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Amazon signed a deal to buy a venture-backed podcast maker with 20 million monthly listeners named Wondery. The deal is a bid on the retail giant’s part, to expand into the entertainment business, where it has invested billions in recent times, to attract a larger audience.

For instance, the company funded a Lord of the Rings series, with a $1 billion budget. Amazon did not disclose how much it is paying to acquire Wondery but the Wall Street Journal reported that the podcast maker was valued at more than $300 million during the acquisition talks. That valuation is three times as high as the one it received after its most recent funding round.

The entertainment wars

In an earlier report, Bloomberg reported that Apple and Sony both wanted to buy the podcast maker, which could have raised Wondery’s price tag considerably. Wondery is based in Los Angeles and was launched in 2016, with money from Disney’s 20th-century Studios.

The startup published several podcasts in many different genres, with Bravo, the television network, turning one of them into a series.

The acquisition will give Amazon the entire listening base and new revenue for its entertainment business. Wondery was expecting to bring in about $40 million in sales this year from licensing fees and ads.

Amazon’s entertainment business

Amazon competes with other music streaming companies, which also acquire smaller companies to help them target podcast listeners. Apple bought Scout FM in September and Spotify bought Gimlet, a podcast studio in 2019.

The acquisition will ensure Amazon’s entertainment business, which operates in video, audiobooks, and music grows.

In 2019, Amazon disclosed that it would be investing $7 billion to generate original content and, in a few months, it bought a stake in the sports broadcaster Yes Network.