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Report claims Spotify close to nabbing $50m funding round


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There’ve been rumours that Spotify is on the verge of announcing a new funding round for a few weeks, but the Financial Times has gone public with the story, claiming that the round will be $50 million, valuing the company at $250 million.UK VC firm Wellington Partners and existing investors are thought to be stumping up $20 million, while Hong Kong tycoon Li Ka-shing is also on board, via his charitable foundation.Intriguingly, the FT says Spotify is also in talks with another strategic investor “likely to be from the music industry”. A major label? Several have been burned by investments in music startups, but a stake in Spotify may be too tempting to resist.The funding hasn’t actually been confirmed by Spotify yet: a spokesperson told Music Ally the company doesn’t comment on speculation or financial matters. However, rival We7 has leapt at the chance to hail the rumoured valuation as good news for the ad-supported music sector as a whole.”Spotify’s valuation demonstrates tremendous strength in ad-funded music models, coupled with the recognition from the music industry that streaming sites are an incredibly important part of their overall marketing campaigns for artists and albums,” says We7 CEO Steve Purdham.He’s also keen to contrast the two companies’ approaches. “The web based nature of We7 means that it is more acceptable to the mass market and music can be played anywhere and shared via social networking sites, Twitter and email,” says Purdham. “Spotify is more attuned to early adopters who are comfortable with downloadable applications.”And before you ask: no, there’s still no news on whether Spotify’s iPhone app has been approved or rejected by Apple…

Music Ally

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