Pandora raises new funds for Net radio business
Greylock Partners leads the round, which totals $35 million according to one report. The funding news follows word of favorable new royalty rates.
Shortly after announcing a favorable new royalty payment deal with the music industry, the Internet music-streaming start-up Pandora confirmed that it has raised new funding from Greylock Partners.
The size of the round is $35 million, according to a Friday, a forum for private equity discussion. Pandora confirmed that Greylock Partners led the investment and said David Sze from the venture capital firm has joined its board.
"Consistent with our past practice, the amount and valuation are not being disclosed," the company said in its statement. "New funds will be used toward the continued growth and development of Pandora."
Pandora is among Internet music-streaming sites that last week, the group that collects royalties on behalf of artists and labels.
For revenue, Pandora currently plays and shows advertisements and offers a $36-per-year premium service that offers higher sound quality and eliminates the ads. Because of the new royalty agreement the company will require those who want to listen to more than 40 hours of music per month to pay 99 cents for unlimited listening that month once they reach the threshold.
That new fee affects about 10 percent of Pandora's present listeners, founder Tim Westergren said in a blog posting, but he was still jubilant about the deal, declaring, "The royalty crisis is over!...Pandora is finally on safe ground with a long-term agreement for survivable royalty rates."
Existing investors include Crosslink Capital, Walden Venture Capital, Labrador Ventures, King Street Capital, Hearst Corporation, DBL Investors, and Selby Ventures, Pandora said.