​

​

the right buyer

​Read in browser​

Hey! I’ve seen a lot of strong responses to Universal Music Group’s acquisition of Downtown Music. Some are frustrated about the lack of competition. There’s also a lot of “if you can’t beat ‘em, buy ‘em” sentiment.

I hear all of the concerns. But there are only a handful of partners that will buy a music or entertainment company outright for $775 million. If a private equity firm were involved as a buyer, some might have shared their frustrations about PE. A healthy M&A market is a good signal for the entire industry, big and small.

Very few people, I hope, want to go back to the frugal times when digital downloads and ringtones reigned supreme. Well, maybe T-Pain would go back but he’s the exception.

On that note, today’s memo and episode are from my fireside chat with SoundCloud CEO Eliah Seton, at our Trapital Summit. We talked about SoundCloud’s future, its journey to profitability, and its search for the right buyer.

You can listen here or read below for part of our talk about SoundCloud’s search for a company to acquire it.

Was this forwarded to you? Sign up here.​

SoundCloud CEO Eliah Seton - Trapital Summit

SoundCloud has had quite a journey over the years. For two snapshots in time, listen to my November 2019 podcast with then-President Mike Weissman, then listen to my talk in October 2024 with CEO Eliah Seton. Music streaming is in a much stronger place than it was five years ago.

The company is now profitable and is in search of the right buyer. According to Music Business Worldwide, its 2023 revenues were estimated to be €288 million and its consolidated EBITDA was €2 million.

A sale for SoundCloud would also be a payday for its principal shareholders, including The Raine Group, Temasek Holdings, Union Square Ventures, and SiriusXM.

At the Trapital Summit, Eliah talked about how the process is going:

If SoundCloud gets acquired, which type of partner would be the likely buyer? One route is more of a financial partner, like an investment bank or a private equity firm. Another option is a major or independent record label that wants more control over the independent music ecosystem. It could also be a bigger tech company or streaming platform that wants to increase its position. It could also be a combination that fits several options above.

If you have a take on how the process may play out, reply to this email and share your thoughts. Would love to hear your perspective.

In the meantime, you can listen to our conversation here or watch the video on YouTube here.

Share this episode

​​​​

How would you rate this episode?

​👍🏾 or 👎🏾​

Dan Runcie
Founder of Trapital

​

Check the archives | listen to the podcast | become a sponsor

P.S. Know someone who would enjoy Trapital? Tell them to sign up here.

Not enjoying Trapital? Unsubscribe. Change preferences.
The City, San Francisco, CA 94103