Spotify has entered into a definitive agreement to acquire audiobook distribution company Findaway.
The terms of the transaction were not disclosed.
According to a media statement, Spotify and Findaway “will accelerate” the music streaming company’s entry into the “rapidly growing audiobooks industry”, currently dominated by the likes of Audible, which was acquired by Amazon for $300 million in 2018.
Spotify says that Findaway’s technology infrastructure will allow it to “quickly scale its audiobook catalog”.
Additionally, Spotify claims that the acquisition positions it to “revolutionize” the audiobooks space “in the same way as music and podcasts”.
Spotify, whose global Premium Subscriber base grew to 172 million in the three months ended September 30, has invested heavily in podcasts over the past couple of years in the form of original content spending, exclusive deals, and company acquisitions.
Spotify counted 3.2 million podcasts on its platform at the end of Q3, according to its Q3 financial report, which was up from 2.9m at the end of the prior quarter (Q2).
In August, Spotify rolled out paid podcast subscriptions to US podcast creators and says that it plans to expand the monetisation tool globally.
Speaking on the firm’s Q3 earnings call, CEO Daniel Ek noted that “Excitement from advertisers for the podcast industry has increased substantially over the last year, and we’re ahead of our plans for podcast monetization.” Ek added that Spotify is on course to surpass €1 billion in ad revenue in 2021.
Findaway will maintain its headquarters in Solon, Ohio and will continue to be led by Findaway Founder & CEO Mitch Kroll, who will report to Nir Zicherman, Head of Audiobooks at Spotify.
The transaction is expected to close in the fourth quarter of 2021 and is subject to regulatory review and approval.
“The acquisition of Findaway will accelerate Spotify’s presence in the audiobook space and will help us more quickly meet that ambition.”
Gustav Söderström, Spotify’s Chief Research & Development Officer, said: “It is Spotify’s ambition to be the destination for all things audio both for listeners and creators.
“The acquisition of Findaway will accelerate Spotify’s presence in the audiobook space and will help us more quickly meet that ambition.
“We’re excited to combine Findaway’s team, best in class technology platform, and robust audiobook catalog, with Spotify’s expertise to revolutionize the audiobook space as we did with music and podcasts.”
“Together with Spotify we have the opportunity to innovate and democratize the audiobook ecosystem.”
Mitch Kroll, Findaway
Findaway Founder & CEO Mitch Kroll added: “Together with Spotify we have the opportunity to innovate and democratize the audiobook ecosystem.
“We founded Findaway with the recognition of the power of the spoken word through audiobooks and the unique opportunity to empower storytellers and connect them with listeners.
“We look forward to combining our leading technology tools and world-class team with the reach of Spotify’s platform to provide an enhanced audio experience for creators, publishers and listeners around the world.”
Music Business Worldwide