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Spotify in talks to buy podcasting company Gimlet Media
By Andy Malt | Published on Monday 4 February 2019
As Spotify increases its reach as a podcast provider, the streaming service is reportedly in talks to buy podcasting company Gimlet Media. The deal would be worth more than $200 million, according to Recode.
Founded in 2014 by former ‘This American Life’ producer Alex Blumberg, Gimlet’s first show was ‘Start Up’, which documented the company’s launch. The show proved a hit, which helped, and the company has since gone on to launch numerous shows – one of which, radio drama ‘Homecoming’, was developed into a TV series for Amazon last year.
In 2016 it also moved into creating branded content and has since worked with companies including Microsoft, Mastercard, eBay, Virgin Atlantic, and more.
When it last raised funds in 2017, Gimlet was valued at $70 million. Since Recode reported news of the pending deal to acquire the company, other sources have said that the specific amount Spotify is offering is $230 million.
Spotify has been gradually increasing its podcast offering for some time and has started to claw at some of Apple’s dominance in the field. There are a number of benefits to this strategy.
First, by providing people with different types of audio to listen to, the company can grab more attention from its users. Secondly, serving podcasts instead of music can save Spotify money. And thirdly, as Spotify seeks to grow its ad income, possibly by moving more into branded content, it’s much more cost-effective to involve brands in spoken-word output than linking them to music, which will require the involvement of featured artists and any business partners which have a stake in their recordings and songs.
If the Gimlet deal goes ahead, it would be the first time that Spotify has acquired a content creation company.
