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Spotify files for its IPO

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Re: Spotify files for its IPO

#31

Post by supster »

bogomipz wrote: post #28
Eridrus wrote: post #23

Earlier quoted context omitted.

I don't see how this is a negative signaling issue. When you buy Apple Stock it's not from Apple. Spotify is going public largely due to terms they agreed to in previous funding rounds, but they are probably not raising money because they either don't need it or believe they can get better funding terms. If anything, this should be a signal that the company thinks the public stock is under-priced.

>"When you buy Apple Stock it's not from Apple." How are these two comparable? When Apple IPO'd back in 1980 you were buying stock from Apple. >"...but they are probably not raising money because they either don't need it or believe they can get better funding terms." They lose hundreds of millions of dollars year over year, why would they not need it? Also why would they believe that they can get better funding now…

An IPO provides 1) a fundraising opportunity 2) a liquidity event 3) an opportunity to fulfill contractual obligations

One of the conditions of their recent debt financing was that they IPO within a certain time frame. If they believe that they don't need additional funding at the moment or can get better terms then they are simply fulfilling criteria #2 and #3 with their unique IPO. I imagine Spotify can get decent debt financing terms b/c they have such a steady and predictable source of revenue (though not necessarily profit).

Re: Spotify files for its IPO

#32

Post by finiteloop »

everdev wrote: post #3

Crazy timing with them just getting hit with a $1.6B lawsuit. https://www.reuters.com/article/us-spotify-lawsuit/spotify-h...

People file lawsuits when companies have filed for IPO because generally that leads to companies being in a "quiet period" in which they cannot effectively respond publicly, which increases the likelihood of settlement, etc. It is also extremely common for competitors to seed the press with negative story lines, taking advantage of the legally mandated quiet period to remove the filing company's ability to counter these stories.

Re: Spotify files for its IPO

#33

Post by aceofspad4s »

Flow wrote: post #21
aceofspad4s wrote: post #20

Spotify was better when it was EU-only. When they started to expand to the US they ruined it all. Fight me. ;P

For someone who has never used Spotify, what changed?

A lot of music was removed. They added really bad limits, like a limit on how many hours you could listen every month. They forced you to create Facebook accounts to register, which means I had to create tons of Facebook accounts to overcome the hours/month limit. And some other things I don't remember.

Re: Spotify files for its IPO

#34

Post by [deleted] »

JonFish85 wrote: post #14

Isn't the point of an IPO generally to raise funds? In this case, it's just allowing people to sell their shares to the public, right? From the company standpoint, this is almost certainly a negative: additional oversight & reporting to do, no funds raised. I guess a positive is that shareholders can cash out, but as an investor, isn't that a giant red flag? I guess as an investor, I don't see why I'd buy Spotify sha…

[deleted]

Re: Spotify files for its IPO

#35

Post by aceofspad4s »

27182818284 wrote: post #22
aceofspad4s wrote: post #20

Spotify was better when it was EU-only. When they started to expand to the US they ruined it all. Fight me. ;P

> Fight me. ;P This comment could be a lot more substantial. You might want to check out the commenting guidelines here: https://news.ycombinator.com/newsguidelines.html

Mind your own business.

Re: Spotify files for its IPO

#36

Post by oli5679 »

JonFish85 wrote: post #14

Isn't the point of an IPO generally to raise funds? In this case, it's just allowing people to sell their shares to the public, right? From the company standpoint, this is almost certainly a negative: additional oversight & reporting to do, no funds raised. I guess a positive is that shareholders can cash out, but as an investor, isn't that a giant red flag? I guess as an investor, I don't see why I'd buy Spotify sha…

One advantage a new investor has over someone who provided Spotify with Seed/Series A is greater diversification. Suppose I'm a VC that invested in Spotify, it succeeded and my 20 other seed investments all failed. My retirement wealth is entirely dependent on it's success in the future - your comment outlines why this is risky. Since I am risk averse, I can sell this to a pension fund who will keep it as 1% of their total holdings and we can both be better off, even if we have the same view of the company's likely success in the future.

Of course, if everyone has too optimistic a view on Spotify's future success (could well be the case, I don't have an informed opinion) then buying the stock is a bad idea. But there is not necessarily anything sinister going on when founders/early investors cash out. From Spotify's point of view, they have an inventive to keep these people happy, balanced against the greater regulatory/oversight costs that you highlight.

Re: Spotify files for its IPO

#37

Post by Shywim »

sova wrote: post #18

Spotify has been doing one feature wrong for as long as I can recall: The Previous Track button will always navigate to the previous track in the list, no matter what you played before, and if there is nothing in the playlist before that track then the button effectively does nothing. Come on! PREV stands for Previous not List Index - 1. Other than that, Spotify works well enough that I do appreciate the service, eve…

Isn't that the standard behavior on every music player?

Re: Spotify files for its IPO

#38

Post by JumpCrisscross »

supster wrote: post #31
bogomipz wrote: post #28

Earlier quoted context omitted.

>"When you buy Apple Stock it's not from Apple." How are these two comparable? When Apple IPO'd back in 1980 you were buying stock from Apple. >"...but they are probably not raising money because they either don't need it or believe they can get better funding terms." They lose hundreds of millions of dollars year over year, why would they not need it? Also why would they believe that they can get better funding now…

An IPO provides 1) a fundraising opportunity 2) a liquidity event 3) an opportunity to fulfill contractual obligations One of the conditions of their recent debt financing was that they IPO within a certain time frame. If they believe that they don't need additional funding at the moment or can get better terms then they are simply fulfilling criteria #2 and #3 with their unique IPO. I imagine Spotify can get decent…

> One of the conditions of their recent debt financing was that they IPO within a certain time frame

Spotify is not IPO’ing. They are direct listing their stock. Because of a simple drafting error on part of TPG et al Spotify is side-stepping the bulk of the delayed IPO penalties.

Re: Spotify files for its IPO

#39

Post by [deleted] »

samfriedman wrote: post #4
everdev wrote: post #3

Crazy timing with them just getting hit with a $1.6B lawsuit. https://www.reuters.com/article/us-spotify-lawsuit/spotify-h...

I wonder if the lawsuit was purposefully timed near the IPO announcement, in an attempt to heap extra pressure on Spotify to settle quickly.

[deleted]

Re: Spotify files for its IPO

#40

Post by pkd »

Shywim wrote: post #37
sova wrote: post #18

Spotify has been doing one feature wrong for as long as I can recall: The Previous Track button will always navigate to the previous track in the list, no matter what you played before, and if there is nothing in the playlist before that track then the button effectively does nothing. Come on! PREV stands for Previous not List Index - 1. Other than that, Spotify works well enough that I do appreciate the service, eve…

Isn't that the standard behavior on every music player?

On all the music players I've used, that's not the case. Easy way to verify is to not shuffle and then try pressing previous.
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