Spotify raises valuation to $4 billion

Nov. 22 (UPI) -- Swedish music streaming service Spotify raised a $250 million investment, valuing the company at $4 billion. This is up from a $3 billion valuation last year, and will help the company's global expansion.

Silicon Valley firm Technology Crossover Ventures, which also invested in Netflix, Facebook and Groupon, led the investment.

Spotify is now in 32 markets, up from 17 a year ago. It competes with U.S. companies Pandora and Apple's iTunes for music streaming. It also raised more revenue than Pandora last year, with close to $585 million raised compared with Pandora's $427 million.

Spotify raised $100 million in a previous year of fundraising from Goldman Sachs and Coca-Cola, among others.

Pandora went public last year and is now valued at $5.7 billion. But both Pandora and Spotify face a shortfall in profits. A huge cost for Pandora has been music royalty costs, while the bulk of Spotify's expenditures are on expanding to new markets.

[Wall Street Journal] [NY Times]