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Business News Digital
7digital secures funding to stay in business
By Andy Malt | Published on Monday 23 September 2019
B2B digital music outfit and radio production company 7digital has secured funds to keep it in operation, and announced improved financial results for the first half of 2019.
In June, the company said that it needed to raise £4.5 million by the end of July or face administration. Slightly later than that original deadline, it announced last week that £4.8 million had now been raised. The last £1.8 million came from issuing new shares. A sizeable chunk of the money overall came from eMusic president Tamir Koch, who is now Chair of the 7digital board.
“We are delighted to have secured further funding from our supportive Chairman, Tamir Koch and non-executive director David Lazurus as well as new shareholders”, says Mark Foster, Senior Independent Non-executive Director of 7digital. “On behalf of the board, I would like to thank them for their continued support at this crucial time as this financing secures the company’s working capital needs as 7digital prepares itself to embark on its next phase of development and achieve for the first time operational profitability in 2020”.
Recently appointed CEO Paul Langworthy adds: “The music industry has experienced continued growth, which has been led by the expansion in streaming services. Having reduced our operational costs and secured this new funding, we are in a good position to benefit from this industry trend and expedite the scale up of the business”.
He goes on: “With the additional financing we are able to implement our plan to build a new partner programme to drive new customer growth; expand sales and support in the US market; as well as invest in market-driven product development thereby delivering sustained growth and shareholder value”.
In its financial results for the first half of the year, the company announced reduced losses compared to the same period in 2018. In part this was aided by a £3.5 million reduction in administrative costs.
