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SoundCloud could be forced to close after $44m losses

factmag.com

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Re: SoundCloud could be forced to close after $44m losses

#31

Post by camillomiller »

petercooper wrote: post #2

I hope this is just an alarmist headline. SoundCloud is pretty essential in its space, it's one of the few services that lets you natively get audio on to Twitter, the main place musicians share snapshots of their work and remixes, and a key part of numerous podcasts and ways to embed easily shared audio on the Web. This is one startup I absolutely don't want to see go down the pan.

I still don't think it will happen. Worst case scenario, someone's gonna make a very nice deal when buying them. What alarms me is the amount of Teslas, Mercedes-AMG M models and other kind of extremely expensive cars parked in their parking lots and in the area surrounding their HQ here in Berlin. In the last one and a half year I've witnessed such a crescendo of the car show-off level that's I'm worried about their paychecks politics. An average salary of ~80k/y, as reported in the linked piece, explains a lot.

Re: SoundCloud could be forced to close after $44m losses

#32

Post by blantonl »

strgrd wrote: post #14

I've been a daily soundcloud user for almost 6 years. At some point they gave up on trying to change or improve the user experience. Soundcloud has done nothing to facilitate the growth of users who focus on reposting/finding/sharing/curating content, vs. content creators who upload their own music. There is no way to gain a following or reputation as someone who reposts content on soundcloud -- and even if you have…

reposting/finding/sharing/curating content

You mean, stealing content from others, right?

Re: SoundCloud could be forced to close after $44m losses

#33

Post by zekevermillion »

rgbrenner wrote: post #10

Article is bs. they lost 44m in _2014_. Raised 77m last year. They may need to raise more in 2016. Nothing else. No other facts. No info on their balance sheet, etc. Doesn't even know if they're growing, what their revenue or losses for 2015 were. And based on that, Fact thinks that's enough to say they "may be forced to close".

Agree. The article could just as well be written about any other successful high-growth company. Continued survival will require further capital investment...no sh@*t! Obviously the author is just trolling for views. If SC announces another round, and then turns a profit in 3 years, someone will write another article about their "amazing turnaround".

Re: SoundCloud could be forced to close after $44m losses

#34

Post by Mizza »

"Forced to close" is a really, really big stretch here.

They have a huge community, play an important role in online music, and have a seemingly excellent engineering team. I'm sure they would be acquired by a major media player long before they ever closed, but I don't see that happening any time more. I bet they'll just double-down and raise more money while trying to develop more subscription revenue offerings to music consumers.

Re: SoundCloud could be forced to close after $44m losses

#36

Post by raesene4 »

rgbrenner wrote: post #26
raesene4 wrote: post #18

Earlier quoted context omitted.

I'm not sure I'd agree there's no other facts. links from the article include excerpts from their financial accounts which don't look good (losing 39M on a 17M turnover is not healthy). And the quote from the auditor is significant, auditors don't put that kind of thing in unless they have to as it annoys their customers to be reminded that there's significant concern over their ability to continue operations.

one excerpt of their P&L does not equal "excerpts from their financial accounts" (plural). And again, it's from 2014. For all we know Soundcloud was profitable last year. Maybe it's not likely.. but the article has no information at all on last year, yet they feel comfortable making this statement. The auditor statement is standard boilerplate. It applies to every company that is losing money. That's right -- if the…

there are two excerpts from their financial accounts in there if that makes you any happier (and justifies my use of the plural :) one from the P&L and one from the staffing section

The article is working on what's publicly available (there's a surprise), as they can hardly work on what Soundcloud hasn't released! My guess would be that if Soundcloud had managed to get into profitability that quickly then soundcloud would've got a press release out to say that.

edit - didn't realise they were a UK company. So the full accounts and company filing history are https://beta.companieshouse.gov.uk/company/06343600/filing-h...

definitely their cash position at the end of 2014 was not of the best...

Re: SoundCloud could be forced to close after $44m losses

#37

Post by _ak »

> While SoundCloud brought in €17.35m ($15.37m) in 2014, it lost a total of €39.14m ($44.19m). Employee wages during that period also increased 42.5% to €17.9m, meaning that the average wage per employee for that year totalled €79,980.

Wow, that is ridiculously high, especially so for Berlin.

Re: SoundCloud could be forced to close after $44m losses

#38

Post by npalli »

rgbrenner wrote: post #10

Article is bs. they lost 44m in _2014_. Raised 77m last year. They may need to raise more in 2016. Nothing else. No other facts. No info on their balance sheet, etc. Doesn't even know if they're growing, what their revenue or losses for 2015 were. And based on that, Fact thinks that's enough to say they "may be forced to close".

The auditor has clearly stated that it has doubts about the company as a 'going concern'. This is a technical term in auditing that implies the auditor has doubts that the company will survive (i.e, will have to liquidate) another twelve months. It's not a willy nilly "growing company is losing money" type statement, it means there is a fundamental problem in how the company is financed and operated.

https://en.wikipedia.org/wiki/Going_concern

Re: SoundCloud could be forced to close after $44m losses

#39

Post by throwaway2048 »

kidsil wrote: post #15

Youtube is not making any profit either, I suppose streaming based websites are very difficult to make profitable. Must be the constant growing expenses for servers.

All the sites that have predicted youtube as unprofitable assume google is paying standard bandwidth rates, with the peering arrangements they have with ISPs of virtually any size, they pay next to nothing to reach 95% of end users.

Re: SoundCloud could be forced to close after $44m losses

#40

Post by cheshire_cat »

bg46z wrote: post #4
petercooper wrote: post #2

I hope this is just an alarmist headline. SoundCloud is pretty essential in its space, it's one of the few services that lets you natively get audio on to Twitter, the main place musicians share snapshots of their work and remixes, and a key part of numerous podcasts and ways to embed easily shared audio on the Web. This is one startup I absolutely don't want to see go down the pan.

The trouble is there is no real alternative. There's Vocaroo, but it serves a different niche than SoundCloud.

Have you looked at https://hearthis.at already?
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