Technical and economic hardships have hit Berlin-based music streaming platform SoundCloud hard in recent years, operating at a loss and leaving many to wonder if the company will continue to grow or if the music will go silent for the company.
SoundCloud is a distribution platform that allows its users to upload, record, promote and share their own creations. It was founded in 2007 and launched in October 2008, aimed at creating a place for musicians to collaborate and discuss their tunes. Soon, it became a forum for distributing and publishing music.
In 2014, SoundCloud released a new program that would allow premier partners to skip ads and announced partnerships with several organizations. With new investments, news sites reported that the company could surpass $1 billion in valuation.
At the beginning of last year, several articles from different organizations reported that SoundCloud was faltering, continuing to operate at a loss and that investors were reluctant to put more money into the project.
“SoundCloud is facing three primary pressures,” Casey Rae, a music professor at Georgetown University, said in an interview with Wired. ” It needs to become past a specific edge despite the fact that development will normally level; oversee exclusive standards from financial specialists; and depend on a plan of action that expects them to pay at least 70{498f45a2d590969326697e149cf583a7ce36348d025b968ab6be0e344e90a807} of available revenue to content license holders.”
Alex Ljung, who was the CEO at the time, issued several statements last year about the foundation of the company and that it continued to do well. In a note on the SoundCloud blog on July 6, 2017, Ljung said that the company was cutting 173 staff members to reduce costs and continue to grow.
“In the competitive world of music streaming, we’ve spent the last several years growing our business, and more than doubled our revenue in the last 12 months alone,” he wrote. “However, we need to ensure our path to long-term, independent success.”
Artists continued to use SoundCloud despite its setbacks and the platform gave a stage to a new class of rappers, hip-hop artists and more. Artists like Post Malone, Don Monique and Kehlani first made an appearance on the site before hitting it big.
In 2017, the company had about 175 million unique listeners and 135 million tracks.
At the end of 2017, when it came clear that SoundCloud could soon sink into internet history, two new investors stepped in and funded the platform.
The Raine Group, a merchant bank, joined with Singapore-based investment company Temasek to invest just under $170 million. That cash helped keep SoundCloud afloat.
At the same time, former Vimeo CEO Kerry Trainor took over as CEO, replacing Ljung.
“As a huge fan of the SoundCloud platform since its founding, I deeply admire what Alex and Eric have built,” Trainor said in a press release from the company in August 2017. “There is only one SoundCloud and its importance to creators and music culture is undeniable. I’m extremely eager to join this capable group and construct the following section of development around SoundCloud’s central goal to engage sound makers. I look forward to sharing more about our plan and path forward in the months ahead.”
He said it was not his goal to compete with streaming services like Spotify, but instead to focus on the creators themselves and give them a platform that would help them succeed in the business.
“The investment will ensure a strong, independent future for SoundCloud, funding deeper development and marketing of its core tools used by millions of audio creators – musicians, DJs, producers, labels, managers and podcasters – that fuel SoundCloud’s one-of-a-kind, creator-driven listener experience,” according to the release.
And now, SoundCloud is continuing to grow.
According to its website, the platform features more than 18 million artists, 2 million albums and 150 million tracks. Users can stream the content for free or pay extra to download it and listen to it on the go. Apps are available on several different devices, including on the web, for iPhone and Android and through Chromecast and Xbox One. Artists can promote their SoundCloud account through official channels or via a number of third-party services that have popped up over the years.
By the end of 2016, the SoundCloud Android app had been downloaded more than 100 million times. Features for artists include real-time stats, a way to connect to communities of listeners and avenues to connect directly with fans. Musicians can schedule their releases and time when a new tune is added to his or her profile and to listeners streams.
A blog on the site highlights some of the success stories of those who started on SoundCloud, as well as posts about the newest features the platform offers, like a new mini player.
In March, the company released a post about “First on SoundCloud,” the series of inspiring stories about creators who started on SoundCloud.
“As the world’s largest open audio platform, SoundCloud is the first place creators share what’s new, now and next in music culture,” the post says. “‘First on SoundCloud’ will promote emerging talent on the platform through new music, video and photography, and empower all creators to upload to SoundCloud and be heard.”
‘First on SoundCloud’ creators were honoured with a showcase this year at the South by Southwest Music Festival in Austin.