One of the biggest digital music sharing platforms in the world was able to prevent itself from totally going under due to some last minute business decisions.
The Industry Observer reported on Friday (August 11th) that SoundCloud's controlling stakeholders were recently able to reach a vote in order to accept a buyout from the Raine Group and Temasek Holdings.
The Raine Group is a merchant bank based in New York City, which is primarily interested in providing capital in the fields of technology, media, as well as telecommunications. It was founded in 2009.
Temasek Holdings is a multi-billion dollar investment firm that is owned and controlled by the government of Singapore. Some of this company's subsidiaries include DBS Bank and Singtel.
The two entities reportedly offered to invest around $169.5 million in order to save SoundCloud from a complete financial collapse. The Industry Observer followed up on its SoundCloud report on Saturday (August 12th).
SoundCloud's stakeholders voted collectively to approve the mammoth offer from the Raine Group and Temasek even though SoundCloud's CEO previously tried to publicly brush off speculation about the company doing poorly.
As part of the new deal, SoundCloud CEO Alex Ljung will not remain in his position. Kerry Trainor, a former senior management official at Vimeo will replace Ljung as CEO from now on, according to the Industry Observer.
SoundCloud was founded in 2007 by two Swedes who eventually established the company's headquarters in Berlin, Germany. SoundCloud started off as just a digital music sharing tool among recording artists.
However, it went on to become a full-blown music publishing and distribution resource, which has helped recording artists all across the world make unimaginable moves in the music business.
Ljung (who is also a SoundCloud co-founder) and Eric Wahlforss (another founding partner) will remain involved with the company in other key positions. Ljung will serve as Chairman of the Board.
Wahlfross was a Swedish musician who at some point formulated a bond with Ljung, a Swedish sound designer. In an exclusive interview with Wired, Ljung said the following in the first months after SoundCloud was founded:
"We both came from backgrounds connected to music, and it was just really, really annoying for us to collaborate with people on music—I mean simple collaboration, just sending tracks to other people in a private setting, getting some feedback from them, and having a conversation about that piece of music. In the same way that we’d be using Flickr for our photos, and Vimeo for our videos, we didn't have that kind of platform for our music." (Wired.com, 2009)
Wahlforss has been tapped to assume the role of SoundCloud's Chief Product Officer going forward. Trainor spoke to Billboard Magazine about some of the things he wishes to implement for SoundCloud in the future.
"SoundCloud is the largest open audio platform in the world. Millions of creators choose these tools to share their work with the world -- that will remain the focus and center of the company," Trainor told Billboard.
Trainor is banking on the possibility that music creators will pay to use a bolstered up SoundCloud Unlimited Service. Another component of SoundCloud is the Pro Service, which costs only $7.00 per month.
A heightened focus will be placed on providing DJs and musicians with more useful resources to enhance their song production. In the past, SoundCloud had no choice but to lay off employees and close its Australian office.
A handful of quite notable hip-hop artists who have recently rocketed to prominence earned their claim to fame using SoundCloud.
Chance the Rapper, Bryson Tiller and Post Malone are a few of today's stars who have made their careers on the strength of the SoundCloud music marketing platform.