Two years ago, Dean Graziano was at a concert at Seattle's Key Arena when he had his entrepreneurial A-Ha moment.

If you think we're referring to the 1980s Norwegian band of Take On Me fame..sorry, wrong A-Ha. We're talking about the A-Ha inspiration for a new way to enjoy live music.

I saw 10.000 people with their phones in the air, and thought to myself, wow, this is lose-lose, said Graziano, founder and CEO of Lively.

He watched as those concertgoers used their smartphones to capture the concert with bad audio and shaky video. It's also technically illegal to record live music in that situation. As an artist, all that content is walking out the door, and they can't control it and they're not getting paid for it. So being an entrepreneur and having done this before, the brain starts rolling a little bit, and Isaid, you know, there's got to be a better way to do this.

Graziano thinks he's come up with one: theLively app for iOS, Android and Windows Phone smartphones. If you're enjoying a concert and want a copy of that show, and you're at a venue that's a Lively partner, simply use the app and for $4.99 an audio file of that very show will be sent to you later that night. For $9.99, a video file will be sent to you via the cloud within 24 hours.

So now you have, instead of the t-shirt or the hoodie - or maybe added to that - you have the actual experience of that show, he said.

The audio is from the concert's official sound system. Lively shoots its own professional quality, three-camera videos from the concert venues. It also does that at company headquarters south of downtown Seattle, which doubles as the Lively Lounge, where artists playing that evening in local clubs can perform special afternoon sets for their Facebook and Twitter fans. Lively will invite Seattle music tastemakers to help publicize the bands.

Lively provides extra content like artist interviews and behind-the-scenes footage. 70 percent of the revenue goes to the artists and their music labels. That's key, since the music industry hasn't always been in harmony with digital technologies.

There were definitely some speed bumps because this is new, this has never been done before, Graziano said. But they (the music labels) have been absolutely instrumental and phenomenal in moving those speed bumps away.

We're completely humbled by the validation and the traction we've gotten with everybody in the ecosystem, including the labels. The labels are partners of ours, and it's incremental revenue for the artists and the labels, so that always helps with the conversation.

In addition to deals with the three big music labels - Universal, Sony, Warner Bros. - Lively's venue partners in Seattle include Neumo's, the Showbox and the legendary Crocodile Club. It also has agreements with venues in Austin, New York and Los Angeles, but it hopes to expand to two dozen venues across the country by year's end. The company also wants to double its artists' catalog; right now it has content from about 300 bands.

The recent South by Southwest music festival was the latest test for Lively; the company shot 130 shows in four days. We did all the major showcases, Graziano said. We came out of that with a lot of mojo, and I'm very cognizant of riding that momentum right now and so that's what we're planning on doing.

To that end, Lively has already taken in a few million dollars so far in seed money, and is in the middle of raising its A round of financing from individual and institutional investors.

I think we hit the right timing across the board, with technology, the labels, and the industry, Graziano said. I couldn't do this business two years ago. The phones weren't there, and we do everything from the cloud so from the bandwidth standpoint, we scale much easier now.

Ithink the labels, the industry, is ready for this.

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