E-Reading Startup Oyster Raises $14 Million
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After tendering $14 million in a new round of financing, investors are hoping that e-reading startup Oyster will harvest a pearl.
The company, which launched out of New York last fall, employs a business model similar to Netflix, offering customers unlimited access to over 100,000 e-books for a monthly subscription fee of $9.95.
With this latest fundraising round led by Highland Capital Partners and additional capital from an existing investor, the Peter Thiel's Founders Fund, the company's total funds are now upwards of $17 million, reports The New York Times.
Oyster's co-founder and chief executive, Eric Stromberg, told the Times that the funds would aid in a significant expansion effort to platforms beyond its existing iPhone and iPad apps.
And at the same time that it's seeking to add more platforms and users, Oyster is also pursuing more publishers to add to its arsenal of book titles. While it has already signed HarperCollins and Houghton Mifflin, notes the Times, the company's pitch to skeptical publishers for an all-you-can-read business model is that it "will draw in more readers, eventually expanding the universe of book customers."
Oyster currently competes with Scribd, which launched in 2007 and has raised a reported $25 million in venture capital.
And to distinguish itself from the collection of 300,000 titles available to Kindle owners via Amazon's Lending Library, Oyster has implemented "lightweight community features" within its app, noted TechCrunch, including the ability to share and receive book recommendations from friends.