Sources: Scribd CEO trying to raise more money at CODE conference, mainly to bribe book publishers
PDF-embedders turned wannabe Netflix-for-books, Scribd is reportedly raising a "growth round."
According to extremely well-placed sources, CEO Trip Adler is making it widely (and loudly) known that the primary purpose of his trip to Kara Swisher's CODE conference is to find willing investors to help Scribd get to the next level.
Like competitor Oyster, Scribd has recently signed deals with HarperCollins and Simon & Schuster to offer those publishers' books to its subscribers. Unlike Oyster, however, Scribd is still better know to most users as the service that allows sites (like Pando) to embed PDFs in articles. In an attempt to woo users away from its more clearly branded rival, Scribd offers monthly access for $8.99 compared to Oyster's $9.95. However, with an estimated 500,000 books in its library, Oyster maintains a 100,000 book advantage over Scribd.
We're told Adler is attempting to raise cash for a very specific purpose: To pay hefty guarantees to publishers wary of licensing their intellectual property to book rental services. Sources tell us that many publishers are holding back their books unless they are guaranteed a certain amount of royalty cash.
In other words, rather than building their own services, the famously Luddite publishing industry is letting Scribd, Oyster et al take all the risk (and raise all the cash), safe in the knowledge that those services can't exist without licensing popular books. And so Scribd's CEO is reportedly roaming the halls of CODE looking for someone to pay the ransom.
Scribd did not respond to a request for comment [~2hrs before publication] about Adler's reported fundraising mission to Rancho Palos Verdes.
Update: Scribd investor (and so perhaps Trip advisor?) Marc Andreessen -- who is also a Pando investor -- responded on Twitter to my use of the word "bribe" in the headline...
@paulcarr Here in Capitalismstan, we use the word "pay".
— Marc Andreessen (@pmarca) May 28, 2014