Online music-focused social network Imeem is on the block, according to our sources, and has hired investment banker Montgomery and Co. to lead the sale. Coincidentally, we have also learned that the company is announcing some layoffs internally today—as much as 25 percent of its around 80-strong workforce.

Imeem has raised above $50 million in funding over the last two years, including a $15 million round from Warner Music Group earlier this year. Other previously disclosed investors include Sequoia Capital and Morgenthaler Ventures…we have also learned that DAG Ventures was the last one to invest in the company this summer, with the valuation north of $200 million. They would probably like more than that, but with the current market, anything in nine figures would be, well, reality-rational.

It is worth noting that DAG did the last funding at $200M.  Depending on what, if any, liquidation preference they put in the deal, it is very possible that the founders, management and employees will be wiped out in any deal.

This is why I would never agree to a liquiditation preference, frankly.

Disclosure: Imeem is one of WatchMojo.com’s distribution partners.  We have absolutely no insight on the company’s layoffs etc.