This is has not been confirmed by either party, but we’ve heard from multiple sources that European music startup Spotify has closed a venture investment from Founders Fund. Managing Partner Sean Parker, who was a cofounder of Napster and President of Facebook, led the round for Founders Fund, and we believe he may have take a board of directors seat.
We do not know the size of the investement; however, we believe it may have been a token amount to get Parker’s involvement in the company. The investment was likely done at the same €200 million valuation as the round Spotify raised in late 2009.
This is the first U.S. investor in Spotify, and the service is only available in some European countries. A U.S. launch has been broadly anticipated for months.
We’ve also heard this was a competitive round and a number of U.S. venture funds were interested. Parker, with his ties to Facebook and his experience in early P2P music sharing via Napster, is likely the winner for his strong strategic potential.
In January we reported that Spotify had been in talks with Google over integration with Android for their U.S. launch. When Spotify does launch in the U.S. (assuming it does), we expect them to have a large U.S. partner alongside them. Google, Facebook and Microsoft are all likely to be talking to them, and we wouldn’t be surprised to see one or more of them sign a partnership.
Spotify has created a lightweight software application that allows instant listening to specific tracks or albums with virtually no buffering delay. It was launched in the fall of 2008 and had approximately 10 million users by September 2010. Spotify offers streaming music from major and independent record labels including Sony, EMI, Warner Music Group, and Universal. Users download Spotify and then log onto their service enabling the on-demand streaming of music. Music can be browsed by artist, album, record...
Founders Fund is a San Francisco based venture capital firm which invests at every stage in companies with revolutionary technologies. The firm’s six partners, Peter Thiel, Sean Parker, Ken Howery, Luke Nosek, Bruce Gibney, and Brian Singerman have been founders of or early investors in numerous well-known companies such as Facebook, PayPal, Napster, and Palantir Technologies. Founders Fund was formed in 2005 and has launched four funds to date with more than $1 billion in aggregate capital...
Sean Parker is a serial entrepreneur and a managing partner at the Founders Fund. As one of the two founders of Napster, Sean helped architect and manage the peer-to-peer file sharing application to become one of the largest on the net. Parker subsequently helped found and manage Plaxo, a VC-backed contact management application company. More recently, Parker worked as the Founding President of Facebook before moving on to join up with Peter Thiel at The Founders Fund,...
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