Spotify valued at over $ 70 billion in new financing round
Swedish music streaming service Spotify is the sixth time on the way to access capital. The company is close to bring in $ 400 million, about SEK 3.5 billion, from including Goldman Sachs and Abu Dhabi wealth fund. It reveals the Wall Street Journal referring to people familiar with the deal.
If the information is correct is Spotify one of the most valued privately owned technology companies in the world. Valuation at the round of funding stated fact be $ 8.4 billion, almost 74 billion. This is an increase from a valuation of over $ 5 billion in September last year.
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Analysts at Manhattan Ventures Partners believes that Spotify had revenues of $ 1.3 billion in 2014. This means that the company is valued at approximately 6.5 times revenue.
The terms of the recapitalization is said to be secured and the transaction is expected to close in the coming weeks, according to one source.
Spotify announced in January that their music service used by 60 million users, of which 15 million will pay $ 9.99 per month for the ad-free version.
The major record companies, Universal Music Group, Sony Music Entertainment and Warner Music Group, together own 15 percent of Spotify. They have recently called Spotify to convert more users into paying customers. Lately, the issue has become highly topical given that Jay-Z has launched competing service Tidal who do not have an ad-supported version.
It is clear that the market for streaming music attracts more players. One of those who have been around the longest, Pandora, with a market value of about 3.5 billion dollars, but both Apple and Google are expected to soon roll out their services.
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