Scribd, a company offering unlimited access to half a million e-books for $8.99 a month, is announcing that it has raised $22 million in additional funding.
The round was led by Khosla Ventures, with Khosla partner Keith Rabois (previously an executive at PayPal, LinkedIn, Slide, and Square) joining the Scribd’s board as an observer. Asked via email about how the subscription business will play out for books, Rabois noted that the model has “already transformed the way we consume other forms of content.” (An easy shorthand for what Scribd offers is “Netflix for books.”)
“With over 80 million users in nearly every country, the Scribd team is well positioned to grow to a massive global audience,” he said.
Launched in 2007 and incubated at Y Combinator, Scribd started out as a document-sharing service. While it still supports those features (and we still use it at TechCrunch when we want to embed documents in our posts), its focus shifted last year to subscription e-books, where competitors include startup Oyster and Amazon’s Kindle Unlimited service.
Echoing Rabois’ comment, co-founder and CEO Trip Adler told me that Scribd now reaches more than 80 million unique visitors each month. He didn’t specify how many of those visitors are actually paying subscribers, but he did say subscriptions have been growing an average of 31 percent each month since the service was officially unveiled in October 2013.
Just a couple of months ago, the company also expanded into audiobooks, and Adler said the response “beat our expectations.” (Users have already logged 180,000 listening hours, according to Scribd.)
Asked if he thinks the subscription model has now proven itself in the e-book world, Adler replied, “From my perspective it’s proved out. From the industry perspective, there are still people at both ends of the spectrum.” He noted that Scribd is now working with two of the big five publishers (HarperCollins and Simon & Schuster — they’re mostly offering older “backlist” titles).
“I can’t say where we are with the other ones, but they’re all going really well,” he added. “By the end of , we’ll be able to basically say almost all of the significant players in the industry are on-board.”
This brings Scribd’s total funding to $48 million. Previous backers Redpoint Ventures, Charles River Ventures, and Silicon Valley Bank also invested in the new round.
Adler said he plans to spend the money on improving the product (with a focus on algorithmic book recommendations and the reading experience itself), as well as continuing to expand the content available in Scribd.
He also clarified a comment he’d made during our last interview, when he said he was “not ruling out” a tiered pricing model in the future. It sounds like I may have interpreted that as a more definite plan than it really was — when I brought it up earlier this week, Adler said, “I think I was just brainstorming with you there. We’re still focused on the $8.99 price point and there are no plans to change it.”