Updated May 4, 2015: Closeup.fm announced that Knoxville-based Angel Capital Group has made an investment of undisclosed nature and magnitude in the startup. Our October 2014 story appears below.-Ed.

CLOSEUP.FM, the crowdbooking and promotion platform for touring bands that want additional gigs at unconventional venues in cities they visit, considers Knoxville and the South its home.

Yet, pressures such as the risk of market preemption and a business burning cash as its founders spend time and energy courting potential investors make it impossible to completely rule-out relocating elsewhere, acknowledged co-Founder and COO Austin Church in a VTC interview.

"Time is of the essence," said 32-year-old Church. "Knoxville nurtured us, and we don't want to bite the hand that feeds us by relocating," even though it's possible that could become a demand they encounter from investors in their Seed-capital raise, which has an initial $800K target.

Austin Church

"We really want to put Knoxville on the radar, in a way it hasn't been before. And, we want to do Closeup in the South, to help people realize all the good the South has to offer," said Church.

Though the distraction and time-pressure of raising capital is enormous, the funding is needed to accelerate its growth and development, to secure its niche, said Church.

The platform allows fans in markets bands are touring to draw a crowd to bid competitively with other fan-groups to win commitments for private performances in homes or other unconventional venues.

Proceeds from a capital raise will enable the founders to develop iOS and Android apps and bring aboard more engineering talent, though they've gotten by til now with contract help. The team deliberately put building a business-worthy backend to their website ahead of developing mobile apps, which are more challenging than most investors understand, Church noted.

Thus far, said Church, neither he nor Co-Founder and CEO Nathan Fray have yet to have an investor respond with a firm "No," or pass on the deal. Tough as it's been, said Church, "it's hard to imagine a startup having things any easier than we have."

Nathan Fray

The owners were cautioned early-on by by a veteran investor not to "fall in love with what you think you need." So, they'll work to keep in-balance their concerns about valuation, control of the company and their Seed and eventual Series A targets, with the latter having earlier been pegged in the $3MM to $5MM range, he said.

Harried though he feels, Church said -- "depending on what day you ask me" -- he remains as optimistic as he did after Co-Founder Fray's presentation Aug. 5, during the Knoxville Entrepreneur Center's MediaWorks Demo Day -- a year-to-the-day after he team on Closeup.fm with Co-Founder and CEO Nathan Fray. He believes there'll be a termsheet in-hand by November.

Church is in Nashville this week for meetings with potential Angel investors. He said he and Fray have also had conversations with Knoxville investors, as well as with a VCs in Nashville, North Carolina and elsewhere. A smattering of investor contacts in Vancouver, Toronto and elsewhere have also popped-up, he said.

Scott Beck

In addition, as previously announced, its first outside investor was Denver-based Scott Beck, who is head of Tango, the Boulder-based investment company, as well as founder-CEO of Gloo and former vice chairman of Blockbuster Entertainment. He and others associated with Tango are also involved with its affiliate, High Country Ventures, a Boulder VC, according to information online.

According to Church, Closeup.fm is virtually alone in marketing its platform toward relatively unknown Indie artists who each have, for example, an average of fewer than 20,000 fans of their Facebook pages.

They've paid-out about $25K to artists, thus far, and still have some of the initial $100K that came from the two founders, and Beck, whom they met through an introduction by Fray's father.

Closeup.fm currently works with about 120 bands and engages with a growing universe of fans who number about 3,000, and growing. Deliberately not yet mobile-ized, Closeup.fm is Web-only, with revenues coming from a 10% fee for ticket sales to performances in private homes and other unconventional venues, said Church.

In a series of interviews for this story, Church said Closeup.fm has found that it's crucial to connect with artists who realize that "their fate is in their hands" and they must adopt social media and other tools, rather than wait for a traditional label to discover them.

Those who don't master the new tools are suffering, "waiting for someone else to take their success more seriously than they take it, themselves. This train is leaving the station," Church added.

Church heaped praise (think "awesome!") upon its many formal and ad hoc advisors, noting that they had received encouragement from potential investors, entrepreneurs and others from Knoxville, Chattanooga, Memphis and Nashville.

Mark Montgomery

He singled-out KEC Entrepreneur in Residence Jonathan Sexton and other principals in the Back Porch Group consulting firm, as well as two Nashville-area advisors: Mark Montgomery of FLO{thinkery}; and, Malcolm du Plessis, who has also been an advisor to Fray's band, United Pursuit.

Other advisors include its interim CFO Bruce Charles, who is also a principal with Mossy Creek Enterprises; attorneys with Egerton McAfee Armistead & Davis; accountants with Burkhart & Company in Knoxville; and, bookkeeper Elizabeth Byerly in the Nashville area. It is likely to establish a formal commercial banking relationship after its capital raise, said Church.

As have others interviewed about the value of the KEC MediaWorks program, Church said "it was of huge value for us. Without it, our business model would be very crude now, compared to where it was and the end of Mediaworks."

"MediaWorks was definitely a trial by fire, but you need to get beaten-up a little bit, so that you really do understand what sets you apart. It's not enough to be nicely optimistic.

"Lots of times, you need at least one advisor for affirmation, but another who will set your tail on fire -- the Bad Cop," he added. VTC