According to sources speaking in confidence to The New York Times, Spotify has netted a not-too-shabby $100 million in new financing, spiking its valuation above $1 billion.
Venture firm Kleiner Perkins Caufield & Byers is believed to be planning a $50 million investment in Spotify in return for a 5% stake in the hugely successful digital streaming music service. The latest round reportedly also includes hefty contributions from the likes of DST Global, which recently planted its investment flag in the likes of Facebook and Groupon.
Sources in the know indicate that Spotify plans to dedicate the influx capital to push forward with the company’s international expansion as well as lay the groundwork for new consumer features.
Sweden-based Spotify was launched in 2006. During the last five years, the company has gained enormous traction in digital music, despite the simultaneous growth and expansion of iTunes.
Spotify, which now boasts some 10 million users, lets users access online music at no charge through an advertising-supported portal. A subscription plan, however, offering access to a premium version of the service is also available.
Although Spotify doesn’t presently operate in the US, the company is believed to be “working on revising its agreements with major music labels to take on American customers,” The New York Times reports.
If Spotify succeeds at establishing and growing its presence in the US, such a development could prove a major game-changer for digital music services and distribution as we presently know them.
