Bad News: SoundCloud Cuts and Jawbone Elimination

Today we started a series of materials about what newcomers who decide to find a job in the music field need to know . Now let's talk about the industry itself, a significant part of which consists of online platforms and "iron" startups.

Judging by the latest reports, in these niches everything is not going as smoothly as we would like .

Greg westfall CC photo

According to notes ( 1 , 2 ) of Techcrunch journalists, there are just two bad news in the world of audio startups. Let's try to understand the situation.

What happened

SoundCloud , an online platform from Stockholm, fires more than 170 employees and closes offices in San Francisco and London

Remain: HQ in Berlin, an office in New York, more than 240 employees in the state and 175 million users from 190 countries of the world. Numerous integration with the largest social networks, multi-million investments and all sorts of monetization options do not yet give the desired result.

This news came 7 months after the company stopped negotiations on joining Spotify (in 2014, she had a similar “dialogue” with Twitter, but instead of taking over, she decided to go with the investment option).

Shortly before the number of full-time employees was reduced, the SoundCloud team planned to close a new investment round of $ 100 million (the total investment in the company already exceeded $ 190 million), but these plans failed.

Investors such as Ares Capital, Kreos Capital and Davidson Technology agreed to act as the “rescuers” of the “sound cloud” team. They organized a credit line of $ 70 million. With this money, SoundCloud will continue to look for options for working with counterparties from the music industry and major brands.

According to various analytical reports, online services have long been bypassed by physical media in terms of the number of sales and the audience volume of listeners. Anyway, SoundCloud, Pandora and Spotify are still unprofitable companies that continue to “survive” with new rounds of investment and “preparation” for a potential IPO exit.

An interesting point : one developer failed to get a job in the company - the news about the dismissal of a third of employees found him almost at the door of the SoundCloud office in Berlin, although he had a successful interview ( to his credit, we note that he received his salary for the first month ).

Another fact : on the day this news was published on Hacker News, an almost complete list of dismissed employees was published with contacts for communication with the purpose of subsequent employment.

According to an official statement : SoundCloud has enough money to continue working in the third and fourth quarter of this year, and all laid-off employees receive the appropriate payments and support from the company.

Jawbone is still being eliminated, but in parallel with this, a new project will be launched at the intersection of the Medgadget niche and the first-aid area for patients

The company became known for its portable acoustics Jambox, Big Jambox and Mini Jambox (a pair of materials on the topic: 1 and 2 ), although it also produced a Jawbone Icon headset.

At the peak of the popularity of the Jambox line, management decided to start working more closely in the IoT niche and wearable gadgets (Jawbone UP series products), but the company was not able to achieve tangible financial results.

Total investment : just under $ 1 billion (951 million according to the PitchBook data ) attracted since the first round in 2000.

Photo of Rafiq Sarlie CC

At the moment, Jawbone, which was once estimated at $ 3 billion, is in the process of liquidation, which does not prevent FitBit from litigating with the temporary administration of the company.

In parallel with this process is the launch of a new project. He is engaged in one of the former leaders of Jawbone.

This is the Jawbone Health Hub, which is designed to move away from the battle for the market of "smart" fitness bracelets and change the niche of medgadzhetov used in the maintenance and treatment of patients.

Not so bad

Earlier we talked about a huge number of startups and services working with audio content. The point problems of "promoted" companies do not stop newbies - there are more and more people willing to try themselves in this field.

One such example is the Currently application, another attempt to create a social network based on audio notes that can be shared. Traction to such developments was not formed "from the ceiling" - it is actively supported by the growing popularity of audio books and podcasts ( our example ).

Major players like Adobe are not far behind startups and are conducting experiments in speech recognition. One of the last is VoCo , an audio editor that allows you to simulate speech. Analysts expect it to appear in the updated Adobe Audition package.

PS More interesting on these topics:

PPS A little about what happens here:


All Articles