MusicGremlin, Inc. Raises Venture Round Led by Allen & Company; Appoints Richard Fields to Board of Directors

MusicGremlin, Inc. Raises Venture Round Led by Allen & Company; Appoints Richard Fields to Board of Directors

NEW YORK, Feb. 24 /PRNewswire/ -- MusicGremlin, Inc., developer of innovative direct-to-device software technology and music services, today announced that it has completed its Series B funding round led by Allen & Company LLC. With this latest round of private financing, MusicGremlin has raised more than $5 million to date. Allen & Company Managing Director Richard Fields joined MusicGremlin's Board of Directors as part of the financing.

"We are very excited to have Allen & Company as a financial and strategic partner," said co-founder Robert Khedouri. "Allen's experience and deep relationships throughout the media, entertainment, consumer products, and technology arenas will strengthen MusicGremlin's market positioning, particularly in anticipation of our 2005 consumer launch."

MusicGremlin has completed development of its second generation product and is in the process of licensing its technology to major consumer electronics companies.

"Our partners are anxious to bring our technology and service to market to differentiate their next generation digital audio products," said co-founder Jonathan Axelrod. "We are thrilled that this investment will help us to make our vision of giving consumers a 'record store in their pocket' a reality."

MusicGremlin's technology solution combines device-based software technology with a custom-architected music store and content acquisition system that allows customers to discover, purchase, manage, control and legally share their digital music collections directly from their digital audio players -- wirelessly and without a personal computer. MusicGremlin- enabled devices will allow consumers to purchase both "a la carte" and subscription content, both delivered directly to the device, without needing to connect wires or install software.

"We believe that MusicGremlin has developed breakthrough technology that will help fuel the digital music revolution," said Richard Fields, Managing Director, Allen & Company. "During the next year, the market will see significant steps forward in the digital audio world; MusicGremlin is poised to play a leading role in the development of this exciting market," he added.

Mr. Fields will join Mr. Axelrod, Mr. Khedouri and Chairman Morton P. Hyman on the Board of Directors.

The new investment will be used for working capital and to expand the company's operations.

About MusicGremlin, Inc.

Based in New York City, MusicGremlin, Inc. has created device-based software technology that connects to its proprietary digital music store, providing consumers with the next generation of benefits promised by digital music. MusicGremlin's powerful combination of device software and secure digital content distribution allows users to discover, purchase, manage, control and legally share their digital music collections directly from their digital audio players -- wirelessly and without a PC. MusicGremlin's patent-pending technology allows devices to access the MusicGremlin Music Store and download tracks directly to MusicGremlin-compatible consumer electronics (CE) devices using wireless high-speed networks. MusicGremlin's end-to-end system benefits content owners by providing a secure and exciting new distribution channel for their valuable digital assets, and MusicGremlin's device technology benefits consumer electronics partners by providing next-generation functionality to their digital audio products. For more information, visit http://www.musicgremlin.com/ .

About Allen & Company LLC

Allen & Company LLC is a privately held investment banking firm based in New York City. It provides its clients with a full range of financial advisory services and also invests its own capital with a view toward long-term appreciation.


Source: MusicGremlin, Inc.

CONTACT: Karen J. Novak for MusicGremlin, Inc., +1-212-431-0703, or
knovak@musicgremlin.com

Web site: http://www.musicgremlin.com/


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