Berlin - Twitter has invested about $70 million in SoundCloud to help the Berlin-based music streaming business expand its paid offering.
The investment is part of a larger financing round expected to amount to about $100 million, valuing the company at about $700 million, according to a person familiar with the situation.
“We can confirm that Twitter has made an investment,” SoundCloud said in an e-mailed statement Wednesday, declining to comment on specifics or the valuation. It said it will use the money to “continue the global roll-out of many company initiatives such as our recently launched subscription service, SoundCloud Go.”
Read also: LinkedIn deal spurs buzz around Twitter
While SoundCloud’s massive, engaged user base has tantalised the recorded music industry for years, it had been under increasing pressure to develop a paid service after failing to turn its reach into sustainable revenue streams.
SoundCloud, perhaps “the Facebook of music”, released the premium service in March and has completed deals with major music labels, as well as publishers and independent labels.
Recode reported the investment earlier Wednesday.
BLOOMBERG