Radiohead’s Thom Yorke may have recently labelled Spotify 'the last desperate fart of a dying corpse', but Spotify isn’t showing signs of slowing just yet. The music streaming service has raised $250m to launch in Japan, valuing the company at more than $4bn.
The funding round was led by Silicon Valley venture capital firm Technology Crossover Ventures, an early investor in Netflix. According the Wall Street Journal, this values the company at more than $4bn (£2.5bn) – up from a $3bn valuation a year ago.
Launched in 2008 by Swedish start-up Spotify AB, Spotify now reaches people in 32 countries and has 24 million users and 6 million subscribers who pay for its premium service. The firm charges £10 per month for unlimited access to some 20 million songs which can be accessed on a mobile. A free version includes advertising and can only be used on PCs.
Make no mistake new artists you discover on #Spotify will no get paid. meanwhile shareholders will shortly being rolling in it. Simples.
— Thom Yorke (@thomyorke) July 14, 2013
Radiohead's Thom Yorke is a strong critic of Spotify
Because of its popularity, Spotify has attracted criticism from music artists who complain about how much it pays them. Radiohead and Atoms for Peace frontman Thom Yorke is one notable critic. Earlier this year he pulled some albums from the service, tweeting: ‘Make no mistake new artists you discover on #Spotify will not get paid. Meanwhile shareholders will shortly being rolling in it. Simples.’
In a more recent interview with Mexican website Sopitas, Yorke labelled Spotify ‘the last desperate fart of a dying corpse’, accusing the company of taking money away from record labels by re-selling their old albums for free.
‘That’s why, to me, Spotify is such a massive battle,’ he said. ‘Because it’s about the future of all music, it’s about whether we believe there is a future in music.’
Spotify is the latest private technology company to notch up a multibillion-dollar valuation after Dropbox was recently valued at $8bn and Snapchat $3bn.
Spotify’s revenue more than doubled to €434m last year, according to July filings in Luxembourg, where the company is registered. However, investment and expansion meant losses widened to €58.7m from €45.4m in 2011.