Spotify Reportedly Aiming to Raise $500 Million
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Online music streaming service Spotify is working with Goldman Sachs for a new round of private fundraising which could potentially put off the initial public offering for another year, the Wall Street Journal reported, citing people familiar with the matter.
The company has expressed interest to raise about $500 million in new financing and investors have heard talks that put the company valuation at more than $6 billion, the people said.
However, the amount to be raised and valuation are still to be settled, the Wall Street Journal reported.
Spotify is talking with investors who are known to buy into companies before a IPO, including mutual fund T. Rowe Price Group, the report said, citing people familiar with the matter.
The company has indicated its willingness to provide investors with a "ratchet" provision that will give them a guaranteed return in the event of an IPO, one person said.
Spotify said it does not comment on rumors.
The company was founded in 2006 by Daniel Ek and Martin Lorentzon. It provides free on-demand music or ad-free tunes for paying customers.
Spotify raised speculation of an IPO in August after it re-advertised a job for a regulatory filings expert.
Representatives at Goldman Sachs and T. Rowe Price declined to comment.
Spotify had 15 million subscribers and 60 million active users at the end of 2014.
(Reporting by Shivam Srivastava in Bengaluru; Editing by Diane Craft)