Digital commerce services company Magex said Monday it has raised $80 million in private equity from several investors, including Universal Music Group, to create and deploy a system that enables companies to securely charge for digital music and video downloads.
Funding of the U.K.-based company marks one of Europe’s largest private equity investments in the Internet sector to date.
UMG, InterTrust Technologies Corp., GE Capital, Westpool Investment Trust, Europ@web and Reuters join National Westminster Bank, one of Magex’s initial backers, as part of the round.
Magex’s copyright protection software uses digital rights-management technology developed by InterTrust Technologies Corp. that enables companies selling digital content to enclose it within a secure electronic envelope and conduct transactions. Software stops copying of content.
Magex manages the payments flow from consumer to content provider, with Magex collecting consumer payments and passing the revenue on to the content provider at predetermined periods.
The company has doubled its staff to 85 in the past six months, with offices in New York and London and plans to expand to the West Coast this year.
The funding was led by Goldman Sachs and Capital Z Financial Services Fund II and will be used to broaden Magex’s operations on a global scale and to tap into the $275 billion-and-growing digital content space by 2003.
“We have for some time been working with businesses who have seen the potential of the digital economy and who wish to build exciting new products, new revenue streams and new customers,” said Peter Beverley, CEO of Magex.