SoundCloud confirms new round of funding

Audio hosting service SoudCloud cofirmed Friday that it has raised a new Series D round of funding led by Institutional Venture Partners with the Chernin Group participating. SoundCloud didn’t disclose the amount raised, but the Wall Street Journal reorted earlier on Friday that the company had raised $60 million at a $700 million valuation.

In an emailed statement, SoundCloud said it wants to use the money “to grow more rapidly in product, personnel and expansion in mobile efforts.” Institutional Venture Partners also confirmed the funding with a long blog post outlining ten reasons it chose to invest in the company. Care for an excerpt? Here you go:

SoundCloud is the YouTube of Audio – Our core investment thesis for SoundCloud is centered around our belief that SoundCloud will become the dominant online digital delivery platform for audio in much the same way that YouTube has become the dominant online platform for video. YouTube is the most fundamentally disruptive thing to happen to video content since the advent of cable TV, and it is not just the dominant online video platform, it is also now one of the leading search platforms, social media platforms, and smartphone apps.”

The funding round closed some time last year, but hasn’t been announced — something that Recode’s Peter Kafka attributed to the company’s attempts to strike licensing deals with major labels.

So far, SoundCloud hasn’t had any deals with the major record labels, and instead relied on user uploads, which are protected by the Digital Millennium Copyright Act — essentially, the site has been acting more like YouTube than like Spotify. But with an ever-growing catalog — users now upload 12 hours of audio to SoundCloud every minute — there has also been increased pressure to strike further-reaching deals with rights holders.

SoundCloud signaled that it was preparing itself for that path when it hired former Amazon (S AMZN) exec Ted Suh a little more than year ago to become its head of music partnerships. At Amazon, Suh was responsible for music content acquisition for the company’s MP3 download store. And Suh’s Linkedin profile comes with this telling tidbit:

“Specialize in developing international licensing agreements and managing distribution partnerships with major & independent recording labels, music publishers and movie studios.”

This post was updated at 12:00 pm with a confirmation from SoundCloud, and comments from Institutional Venture Partners.

Image courtesy of flickr user stevendepolo