8tracks Raises $2 Million From Small Investors, Plans Shift To Subscription Model
Playlisting service 8Tracks has raised almost $2 million of a hoped for $5 million from 3700 small investors. The startup's crowdfunding campaign with SeedInvest has two week's remaining.
In an email to investors obtained by RAIN, 8tracks CEO David Porter signaled a shift from ad supported to paid subscriptions. “Our current audience size and lack of growth have hampered our ability to sell advertising, the revenues from which have fallen short of forecasted levels over the last few months,” according to the email. “In order to both conserve and generate cash, we’re shifting the focus of our US business model to an ad-free, subscription-based experience.”
8Track currently offers a $2.99 per month subscription.
Launched in 2008, 8tracks has 5 million monthly active users who stream 20M-30M hours of music each month. Around two-thirds of that streaming is delivered to mobile devices and two-thirds is delivered to listeners in the U.S. and Canada.
According to comScore, 8tracks is the third-largest “pure play” internet radio service among U.S. millennials.
