By Tian DuBelko
(Bloomberg via Twitter)
Despite launching a new on-demand streaming service last month, Pandora Media Inc said it is considering a possible sale.
The news comes after a series of substantial losses for the internet radio company and the departure of Chris Martin, the company’s Chief Technology Officer last week. Martin had been with the company since 2004 and had been considered the catalyst behind Pandora’s engineering.
A suitor, the private equity group KKR has already agreed to invest $150 million in the company. Pandora will also rejigger its board. A new, independent board committee will be created while two directors will leave.
Despite being once the dominant music streaming service, Pandora has struggled to keep up with the likes of Spotify and Apple Music. The fast growth of these competing music services, which include tech giants such as Google and Amazon, has pressured Pandora to expand from an internet radio streaming company to include on-demand streaming.
The new service, Pandora Premium will directly compete with the likes of Spotify and Apple Music. However, Pandora may be at a disadvantage in this new music arena, due to its late arrival.
In 2015, Pandora purchased Rdio, a failed on-demand streaming app. It has taken the company nearly two years to turn that foundation into Pandora Premium. And the app’s arrival in March this year means it will have to play catch up to the other music services that have had time to build an audience.
The extra cash from KKR could afford Pandora the funding it needs to add attractive features to its new service. Pandora’s CFO Naveen Chopra said this regarding the KKR investment, “A strong balance sheet gives us the ability to accelerate growth investments when appropriate and to compete aggressively in a rapidly changing, complex market.”
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