9 ms·

After big layoffs SoundCloud founder says its strategy is to ‘take back control’

69 points by weitingliu 9y ago

9gunpi 9y ago
well, laying off the most expensive part of SC + focusing looks like business is getting mature and practical, given the competition and turning from 'exciting new thing' into regular normal business.
macawfish 9y ago
I wish they would partner with services like Patreon and flattr instead of limiting everything to a stupid subscription model. I imagine that many artists could get a lot more revenue through voluntary payment services than through forced subscription models.
- jaggederest 9y ago
  Not gonna lie, I find it really amazing that I see really niche projects with three- or four-digit patreon income levels, things like that. I'm really glad that as a society we've found a way to support public goods directly.
  - toomuchtodo 9y ago
    SV Delos, known for their sailing videos, is pulling in $10k per video. https://www.patreon.com/svdelos https://www.patreon.com/svdelos https://www.youtube.com/user/briantrautman https://www.youtube.com/user/briantrautman
rfrank 9y ago
This seems strange, given that another article from TechCrunch today states that the layoffs bought them very minimal runway. https://techcrunch.com/2017/07/12/soundshroud/ https://techcrunch.com/2017/07/12/soundshroud/ > Instead, sources at SoundCloud tell TechCrunch that founders Alex Ljung and Eric Wahlforss confessed the layoffs only saved the company enough money to have runway “until Q4” — which begins in just 50 days. > A core question from staff during the all-hands was why there wasn’t transparency into the finances or a strict hiring freeze. The message from management was that a hiring freeze would show weakness and lead to people asking questions. That wasn’t satisfying when the company ended up shedding almost half its staff.
- ChuckMcM 9y ago
  The bridge loan in March might have helped (see https://www.crunchbase.com/organization/soundcloud#/entity https://www.crunchbase.com/organization/soundcloud#/entity)
- valuearb 9y ago
  If they actually thought a hiring freeze would actually show weakness, then they deserve what they got. Not being transparent with employees basically shows these two aren't suited to motivate or lead anyone.
  - rfrank 9y ago
    My take on the matter too, particularly the hiring freeze thing. Yeesh.
scopecreep 9y ago
Remember the employee you guys had that said "Comment timelines are neat but this is not enough to establish a working business"? Find him/her - rehire him/her, and fire all of the fucking idiots that ignored them. They should have sold the idea to Google - at least then we might all benefit from it. Instead, SoundCloud, and comment timelines, will be a neat idea strangled by poor leadership.
- marssaxman 9y ago
  What is a "comment timeline"?
  - snakeboy 9y ago
    I assume they are referring to the feature in which users comment at specific times in the song. As the song plays, these pop up on-screen.
    - TYPE_FASTER 9y ago
      I think Facebook does that now with live videos.
- draw_down 9y ago
  Dear lord, no. That feature is not ever anything but annoying.
  - weego 9y ago
    I have actively spent a good amount of my free time finding or maintaining chrome addons to block that garbage. It's the most inane and vacuous product feature I've come across and that's ignoring that it used to be so badly optimised that changing the comment caused a noticeable browser slow down
    - draw_down 9y ago
      On the other hand, it's really useful to know that DragonSlayer69 thinks 0:41 of this song kicks ass.
ChuckMcM 9y ago
I can't help but feel badly for SoundCloud and their CEO. Over the years I've seen dozens of companies get to a point where its clear that the future is not what they had envisioned. It's that moment of facing reality of "If we were likely to win, we would have by now, but we didn't so really what is next for us?" It is that point where the investors have seen perhaps three or four internal projects that haven't pushed them into that accelerating growth point, and there really isn't enough money to go further. So the investors have said to themselves, "I'm thinking this one isn't a winner." Let's focus on some of the more promising companies in our portfolio. The CEO is massively constrained in what they can say when a company reaches this point, so they all say the same thing, "We've got great things happening, really hated to have to let go some great people, we're aligning the company on this awesome plan to take us to the next level." The alternative is saying "Nothing we've been able to think of to date has created a viable business. We're now at the point that we are losing money so fast that even our most optimistic ideas about what might work were beyond the point where we cross $0 and go negative. We're laying off a bunch of staff which will slow are burn rate enough to pursue both a "Hail Mary"[1] strategy and look for a way to liquidate the company and claim victory anyway." Hedge funds and other private equity firms will come out and review what things they have and how they might be re-packaged or sold, internal investors will squabble over terms and conditions of bridge (aka Debt) financing to let them live long enough to get there, management will be constrained by this effort to focus mostly on selling the company and less on actually making it a viable proposition. It sets the clock, and when the debt financing runs out, everyone goes home sad. But nobody ever says that. They say "We've got this new direction we are super excited about." [1] "Hail Mary", made popular by quarter back Roger Staubach (https://en.wikipedia.org/wiki/Hail_Mary_pass https://en.wikipedia.org/wiki/Hail_Mary_pass) is a plan that conceptually can be successful but is probabilistically unlikely to succeed.
- roundupReady 9y ago
  win what?
- thesmallestcat 9y ago
  Cry me a river, poor well-connected CEO will have to go Serial Entrepreneur another company on the wings of investors. These people only have to deal with mental anguish, the ones with consciences at least. I feel badly for the employees and, to a certain extent, the customers.
matt4077 9y ago
I wish I could somehow archive some of their content. They have a serious amount of audio data and are the only source I know with annotations attached to specific seconds within a track. I've been thinking about building a music-generating neural network–something that may work especially well for electronic (and often instrumental) music that soundcloud has a lot of. Unfortunately, they have limited their API access to approved developers, and I haven't even gotten a response after applying two months or so ago....
- aeontech 9y ago
  ArchiveTeam is discussing archival efforts I think, but I doubt they'd be able to get all of it, it's a pretty big dataset (several PB, I think). It sounds like youtube-dl tooling works with soundcloud though, so you could write a crawler to at least archive your favorite artists' tracks individually. Example: youtube-dl http://api.soundcloud.com/tracks/182804938 http://api.soundcloud.com/tracks/182804938
- s_kilk 9y ago
  youtube-dl seems to work with soundcloud urls
capex 9y ago
I thought Soundcloud would truly become the 'Youtube of Audio'. But it seems to be trying to do too many things. Right now, there is no place on the internet where I could search a keyword and find relevant podcasts about a topic. Why can't Soundcloud do that? Just be the Youtube of podcasts, leave the music part to others.
- cr1895 9y ago
  Curious...why doesn't <any search engine> fit the bill? Not a podcast listener, so maybe it's not as simple as searching for music.
josephpmay 9y ago
It's a huge shame that SoundCloud is likely dying, because large segments of the music industry and literally entire genres of music are solely on SoundCloud. This may sound hyperbolic, but I feel like them shutting down would be the "burning of the Library of Alexandria" of 21st century music
- latencyloser 9y ago
  Agreed. Anecdotal, but I was in a "band" in high-school. We recorded our music and that music was and is solely hosted on soundcloud. I like to go back and listen to it occasionally as a part of my life that's fun to kind of laugh about, but also appreciate the good memories I have of it. It's both sad and strange to see that part of my life is fading from the world already.
- danbolt 9y ago
  So true. I feel like I'm frantically bookmarking all the Facebook/Bandcamp pages of musicians that I've found on the service.
- ghaff 9y ago
  Largely already happened previously with MP3.com Not to say "we" couldn't do better but there's always been a huge amount of content, music and otherwise, from amateurs and mostly amateurs in particular that isn't preserved in any systematic way.
  - epa 9y ago
    MP3.com and SoundCloud are not as comparable. SoundCloud has really re-defined how new music is released and how new artists promote their music.
    - thirdsun 9y ago
      > SoundCloud has really re-defined how new music is released and how new artists promote their music. For promotion Soundcloud undoubtly serves its purpose, but actually releasing the music has to happen somewhere else. And in my opinion the actual re-defining service in that regard is Bandcamp. After all, you can't buy music on Soundcloud, can you?
erikpukinskis 9y ago
They seemed to remove the in-browser recording feature so I stopped using it.
redm 9y ago
The biggest problem is what the article touches on, loss of the best employees. They kept who they thought were key, but the best employees, the ones who really move the needle and have lots of other opportunities are out the door first. Losing your best talent means time to market goes up for new products and quality goes down. It's also really hard to get top talent again. This makes a bad situation far worse and its why so few companies can recover. On top of that, the investors are going to push for a sale or write off the company completely. It becomes toxic very quickly. There's still time for SoundCloud, it still has value, but they have to make some good choices in the near term.
- brandnewlow 9y ago
  To take things further, these failed companies become zombies, and like zombies, they become more than just toxic, they become dangerous. When your good people start leaving, you replace them with OK people. When THOSE people leave you replace them with anyone with a pulse. Those people eventually screw things up and you wind up with data breaches and the like which further screw over customers, shareholders, employees or all of the above. Zombie companies are bad news.
- di4na 9y ago
  At the same time, Netflix discovered that keeping only the good one accelerate your time to market and productivity by a huge factor.
flyinglizard 9y ago
They should start begging for money, Wikipedia style. I'd happily pay $50-$100 a year for a service I use for like 10 hours a day (I already pay di.fm something like that).
- nemo44x 9y ago
  That's how charities, not businesses work.
  - almost_usual 9y ago
    Every time a company raises a round of investment they're begging for money.
  - flyinglizard 9y ago
    It's a long standing model in the software world (freemiums, sharewares, etc). I suspect SoundCloud demographics won't withstand a mandatory subscription.
    - nemo44x 9y ago
      Right, but I was taking that from the CEO of MySQL. In a presentation (after they were sold) he mentioned that he once got a donation from Craig's List for $15,000.00 since they were big users of MySQL. It was at that point he realized the problem with their open source business model.
moomin 9y ago
I've heard that slogan before. It didn't end well.
thinbeige 9y ago
I am still waiting for some words from Fred Wilson, one of their loudest VCs. After he was worshipping SoundCloud in so many posts and glorifying the future of 'sound' for (too) many years I'd like to hear an update. A VC should not just hype a company when he invested but also comment on tough times. Fred, what happened? What did you tell your LPs? Bad luck? Let's gamble on the blockchain now?
likeclockwork 9y ago
AGAIN? All these companies saying come put your content here and then they fold. I still remember mp3.com. I feel like we need some kind of distributed federated service for self-publishing music at this point.

69 points by weitingliu 9y ago

well, laying off the most expensive part of SC + focusing looks like business is getting mature and practical, given the competition and turning from 'exciting new thing' into regular normal business.

macawfish 9y ago

I wish they would partner with services like Patreon and flattr instead of limiting everything to a stupid subscription model. I imagine that many artists could get a lot more revenue through voluntary payment services than through forced subscription models.

jaggederest 9y ago
Not gonna lie, I find it really amazing that I see really niche projects with three- or four-digit patreon income levels, things like that. I'm really glad that as a society we've found a way to support public goods directly.
- toomuchtodo 9y ago
  SV Delos, known for their sailing videos, is pulling in $10k per video. https://www.patreon.com/svdelos https://www.patreon.com/svdelos https://www.youtube.com/user/briantrautman https://www.youtube.com/user/briantrautman

rfrank 9y ago

This seems strange, given that another article from TechCrunch today states that the layoffs bought them very minimal runway. https://techcrunch.com/2017/07/12/soundshroud/ https://techcrunch.com/2017/07/12/soundshroud/ > Instead, sources at SoundCloud tell TechCrunch that founders Alex Ljung and Eric Wahlforss confessed the layoffs only saved the company enough money to have runway “until Q4” — which begins in just 50 days. > A core question from staff during the all-hands was why there wasn’t transparency into the finances or a strict hiring freeze. The message from management was that a hiring freeze would show weakness and lead to people asking questions. That wasn’t satisfying when the company ended up shedding almost half its staff.

ChuckMcM 9y ago
The bridge loan in March might have helped (see https://www.crunchbase.com/organization/soundcloud#/entity https://www.crunchbase.com/organization/soundcloud#/entity)
valuearb 9y ago
If they actually thought a hiring freeze would actually show weakness, then they deserve what they got. Not being transparent with employees basically shows these two aren't suited to motivate or lead anyone.
- rfrank 9y ago
  My take on the matter too, particularly the hiring freeze thing. Yeesh.

scopecreep 9y ago

Remember the employee you guys had that said "Comment timelines are neat but this is not enough to establish a working business"? Find him/her - rehire him/her, and fire all of the fucking idiots that ignored them. They should have sold the idea to Google - at least then we might all benefit from it. Instead, SoundCloud, and comment timelines, will be a neat idea strangled by poor leadership.

marssaxman 9y ago
What is a "comment timeline"?
- snakeboy 9y ago
  I assume they are referring to the feature in which users comment at specific times in the song. As the song plays, these pop up on-screen.
  - TYPE_FASTER 9y ago
    I think Facebook does that now with live videos.
draw_down 9y ago
Dear lord, no. That feature is not ever anything but annoying.
- weego 9y ago
  I have actively spent a good amount of my free time finding or maintaining chrome addons to block that garbage. It's the most inane and vacuous product feature I've come across and that's ignoring that it used to be so badly optimised that changing the comment caused a noticeable browser slow down
  - draw_down 9y ago
    On the other hand, it's really useful to know that DragonSlayer69 thinks 0:41 of this song kicks ass.

ChuckMcM 9y ago

I can't help but feel badly for SoundCloud and their CEO. Over the years I've seen dozens of companies get to a point where its clear that the future is not what they had envisioned. It's that moment of facing reality of "If we were likely to win, we would have by now, but we didn't so really what is next for us?" It is that point where the investors have seen perhaps three or four internal projects that haven't pushed them into that accelerating growth point, and there really isn't enough money to go further. So the investors have said to themselves, "I'm thinking this one isn't a winner." Let's focus on some of the more promising companies in our portfolio. The CEO is massively constrained in what they can say when a company reaches this point, so they all say the same thing, "We've got great things happening, really hated to have to let go some great people, we're aligning the company on this awesome plan to take us to the next level." The alternative is saying "Nothing we've been able to think of to date has created a viable business. We're now at the point that we are losing money so fast that even our most optimistic ideas about what might work were beyond the point where we cross $0 and go negative. We're laying off a bunch of staff which will slow are burn rate enough to pursue both a "Hail Mary"[1] strategy and look for a way to liquidate the company and claim victory anyway." Hedge funds and other private equity firms will come out and review what things they have and how they might be re-packaged or sold, internal investors will squabble over terms and conditions of bridge (aka Debt) financing to let them live long enough to get there, management will be constrained by this effort to focus mostly on selling the company and less on actually making it a viable proposition. It sets the clock, and when the debt financing runs out, everyone goes home sad. But nobody ever says that. They say "We've got this new direction we are super excited about." [1] "Hail Mary", made popular by quarter back Roger Staubach (https://en.wikipedia.org/wiki/Hail_Mary_pass https://en.wikipedia.org/wiki/Hail_Mary_pass) is a plan that conceptually can be successful but is probabilistically unlikely to succeed.

roundupReady 9y ago
win what?
thesmallestcat 9y ago
Cry me a river, poor well-connected CEO will have to go Serial Entrepreneur another company on the wings of investors. These people only have to deal with mental anguish, the ones with consciences at least. I feel badly for the employees and, to a certain extent, the customers.

matt4077 9y ago

I wish I could somehow archive some of their content. They have a serious amount of audio data and are the only source I know with annotations attached to specific seconds within a track. I've been thinking about building a music-generating neural network–something that may work especially well for electronic (and often instrumental) music that soundcloud has a lot of. Unfortunately, they have limited their API access to approved developers, and I haven't even gotten a response after applying two months or so ago....

aeontech 9y ago
ArchiveTeam is discussing archival efforts I think, but I doubt they'd be able to get all of it, it's a pretty big dataset (several PB, I think). It sounds like youtube-dl tooling works with soundcloud though, so you could write a crawler to at least archive your favorite artists' tracks individually. Example: youtube-dl http://api.soundcloud.com/tracks/182804938 http://api.soundcloud.com/tracks/182804938
s_kilk 9y ago
youtube-dl seems to work with soundcloud urls

capex 9y ago

I thought Soundcloud would truly become the 'Youtube of Audio'. But it seems to be trying to do too many things. Right now, there is no place on the internet where I could search a keyword and find relevant podcasts about a topic. Why can't Soundcloud do that? Just be the Youtube of podcasts, leave the music part to others.

cr1895 9y ago
Curious...why doesn't <any search engine> fit the bill? Not a podcast listener, so maybe it's not as simple as searching for music.

josephpmay 9y ago

It's a huge shame that SoundCloud is likely dying, because large segments of the music industry and literally entire genres of music are solely on SoundCloud. This may sound hyperbolic, but I feel like them shutting down would be the "burning of the Library of Alexandria" of 21st century music

latencyloser 9y ago
Agreed. Anecdotal, but I was in a "band" in high-school. We recorded our music and that music was and is solely hosted on soundcloud. I like to go back and listen to it occasionally as a part of my life that's fun to kind of laugh about, but also appreciate the good memories I have of it. It's both sad and strange to see that part of my life is fading from the world already.
danbolt 9y ago
So true. I feel like I'm frantically bookmarking all the Facebook/Bandcamp pages of musicians that I've found on the service.
ghaff 9y ago
Largely already happened previously with MP3.com Not to say "we" couldn't do better but there's always been a huge amount of content, music and otherwise, from amateurs and mostly amateurs in particular that isn't preserved in any systematic way.
- epa 9y ago
  MP3.com and SoundCloud are not as comparable. SoundCloud has really re-defined how new music is released and how new artists promote their music.
  - thirdsun 9y ago
    > SoundCloud has really re-defined how new music is released and how new artists promote their music. For promotion Soundcloud undoubtly serves its purpose, but actually releasing the music has to happen somewhere else. And in my opinion the actual re-defining service in that regard is Bandcamp. After all, you can't buy music on Soundcloud, can you?

erikpukinskis 9y ago

They seemed to remove the in-browser recording feature so I stopped using it.

redm 9y ago

The biggest problem is what the article touches on, loss of the best employees. They kept who they thought were key, but the best employees, the ones who really move the needle and have lots of other opportunities are out the door first. Losing your best talent means time to market goes up for new products and quality goes down. It's also really hard to get top talent again. This makes a bad situation far worse and its why so few companies can recover. On top of that, the investors are going to push for a sale or write off the company completely. It becomes toxic very quickly. There's still time for SoundCloud, it still has value, but they have to make some good choices in the near term.

brandnewlow 9y ago
To take things further, these failed companies become zombies, and like zombies, they become more than just toxic, they become dangerous. When your good people start leaving, you replace them with OK people. When THOSE people leave you replace them with anyone with a pulse. Those people eventually screw things up and you wind up with data breaches and the like which further screw over customers, shareholders, employees or all of the above. Zombie companies are bad news.
di4na 9y ago
At the same time, Netflix discovered that keeping only the good one accelerate your time to market and productivity by a huge factor.

flyinglizard 9y ago

They should start begging for money, Wikipedia style. I'd happily pay $50-$100 a year for a service I use for like 10 hours a day (I already pay di.fm something like that).

nemo44x 9y ago
That's how charities, not businesses work.
- almost_usual 9y ago
  Every time a company raises a round of investment they're begging for money.
- flyinglizard 9y ago
  It's a long standing model in the software world (freemiums, sharewares, etc). I suspect SoundCloud demographics won't withstand a mandatory subscription.
  - nemo44x 9y ago
    Right, but I was taking that from the CEO of MySQL. In a presentation (after they were sold) he mentioned that he once got a donation from Craig's List for $15,000.00 since they were big users of MySQL. It was at that point he realized the problem with their open source business model.

moomin 9y ago

I've heard that slogan before. It didn't end well.

thinbeige 9y ago

I am still waiting for some words from Fred Wilson, one of their loudest VCs. After he was worshipping SoundCloud in so many posts and glorifying the future of 'sound' for (too) many years I'd like to hear an update. A VC should not just hype a company when he invested but also comment on tough times. Fred, what happened? What did you tell your LPs? Bad luck? Let's gamble on the blockchain now?

likeclockwork 9y ago

AGAIN? All these companies saying come put your content here and then they fold. I still remember mp3.com. I feel like we need some kind of distributed federated service for self-publishing music at this point.