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SoundCloud's Collapse

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Re: SoundCloud's Collapse

#141

Post by tnolet »

xfer wrote: post #10

> According to one former SoundCloud Berlin employee, a lack of direction from Wahlforss, who served as chief technology officer, made things worse, with some engineers going rogue and rebuilding their colleagues’ work in their preferred programming language. Does this happen at other startups?

I've literally experienced this exact gut reaction two times in the last couple of months at two different companies. Code that is working fine, might need a bug fix here and there, is deemed worthless and should be rewritten. These we're tiny dev team: 3, 4 people max, so it happens everywhere I guess.

Re: SoundCloud's Collapse

#142

Post by TekMol »

Is there a collapse? They used their VC money to pay employees to build stuff. Now the money is spent. Employees get layed off.

It could very well been worth it. What has been built might bring in return on invest for a long time.

Isn't that normal? Isn't VC money intended to be used that way? Are VCs demanding to build jobs for eternity? Or is there some moral reason to not grow and shrink the work force while building a company?

Re: SoundCloud's Collapse

#143

Post by Myrmornis »

duncan_bayne wrote: post #101
Myrmornis wrote: post #28

Earlier quoted context omitted.

No, it shows us that our economies make it very hard to maintain a valuable and beautiful cultural/artistic ecosystem as a commercial entity.

The music industry takes $18bn / year revenue, and movies $62bn. Perhaps I'm missing your point, because that seems like a whole lot of "valuable" to me?

I was referring to the non-mainstream music that is what people originally loved soundcloud for. The figures you refer to are entirely dominated by sales for music and movies of mainstream genres.

Re: SoundCloud's Collapse

#144

Post by philipps »

I would hate to see SoundCloud disappear or get dismantled in an effort to migrate its user base into a different social network. The core idea, to provide a way for amateur creators to share their music, and connect with an audience, is sound. I also think there is/was a gap in the market for podcast creators that SoundCloud authoring tools could have filled. Can some combination of charging creators for advanced authoring or analytics, and placing ads in a free listening tier, not provide sufficient income to keep something like this going?

Re: SoundCloud's Collapse

#145

Post by gcb0 »

rrdharan wrote: post #51
thinbeige wrote: post #23

Earlier quoted context omitted.

> Is SoundCloud worth a billion dollars? This reminds me of the current ICOs and the token economy. Early adopters try to push new currencies like crazy to cash out once popularity peaks. SoundCloud was never thought as a real business. Everybody involved in the music industry should have known that it's not possible to build a solid business based on the oligopoly of three music labels and with Spotify having a head…

Traditionally pump and dump meant taking advantage of unsophisticated retail investors. I don't think this qualifies as pump and dump unless you mean the earlier stage VCs somehow managed to cash out at the expense of some later naive shareholders? In this case sounds like everyone (except maybe Ljung) lost out..

but that's exactly what they did. who do you think people got their shares from when people bougth in after the high valuation?

Re: SoundCloud's Collapse

#146

Post by gcb0 »

pas wrote: post #138
thinbeige wrote: post #59

Earlier quoted context omitted.

Technically you are right. Still it's a long-term pump and dump game. VCs praise their investments to the utmost (which is their job and because their believe in their investments) but mainly to attract more investors (pump) and at some point to find potential buyers (dump) where you can exchange retail investors with dumb corporations.

Intent matters. If they promote it, and honestly believe in it, and want to cash out at an IPO, then it's just good old investing. You don't have to think it's the best thing ever. Or that it'll surely work. But you can still think that it's a pretty decent investment, high risk, high expected payout.

not really. they will have to prove they could see a profitable exit. which in this case is dubious since there were other companies doing what they promoted years ahead of them and all had the same outcome.

I could try to sell you a magic goose and I can really believe it will lay golden eggs any time now. interested? I even have ten of them myself!

Re: SoundCloud's Collapse

#147

Post by wodenokoto »

lukaslalinsky wrote: post #136
cupcakestand wrote: post #87

Earlier quoted context omitted.

Best comment in the thread. It shows that one of SoundCloud's key problem is an oligopolostic industry they are dealing with.

SoundCloud's key problem is that they couldn't stay small because of VC money, not the music industry.

They couldn't stay small due to user influx. They couldn't sustain their music offering without deals with the music industry.

VC money is just something they needed because they couldn't do any monetisation without deals with the industry (too much of their content is non-fair-use derivatives of the big 3's copyrighted content) and they obviously can't stream millions of hours of music without some sort of money.

Re: SoundCloud's Collapse

#148

Post by jamesrcole »

iagooar wrote: post #14

This shows us, that company valuations are ridiculous and actually mean nothing. Is SoundCloud worth a billion dollars? Well, it might be on paper or in the imaginations of the founders, but what does it really mean? To me, it's worth nothing. The real problem is: these companies start to operate from the perspective of "having" those millions of dollars. This is why they hire too many people for too much money. They…

> This shows us, that company valuations are ridiculous and actually mean nothing.

A single case never proves any generalisation.

(I'm not taking any position here on what such valuations mean in general - it's not something I know much about).

Re: SoundCloud's Collapse

#149

Post by pas »

tanilama wrote: post #75
elmar wrote: post #33

Earlier quoted context omitted.

I think most of google sucesses outside search were done like that without the CEO having knowledge.

Ads: doubleclick, bought Maps: bought Youtube: bought Android: bought What else?

Source on Maps please. They bought KeyHole or whatever, fir Google Earth maybe. But Maps itself was started in-house, no?

Re: SoundCloud's Collapse

#150

Post by gcb0 »

fooker wrote: post #96
tanilama wrote: post #75

Earlier quoted context omitted.

Ads: doubleclick, bought Maps: bought Youtube: bought Android: bought What else?

Google had a successful ads business before the doubleclick acquisition. They are still more or less separate software stacks. (Disclaimer: This knowledge is outdated by about 2 years, but a significant change is unlikely. )

but it was far from supporting the whole company alone as it is now. it mostly was successful because of their search monopoly alone. they could have banners and it would have been the same before the acquisition
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