Coca-Cola Places $10M Bet on Spotify

by Christopher Freeburn | November 15, 2012 11:25 am

Spotify 120 flickr1 Coca Cola Places $10M Bet on Spotify[1]Streaming music service Spotify has attracted $100 million in a new round of financing, which included Coca-Cola (NYSE:KO[2]) taking a minority interest in the company[3], the New York Times noted.

Sources said that Coca-Cola contributed about $10 million to the latest round of financing, with Goldman Sachs (NYSE:GS[4])¬†kicking in $50 million. The remainder came from Fidelity Investments and Spotify’s current investors.

With its new stake in Spotify, Coca-Cola is cementing a relationship that began back in April, when the two companies pledged to combine their worldwide marketing campaigns[5].

Spotify, which was founded in Sweden, but relocated to the U.S. last year, continues to lose money. It has atracted 4 million paying subscribers, and 15 million total users around the world. In 2011, the firm raked in $236 million in revenue, but posted a $57 million annual loss.

Still, with the latest round of financing complete, Spotify is currently valued at about $3 billion[6].

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2011/07/Spotify_120_flickr1.jpg
  2. KO: http://studio-5.financialcontent.com/investplace/quote?Symbol=KO
  3. taking a minority interest in the company: http://mediadecoder.blogs.nytimes.com/2012/11/14/spotify-attracts-investments-from-coca-cola-and-fidelity/
  4. GS: http://studio-5.financialcontent.com/investplace/quote?Symbol=GS
  5. combine their worldwide marketing campaigns: http://investorplace.com/2012/04/coke-loses-bears-shares-dollar-stores-adds-spotify/
  6. is currently valued at about $3 billion: http://investorplace.com/ipo-playbook/spotify-worth-nearly-3-billion/

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