From music streaming disruptor to financial swan song, SoundCloud is now up for sale to the tune of $1 billion.
The company’s billion-dollar encore performance arrives after an 8% reduction of its workforce in 2023 as its owners chased profitability. Two major shareholders, the boutique merchant bank Raine Group and Singaporean investment firm Temasek Holdings, have now started interviewing banks about a “prospective auction” of SoundCloud, Sky News reports.
It’s a not-so-serendipitous revelation after SoundCloud’s execs recently revealed the music streaming company is planning to turn an annual profit for the first time since its 2007 inception. CEO Eliah Seton said the organization reached a positive €2 million EBITDA (earnings before interest, taxes, depreciation and amortization) on the back of projected annual revenues of €288 million, we reported in late-December.
Raine and Temasek acquired their equity in SoundCloud back in August 2017 after inking a deal worth $170 million. The agreement saw them acquire a majority position as the company’s value ballooned to $300 million, per Music Business Worldwide.
Despite its standing as a music tech darling, SoundCloud was on the brink of collapse at that time as the organization endured years of platform reformation and corporate restructuring in its pursuit to establish a profitable business model. Roughly 40 million artists have released over 320 million tracks on the service to date.
The sale isn’t expected to begin for “some months,” a source told Sky News.
