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November 16, 2012

Spotify secures $100m funding from Coca-Cola, Goldman Sachs, Fidelity

The funding brings the total amount of money raised by the music service to $288m

By CBR Staff Writer

Digital music service Spotify has secured $100m funding from Coca-Cola, Goldman Sachs and Fidelity Investments, which values the company at around $3bn.

Of the $100m investment, half will come from Goldman Sachs and Coke is contributing about 10% while Fidelity is contributing about 15%.

The rest of the investment is expected to come from Spotify’s existing investors and the latest round of funding brings the total amount of money raised by the music service to $288m.

Spotify is facing stiff competition from its French rival Deezer, which had raised $130m in new funding in October this year.

In April this year, Spotify had formed a partnership with Coca-Cola to access the soft drinks firm’s global marketing engine to help it expand globally.

Under the partnership, Spotify agreed to offer technology for Coca-Cola Music globally and Coke would integrate Spotify into its Facebook Timeline media.

Spotify provides a basic free online music service and has around 15 million active members in over 15 countries.

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Last year, Spotify had doubled its revenues but lost EUR45.4m, 59% more than in 2010.

In September this year, Spotify had revealed its plans to launch a new browser-based music player app for its streaming service which was earlier being delivered through a desktop application.

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