The Representative

India's Youth News Tank

How Spotify Secured Its Spot To Become The Biggest Streaming Platform

2 min read
spotify

Launched in 2006, the Swedish music service has grown to be the biggest streaming platform with its value of more than $23B!

Spotify was started as a small start-up in Stockholm, Sweden by Daniel Ek & Martin Lorentzon as a response to the growing piracy problem. Daniel had a hunch that Spotify would one day be worth “tens of billions”.

However, artists like Taylor Swift initially called the platform an “experiment” as it paid less. With the freemium model, by 2011, it had more than 10M tracks & $100M in bank acc. In the same yr, it also integrated with Facebook, becoming its official music player & netted 1M new FB users in just 4 days. At that time, most of its #revenues came from ads~ $40M!

In 2012, Spotify raised $100M in its Series E round led by Goldman Sachs. By 2013 it launched its premium model & reached 6M paid subscribers. In 2014, to compete in the space, Spotify paid more than $2B in royalties to artists!. By April’18 it went public with approx $1.36B in revenue in Q1’18

Today, it has more than 170M monthly active users worldwide, of whom 75M are paying #subscribers. Spotify succeeded because it identified a major market opportunity & pursued it relentlessly

Do you think the reward is always worth the risk in business?

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