Why Native Instruments Is In Bankruptcy Court
The news that Native Instruments has filed for Preliminary Insolvency shook the music industry, because the company’s tools have been used by so many, for so long.
Many have speculated about what led to the company’s decline, but the best take we’ve seen comes from Music Trades Editor Brian T. Majeski, who calls Native Instruments as “the industry’s latest private equity casualty”.
In his newsletter, he shared his analysis of the company’s decline after it was acquired by private equity firm Francisco Partners:
“After five years under the stewardship of Francisco Partners, the company that pioneered computer-centric music systems filed for bankruptcy protection in the Berlin courts on January 27.
The catalyst for the filing was a steep decline in sales, cumulative losses of €288 million ($339 million) accrued in 2023 and 2024, and looming maturities on approximately €262 million ($309 million) in debt.
The bankruptcy court has a mandate to keep Native Instrument intact as a viable business and they are likely to succeed. The company retains a valuable product portfolio that is used on 80% of the Top Ten Billboard tracks and has over 1.5 million registered users. However, there will be serious post-bankruptcy challenges.
Despite assurances from management that “business will carry on as usual,” consumers are understandably wary. Many are deferring or cancelling planned purchases out concern that the restructured company many not honor existing software licenses or provide product support.”
Recent moves left many Native Instruments customers puzzled:
- In 2022, Native Instruments and iZotope announced ‘Soundwide’ as the new name of their parent company, and welcomed several new members to the Soundwide group of brands, including audio plugin platform Plugin Alliance and audio software company Brainworx. The goal was to provide end-to-end solutions, but the companies seem to have struggled to find synergy.
- Just a year later, they announced dumping the Soundwide brand, and that iZotope, Brainworx, and Plugin Alliance would become part of Native Instruments.
- The company also frustrated long-time customers by neglecting or retiring loved products. In 2022, the company retired Absynth – one of its oldest and most powerful software synths. In late 2025, though, the company introduced Absynth 6. It was a welcome return, but also left many questioning Native’s strategy for its software synths and virtual instruments.
“The failure of Native Instruments is a complicated story, worthy of a full-length case study,” notes Majeski, adding that “Misplaced growth expectations, poor product development, and a healthy dose of hubris surely contributed.
You can read more analysis and editorials by Majeski at the Music Trades site.
Have your own take on what created Native Instruments’ predicament? Share your thoughts in the comments!
