Imeem Gobbles Up A Young Startup, Anywhere.FM
After less than a year in operation, the team at Anywhere.FM reached an early payday today when veteran social music service Imeem gobbled them up for an undisclosed sum, most likely in a cash and stock mix. The iTunes-style web music player had raised under $100,000 in financing from Y Combinator and angels, making an early exit likely below $5 million possible. Anywhere.FM with its 60,000 users and over 9 million uploaded songs will continue to exist as is, but the founders will be joining Imeem to complete their earnout and continue work on their iTunes-style music player at Imeem’s San Francisco office.
Both Imeem and Anywhere.FM saw a lot of synergy in the deal. Anywhere.FM has the best upload and player interfaces I’ve seen, but lacked a solid monetization method. Imeem will bring its music deals and sales team to bear on the service and hopes to leverage Anywhere’s client side iTunes sync uploader, buddy radio, and recommendation technology in particular. Anywhere’s uploader can upload your entire iTunes, WinAmp, or Windows Media Player libraries, including personal playlists, song ratings and play counts, with a single click. In an email correspondence, Imeem’s CEO Dalton Caldwell hinted at the company’s future saying, “I think that an excellent and complete product that is fully licensed will win vs. the fragmented market we are seeing out there right now.” I couldn’t agree more.
Although not currently announced, Anywhere.FM will likely have access to the same licensing deals Imeem struck with the major labels. The deals allow users to stream any of 5 million songs from their friends for free. Being included on the deals would mean Anywhere.FM could avoid web broadcasting rules that placed limits on how often and in what order songs could be played.
Inking deals with all the majors marked a major turn around in Imeem’s history by ending the lawsuits that earlier dogged the site. But the deals came with at least Universal exacting a pound of flesh in form of some stock and a large upfront cash payment. The Financial Times said the payment was $20 million, although Imeem disagrees. Michael Robertson of MP3tunes.com, and earlier MP3.com, called it a death sentence.
While the ad supported model by their executives own admission has yet to be proven, Imeem has a major leg up over the competition. They’re legal with a large library and currently have over 20 million monthly uniques and 65,000 new registered users each day according to their own stats. Comscore ranked them the top growing social site last September. If ad supported music is going to succeed, Imeem is the startup to watch.
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