Popular streaming music service provider Spotify is nearing a deal to raise $400m in an investor round that is expected to boost its valuation to more than $8bn.
First reported in the Wall Street Journal, over a dozen investors are said to have participated in the latest funding round, with prominent names being Goldman Sachs and an arm of the Abu Dhabi government-managed fund.
Spotify is also understood to have engaged in discussions with other notable hedge funds and money management firms from around the world.
Thye funding round is expected to close in the coming weeks.
Launched in 2008, Spotify has risen fast among the ranks of other streaming music services in the market such as Rdio, Beats Music and Google Play Music.
It earlier raised more than $500m in equity funding. In fact, the latest round is the seventh time the service is raising funds, reports the WSJ.
Spotify said its subscriber base has grown by 50% from the last eight months, when it declared a subscriber base of 15 million in January.
The service needs cash as it pays nearly 70% of its revenue to music rights holders as royalties. It is also depends heavily on advertisements for the free version of its service.
More than 60 million people use Spotify in nearly 60 countries around the world, with the company saying it had about 45 million free users and 15 million who pay $9.99 a month for an ad-free version.
People are increasingly turning to streaming services for music and other content, leading to decline in sales of physical compact discs and digital downloads. This in turn has resulted in increasing friction with artists and music industry over how the music would be made available to customers.
A spokesman for Spotify declined to comment.