Internet Radio Streaming service, Songza has grown significantly over the past year. The news was first reported by Techcrunch. When reached by Billboard, Songza declined to comment on how they are going to use the funding.
Songza was created by the team of developers that also founded and sold Amie Street, a music download service. Songza, unlike services that create a personalized listening experience using algorithms to tailor musical tastes, creates a channel based on people's mood or activity. It's "Music Concierge" feature guides the listener to playlists deemed suitable for everything from doing housework to entertaining friends. Clear Channel copied the feature when it launched it's "Perfect For" service in January.
In August of 2012, Songza raised 1.5 million from companies such as Amazon.com, Deep Fork Capital and Metamorphic Ventures. Other investors included Troy Carter, William Morris Endeavor and NBA star Baron Davis. The company has 27 investors through the most recent funding round, according to the SEC filing.
Although digital music services have had a tradition of scaring off investors, numerous internet radio companies have been raising funds recently. In 2011, Pandora had an intial stock offering while other services such as Earbits and Radical.fm attracted investors. TuneIn, a website that aggregates internet music streams earned $16 million in investment last August. Larger companies are also looking to get in on the action, with Apple announcing it was working on an internet radio service for Itunes.
Perhaps Songza's greatest impact in the market has been to devalue the #1 online radio company, Pandora. Pandora's stock dropped 11.2 percent over two trading days, shedding about $208 million of market value. This was in large part contributed to by BTIG analyst Richard Greenfield, who warned in a blog post that Pandora investors should be worried by the sudden rise of Songza.
Source: The Hollywood Reporter