Streaming music and social networking site
Imeem Inc. has laid off a quarter of its 80 employees and is
reportedly retaining investment bank Montgomery & Co. to explore strategic options including a sale of the company. The cuts come just two weeks after
stakeholder Sequoia Capital
encouraged its portfolio companies to reduce costs. An Imeem representative calls the layoffs "proactive," and says they have occurred across the entire organization.
Imeem, which delivers on-demand streaming music to as many as 100 million users via its Web site, widgets and a new
application for Android-enabled phones, features songs from all four major labels, and generates revenues from online advertising. Although its popularity continues to grow, it
faces increased
competition from the new
MySpace Music, which also provides free ad-supported streaming, as well as
iLike Inc., which dominates on Facebook.
Warner Music Group Corp. [
WMG] is
known to be an investor in the company, as is Morgenthaler Ventures; this
report also says DAG Ventures took a stake this summer in a round valuing Imeem at more than $200 million. The startup
acquired music fingerprinting technology developer Snocap Inc. for under $5 million earlier this year, and also
paid an undisclosed amount for Anywhere.fm.
Although a company representative disclosed the layoffs, Imeem has historically kept quiet about its investors and strategic options, and remains tight-lipped about matters concerning them today.
-- Paul BonanosSee
Apr. 15 and
Aug. 8 posts from Tech Confidential about Imeem's investors
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It’s a shame to see yet another VC backed management team falter with the assets they have at their disposal.
With just a little outside of the box thinking Imeem could be the most influential force in the digital music sales market…
Good Luck...