Music subscription service provider MOG has raised $9.5 million in a new round of venture funding, with UK-based Balderton Capital joining lead investor Menlo Ventures, an existing stakeholder, in the round. The new money builds on at least $12.5 million in existing funding, including investments from major labels Universal Music Group and Sony Music.
The choice of Balderton as a new investor gives MOG a beachhead in the UK, where it plans to launch its service this spring. The company is also planning to introduce a series of mobile applications in the coming weeks, and is exploring integrations with networked consumer electronic devices, including set-top boxes.
MOG raised $5 million last summer, prior to the introduction of its all-you-can-eat streaming music service in early December. David Hyman, CEO of MOG, said the company will use some of the funds for an aggressive consumer marketing strategy intended to win over new users. MOG plans to extend its free trial period from one hour to three days in order to encourage new signups; the company says it’s currently converting 17 percent of trial users to paying customers.
MOG, whose service allows on-demand streaming of nearly 7 million songs from all four major labels and numerous independents, is preparing to launch iPhone and Android applications by April. MOG’s desktop service currently costs $5 a month, but Hyman has said the mobile version will cost more.
With the UK launch, MOG will enter a market in which Spotify’s free service has won considerable consumer attention but relatively few of its fans have become paying customers. Rumors have suggested that Spotify may launch in the U.S. as soon as next month’s SXSW conference, although the stateside version may lack the free tier in favor of a monthly subscription fee similar to MOG’s. Warner Music Group chief Edgar Bronfman Jr. said earlier this month that the label is no longer interested in working with free streaming services, but remains in full support of subscription models. Warner holds a small equity stake in MOG, but has never invested cash in the company.