AI music company GRAI has acquired Hangout, the social listening platform built around the idea that discovering music through another person can be more interesting than letting an algorithm choose everything.
The acquisition closed September 22nd and will fold Hangout’s social-listening technology and music-industry relationships into a new streaming service GRAI is preparing to launch. Financial terms were not disclosed.
The transaction goes beyond buying Hangout’s product. GRAI Inc. acquired TTFM Labs, the parent company that trades as Turntable Labs, in a merger structure, with the business continuing as a wholly owned GRAI subsidiary, Music Business Worldwide details. Hangout founder Joseph Perla will remain connected to the combined company as a board observer.
Hangout brings something unusually relevant to GRAI’s plans: a social music service already built around access to more than 100 million licensed tracks and relationships covering Sony Music Entertainment, Universal Music Group, Warner Music Group and independent licensing organization Merlin.
GRAI says it will maintain and expand Hangout’s relationships with labels, publishers and collecting societies while combining its technology with what Hangout has learned about people listening to music together.
Hangout Put People Back Into Music Discovery
Hangout launched in November 2024 with a premise that runs against much of modern streaming.
Instead of opening an app and receiving an endless personalized feed, users enter virtual rooms called Hangouts. Participants can invite friends or join other listeners, step into a virtual DJ booth and take turns choosing what everyone hears.
The original launch gave users access to more than 100 million songs through agreements covering Sony, Universal, Warner and Merlin’s independent members. Hangout was available across the web, iOS and Android.
Music discovery in that environment works differently from a conventional recommendation engine. A song can enter the room because another person loves it, thinks it fits the moment or simply wants to see how everyone else reacts.
Perla has described the goal in deliberately physical terms. Hangout was designed to recover some of the feeling of people sitting together and passing records around rather than occupying separate algorithmic feeds.
That philosophy now sits at the center of GRAI’s next product.
Turntable.fm Tried This Before Streaming Took Over
Hangout’s roots stretch back to one of the more memorable music experiments of the early social web.
Perla helped launch Turntable.fm in 2011. Its virtual rooms let users appear as avatars, take turns acting as DJs and play songs for one another while everyone else listened and reacted.
The concept arrived before today’s streaming ecosystem had fully settled into place. Spotify had only recently entered the United States, and the idea that nearly every listener would eventually carry an enormous personalized music library in a phone was still developing.
Turntable.fm shut down in 2013, but its central idea kept resurfacing: online music could function more like a room full of people than a private recommendation feed.
By the time Hangout launched more than a decade later, the surrounding market had changed completely. Personalized streaming had become normal, while Discord, livestreams, multiplayer games and social platforms made spending time together in virtual spaces routine.
Hangout revived the virtual-DJ concept inside that newer environment rather than simply recreating a 2011 service.
Hangout Brings More Than 100 Million Licensed Tracks
Licensed catalog access is a crucial part of what Hangout brings to GRAI.
The service did not build communal listening around an unlicensed pool of recordings. At launch, it secured access to more than 100 million tracks through agreements covering all three major record companies and Merlin.
B2B music provider 7digital supplies the underlying catalog and streaming infrastructure, with its system designed to ensure music played through Hangout aligns with the service’s approved licenses, the partnership announcement explains.
That gives GRAI a substantially different starting point from an AI music startup whose first challenge is figuring out how commercially released recordings can legally appear inside its consumer product.
GRAI’s own acquisition announcement says the company intends to continue and expand Hangout’s relationships with labels, publishers and collecting societies.
The wording matters because GRAI’s planned service is not being presented solely as an AI generator. Existing recordings, social listening and new creative tools are supposed to operate inside the same product.
GRAI Wants Streaming to Become “Co-Creative”
GRAI describes its larger idea with two words: social and co-creative.
“The future of streaming is social and co-creative,” GRAI co-founder and president Andrei Avsievich said in announcing the deal. The company believes advances in AI can support music experiences that go beyond pressing play on a fixed recording or receiving another automated playlist.
Exactly what that will look like in GRAI’s finished consumer service remains partly undisclosed. The company has not yet publicly launched the platform and currently directs prospective users to a waitlist.
Its acquisition language points toward a service where existing music moves between people while AI adds interactive or creative possibilities around that listening experience.
That positioning is important. Much of the attention around generative music has centered on systems capable of producing complete songs from text prompts. GRAI is describing a broader product in which AI sits alongside licensed music, human recommendations and social interaction.
Hangout had already experimented with generative music itself. In December 2025, it introduced Turntable.AI, allowing users to create music from text prompts inside its wider ecosystem. Perla said around that period that the platform had surpassed two million users.
GRAI is therefore acquiring a company that has worked on both sides of the idea: listening socially to commercially released music and allowing users to generate something new.
GRAI Comes From Consumer AI, Not Music
GRAI itself is considerably younger than the social-listening concept it just acquired.
The Warsaw-headquartered company was founded in 2025 by members of the team behind Vochi, an AI-powered video-editing app acquired by Pinterest in 2021. That background gives GRAI experience building consumer creative software even though its current focus is music.
The startup has raised a $9 million seed round co-led by Khosla Ventures and Inovo VC, MBW notes. The financing supports a company now attempting something considerably broader than launching another standalone AI creation tool.
Buying Hangout gives GRAI an existing community product, licensing relationships, social-listening technology and a team whose experience with communal music discovery stretches back to Turntable.fm.
For a company founded only last year, the acquisition provides a shortcut to capabilities and music-industry relationships that could otherwise take years to build independently.
Licensing Comes Before GRAI’s Consumer Launch
The Hangout deal arrives shortly after GRAI made another agreement that helps define its approach to AI music.
In August, GRAI and Udio became the first two companies to license technology from Music IP Holdings, an intellectual-property company backed by Universal Music Group.
Music IP Holdings has assembled a portfolio containing more than 24 issued or allowed patents, with additional applications pending. The technology covers areas including authorization, moderation, watermarking, identifier tagging, licensed distribution and payment for AI-generated content.
The Music IP Holdings framework is designed to support licensed AI experiences including covers, remixes and interactive music while establishing controls around how generated material is authorized and distributed.
GRAI’s involvement does not mean Universal has licensed its entire recorded-music catalog to the startup for unrestricted AI use. The agreement concerns technology and intellectual property held by Music IP Holdings, an important distinction as different kinds of AI licensing deals begin to overlap.
Still, the arrangement places GRAI inside an effort to build rights and payment infrastructure before its consumer music platform has publicly launched.
Hangout adds another layer. Its existing service already operates through relationships spanning major labels and independents, while GRAI says it intends to continue working with labels, publishers and collecting societies as the combined product develops.
None of that guarantees that every future rights question will be simple. A service combining commercial recordings, user activity and generative tools can create complicated issues around compositions, masters, derivative uses, permissions and royalties depending on what users are ultimately allowed to do.
GRAI’s public position is that those relationships should be built with the music industry rather than around it.
The Bigger Bet Is on Human Recommendations
The most interesting part of the acquisition may ultimately have little to do with generating songs.
Modern streaming is extraordinarily efficient at removing friction. A listener can open Spotify, Apple Music or another service and receive an almost endless supply of music shaped by previous behavior.
Hangout was built around the argument that efficiency is not the same thing as connection.
“We wanted to recreate that feeling of sitting on a bedroom floor passing around records,” Perla said in Music Week’s coverage of the acquisition. Integrating Hangout into GRAI gives that emphasis on human connection another path forward.
GRAI is betting that AI does not have to replace the person recommending the next song. It can sit behind a space where people still choose music for one another, react together and potentially create with it.
That is a noticeably different vision from a streaming service trying to perfect the solitary personalized feed.
Hangout’s original idea was that another person could still be the best recommendation engine in the room.
GRAI now wants to find out what happens when AI enters that room too.