SoundCloud – company overview

You have probably heard of this service at some point. SoundCloud is a commonly used term in the music industry; I mean who doesn’t know about the site where a lot of upcoming musicians show their talents to the world? SoundCloud is an online audio distribution platform. It is a European music sharing website based in Berlin, Germany that enables its users to upload, promote, and share audio. It was created back in 2007 by Alexander Ljung and Eric Wahlforss, SoundCloud has grown to be one of the largest music streaming services in the market reaching over 175 million monthly users worldwide.

SoundCloud has both a free and paid membership plan. Through the success of many artists who have emerged from the music-sharing service, SoundCloud has become extremely popular and with this recognition, has influenced the music industry to a large extent. Registered users on the platform are given the chance to distribute their work for free these uploaded works can be accessed by all users. 

The website has gotten support from many investors and other media platforms such as Twitter. SoundCloud has been involved in many with funding issues on its own and as a result, it has laid off many employees in order to remain profitable. Estimates show that SoundCloud users upload audio worth 12 hours each minute on the website, and over 175 million unique users access SoundCloud every month.


SoundCloud was first introduced in August 2007 by Swedish sound designer Alexander Ljung and Swedish electronic musician Eric Wahlforss, and the website was launched in October 2008, in Berlin.

SoundCloud was intended to be a platform that would allow musicians to collaborate by facilitating the sharing and discussion of recordings. Along the line, it transformed into a publishing tool for music distribution. According to a page from Wired magazine, SoundCloud, soon after its inception, began to challenge the dominance of MySpace as a platform for musicians to distribute their music. In 2009, SoundCloud’s series A funding SoundCloud received €2.5 million funding from Doughty Hanson Technology Ventures, in April 2009. By May of the next year, SoundCloud announced it had one million users. It was reported back In January 2011, that SoundCloud had raised up to US$10 million its Series B funding from Union Square Ventures and Index Ventures. With investments from Ashton Kutcher and Guy Oseary’s A-Grade Fund, SoundCloud was reported to have about 10 million registered users, on 23 January 2012. SoundCloud reported five million registered users in the middle of 2011 with this; the site’s usage was increasing by 1.5 million users per month.

In December 2012, SoundCloud released a new APN which improved mobile device support and added features such as concurrent listening and site navigation, and the ability to create personal collections. This change was not exactly welcome as response from users was mixed, and many expressed dissatisfaction with the change. During the time of this change, the site was reported to be “reaching 180 million people per month”, with 10 hours of content being uploaded every minute. SoundCloud announced in March 2014, that it would partner with Twitter in developing its first integrated music app.

This partnership couldn’t get anywhere because SoundCloud was unable to accommodate licensed music due to a lack of necessary arrangements with music labels. This didn’t deter its growth because as of July 2013, SoundCloud had 40 million registered users and new users were joining at a rate of 20 million per month. SoundCloud began licensing negotiations in January 2014. These negotiations were intended to address the matter of unauthorized, copyrighted material regularly appearing on the platform.

This announcement took place immediately after a round of funding in which US$60 million was raised, resulting in a $700 million valuation. , These negotiations were initiated in an attempt to avoid similar problems faced by Google, which had been forced to handle a large number of takedown notices on its YouTube video-sharing platform.

In May 2015, there were speculations that Twitter was considering the acquisition of SoundCloud for approximately US$2 billion. This prospect of acquisition was discounted by the media, stating that “the numbers didn’t add up”. This was attributed to SoundCloud’s ongoing inability to secure deals with the major music labels. In 28 September 2016, Spotify was in talks to buy SoundCloud.  On 8 December 2016, like all other previous deals, Spotify was reported to have abandoned its acquisition plans.

SoundCloud faced being sold in spring 2017 after not being able to raise $100 million dollars to keep the platform afloat. They weren’t able to get sold due to the evaluation of Soundcloud at $700 million. This did not hold as strong to investors after their financial shortages. Luckily, by the end of that year, Temasek and Raine Group were able to raise $169.5 million to keep the platform afloat. There was also a shift in the management, mainly involving Alexander Ljung leaving the company and Mike Weissman becoming the COO.

In July 2017, to become profitable again, SoundCloud announced that it would close its San Francisco and London offices and lay off 173 out of 420 employees. The rest of their staff operating out of offices in Berlin and New York.

In August 2017, CEO Alex Ljung stepped down from his role, with former Vimeo CEO Kerry Trainor replacing him.

It was reported that SoundCloud’s user increase rate had reached over 175 million global users on the platform each month, in March 2019. SoundCloud bought artist distribution platform Repost Network, in May 2019. Early this year, a 75 million US-Dollar investment by Sirius XM was announced.


SoundCloud has raised a total of $542.8M in funding. SoundCloud’s most recent acquisition was Repost Network, Inc. for an undisclosed amount on May 2019

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