Sunday, February 13, 2011

With 80 Million Users, Pandora Files To Go Public

Interesting. Again highlights the fact that people are not largely ready to pay for music!

Erick Schonfeld, TechCrunch
February 11, 2010

Music streaming service Pandora has filed to go public. It could end up raising as much as $100 million. Morgan Stanley and J.P. Morgan are co-managing the deal. The filing puts them on track for a mid-2011 IPO, as we reported earlier.
Some financial stats from the SEC filing: For the first nine months of 2010 it lost $328,000 on revenues of $90 million. (Michael Robertson’s $100 million revenue estimate we published earlier this tear was pretty damn close). Pandora’s fiscal year ends on January 31 (weird), but in the prior full year ended on January 31, 2010, it lost $16.7 million on revenues of $55 million. So you can see how much it got its fiscal house in order since then, adding $35 million in revenues and practically eliminating its loss. (Click financial table below to enlarge)
About 86 percent of Pandora’s revenues ($78 million) comes from advertising, the rest ($12 million)comes form subscriptions. Pandora grew revenues 187 percent in the first nine months of 2010 (through October 31), a growth rate that slightly exceeds the 185 percent revenue growth in fiscal 2010 (which was really 2009, plus January). As of October 31, 2010, it still had $41 million in cash.
According to the filing, Pandora has 80 million registered users and 800,000 songs from 80,000 artists. Regsitered users grew from 46 million a year ago, and 22 million in 2009. The hours of music listened to on the service similarly doubled from 1 billion hours in fiscal 2009 to 2.1 billion in fiscal 2010.
As the dominant free Internet music service on the Web, Pandora wants to expand to mobile, automobiles, and other devices