{"id":8117,"date":"2017-08-11T18:58:03","date_gmt":"2017-08-11T18:58:03","guid":{"rendered":"https:\/\/rsoftsolution.com\/blog\/soundcloud-saved-by-emergency-funding-as-ceo-steps-aside.html"},"modified":"2017-08-11T18:58:03","modified_gmt":"2017-08-11T18:58:03","slug":"soundcloud-saved-by-emergency-funding-as-ceo-steps-aside","status":"publish","type":"post","link":"https:\/\/www.rbsitsoftwaresolution.in\/blog\/soundcloud-saved-by-emergency-funding-as-ceo-steps-aside.html","title":{"rendered":"SoundCloud saved by emergency funding as CEO steps aside"},"content":{"rendered":"


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SoundCloud has just closed<\/a> the necessary funding round<\/a> to keep the struggling music service afloat. CEO Alex Ljung will step aside though remain chairman as former Vimeo CEO Kerry Trainor replaces him. Mike Weissman will become COO as SoundCloud co-founder and CTO Eric Wahlforss stays as chief product officer<\/a>. New York investment bank Raine Group and Singapore\u2019s sovereign wealth fund Temasek have stepped in to lead the new Series F funding round of $169.5 million.<\/p>\n

SoundCloud laid off 40 percent of its staff last month<\/a>, with 173 employees departing in an effort to cut costs. The company only had enough runway left to last into Q4, and today\u2019s investor decision was viewed as a do-or-die moment for the company. Now it will have the opportunity to try to right the ship, or sail into an established port via acquisition.<\/p>\n

SoundCloud declined to share the valuation or quantity of the new funding round. Yesterday, Axios<\/a>\u00a0reported the company was raising $169.5 million at a $150 million pre-money valuation. That\u2019s a steep decline<\/a> in value from the $700 million it was valued at in previous funding rounds. The new Series F round supposedly gives Raine and Temasek liquidation preferences that override all previous investors, and the Series E investors are getting their preferences reduced by 40 percent. They\u2019re surely happy about that, but it\u2019s better than their investment vaporizing.<\/p>\n

Raine will get two board seats for bailing out SoundCloud, with partner and former music industry attorney Fred Davis, and the vice president who leads music investments, Joe Puthenveetil, taking those seats.<\/p>\n

While abdicating the CEO role probably wasn\u2019t exactly what Ljung had hoped for, at least he gets to stay on with the company as chairman of the board. \u201cThis financing means SoundCloud remains strong, independent and here to stay,\u201d he wrote.<\/p>\n

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As I said @SoundCloud<\/a> is here to stay. I’m very excited to announce that we’re ready and strong for decade II. https:\/\/t.co\/c78jEy9ubz<\/a><\/p>\n

\u2014 Alexander Ljung (@alexanderljung) August 11, 2017<\/a><\/p>\n<\/blockquote>\n

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SoundCloud says its total revenue is now at a $100 million annual run-rate. If it can keep costs low and grow that number, it may eventually get to break even and no longer need infusions of investor capital.<\/span><\/p>\n

TechCrunch broke news about the magnitude of the SoundCloud crisis last month. Sources from the company told us the layoffs had been planned for months, but SoundCloud still recklessly hired employees up until the last minute, with some being let go within weeks of starting. Employees told TechCrunch that the company was \u201ca shitshow\u201d with inconsistent product direction and dwindling cash. Ljung was seen as reluctant to be honest with the team, and unfocused as he partied around the world like a rock star.<\/p>\n

Our report led to a flurry of follow-on coverage, prompting fans and artists to speak up in favor of the service. The rally was reminiscent of the love shown to Vine after Twitter announced it would shut down. Popular musician Chance The Rapper tried to get involved to save the company. He, like many other indie hip-hop artists, made their name on the platform as part of a genre that came to be called \u201cSoundCloud Rap.\u201d In the end, SoundCloud was saved when Vine wasn\u2019t.<\/p>\n

\"\"<\/p>\n

SVP of Entertainment, AOL Kerry Trainor attends the 2011 TV Summit Presented By Academy Of Television Arts Sciences Foundation Variety at Renaissance Hollywood Hotel on February 15, 2011 in Hollywood, California. (Photo by Todd Williamson\/WireImage)<\/p>\n

For now, music and other audio saved on SoundCloud is safe. But the company will need to find a way to make its subscription tiers more appealing and scale up its advertising despite having much less staff to drive the changes. If it can\u2019t, SoundCloud could be back begging for cash in a year.<\/p>\n

The new management should provide some additional confidence. I\u2019ve interviewed both Ljung and Wahlforss in the past, and neither had answers to the big questions facing SoundCloud about its product direction, business model and the spurious copyright takedowns that have eroded its trust with musicians.<\/p>\n

Trainor may be able to institute some more discipline at the startup. He was the CEO of Vimeo from 2012 to 2016, and has poached his former COO there to help run SoundCloud. They helped Vimeo fend off bigger rivals like YouTube by doubling down on what was special about the service: a focus on high-quality artful film rather than amateur viral videos. That experience makes Trainor a great fit to lead SoundCloud, which is fending off bigger rivals like Spotify and Apple Music.<\/p>\n

SoundCloud\u2019s best bet isn\u2019t to battle them directly, but double down on the user-uploaded indie music scene, including garage demos, DJ sets, unofficial remixes and miscellaneous audio you can\u2019t find elsewhere. Whether it stays independent long term or tries to seduce an acquirer, SoundCloud will benefit from spotlighting its unique community of creators and hardcore listeners.<\/p>\n

<\/p>\n

Featured Image: TechCrunch<\/small><\/p>\n

Article source: http:\/\/feedproxy.google.com\/~r\/techcrunch\/social\/~3\/KMvhPF-FEt8\/<\/p>","protected":false},"excerpt":{"rendered":"

SoundCloud has just closed the necessary funding round to keep the struggling music service afloat. CEO Alex Ljung will step aside though remain chairman as former Vimeo CEO Kerry Trainor <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[3],"tags":[10,7,14,15,6,12,11],"class_list":["post-8117","post","type-post","status-publish","format-standard","hentry","category-latest-update","tag-computer-news","tag-downloads","tag-microsoft-download-news","tag-networking-updates","tag-technology-update","tag-wordpress-plugin-download","tag-wordpress-theme-download"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t