Streaming music service Spotify has acquired two NYC podcasting startups – Gimlet Media and Anchor. Terms of the transactions were not disclosed but reports pegged Gimlet’s acquisition price to be north of $200M. “These acquisitions will meaningfully accelerate our path to becoming the world’s leading audio platform give users around the world access to the best podcast content and improve the quality of our listening experience as well as enhance the Spotify brand,” said Daniel Ek Spotify cofounder and CEO. “We are proud to welcome Gimlet and Anchor to the Spotify team and we look forward to what we will accomplish together.”
Brooklyn-based Gimlet Media the podcast network that features titles like Homecoming, StartUp, Heavyweight, ReplyAll, and Crimetown was founded in 2014 by Alex Blumberg and Matthew Lieber. The company had raised a total of $28.5M in funding over six rounds. Backers of the company include Lowercase Capital, Betaworks, Stripes Group, Cross Culture Ventures, WPP, Emerson Collective, Fueled, LionTree Partners, Rene Reinsberg, Knight Enterprise Fund, Graham Holdings, Quire, David Fox, and John Rokos.
“Spotify is poised to become the largest audio platform in the world and we are excited for Gimlet’s award-winning podcasts to connect with new audiences around the world,” said Blumberg and Lieber. “The medium of audio is uniquely great at creating human connection and understanding. We are thrilled that Gimlet is joining Spotify to do that at a global scale on the platform and beyond.”
Anchor, the infrastructure production platform for podcasters to create publish and monetize podcasts that powers forty percent of the world’s new podcasts, was founded by Michael Mignano and Nir Zicherman in 2015 and had raised a total of $14.4M in funding over four funding rounds. Investors in Anchor include Accel, SV Angel, GV, Omidyar Network, CrunchFund, Betaworks, Eniac Ventures, Acequia Capital (Acecap), Homebrew, Scott Belsky, The Chernin Group, Quire, Nir Eyal, Avi Muchnick, Craig Kallman, Vijay Vachani, and Mick Batyske.
“We are incredibly excited to introduce Anchor’s industry-best podcasting tools to Spotify’s massive user base as we continue our journey now with even greater resources,” remarked Mignano. “We look forward to continuing to empower creators all over the world to build an audience generate revenue and most importantly have their voices heard.
Spotify reported earnings today and in its earnings release, the company stated that it will aggressively acquire businesses in the podcasting vertical with plans to spend up to an additional $500M in 2019. Spotify’s sales are slowing with year over year declines in sales growth stemming back to 2016. The company went public in the spring of 2018 and debuted on the NYSE as a direct listing at $165.90 with the stock currently trading at $133.44, up from its intraday 52 week low of $103.29 in December of 2018. The pressures of the public markets and the need to satiate investor appetites may ensure that Spotify will be pursuing inorganic growth for the near future.