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Steam Republic’s Trade Minister Paavo Bäckman was interviewed about ongoing financing round by mergermarket, an independent Mergers and Acquisitions (M&A) intelligence service and part of the Financial Times Group.

Steam Republic, the private Finnish mobile solutions company behind the Mobile Backstage concept, is looking to raise up to EUR 5m to support international growthco-owner Paavo Bäckman said.

The company is open to approaches, and aims to have a round completed by this autumn. The investment is likely to come from a cluster of several venture capital investors, Backman noted. The preference is investors that have an understanding of internationalisation processes, with contacts that can support Steam Republic’s efforts in this context, he explained.

The company is seeking to raise between EUR 3-5m, with its current valuation in the EUR 15-20m bracket. Management is using Technopolis Ventures as advisors in the process.

Steam Republic’s Mobile Backstage application allows for music fans to be in touch with their favourite artists and to share digital content with other users. To date, Mobile Backstage has piloted artists like You Me At Six (EMI, UK), Enter Shikari (Atlantic Recors, UK) and Dizzee Rascal (PIAS, UK).

The novelty with the application, available for iPhone, iPod Touch and many Java-enabled handsets, lies in the level of activity of fans using Mobile Backstage, Bäckman said. According to company statistics, a pilot for You Me At Six in April showed 65% of the band’s fans being active in the first 24 hours through the application, rising to 75% in the first 48 hours, and 87% in total.

The business model is based on sign up/hosting fees, subscription fees and product sales within the application. The strongest revenue growth potential lies with the sale through Mobile Backstage of products such as tickets, merchandise and music, Bäckman said. The company envisages about EUR 14m in commissioned sales by 2012, with some EUR 120m of sales overall going through the application.

The UK and US markets are particularly important for expansion and offices will be opening in these countries at first, Bäckman said. The Canadian-, German and Japanese markets will follow after these, he added, and in the future the application itself could expand into e.g. the sports market.

Steam Republic’s main owners are Bäckman and Jussi Ruusila. Other owners include Veraventure, the investment vehicle of Finnvera, a state owned financing company, Koppicatch, Palmen & Charpentier and Geniem.

SOURCE:
http://www.mergermarket.com/
http://www.ft.com/mergermarket/

Tags: atlantic records, capital, direct to customer, direct-to-fan, dizzee rascal, emi, enter shikari, financial times group, fundraising, internationalisation, investor, iPhone, ipod, itunes, marketing, mergermarket, Mobile Backstage, Paavo Bäckman, pias, Steam Republic, venture capitalists, you me at six, youmeatsix