Image via SoundCloud
Instead of purchasing SoundCloud as they had initially planned two years ago, Twitter has now invested in the streaming service.
According to Recode, Twitter has invested about $70 million in SoundCloud as part of an investment round that “should end up in the $100 million range,” which is set to value it at around $700 million—the same valuation SoundCloud had in 2014 before it went into debt.
“Earlier this year we made an investment in SoundCloud through Twitter Ventures to help support some of our efforts with creators,” Twitter CEO Jack Dorsey said about the investment. “They’ve been great partners of ours over the years and their community-supported approach mirrors ours in many ways.” SoundCloud has yet to comment on Twitter’s investment.
Considering the fact that SoundCloud reportedly suffered $44 million in losses earlier this year, this is definitely good news for the company. If Twitter integrates SoundCloud into its app, this can help further promote SoundCloud’s new subscription service, SoundCloud Go, which has received mixed reviews since its launch.
SoundCloud Go offers access to the catalogs of the three major record labels (which SoundCloud signed deals with), as well as the releases of over 20,000 independent labels. The service costs $9.99 a month for desktop and Android users, and $12.99 for those using iOs devices. A 30-day free trial is available for those subscribing.
Related: SoundCloud’s New Business Model, and the Problem With One-Size-Fits-All Music Streaming