Gaga and Kanye Hook Up Turntable

Lady Gaga and Kanye West have 19 Grammys, six platinum albums, five chart-topping singles between them, and, evidently, a lot of faith in Turntable.fm.

The two music stars reportedly contributed to a $7.5 million venture round for the startup headed by Union Square Ventures.

Launched by serial entrepreneur Billy Chasen in January, Turntable.fm is a social-media site which places free streaming music into chat rooms and allows users to "DJ" for other people who visit those rooms.

But it hasn't exactly been sweet melodies at the startup. The company has faced several legal questions in recent months concerning its right to play music for free. Chasen argues that the service operates under the protection of the Digital Millennium Copyright Act, the same law that allows recently public Pandora to stream songs without partnering with record labels.

Legal or not, the still-in-beta service has grown quickly, picking up 140,000 active users in its first month and growing to 300,000 users currently. That kind of growth has gotten investors' attention. A first funding round—Chasen started Turntable.fm with money from another venture, Stickybits—included VCs from Polaris Venture Partners, Mitch Kapor, First Round Capital, Lowercase Capital, and others, which put in approximately $1.6 million.

The latest funding lifts the startup's valuation to about $37.5 million—not to mention the intrinsic draw gained from the support of two of music's biggest names.

While the investment marks Kanye’s first step into the investment arena, Gaga has been here before. Earlier this summer, she and Google exec Eric Schmidt contributed to a $1 million financing round for Backplane, a company founded by her business manager, Troy Carter.

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