SoundCloud Considers $1 Billion Sale

# SoundCloud Reportedly Preparing for Billion-Dollar Sale
The current owners of **SoundCloud** are reportedly gearing up to sell the company in a deal that could surpass $1 billion, according to sources who have spoken to Sky News. This potential sale involves talks between the current owners, **Raine Group** and **Temasek Holdings**, and various investment banks. Although the sales process is not expected to begin for a few months, it has sparked significant interest in the music and tech industries.

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## Rescuing SoundCloud from Collapse
Raine Group and Temasek Holdings, with the latter being the Singaporean state investment fund, played a crucial role in rescuing SoundCloud when it faced the prospect of collapse back in 2017. The platform, originally established to provide hosting and other services to independent creators, expanded its offerings to include a licensed subscription streaming service in the mid-2010s. This move aimed to address concerns from the music industry regarding the uploading of unlicensed music by users.

## Financial Resilience and Corporate Restructuring
However, running a licensed music service posed financial challenges for SoundCloud, which became apparent by 2017, leading to significant job losses. The intervention and cash injection from Raine Group and Temasek Holdings brought about a change in senior management, leading the company to refocus on providing services for independent creators, while the subscription streaming service continued to operate. This strategic shift has yielded some success, with SoundCloud reporting a small profit in the previous year, marking its first profitable year in its sixteen-year history.

## Future Prospects and Potential Sale
With a leaner business model showing signs of profitability and growth, the timing appears opportune for Raine Group and Temasek Holdings to consider recouping their investment through a potential sale. However, the exact implications of this sale on SoundCloud’s future focus and ownership remain uncertain. The high valuation of the company, expected to exceed $1 billion, might limit the pool of potential acquirers.

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## Finances and Investment
Axios reported that the 2017 investment totaled “$169.5 million at a $150 million pre-money enterprise valuation.” Subsequently, in February 2020, Sirius XM injected an additional $75 million into the company, securing a minority stake.

## Conclusion
As the music industry continues to evolve and navigate the digital landscape, the potential sale of SoundCloud represents a significant development with wide-ranging implications for the platform and its users. The next chapters in SoundCloud’s journey will undoubtedly be closely watched by industry insiders and music enthusiasts alike.

To learn more about SoundCloud and its potential sale, visit [Sky News](https://news.sky.com/) and [Axios](https://www.axios.com/).



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