Venture

Spotify Eyes Gimlet, As Podcast Deals Rise

Swedish music streaming giant Spotify is reportedly “in advanced talks” to acquire Gimlet Media for more than $200 million, according to Recode.

That move would be significant for a number of reasons. First off, it would mark Spotify’s first purchase of a content company. It would also represent Spotify’s “first big move” into podcasting, as Recode notes.

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New York-based Gimlet Media, which produces popular shows like Reply All and Startup, raised $20 million in its two tranched Series B that closed between August and September 2017. Its pre-money valuation at that time was $55 million, according to its Crunchbase profile.

Spotify has been vocal as of late about its desire to move into podcasting. In October, Digital Media wrote about how the company had launched its beta “Spotify for Podcasters.” According to Digital Media, that service would “allow podcasters to easily link their RSS feeds to Spotify, allowing for easy upload through various podcast aggregators.”

Last June, Crunchbase News wrote about how 2017 was a pivotal year for venture investment in the podcast industry. Below, we’ve included an updated version of the chart which appeared in that article. In it, we display reported venture deal and dollar volume totals for rounds raised by companies in Crunchbase’s podcast category.

While dollars raised dipped some in 2018, money raised was still significantly higher than years prior. Podcast startups brought in $109.6 million across 17 deals in 2018, according to Crunchbase data. That compared to $156.8 million raised over 27 deals in 2017. But it’s also way higher than $39.8 million in 2016.

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2017’s dollar totals towered above those of the previous year. Of the roughly $157 million in reported funding for podcast startups, $59.4 million of that was raised by subscription platform Patreon in a Series C round. Patreon isn’t primarily a podcasting company, but it does offer podcast hosting to people who use the platform.

Gimlet’s last round, its previously mentioned double-barrel Series B, put its total funding at $27.5 million, which is less than many other venture-backed companies in the podcast industry. This being said, most of the best-capitalized companies (like Acast with $67.62 million, or Luminary Media with $40 million in backing) are on the listening app and hosting end of the business. There just aren’t that many venture-backed podcast companies on the media production side of the coin, and Gimlet is the exception that proves the rule.

Illustration: Li-Anne Dias