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Smule Raises More Money for Magic Piano and Its Other Music Apps

Real money in playful apps.

Peter Kafka covers media and technology, and their intersection, at Vox. Many of his stories can be found in his Kafka on Media newsletter, and he also hosts the Recode Media podcast.

There are lots of one-hit wonders in the app world. But there aren’t many companies that have figured out how to nurture a stable of successful apps.

Here’s one of them: Smule, which makes a series of playful music apps, like Magic Piano and Songify. The company doesn’t have a Candy Crush in its portfolio, but it has been steadily growing its audience — and revenue — for years.

Now it is getting a reward for that growth, via a $16.5 million investment led by Roth Capital Partners. Earlier investors including Bessemer Venture Partners, Shasta Ventures and Granite Ventures are back as well.

Smule’s apps use the now-standard freemium model, which means they make most of their money from a very small slice of their customers. About 200,000 of Smule’s 18 million monthly visitors pay to use its apps, starting at $2.99 per week. But there’s still real money there — the company says it is on track to do about $30 million in revenue this year.

Smule has now raised $42 million, and CEO Jeff Smith says his plan is to use the money to help expand into new markets — he figures Korea should be particularly good for his apps. He’ll also face competition there from the likes of YY, the Chinese music and games powerhouse.

Here’s a Magic Piano demo. You can also see a video of me not using Songify at our Dive into Media conference a couple of years ago over here.

http://vimeo.com/72757049

This article originally appeared on Recode.net.

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