Native Instruments in Preliminary Insolvency!
The Private Equity Roller Coaster : The Story So Far !
As many reading in would be already aware, Native Instruments GmbH ( which is also the parent company to iZotope, Plugin Alliance, and Brainworx) has entered preliminary insolvency proceedings.
This is significant news for many of us who have invested in the products over the years, and has sent a ripple across the Music Technology community.
There are a flood of articles and videos attempting to explain and unravel what is actually happening, and the potential outcomes and consequences of the proceedings. I spent the last week digesting and doing my best to connect the dots as best I could, so thought I’d give a summary of how NI landed themselves in this situation, and what the potential outcomes are moving forward.
Lets layout the time line leading up to where we are currently.
2017 – The first big outside investment !
Native Instruments received a large cash injection from a a Munich based private equity firm called EMH Partners, who invested roughly €50 million into the company.
The goal was to accelerate growth, expansion, and to strengthen their position in the greater digital music community.
NI’s Founders and EMH kept significant ownership, so Native Instruments remained under original leadership but now with PE backing.
Think of it as Native Instruments getting a cash injection to grow faster, but now with investors who would be expecting a large ROI in a few years.
2021 – Francisco Partners Enters the Building !
Francisco Partners, a US-based private equity firm, bought a majority stake from both EMH and the founders/shareholders. EMH retained a smaller piece.
Native Instruments was now fully in the hands of bigger investors, with a strategy to consolidate and expand with other music software companies.
Francisco Partners went on a buying spree, acquiring iZotope, Brainworx and Plugin Alliance, placing the cost of acquisition on NI.
So in short, Native Instruments went from the initial growth investment to a full P.E takeover. The new owners were thinking even bigger - expanding and merging the technologies and resources with the other acquired brands, making it a more powerful option for music and audio producers.
2022-2023 – Rebrand to Soundwide, then back to Native Instruments !
To reflect the bigger ecosystem with iZotope, Brainworx and Plugin Alliance, the owners briefly renamed the holding company to Soundwide.
By mid 2023, they reverted it back to Native Instruments because the original brand had stronger recognition within the community.
To be honest, I had absolutely no idea they had even changed the parent company to Soundwide, and the first I and many others even knew about it, was when they made a public announcement about the name being “changed back “ to Native Instruments ?
From a personal perspective, during this period I noticed an elevated and annoying increase of newsletter and product promotional emails that had reached the point of spam. I remember one email stating that they had noticed I hadn’t opened and read the previous email ?
I was like WTF, how would you even know whether I had read the email or not ?
Turns out they had deployed hidden pixel tracking technology (aka web beacons) in their emails, that are used to track engagement like whether the email was opened, viewing time, etc.
If the plan was for more engagement, it backfired, I removed myself from all mailing lists associated, including ones from Izotope/P.A that I hadn’t even registered for, but the geniuses had added my email to.
I Digress
2025–2026 – Failed Sale to Bridgepoint and Bain / Insolvency Proceedings !
O.K, so now we are up to the current circus being navigated.
In December 2025, there was an attempted sale to US P.E Firm - Bridgepoint and Bain Capital Credit, but the deal collapsed , which resulted in Francisco Partners initiating the filing.
Shortly after on January 27 2026, the German parent companies (Native Instruments GmbH, Holding GmbH, Group GmbH, and Music Creation Midco II GmbH) entered preliminary insolvency proceedings.
Most likely reasoning would be due to a combination of high debt from expansion, leveraged buyouts, and the cost of acquiring other music software companies. The Group is now in the hands of a Prof. Dr. Torsten Martini, who is listed as a preliminary insolvency administrator that has been appointed to oversee restructuring, and any potential sale of assets.
Without too much speculation, that means NI’s various assets will be sold off in some form. Now a process that’s out of the hands of NI executives and owners.
I have seen various numbers being quoted for the financial standings.
Although not current, they still give a glimpse – from a 2024 filing NI reported cumulative losses of €288 million ($339US million) accrued in 2023 and 2024, with maturities looming/due on approximately €262 million ($309US million) in debt.
In a nutshell, the normal operation of the business just couldn’t keep up with servicing the vast debts , and didn’t stand a chance without a restructuring.
So in short, after the failed sale to Bridgepoint and Bain Capital Credit, Francisoc Partners and strategically filed for a German version of a controlled restructuring.
There has been some confusion regards what that means for Plugin Alliance, iZotope and Brainworx, and to be honest, as best as I could wrangle through the articles and information collected , I am still not 100% clear.
P.A have made public statements that they aren’t directly listed in the insolvency filings, so operations continue as normal.
Why the confusion?
Well, the filings are for the specific German legal entities listed prior, whereas P.A, Izotope and Brainworx are listed as US entities, but from my understanding they are still bound under the greater corporate parent company that has just been acquired ?
So one explanation is that although the parent company is in restructuring, the subsidiaries may continue doing business as normal, though they could be sold or spun off later.
Summary
Native Instruments has been on a private equity roller coaster, first with EMH investing in 2017 to help it grow, then Francisco Partners taking majority control in 2021. The brief rebranding of the empire to Soundwide and back, and now in 2026, the German parent companies landing in preliminary insolvency. Not because the companies/software are failing, but because the financial structure and accumulated debt has become untenable.
Subsidiaries like iZotope, Plugin Alliance, and Brainworx keep operating for now, though their future could change as part of the restructuring.
Have we been here before ?
To many of us in the industry, Native Instruments, and/or more specifically Kontakt, is too big to fail. But for those of us old enough to remember Nemesys GigaSampler/Studio from the late 90’s to mid 2000’s, which built a huge end user base , and had a large number of developers locked into that environment and eco space , that literally disappeared overnight after its sale to Tascam, who pulled the rug out of the whole project minutes after releasing V3, leaving end users and developers stranded.
This was the beginning of the rise of Kontakt, when it became the pseudo go to for developers, many porting their Giga Libraries to Kontakt. Over the years Kontakt has maintained the largest number of 3rd party developers, many of which would be currently having some sleepless nights I would imagine.
Yes there are other competing sample playback engines , some appearing as dedicated engines for respective companies like East West ( Opus) and VSL, both of which were originally on Kontakt in earlier incarnations. More recently, other library developers have already been moving off the Kontakt eco space , more and more, mostly with dedicated sample engines, which I suspect are not developed in house, but are instead using engines like Gorilla Engine, and other 3rd party alternatives.
These 3rd party engines and associated environments are not currently in a position where they could quickly and/or easily step into and fill the void of Kontakt, so options are not as clear as back when Giga failed.
So whats my read of all of the above ?
I personally believe Native Instruments will survive in some capacity moving forward, the Kontakt Environment alone is just a huge eco space that has significant commercial value, as way too many developers are dependent on it. So, I am not expecting another Giga moment. As to the other hardware/software products, that might be a harder call.
All we can do now is wait to see where the dust settles once the proceedings are completed in Germany.