French digital magazine newsstand lekiosk today announced it has secured $7.1 million of Series B funding from CM-CIC, the investment arm of Credit Mutuel and an investor in Deezer and Spartoo, and FSN PME CDC Enterprises, a French government fund.
Lekiosk is currently the highest grossing app for the Apple tablet in the French App Store, profiting mostly through a package deal where subscribers pay £10 to download 10 magazines.
FSN PME CDC Enterprises and CM-CIC are joining lekiosk’s strong group of existing investors, including Sigma Gestion and Promelys. The digital newsstand has raised $3.8 million since launching in 2007, with this round bringing their total funding up to a total of close to $11 million. This Series B funding will aid their expansion into Europe. So far, lekiosk is only available in France, the UK and Italy.
The digital newsstand wants to be known as the “Spotify of magazines” by offering users a long list of 600 magazine titles in their French library (100 in the UK edition), which users can download for a monthly subscription fee. So far, lekiosk has a strong track record financially, turning over €1.4 million in 2011 and predicting a raise of that figure to €6 million this year. They have managed to attract some big name publishers to the platform, including BBC, Conde Nast and Dennis.
The magazines can be read on a number of devices, including iPad, iPhone, Android tablets and mobiles, and any computers, and the team will use this funding round to work on developing a Windows 8 model.
Subscribers scan the magazines through a 3D rotating British-style newsstand and read them on their tablets in a way that simulates a real magazine, complete with page turning and a shadow in the crease of the pages.
Lekiosk chairman Ari Assuied said: “This funding will enable us to continue with our investment into the UK service, as well as our international expansion into new markets. We will also be using the funds to continue to develop lekiosk to make it a more social and interactive experience for users.”
Lekiosk faces strong competition from US online newsstand Zinio, along with Apple’s own newsstand, as well as any magazine that offers an app version. This could be why no mention of a launch in the US was made. However, while a roll out in Germany has not yet been announced, it could be on the cards within the company’s European expansion.
For related reading, check out
Project A sprinkles share of $4.5m on Popdust, looks to a future in digital content over eCommerce
Startup of the Week: ebookmakr – become a published author in five minutes
BMW Guggenheim Lab opens in Berlin – the great gentrification debate continues