Online music site Sellaband gets $5 mln investor

By Gavin Haycock

LONDON (Reuters) - Dutch-based online music Web site Sellaband.com said on Tuesday that European venture capital fund Prime Technology Ventures has invested $5 million in the company to help it expand in the United States.

Sellaband, which allows fans to buy shares in unsigned bands to help fund recordings, will use the investment to boost marketing and development, particularly in the United States, co-founder and Chief Executive Johan Vosmeijer said.

"America is the biggest market for us potentially. This new capital will enable us to make the necessary investments and expand in America," said Vosmeijer, a former Sony BMG music executive.

Sellaband opened an office in New York late last year and since launch nearly two years ago has funded 18 recording artists from 11 countries.

Vosmeijer declined to say what stake Prime Technology Ventures, which is based in Amsterdam in the Netherlands and Cambridge in the UK, would get in return for its $5 million.

Its investment comes after Sellaband recently agreed an online retailing deal with Amazon.com in the UK and signed Dutch brewing giant Heineken to be a primary sponsor for Sellaband's live music events.

Sellaband and other online music Web sites like UK-based Slicethepie have emerged with initial financing by private investors as the traditional music industry grapples with the challenges of consumers increasingly turning to the Internet to source, develop and share music.

(Reporting by Gavin Haycock; Editing by Erica Billingham)