Spotify, the European on-demand music service, has reportedly closed on about $ 100 million in a new funding round that values the company at $ 1 billion.
The new round is said to include investment from Russian venture capital firm DST and California-based VCs Kleiner Perkins and Accel Partners, all of which are first-time investors in Spotify, according to an AllThingsD report published Friday. Not counting this latest reported round, Spotify has raised €83 million (approximately $ 118 million USD) in funding to date.
When reached by GigaOM, a Spotify spokeswoman declined to comment on the funding reports.
The fresh funding could be put toward Spotify’s highly anticipated U.S. launch. Spotify’s expansion into the U.S. is a matter of when, not if, and we now hear the company is indeed working on a deeper integration with Facebook as part of its U.S. launch. Closer ties with the social networking giant would likely drive a substantial amount of new traffic to the already-popular music streaming application.
Spotify is currently available only in Europe, where it has already had massive success with more than 10 million users, more than 1 million of which are paid subscribers. But coming stateside is a whole different beast, and it makes sense that Spotify would build up its coffers to ensure that it handles its U.S. debut as well as possible. After all, the company won’t be without competitors: Internet radio company Pandora went public this week and currently has a valuation of $ 2 billion; CBS-owned Last.fm is looking to make a comeback; and new music apps such as Turntable.fm and 8Tracks are popping up– and going viral– all the time.
Judging by the size of the rumored investment, it seems that some of the tech industry’s biggest players are willing to bet Spotify’s American launch will be a huge hit.
Related content from GigaOM Pro (subscription req’d):
- A 2011 Connected Consumer Forecast
- The state of the e-book lending market: Business models and challenges
- Breaking Down Facebook’s Entertainment Strategy
