Just four months after subscription-based mobile ebooks service Oyster finally hit the iTunes App Store, the company has announced a big $14 million investment round, led by Highland Capital Partners, and including participation from existing investor Founders Fund, according to the New York Times.
The new round brings the company’s overall funds raised to $17 million, building off of a $3 million round in 2012. Eric Stromberg, Oyster’s CEO, said via phone today that the money will go directly to building out both personnel and product. Oyster’s app currently offers more than 100,000 across publishers such as HarperCollins, Houghton Mifflin, and others.
“Basically, we saw that there was a lot of existing demand in the market, as well as the demand we anticipate as our service grows,” Stromberg said.
He didn’t share specific numbers about just how large the Oyster user base has grown since its launch for iPhone in September and subsequent iPad expansion — just that it doubled within a week of the tablet edition’s release — but it does appear to be quite a vocal group. Stromberg said that the company has tried to meet the feedback of users and their demands, such as including the works of the highly searched-for Kurt Vonnegut and establishing a Young Adult Fiction genre.
“It’s top priority to keep adding fresh content for our subscribers,” Stromberg explained. “We’re increasingly learning what our subscribers want and what they like to read.”
Of course, the crux of that is the partnerships Oyster makes with publishers to get the right content. Launch partner HarperCollins remains the largest publisher within the app’s library, but Stromberg said that the company is actively pursuing deals with other big publishers to enrich the book count. The funding plays an important role here — Stromberg explained that the money helps publishers feel more secure about the model, a trump card of sorts for those on the fence about ebooks’ viability.
As for the app itself, Oyster will be coming to Android sometime in 2014. The app will also see some improvements down the line — Stromberg said that he’s focused on building a social experience around reading, with robust friend recommendations and better messaging. But in the long term, Stromberg is focused on making Oyster the dominant name in ebooks.
“An increased amount of ebook reading will happen, and we want to position ourselves as the best way to read on the tablet,” he said.
All in all, Oyster’s new stack of cash is a vote of confidence for the app’s subscription model — something that really hasn’t been attempted in the ebooks space. As my colleague Laura Owen said in her review of the app, there’s already an admirable number of books that you actually want to read on the service, but there does need to be participation from bigger, better publishers if Oyster wants to become dominant. The money could help, along with an earnest effort to convince the traditional dinosaurs in print, to make it much easier and convenient to read on a mobile device.