Edited at 8:26 PST to adjust amount from $48M to $46M
Wattpad announced a massive $46 million third round of financing this morning, saying it would use the cash to expand its team and boost product development.
The social reading platform already has 25 million users who spend six billion minutes a month on the platform, the company said, which means Wattpad has doubled in size over the past year. All content on the system is contributed for free by writers looking to build their audience.
I asked cofounder and CEO Allen Lau if the company would now start monetizing.
“Our priorities havn’t changed,” he said. “We’re committed to growing the Wattpad community and building a great platform for people to connect through stories. But now that our community and engagement numbers have grown exponentially … we’ve begun to explore new paths to monetization, including branded content/native advertising and licensing.”
The new funding brings Wattpad’s total funding to almost $70 million. All the investors who invested in the company’s last round also invested in this new round, indicating Wattpad is hitting its targets and shows promise — at least for investors — of becoming profitable.
The size of the funding round also indicates that its investors intend to be patient for profit and are providing the company with enough resources to continue its growth for at least another year or two without being forced to prematurely monetize.
But while Wattpad is now flush with cash, the same can’t be said of authors on the platform, who are not paid for their contributions. That may change soon, according to Lau.
“Last year we experimented with fan funding and learned a lot about how readers will support writers and what type of things they would like to receive in return for their support,” Lau told me. “We’ve also partnered with publishers like Sourcebooks and Summit Media (in the Philippines) to help Wattpad writers get their stories into print.”
The company says international growth is strong, with 10 percent of its traffic now coming from Spanish-speaking countries. Stories are now available in over 50 languages, the company said, and Lau told me that there is at least one “Wattpadder” in nearly every country in the world.
Coming up? New features for allowing writers to write directly in the platform and connect even more with readers:
“One of the reasons Wattpad is so successful is because we offer something readers and writers haven’t had before, a direct connection with each other,” Lau told me. “Moving forward, we’re going to add features that will continue to connect readers and writers in real-time, like an improved writing experience and notification center.”