Pandora could be close to paying $450 million for an American concert-ticket startup

Pandora CEO Brian McAndrews

REUTERS/Brendan McDermid

Pandora CEO Brian McAndrews.

The music-streaming service Pandora is rumoured to be making an interesting acquisition. According to a report from Re/code, the company "appears close" to paying $450 million (£294 million) for the American ticketing agency Ticketfly.

While Ticketmaster still dwarfs Ticketfly - as well as every other company in the ticketing industry - Ticketfly does pretty well and handles ticket sales for performances at smaller venues and clubs where fans can get an intimate live-music experience.

Rather than just selling tickets, Ticketfly's platform also handles marketing and analytics for the venues it serves. Ticketfly sold $500 million (£326 million) in tickets in 2014.
According to Re/code's sources, Pandora intends to pay for Ticketfly with a combination of cash and stock. Ticketfly raised a $50 million (£32 million) Series D round last summer, which brought its total funding up to a reported $87 million.

So far, Pandora has made all of its revenue from its radio-streaming service. It actually beat second-quarter revenue expectations thanks to solid advertising growth on its free, ad-supported tier, which grew 30% year-over-year. Its local advertising business increased by 67% as well.

The music-streaming service's revenue clocked in at $285.6 million (£186 million) for the second quarter, just over the $283 million (£185 million) expected. But Pandora is still struggling with profitability because it has to pass along most of its revenue to music owners, and it actually lost $16.1 million (£10.5 million) overall in Q2.

We have reached out to Pandora and Ticketfly for comment on this story.

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