Create Music Group Finances AI Artist Roster in Multi-Million JV

While major labels spend legal budgets fighting AI platforms in court, the independent sector is moving to financialize the technology. Create Music Group (CMG), the $1 billion independent powerhouse, has finalized a multi-million dollar joint venture with dai + drm (pronounced "daydream"), the management firm behind AI recording artist Xania Monet.

This deal marks a critical pivot in the industry's relationship with generative audio. It transitions the conversation from copyright defense to asset creation, validating synthetic performers as a scalable investment vehicle alongside traditional catalogs.

The operational shift

CMG is betting on a specific model: "human-in-the-loop" AI. Unlike fully autonomous generation, dai + drm pairs human songwriters with AI-generated avatars. The technology acts as the delivery mechanism, but the creative spark—and the underlying copyright—remains human.

Romel Murphy, the architect behind the venture, positions this as a "songwriter-first" economy. In the traditional model, songwriters sell their work to frontline performers who accrue the bulk of the brand equity. Under this new structure, songwriters retain ownership of the virtual performer, capturing the long-tail value of the brand, merchandise, and eventual touring revenue.

Proof of concept stats

The valuation of this deal rests heavily on the market validation of Xania Monet. This is not a theoretical R&D project; Monet is a proven commercial entity.

Key insight: Xania Monet became the first AI-powered artist to chart on Adult R&B Airplay (reaching No. 30), proving that radio programmers and listeners will accept synthetic vocals if the song quality holds up.

The avatar's output is driven by human songwriter Telisha "Nikki" Jones. This distinction is vital for rights management. Because a human provides the lyrical and melodic direction, the compositions avoid the copyright void that plagues purely machine-generated works.

Solving the equity gap

For years, songwriters have complained about the "pennies for play" streaming economy while performing artists reap the rewards of touring and brand deals. This JV flips the leverage.

By treating the AI avatar as an employee of the songwriter, dai + drm creates a path for writers to build frontline careers without needing to be the "face" of the project. It effectively decouples the creator from the performer, allowing for:

Scalability: Avatars do not suffer from vocal fatigue or scheduling conflicts.

Velocity: Content can be released at a frequency human artists cannot sustain.

Asset Value: The "artist" becomes a transferable IP asset rather than a volatile human relationship.

Where the capital flows

CMG's participation signals that they view AI artists as a portfolio diversifier, similar to their recent acquisition of the Deadmau5 catalog or their backing of the Circuit Group. With a $1 billion valuation and a war chest from their 2024 funding round, CMG is building an "operating system" for independent music that prioritizes high-margin assets.

Developing a human act is expensive. Between tour support, glam, travel, and media training, the burn rate is high and the failure rate is higher. A synthetic roster eliminates the "human friction" costs of artist development. The capital in this deal will likely focus on marketing and prompt engineering rather than tour buses and hotel rooms.

Strategic outlook

This partnership offers a glimpse into a bifurcated future. While Universal and Sony build walled gardens to protect human legacy catalogs, aggregators like CMG will likely flood the mid-market with high-frequency, low-overhead synthetic pop stars.

For rights holders, the takeaway is clear: The legal battles over training data will eventually settle. The real money lies in owning the top layer of the stack—the virtual talent that audiences actually stream.