The owners of SoundCloud are preparing to sell the streaming service for more than $1 billion, according to a new report from Sky News.
U.S. merchant bank Raine Group and state-backed Singaporean investment fund Temasek Holdings, which saved SoundCloud from collapse with their majority investment in 2017, have begun interviewing other investment banks about a “prospective auction” of the Berlin-based company.
Sky News’ Mark Kleinman wrote on X, formerly Twitter, yesterday that the deal “could fetch more than $1 billion and underscore the turnaround in the company’s fortunes,” following the appointment of CEO Eliah Seton last year. An insider told Sky News that the sale is expected to officially take place later this year.
Since its inception in 2007, SoundCloud has provided an online home for over 320 million tracks from more than 40 million artists. However, Sky News reports that the company has struggled to monetize its business model as economics in the global music industry shift at an unprecedented pace.
It took a $170 million investment from Raine Group and Temasek Holdings to keep SoundCloud afloat in 2017, more than half of the company’s $300 million valuation. Since then, SoundCloud has undergone two rounds of layoffs, cutting 20 percent of its workforce in 2022 and another 8 percent–about 40 staff members–in May 2023.
At the time, Seton called the layoffs “a challenging but essential decision” as part of a larger plan to “get Soundcloud to profitability this year,” in an email obtained by Variety.
A Soundcloud spokesperson reportedly declined Sky News’ request for comment.
Featured image from SoundCloud.
