Music streaming platform SoundCloud has laid off 8% of its staff according to multiple reports. The fresh round of job cuts comes after the company laid off 20% of its employees last August.
In a memo sent to staff — seen by Variety — CEO Eliah Seton said that SoundCloud is reducing headcount to get to a profitable position this year. “This is a challenging but essential decision to ensure the health of our business and get SoundCloud to profitability this year. In doing so, we are securing the company’s future for the millions of artists who rely on us for their living and their self-expression, and the millions of fans who come to SoundCloud for the joy of music,” the CEO said in the memo.
“It is critical to ensure that SoundCloud thrives in our mission to influence culture, be the preeminent home for artists and fans and lead what’s next in music.”
This was Seton’s first major move after becoming the CEO in March and replacing Michael Weissman.
In the last few years, SoundCloud has expanded partnerships with multiple labels like Merlin and Warner Music Group to power its fan-powered royalty program. The project distributes ad and subscription revenues to artists users listened to. It’s a more granular royalty program compared to other streaming services. Earlier this year, the company debuted a TikTok-like vertical feed for music discovery. Last month, SoundCloud launched a fan-engagement tool for artists to get more insights and communicate with their fans.
SoundCloud claims it has 130 million “engaged fans.” It currently hosts more than 320 million tracks from over 40 million creators.
Music streaming startups are in a tough spot as they are trying to achieve profitability. Last year, Tencent-backed Indian app Gaana switched to a subscription-only service. Bytedance’s Resso app, which operates in India, Brazil, and Indonesia, followed suit as it also went behind a paywall this month.
SoundCloud lays off 8% of staff as it aims to reach profitability this year by Ivan Mehta originally published on TechCrunch