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Spotify secures $100m; Coca-Cola an investor
/ November 14, 2012 12:30 pm

Coca-Cola, which is no stranger to music-related marketing, is taking a minority stake in Spotify. The deal is part of a new round of financing expected to bring in $100 million.

Whispers about a partnership have been circulating for weeks – starting in April when Coca-Cola said it had entered a not-very-specific marketing partnership with Spotify – but the New York Times today reported the financing round is completed and values Spotify at about $3 billion.

According to the New York Times, Coca-Cola is contributing about 10 percent, new investor Fidelity Investments is coming in with 15 percent, and Goldman Sachs brings 50 percent. The remaining 25 percent is coming from existing investors.

Coca-Cola launched its own U.K.-based digital music service in 2003, had a major European marketing partnership with Apple for music, and currently sponsors live music events, among other initiatives.

Spotify is not a profitable enterprise. Globally it has 4 million paying subscribers and 15 million users, and last year reported a $57 million loss on $236 million in revenue.

Related links:

New York Times – Spotify Attracts Investments From Coca-Cola and Fidelity

GigaOm – Spotify gets $100M, including $10M from Coca-Cola

AdAge – Coca-Cola in Discussions to Invest in Spotify

Photo by Flickr user @N3T1O, used under Creative Commons license


1 Comment

  • I know there’s lots I don’t know about Spotify’s future plans and financial projections, but I’m having trouble understanding how a company that lost $57 million last year is worth $3 billion right now. Still, some very smart and experienced people are making these investments, so it will be interesting to see how things play out for Spotify over the coming months and years.

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