Monster Amounts of Funding Await Spotify

Some think we’ve entered another internet bubble, of which music is just one component.

Well, this could provide all the evidence they need.  According to a tip from TechCrunch, Spotify is about to receive a very handsome funding round from DST.  That is, a major backer behind Facebook, Groupon, and Zynga, among others.

So how much?  The “very large” amount of funding could exceed $100 million, as unbelievable as that seems.  Sounds like ‘dumb money’ defined, unless that is, the future really is monetized cloud-based streaming.  But let’s see what actually materializes – this week, and this decade.

And how would this funding drop affect the stateside licensing situation?  The company just inked a licensing deal with EMI, and Warner Music Group appears to be softening.  But let’s face it: with enough upfront cash, stubborn ideologies and monetization problems have a way of getting re-rationalized.  Especially given the distressed balance sheets of major labels.

 

One Response

  1. Jonathan Jaeger

    Yes, there might be a mini bubble, but let’s not compare this to a decade ago. There are companies making wild amounts of money now (compared to the companies in 1999 just blowing hot air).

    What will probably happen is there will be many startups that can’t get more funding a couple years from now. Of course, on the other hand, it takes a lot less capital to start a company these days.

    Taking big bets on more powerful companies like Spotify is another story, but everyone questioned DST’s investment in Facebook a couple years ago. We’ll see.