DMN on Feedburner
divider image

Spotify Sinkhole Secures $250 Million In Fresh Financing…

spotifyfinancingyear2

The latest round, a massive $250 million investment from Technology Crossover Ventures, comes just as Spotify was burning its last pile.  Earlier, whispers surrounded a round north of $200 million (this looks like it), as well as separate, contingency efforts by founders Daniel Ek and Martin Lorentzon to secure a massive bank loan.

The latest injection now brings Spotify’s total funding level significantly past half-a-billion dollars.

spotifylosses2

The Wall Street Journal was among the first to report the latest infusion, with few additional details.  The development comes just as Deezer has officially confirmed its planned entrance into the US, first reported by Digital Music News earlier this month.

More as it develops!

blue bar background graphic
Comments (22)
  1. Casey

    They need manage this money better. No doubt a chunk of the money is going to go toward subsidizing a free service that isn’t bringing in subscribers like they intended. It is time to start locking down the free service in the US and perhaps adding some new features to Premium and Unlimited. As of right now the only difference between Unlimited and Free is the ads. That’s not enough.


    Reply
    1. TuneHunter

      Let’s stream for free with no subscriptions.
      Just start collect cash for discovery and addition of new tunes to the play list.
      Recovery and cash for all at instance!


      Reply
  2. Billy

    The music labels are making bank.

    Since money is flowing from these investors into the music labels pocket in term of 70% royalties.

    Spotify pays 70% royalties to the music labels. The music labels pay the artists streaming royalties based on the contract the artists signed.

    Let’s say that Paul Resnikoff owns 90% of Spotify, what would Paul Resnikoff change to make it so that the music labels pay the artists better in term of streaming royalties?

    It’s easy to bash Spotify. Let’s see if you can come up with a solution if you’re own 90% of Spotify.


    Reply
    1. TuneHunter

      There is no streaming bank on the horizon!
      Shazam, similar tune suggest has to be pay per tune event – subs will never bring enough cash to the table.

      With current sub rates 500 million subs can deliver just 30 billion dollars and that 500 might never happen.


      Reply
      1. Ted

        You win the prize for the longest serving and most idiotic poster on this site. Your complete lack of understanding about how streaming economics work is however hysterical. Keep it up.


        Reply
        1. Anonymous

          “You win the prize for the longest serving and most idiotic poster on this site”

          +1

          @tunehunter If you think your idea is so good, why don’t you write a business plan for it and take it to the major labels/publishers? Posting the same thing on every streaming article on this site isn’t going to change anything and you look like a nutter.


          Reply
          1. TuneHunter

            There is no business plan option!
            Key players – old dogs like labels and RIAA and new ones like discovery services (with over billion users) streamers and iRadios have to change the business model to simple monetization at the Discovery Moment.

            Spotify or Veevoo or iRadio are all in desperate ass-kissing mode with just hopes fro some breadcrumbs!

            Ads and subs will never bring 1999 (approx $56 billion today) – so lets change religion from unproductive middle ages to simple sales.
            If we cannot lobby in new “fair use” lets bribe all Shazams, Echo Nests, etc. to sales only mode – we will see mega cash and total decline in piracy.

            Treat it as a simple business plan for the industry.


            Reply
            1. Adam

              What exactly does “monetization at the Discovery Moment” mean??? Do you think people will pay to discover music? If so you’re crazy. They haven’t paid for that in ages. Hence radio.


              Reply
              1. TuneHunter

                It is very simple. You just have to tell Shazam, Gracenote, Soundhound, The Echo Nest, lyrics ID guys and few others discovery providers to stop the business kindergden.
                Today they are leaching investors and provide undeserved pleasure to guy like you at someones expense.

                If you reduce info on radio, Spotify, or Deezer desplay for all new tunes (not part of your play list) you will have to pay! .. and you will be really stressed up untill you allow Shazam to nible 39 cents from your pocket.

                You want to live it again – you got pay – it is simple will bring tones of cash and will kill most of the piracy!


                Reply
                1. Ted

                  something tells me you’ve applied for and been turned down for a lot of jobs at spotify, universal and beyond.


                  Reply
                  1. TuneHunter

                    I do not need or look for any job.
                    Just trying to point into unrefusable opportunities for pure satisfaction :)


                    Reply
                    1. jw

                      If Shazam, etc started charging for discovery (which doesn’t fit their business model & they would never do), people would just go back to googling the lyrics. Just in the past 3 days I’ve googled the Bob Dylan cover in the new Kohls commercial & a White Buffalo song when I flipped to Palladia mid-video & couldn’t place the artist.

                      Shazaam & the like are conveniences, but not necessities. That’s why their better play is providing an interactive element to broadcast marketing.


            2. Anonymous

              “There is no business plan option”

              I agree with that bit


              Reply
    2. Nasa

      This is so incorrect I’m not sure where to start. I’ll just suggest you read more. This isn’t meant to be snarky. Seriously. Do some research, talk to an actual artist.


      Reply
  3. What would Paul Resnikoff do?

    In addition, Paul Resnikoff bash Spotify all the time. So if Paul Resnikoff owns 90% of Spotify, what would he do differently?

    regarding the 70% royalties rate
    regarding the $10 a month subscription
    regarding the free desktop streaming with ads

    I hope you reply.


    Reply
  4. Who cares

    Who cares?

    Spotify is a very small streaming service with a catalog of just 24 million songs. Everybody enjoy free music on YouTube, where all albums and all songs from every nation can be found for free.


    Reply
    1. Casey

      There is actually a considerable amount of music I listen to that I can’t find on Youtube. A lot of incomplete albums.


      Reply
  5. Tristan Berry

    DMN, you are aware that growing a business involves some years of “loss” right? Stop being so hysterical.


    Reply
    1. TuneHunter

      Spotiy is not growing a business!
      It is well lubricated rape machine with demoralized music excs providing the rape victims!
      Streaming in current “all inclusive” form is dwarfing total size of the industry and prevents virtually any other logical monetization. It will kill iTunes and Amazone MP3.

      If you do not see it – you are blind!
      Claiming that all inclusive streaming is good for music is like claiming that Sun is evolving around the Earth. ..and that stupidity lasted for over 1600 years. I hope it will take just 1.6 years to wake up.


      Reply
  6. chosenlovemusic

    J. Cole isn’t the only raw talent coming out of North Craolina. Check out unsigned, solo artist Chosen Love (formally known as Young D). http://m.youtube.com/watch?v=WvNdYDekWPw


    Reply
  7. Edward David Jennings

    And this is why the exaggerations of the “death” of Spotify and Spotify “Killers” are figments of people’s imaginations.


    Reply
  8. Oz

    in the last 6 months alone, many or even most news outlets worth reading are now behind a paywall. ad-based revenues are essential for some businesses/products, but very ugly for consumers of music & other entertainment platforms. it’s time to end free and make everyone pay for any service worth its salt – as youtube etc & free-to-air programming (tv/radio etc) already provide tons of free content & the ability to sample other content you might ultimately want to pay to own or stream. running a business is always hard, that’s why it’s called business – but the equation never changes: you have to sell more than you give away. and you HAVE to sell it, otherwise you’re not really in business – which is not the same thing as ‘running’ a highly leveraged & risky speculative venture.


    Reply

Leave a Reply


You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

  1.  
  2.  
  3.  
  4.