Music streaming company Saavn announces $100M Series C funding round led by Tiger Global
Indian music streaming company, Saavn today announced $100 million in a new funding round led by Tiger Global Management. Existing investors Bertelsmann India Investments, Steadview Capital, Liberty Media, and Mousse Partners are also participating in this round along with the new global investors Quilvest, additional Hong Kong-based hedge funds, and a number of strategic individuals. Advisory for the round was led by Avendus Capital in Mumbai and LionTree Advisors in New York.
The eight-year-old company has offices in five locations across India and US, viz. Mumbai, New Delhi, Bangalore, New York, and California.
Initially, Saavn was a B2B company till about 2009, partnering with distribution platforms to stream movies(legally). The Bollywood films were distributed on Hulu, for online viewers in the USA and on YouTube for a global audience. Later on, the company shifted its focus to being a destination for Bollywood music and launched Saavn.com, a free music streaming service, with features like playlists.
Partnerships and growth
Saavn has an ad-supported 'freemium' service and a paid pro service, through which it generates revenue. They launched their android app in 2010, followed by their iOS app. In 2011, they launched their web based chrome app and also became Facebook’s first global partner on the open graph platform.
In 2012, Saavn entered a partnership deal with Sony to acquire their entire music catalog database. In 2013, they entered an exclusive partnership with Shazam, the mobile based music identification service and Saavn’s music library was incorporated in Shazam’s music database. Then in 2013, Saavn launched its radio model and partnered with Twitter to crowd-source song requests through the handle @SaavnRadio
In early 2015, Saavn partnered with the global non-profit Akshaya Patra to launch '#MusicForMeals', an initiative to provide midday meals for school-going children in India. Over the years they have also partnered with global brands like Apple, Amazon, AT&T, Bose, General Motors, Nokia, Samsung etc. The company is also working with teams at Microsoft to launch Saavn on Windows in August 2015. The company has 900+ label partnerships including T-Series, Tips, YRF, Saregama, Eros, Universal, Sony, and Warner Music.
Related read from 2013: Adding New Notes To Its Musical Journey – Saavn.com
As India becomes the leading market for Android handset growth, Saavn has been growing its monthly active users by over 1MM users a month. Since announcing 11MM monthly active users in Q1 2015, the company has increased its monthly active user base to 14MM users. They aim to cross 20MM users by the end of the year.
- With more than 90% of Saavn usage on mobile devices, the company is announcing updates (first Android and later on iOs)to its mobile offerings. The updates include:A personalized multi-language homescreen, additional charts, including top “Rewind” charts by decade for all 11 languages.
- Infinite scroll and “One-Click Play” on homescreen.
- New and trending content along with enhanced personalization in 'My Music' category and enhanced music tagging and music chat features for Saavn Social.
In India, Saavn is competing with Hungama, Airtel's Wynk, San Francisco based Rdio (which acquired Dhingana), Gaana.com and recently launched Apple Music. On the global front, there is Spotify, which recently raised $525M in funding in June 2015, taking their total tally of funds raised to $1.1B. On a different note, Grooveshark shut down in April 2015 as a part of a legal settlement.
Music streaming has been received well in developed economies. With low cost mobile devices and easier access to internet services, they seem to be doing well in developing countries as well. Since Indians are becoming more comfortable about transacting online owing to the penetration of e-commerce, music streaming services may also see similar user adoption.
Comparison from 2013: Fight Club! Saavn vs Dhingana vs Gaana – App music streaming services
The company will use the capital from their Series C round for long-term product development and customer acquisition. In addition, the company is investing in its proprietary ad technology, growing the sales force, and inking new content deals. Rishi Malhotra, CEO & Co-Founder of Saavn, said:
Music streaming is at the center of the music industry, and India is one of the most important music economies in the world. With 2 million Android devices shipping each week, music is driving data consumption and redefining mobile advertising. We’re excited to add millions of users to the Saavn family and deliver our long-term product vision across multiple platforms.
“Saavn continues to innovate consumer products designed for India’s growing mobile user base. The team has built a leadership position in a unique marketplace while at the same time developing a world-class music service. We’re excited to support Saavn as it continues to define India’s mobile entertainment market,” Lee Fixel, Partner at Tiger Global Management, said.
Gautam Gandhi one of the early advisor's to Saavn added,“ Video is definitely the next big thing and Saavn is poised to go after it. They have an experienced core team and a great mobile app strategy.”
Related read: How Internet radio could be the next big thing