Soundcloud Will Reportedly Only Last For 50 More Days

[Chelsea Press 2]

SoundCloud Has Enough Money to Survive Only 50 Days, Report Claims

Jem Aswad
Senior Music Editor

JULY 13, 2017 | 07:28AM PT
UPDATED: The prognosis on SoundCloud, the popular but financially strapped streaming service, has been grim for all of 2017, with 40 percent of its staff laid off last week and statements from its founders that it may not have enough money to see it through the year. According to a report published Wednesday in TechCrunch, the company may not have enough money to see it through the summer.

According to the long and bruising report, a video conference was held Monday by cofounders Alexander Ljung and Eric Wahlforss to explain last week’s layoffs to the staff — and during the course of the otherwise largely uninformative meeting, the staff was told the company has only enough cash to last “until Q4,” which begins in 50 days.

On July 13 afternoon, after this article originally published, SoundCloud responded with a statement in which it said in part: “There are a number of inaccuracies within the TechCrunch article. They seem to stem from a misinterpretation of information by one or two laid off employees during a recent all hands meeting. …. To clarify, SoundCloud is fully funded into the fourth quarter.” (Head here to read SoundCloud’s full statement.)

The report cited an unidentified staffer as saying that morale is “pretty sh–ty. Pretty somber. I know people who didn’t get the axe are actually quitting. The people saved from this are jumping ship. The morale is really low.” Staffers also questioned the wisdom of the company continuing to hire new staff only to lay at least one of them off, Vojta Stavik, as he was in the middle of moving to Berlin to start at the company.

The staff also questioned the wisdom of Ljung’s insistence on continuing to hire under the company’s dire financial circumstances. He replied that a hiring freeze would be a sign of weakness.

In March, the company confirmed the latest in a series of financial infusions, $70 million in debt funding from Ares Capital, Kreos Capital and Davidson Technology. However, it incurred a 51 million Euro loss in 2015 on revenue of 21.1 million Euros. In January Ljung expressed concern that “risks and uncertainties may cause the company to run out of cash . . . and would require [SoundCloud] to raise additional funds which are not currently planned” — concerns that were partially, although certainly not completely, allayed by the March debt-funding infusion. The company has also been hobbled by a long series of executive departures.

The new funding arrived after earlier reports that SoundCloud was considering a fire-sale exit because it hadn’t been able to raise the necessary money to continue its operations. It acknowledged the need for new capital, but denied that it was getting ready to sell for pennies on the dollar. “We are actively speaking with a variety of potential investors and other strategic partners,” SoundCloud told Variety at the time.

SoundCloud had raised $70 million from Twitter in June 2016, after raising $35 million more of debt financing in January 2016.

Source

[Deleted]

Oh that is a shame it's a good spot to discover the next set of overrated artists .

[Deleted]

I'm hard pressed to think of anything Soundcloud offers that I can't get from Spotify (or Apple Music, or Google Play) other than the random unofficial mashup or remix. They were an indie haven but lbr if you're not into wading through 99 misses to land on 1 hit...sucks to say but maybe Soundcloud should call it a wrap intead of delaying the inevitable.

[maine]

rip to all the SoundCloud rappers' careers

[surfy]

Actually, after a talk with Chance the Rapper, I believe they tweeted that they are here to stay once more!

edit: www.xxlmag.com/news/2017/07/chance-the-rapper-call-soundcloud-here-to-stay/#photogallery-1=4

[Chelsea Press 2]

I used to love Soundcloud when it first came out. A lot of remixers put up their special private and unreleased mixes for the fans and other DJs to download after the "exclusivity period" of those tracks had ended. Same with podcasts and stuff. I used to put up my mashups and podcasts on there.

As the service gained popularity, eventually the takedown notices started getting sent. I had a number of my podcasts removed because their bots ID'd a track in my set that matched something that was copyrighted.

It got so bad that many producers couldn't put up their own work there without it getting auto-removed or a takedown notice being served. This was work that they wrote, produced, and owned the publishing to and had self-released it. There is one producer whose works I featured on my review blog back in the day. He finally left Soundcloud after their bots ID'd an entirely original song he posted that had no samples or elements from any other track and took it down and shut down his channel. Their algorithm ID'd it as matching some obscure song that sounded nothing like his track. He got his lawyer involved and they discovered that the waveform for both tracks was similar despite there being no actual similarities in the songs. They said that since they use bots and other technologies, occasionally it gets it wrong. They didn't reinstate his channel nor refund his premium membership subscription fee.

Soundcloud has basically turned into MySpace but much, much worse. There are all sorts of bootlegs and other garbage there. Nothing wrong with that except that there are all these services and stuff that help you re-share a track and everyone's timelines are filled with those and all the actual tracks are lost in that abyss. SC had to remove the feature that allowed you to re-share the same track multiple times because some would re-share it many times per day to get more exposure. When you do actually do that now, it removes the original re-share and does it as a new one.

[Anticonformity]

I agree with you Chelsea Press 2

I have found unreleased (like literally no one has it cause it was only up for a BIT) demos, songs, remixes etc which I have been SO SO SO thankful for but the last few years its been harder and harder...

I do think it still serves that purpose at times (as rare as it may be with all the copyright s**t)...

[Deleted]

This is quite awful..I was laid off from one of the NYC engineering teams. No ONE saw it coming at all!

[chicken077]

My English teacher for the past two years used to have a duo with a friend of his when they were in high school and posted an EP or something on SoundCloud. I wonder how he would react to this.

Also RIP to some of Kelsea's early songs from when she was in high school/college (or were those on MySpace? oh well, at this pace MySpace is also gonna end soon)

[Chelsea Press 2]

A Cloudy Future: Why It Matters If SoundCloud Lives Or Dies
by MICHAELANGELO MATOS

JULY 20, 2017

LAS VEGAS, NV - JUNE 22: Fans react as Fedde Le Grand performs during the 18th annual Electric Daisy Carnival at Las Vegas Motor Speedway on June 22, 2014 in Las Vegas, Nevada.
ETHAN MILLER/GETTY IMAGES
Nine years ago, Alexander Ljung and Eric Wahlforss, a pair of Swedish DJs and programmers who’d moved to Berlin, created what Ljung would later describe to Billboard as something akin to a Flickr for DJs and musicians. Flickr, as you might recall, was a photo-saving and -sharing site that once dominated its field in a way that, in 2010, seemed insurmountable, only for both Facebook and Instagram to usurp it within three years. SoundCloud, on the other hand, has yet to be usurped as a creator’s platform and crucial incubator for all manner of pop, particularly EDM and hip-hop — except, perhaps, by its own doing.

Last week, an announcement that SoundCloud had only enough capital to keep running for another few months (first reported as fifty days, then amended to eighty) sent shock waves through the independent-music ecosystem. And in an echo of the last days of Napster 1.0, it sent scores of listeners to their computers to grab as much music as they could while it was still there for the taking — only for Chance the Rapper to announce on Twitter that a phone call he’d made to Ljung had steadied the waters, which SoundCloud itself more or less corroborated on Twitter: “*airhorn* Spread the word: your music isn’t going anywhere. Neither are we.”

The Napster comparison is not idle. Along with Spotify, SoundCloud is one of the two most efficacious musical delivery systems to emerge since the ascension of the iPod. Its one-click shareability, in particular, was so successful that nearly every music blog to emerge in its wake has oriented itself to SoundCloud — whose usability as an embedded player for blogs and social media pre-dates Spotify’s by five years. So, too, every new record label, every songwriter with a new tune, every DJ with a new set, every producer with a dream. SoundCloud allowed users to make their pages and streams private and invite-only — perfect for publicists and labels, who could distribute yet-to-be-released new music selectively to writers and DJs without the hassle of the labyrinthine, laborious downloading and streaming systems the majors began using in the late 2000s. “We’re in the Wild West with streaming, still,” one publicist says. “Why have five clicks when you can have just one?” The idea of SoundCloud suddenly going away, the publicist says, would be “like hearing, ‘The U.S. mail isn’t delivering CDs anymore’ in the late Nineties.”

The showdown appeared to have come last week. On July 12, TechCrunch published a scathing report from Josh Constine surmising that SoundCloud’s morale was bottoming out at the same rate as its coffers. A reported 173 positions — 40 percent of the staff — were eliminated. A former SoundCloud employee, speaking to the Voice on the condition of anonymity, disputed portions of the TechCrunch piece but agreed that the company is rudderless. “I kept waiting for them to hire a rock star senior leader to steer the company, but they never did,” said the ex-employee. “When they moved away from focusing on creators, I knew it was time to go.”

That focus, particularly early on, is what made SoundCloud successful in the first place. “We still haven’t done any advertising or anything like that,” Ljung admitted in October 2010. “There’s been no real marketing around it….We started from our feeling that there was really something lacking on the creators’ side. We knew that there were a lot of creators out there.”

The time and place of SoundCloud’s origins are important to consider. In 2007, Ljung and Wahlforss were in the thick of a bustling Berlin tech and techno scene. The city had remade itself in the face of a severe miscalculation of the effects of post-Wall reunification. As Tobias Rapp wrote in his 2009 chronicle, Lost and Sound: Berlin, Techno and the Easyjet Set, “an overly optimistic budget forecast made in the early Nineties” meant that “as a result, Berlin, a city with three and a half million residents which is designed for around five million, didn’t grow — it shrank.” One way it made up for that was by offering a residence/artist visa that allowed one to live in Berlin so long as one’s income mostly came from outside of it — a boon to programmers, coders, and creatives who worked remotely, not to mention liked to party alongside a continent’s worth of weekenders — the “Easyjet Set” of Rapp’s title — who flew in to hit the city’s techno clubs. Prior to launch, Ljung and Wahlforss got the ball rolling by handing out free accounts to their favorite DJs.

SoundCloud, then, was by DJs for DJs. It just so happened that its orange casing, its waveform, its ability to target a comment to any point on an upload’s unfolding time grid, and its possessing the easiest interface imaginable happened to apply to discrete songs as well as DJ sets.

SoundCloud came along right as the availability of DJ mixes online began to proliferate. A year prior, in 2006, dance music website Resident Advisor began its weekly podcast series, sending a new DJ set to your iTunes every week, and soon every other dance site began doing the same — right, of course, as the number of dance sites began to mushroom. It didn’t take long for all of them to begin using SoundCloud as their primary library. Nor did it take most DJs long to do that themselves.

And make no mistake: As much as Daft Punk at Coachella or the Electric Daisy Carnivals in L.A. and Vegas, SoundCloud broke EDM in the U.S. Suddenly the DJ mixtape, long an underground dance music staple that had yet to fully track outside of the subculture, was right there for the listening. You could headline Coachella’s DJ tent and zip your set up to SoundCloud an hour later, and all your fans would find it there, and listen to it, and share it, and embed it. In 2014, Astralwerks a&r man Lawrence Lui compared SoundCloud’s effect to “what Dave Matthews Band did by allowing fans to come to shows and record their live sets, creating a marketplace for trading them for free. I think a similar thing is happening with electronic music right now, where artists will put a set up from a show. It brings in this whole social aspect that was previously unseen.” SoundCloud is where young DJs discover music — period.

But recorded DJ mixes are the thorniest of musical commodities. And with its endless handshake deals and pretend-you-didn’t-hear-that-sample ethics, dance music tends to stay underground in part to protect itself from the legal consequences of reconfiguring other people’s properties by the handful. Like a lot of tech companies, SoundCloud was a great idea without a real business model. Clearly, SoundCloud couldn’t have survived purely as a DJ- and creator-driven platform, so it introduced subscription streaming, à la Spotify, Apple Music, and Tidal. Not only was almost no one interested in paying for something they’d gotten free for years, a number of tracks and DJ sets suddenly disappeared from the site once the majors turned their attention to it.

Although its roots are in dance music, SoundCloud has been most visible as a conduit for hip-hop. As Spin’s Jordan Sargent notes, “there was never rap named after mixtape websites — no ‘Datpiff rap’ or ‘LiveMixtapes rap.’ There was no Best Buy rap or Sam Goody rap.” But there is most certainly SoundCloud rap. Any mixtape from the Weeknd to NoName would make its way to the site.

So it wasn’t a surprise when, after Chance tweeted a request on Friday morning for “an artist who you wouldn’t know if not for @soundcloud,” he landed a bombshell: “Just had a very fruitful call with Alex Ljung. @soundcloud is here to stay.” (Later that night, Chance uploaded a new track with Young Thug, “Big B’s,” exclusively on SoundCloud.) A SoundCloud rep told Variety that “the rapper is essentially spreading good vibes about the company during a challenging time and that if he is making a more material commitment to the service, she is unaware of it.” Killing MTV News and saving SoundCloud — talk about power.

Nevertheless, we should probably ready ourselves, in some manner, for SoundCloud’s demise. There are already DJ-centric successors such as Mixcloud and hearthis.at, and songs and albums on Bandcamp. Uploading music for free in a universally applicable way will be harder; YouTube is less appealing to musical aspirants than it is to meme creators and showbiz kids.

One of Ljung’s stated goals, per a 2015 Billboard interview, is to “not just monetize but also create a functioning platform for more user-generated content, like mash-ups and remixes,” as well as DJ mixes containing unlicensed music: “It’s a huge part of music culture today, and we’ve taken on the challenge. I don’t think anybody can solve everything, but we’re aiming to solve the majority of it.” A truly outlaw format such as the DJ mix, where part of the creativity involves being able to ignore rights issues, continues to resist that kind of full integration into the old-biz way of doing things. And so does SoundCloud, whose killer app came for free, hamstringing later attempts to monetize it.

[Bigfatliar 3]

Hmm okay.. Starting to download all podcasts that I follow.

[rosemulet]

Honestly? I personally never liked Soundcloud, since it's basically just a streaming site that doesn't pay, that people sneak popular songs and unreleased demos onto. but I understand why it exists, I know many artists who rely on it to get their music known and shared. That being said, it is very sad to see SoundCloud go, and a lot of creators will probably lose their songs if they don't have them backed up.
As for me, I liked posting my remixes there. I wouldn't post my original music there though...I need to support myself, since making music costs money.

Also, RIP Can't Steal Our Love :( The song that never was...

[Chelsea Press 2]

SoundCloud’s Investors May Terminate the Company In 24 Hours
Paul Resnikoff August 10, 2017 9

On Friday, SoundCloud’s existing investors will determine if the company lives or dies. So you might want to back up your catalog.

The walls are caving in on SoundCloud. And its entire future is now hinging upon one vote.

Earlier, Digital Music News reported that the beleaguered streaming service was entertaining rescue investment from two groups. But according to a just-published report, those newer investors need to be approved by a bunch of older investors. And that’s not guaranteed.

The vote to rescue (or not) comes on Friday, August 11th, according to Axios writer Dan Primack. Citing a memo leaked to Axios, Primak notes that the incoming ‘rescue’ investors Raine Group and Temasek would receive preferential treatment. Which basically means that other investors would be de-prioritized, receive worsened terms, and have a harder time recovering their cash.

Ljung has warned that if the rescue package isn’t approved, the company won’t have enough money to survive. It would introduce a dangerous tailspin as employees jumped ship and the money dwindled to zero.

So essentially, a ‘no’ vote terminates the company. Or at least drastically reduces its chances of survival.

Existing investors would face some raw deal terms. In the case of an eventual fire-sale or liquidation, Raine and Temasek would get to recover their funds first, along with any other investors participating in this ‘Series F’. Sounds like a bad deal, except that the alternative is destroying SoundCloud forever.

SoundCloud is asking for an additional $170 million. The Series F sharply plunges SoundCloud’s pre-money valuation to $150 million.

One option for existing investors is to keep the company afloat and accept the bad terms. Then, work like hell to either liquidate or sell the company, a move that Ljung has previously resisted.

Others investors participating in this ‘Series F’ round include Union Square Ventures, Doughty Hanson and Atlantic Technology. So that complicates the analysis and decision matrix a bit.

Existing SoundCloud CEO Alex Ljung is obviously urging investors to vote yes. But here’s the kicker: ReCode has just reported that if the rescue round is approved, Ljung will probably be fired. In fact, a massive leadership shakeup is almost a certainty.

Accordingly, Vimeo CEO Kerry Trainor would assume the CEO helm, according to the Recode report. Whether Ljung would fight to remain CEO is another question.

Earlier, we’d heard that investors loved Ljung. But love has a funny way of turning into hate.

Over its multi-year history, SoundCloud has burned through more than $230 million. That doesn’t even include an additional $70 million in loans, undoubtedly accruing massive interest.

Meanwhile, attempts to launch a premium tier have floundered. SoundCloud Go has largely underwhelmed and failed to amass any subscribers. Spotify, meanwhile, has 60 million paying subscribers.

+ Spotify Walks Away From SoundCloud Acquisition

Incidentally, Spotify apparently passed on a deal to acquire SoundCloud. That could play into the current decision, especially the analysis of whether SoundCloud is actually sellable or not.

[MilesW1998]

Well, then I guess that also means most of Bodak Yellow's support also disappears, since it's #1 on the SoundCloud chart.

[slowmo]

It's got a little more life left in it.

It’s Official: SoundCloud Secures New Investment, Names New CEO
variety.com/2017/music/news/its-official-soundcloud-secures-new-investment-names-new-ceo-1202523832/

[Chelsea Press 2]

SOUNDCLOUD COFOUNDER ERIC WAHLFORSS RESIGNS FROM ROLE AFTER 11 YEARS
He will take on an advisory position at the company instead...
CHRISTIAN EEDE
THURSDAY, JANUARY 24, 2019 - 20:26

SoundCloud co-founder Eric Wahlforss is standing down from his current role as chief product officer at the company in March.

The move means that the Swede will step away from the company that he has worked at since founding it in 2007 alongside Alexander Ljung. Wahlforss will, however, transition into an advisory role within the company.

"I have come to the realisation that now is the right time for me to take a break, reflect and think about what to create next," Wahlforss said announcing his decision.

He continued, "This was not an easy decision to make, but one of the biggest reasons why I feel I have made the right decision is that the company is in such capable hands. It's been a pleasure working with Kerry [Trainor, the company's CEO] and the new leadership team over the past 18 months. Our team is stronger than ever, and we have very exciting plans slated for 2019."

SoundCloud has spent recent years trying to boost revenue from offering subscription services. It was forced to let go of 40% of its staff in 2017, but later received $170 million to keep it running. Co-founder Alexander Ljung stepped down as CEO to make way for current CEO Kerry Trainor at that point.

Last month, SoundCloud detailed new plans to integrate the streaming platform with Serato DJ.The company also last year responded to a backlash surrounding a controversial clause within their monetisation program Premiere.