan said any pay day for creditors would depend "very much" on the ability to sell assets such as sound equipment, musical instruments and computers. Physical assets removed from the company in March were in safe storage and insured. The liquidation would also explore the possibility of assigning the existing artists' contracts to another company." The first report from the Liquidator is due April 27.