Impact of Arctos Equity on Elektron's product range

The Lounge General Discussion
#1

Does Digitakt, Heat, Drive and Elektron’s current output of smaller one-trick-pony machines reflect Arctos Equity investment group taking 28% share of Elektron last year, with an option to increase their stake to 45% this year?

Discuss…

FWIW my view is that private equity investment and ‘enforced’ growth nearly always ruins small successful specialised brands for their already established loyal customer base, even though they become more profitable and successful overall… but I hope not in Elektron’s case :slight_smile:

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#2

I didnt understand a word you just said.
I make noises with metal knob covered boxes.

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#3

Interesting angle. What else are Arctos involved with?

#4

From their website no one I’ve heard of: Tele Radio, Rapid Images and PDS.

#5

If they are going for “maximum profit”, then good night creativity :frowning:

#6

Interesting. I suppose their track record might be some indication. Elektron machines are very important to me, I share your interest.

#7

Most investors want sustainable growth rather than maximum short-term profit. It’s obvious that Elektron wants to grow its market, and I think it makes sense to do that. It makes the company more stable as well as more profitable. And because R&D becomes a smaller percentage of overall costs, it allows (though it certainly doesn’t guarantee) more stable, polished products, and a wider range of products.

My feeling is that it makes sense for Elektron to release smaller, less expensive, more focused (limited if you prefer :wink: ) products. I strongly suspect they will still make new flagship products similar to legacy machines - a ‘master’ digital Elektron seems likely - not least because it creates the “halo effect” that maintains Elektron’s reputation as a high end synth manufacturer and makes their cheaper products look good.

Where growth fails is when you get management changes, and/or the growth is too rapid and you can’t recruit high quality people, and/or you lose key talent and the product becomes worse. That’s down to management and I’m not sure it’s something we can readily perceive from the outside.

Few companies are happy treading water, the drive to grow and expand and improve would have been there with or without this particular investment; from my point of view I hope they chose wisely and that Arctos have a sensible outlook and understanding of the business.

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#8

Yeah EMM are a great company and it is none of our business how they run the company - we’re just lucky enough that they are around making great products.

I just thought it was interesting and although it probably won’t happen, once private equity is onboard EMM have to account to and maximise return for their stakeholder’s interest… which in some cases isn’t always compatible with the integrity of a brand.

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#9

I dunno about any business stuff - but for what my opinions worth i think Elektron making more equipment thats more financially accessible to all pockets and walks of life is a brilliant thing. If people are put out by Elektrons ‘boutique’ image being damaged then good luck to em. That aint me. Frankly i only ever wanted Elektron because it has a sound i like, and i think maybe its the workflow that makes it more ‘selective’ than the price. Their units are really not that expensive considering the vast pool of audio equipment available nowdays. Second hand prices put it in what i would class as midrange gear. What we are spoilt with in features bs cost nowdays is fucking ridiculous. Opening their product list to a different customer base means the company expand in all areas and have more money for ‘flagship’ products.
Bottom line is, it also benefits the consumer. And really, thats a good thing right??? They make nore money for R&D and we gain amazing creative instruments to project our emotions. Win. Win. :slight_smile:

#10

Elektron is a publicly traded company and they have an obligation to their shareholders. That said I don’t think they’re being forced to churn things out. I don’t think they have the dev resources.

#11

Dunno man. Yeah, if they keep making updated/expanded/innovative/deep A4/OT style boxes then all good!

Just seems like there’s a possibility that the more of the small boxes they make the more they’ll be torn between unrestrained innovation/functionality/instinct or crippling the big boxes in those areas so there’s no crossover. So we might see less features/more carefully contrived features happen together in one box down to business reasons. Not creative. So in that way then potentially the small boxes aren’t great for future.

God knows atm tho. Just being cynical I guess…

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#12

Expand you mind, man. Take drugs and learn finance. Get weird.

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#13

can I buy elektron stock?

#14

Dont think so, they are a privately owned company.
http://www.arctosequity.se/wp-content/uploads/2016/09/Pressmeddelande_AEP_Elektron_en.pdf

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#15

the reason the Digitakt form faktor is smaller is due to one main reason: impeccable design. look at it. one of the best arranged interfaces for live realtime performance remixing.

becoming smaller yet with just as many buttons, made the new unit potentially a fave with dj’s and so forth, people looking to include a small footprint high quality item alongside the decks to make sound with.

#16

Could be the reason prices have gone down on Elektron gear. And now Elektron is making things with a smaller price tag. With their apparent return to digital, new Elektron’s should be REALLY cool(since the investment price will go down). Could be cool? Elektron’s essence is a really cool. They switch their style up and put a lot into their gear. While DSI comes out with different variations of an Analog Synth, Elektron makes a groovebox that covers all their bases and then move onto to reinventing another arena of music making. I can’t think of another company with such an expansive range.

Provided that Elektron maintains most of their essence with their output then this is mostly a good thing for us consumers.

Edit: it could mean, when Elektron announce a new box I will be filled with the impulse to sell a car instead of a kidney :smiley:

#17

getting investment to break into new markets seems fine to me.
i doubt elektron went into this blind , it takes a lot of cash to develop new boxes and spreading the risk over smaller , cheaper and quicker to develop boxes reduces the risk of 1 box every few years .

#20

“Foreign capital” is a double sided coin. Yes, you can invest to strenghten a company, make it more stable, secure quality and creativity on a long run, and IMO that’s the only healthy way of investment for a company and the people, who are doing the work to generate business :wink:

So let’s hope that this is the case here, and why should it not be so … then everybody will be a winner at the end, we as the customers, the hard working people, and the investors.

Sadly there are other investors too, who only see numbers and money they can make. Many companies, which are operated or directed by “management” rather then by “entrepreneurs” tend to listen to so called “share-holders” more then to “stake-holders”. At the end numbers can become more important, then the people doing the work. If employees are perceived by management as “cost-factors”, which have to be minimized rather then valued as the most important business creating asset … first the spirit dies, later much more. I am not sure, but didn’t NOKIA suffer just from something like this?

#21

Absolutely … only building Rolls Royce cars will be good only for a limited market … and there is a reason, why just this same company has been sold long time ago.

I think developing a product like Digitakt was a great idea. Good quality, good usability, maybe less bells and whistles, but a great price. It should become a success story like Arturia with the Brute-series :wink:

#22

I think most speculation/concern is just idle thoughts/rants brought on by the digitakt/AH and guessing at the effect that boxes like these might have on their relative future products/strategies…

Digitakt to me seems potentially overpriced compared to something like Electribe sampler or the mpc live. In terms of bang for buck and advancement. Which is something I could never say about OT or AK. If you dig the old boxes it’s natural to hope for the next gen to be as generous with ideas/functions. That’s not someone feeling entitled… It’s someone hoping, while looking around.

Everyone’s still digging Elektron as a company and busy making music with the gear they have. Just be a shame to see elektron do a Roland… Hopefully that won’t happen :wink: I don’t really care too much either way, already got more gear than I have time to make the most of, and the old boxes aren’t gonna disappear off the earth.

If Elektron do decide to go Roland/Apple I’ll just shop elsewhere. I wouldn’t really judge any of this as optimism/pessimism. Just people voicing their hopes/fears on a forum where feedback sometimes reaches the company and might have a tiny positive effect, like ‘Elektron you make amazing stuff, keep it up, don’t sell out/try to squeeze us too hard’. This forum is often as much a free market research tool for Elektron as anything else. I imagine famous people that are surrounded by people always telling them they’re faultless soon turn in to arseholes and possibly lose their craft :wink:

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