Music-streaming service SoundCloud could become the next billion-dollar startup, according to a report this week that says the company is in talks to raise a $150 million round of funding. If the German startup secures the financing, it could notch a $1.2 billion valuation, according to a report Tuesday by the Wall Street Journal.

At those heights, SoundCloud would be in league with other billion-dollar startups, including Dropbox, Square and music-streaming rival Spotify, which last year raised $250 million in financing for a $4 billion valuation.  

SoundCloud has been described as the YouTube of sound, with artists and members uploading about 12 hours of audio every minute and others listening to the content for free. The Berlin-based startup claims an audience of more than 175 million listeners each month, but its biggest problem is its business plan. 

Until recently, SoundCloud made money just by charging members monthly subscription fees to upload content; it didn't introduce ads until this year. The company is hoping to generate more revenue by launching a subscription service for listeners next year. SoundCloud has been working to get deals in place with major record labels, but so far only Warner Music Group has come on board.