Pandora Buys Ticketfly for $450 Million
The music-streaming service Pandora just made an interesting acquisition. On Wednesday the company confirmed it is paying "approximately" $450 million (£294) for the American ticketing agency Ticketfly.
The news comes after a report from Re/code, said that Pandora "appears close" to acquiring the ticketing company.
The two companies are joining forces to "create the world’s most efficient platform for connecting listeners with live shows from their favorite bands," Pandora cofounder Tim Westergren wrote in a blog post.
That means that Pandora listeners will start be getting a "personalized flow of local shows they love," Westergren writes, and artists and venues will hopefully be able to sell more tickets because they'll be getting access to Pandora users in their area.
While Ticketmaster still dwarfs Ticketfly — as well as every other company in the ticketing industry — Ticketfly does pretty well and handles ticket sales for performances at smaller venues and clubs where fans can get an intimate live-music experience.
Rather than just selling tickets, Ticketfly's platform also handles marketing and analytics for the venues it serves. Ticketfly sold $500 million (£326 million) in tickets in 2014.
The deal $450 million pricetag is "a nearly equal balance of cash and stock," Pandora said in a press release. Ticketfly raised a $50 million (£32 million) Series D round last summer, which brought its total funding up to a reported $87 million.
So far, Pandora has made all of its revenue from its radio-streaming service. It actually beat second-quarter revenue expectations thanks to solid advertising growth on its free, ad-supported tier, which grew 30% year-over-year. Its local advertising business increased by 67% as well.
The music-streaming service's revenue clocked in at $285.6 million (£186 million) for the second quarter, just over the $283 million (£185 million) expected. But Pandora is still struggling with profitability because it has to pass along most of its revenue to music owners, and it actually lost $16.1 million (£10.5 million) overall in Q2.
In a statement, Pandora CEO Brian McAndrews said: "This is a game-changer for Pandora – and much more importantly – a game-changer for music ... Over the past 10 years, we have amassed the largest, most engaged audience in streaming music history. With Ticketfly, we will thrill music lovers and lift ticket sales for artists as the most effective marketplace for connecting music makers and fans."