Online music service SoundCloud saved by $170 million investment

Cornelia Mascio
Agosto 13, 2017

We previously reported that SoundCloud was in final talks with Temasek Holdings and boutique merchant bank Raine Group, who were interested to buy stakes in the troubled tech company.

"I look forward to fully dedicating my time to leading the board and helping drive SoundCloud's long term strategic vision, and forging strategic partnerships and connections with industry partners and our one-of-a-kind creative community", said Ljung in a statement this afternoon. Raine and Temasek were not immediately available for comment.

As part of the investments, SoundCloud is adding talent from two former Vimeo executives. SoundCloud disclosed steps it would cut its overhead costs last month, which included 173 layoffs. The company outlined the investments in a blog post, while it also announced that former Vimeo executive Kerry Trainor will be taking over as CEO... "All of this together-the capital, the capital partners, with Kerry and Mike joining our team-it puts our company in a really great position to stay strong and remain independent".

Ljung will continue to serve as chairman, and co-founder Eric Wahlforss will stay with SoundCloud as chief product officer.

In July, SoundCloud fired 173 employees and closed its London and San Francisco offices to focus on Berlin and NY. It is supported partly by advertising, with only a small chunk of listeners paying fees.

Axios reports it has obtained a memo that was sent to SoundCloud's current shareholders on Tuesday, indicating that a pending reorganization proposal is "do or die" for the music streaming platform. Atop all that, should this new investment close tomorrow, SoundCloud's pre-money valuation will have decreased a whopping 77 percent, from $640 million in 2014 to $150 million.

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