SoundCloud lives to play another day: The so-called YouTube for audio, which ran into cash problems this year when it introduced a subscription service, says today that it will receive “a significant investment” from The Raine Group and Singapore-based investment company Temasek.
Techcrunch pegs the investment at $169.5 million
As part of the deal, former Vimeo CEO Kerry Trainor and COO Michael Weissman agreed to take charge of SoundCloud, with the same titles that they had at the video sharing company. Trainor also will join the board.
Alexander Ljung and Eric Wahlforss, who co-founded the company a decade ago in Germany, will remain as, respectively, Chairman of the Board and Chief Product Officer.
SoundCloud’s prospects looked bleak this year. The subscription service raised costs, but was unable to win enough customers in a field dominated by Spotify, Apple, and Google. Hemorrhaging cash, last month SoundCloud laid off about 40% of its workforce.
The new investment, the company says, “will ensure a strong, independent future for SoundCloud, funding deeper development and marketing of its core tools used by millions of audio creators—musicians, DJs, producers, labels, managers and podcasters.”
Raine Partner Fred Davis — who will join the board along with VP Joe Puthenveetil — calls SoundCloud “a unique and essential music platform for new and developing artists. For ten years, SoundCloud has been the birthplace of genre-breaking musical movements in Electronica and Hip Hop. We are excited to partner with Temasek on this investment and are confident our involvement can ensure it remains the most artist-friendly music creation and streaming platform in the world.”
Raine has also invested in Vice Media, Imagine Entertainment, Matt Stone and Trey Parker’s Important Studios, fantasy sports operator Draft Kings and C3 Presents, owner and operator of music festivals Lollapalooza and Austin City Limits.
Ljung says in a blog post that “10 years ago SoundCloud was just an idea Eric and I bounced around. Today it’s a platform essential to the shaping of songs, artists, genres and global culture. I can’t fathom how we’ve been so lucky as to create that. But what’s even better is this: we’re all just getting started. The first 10 years are done, and now we’re onto decade II.”
The company says that it expects to generate more than $100 million in annual run-rate revenues this year.
Trainor left IAC’s Vimeo — a filmmaker-founded video sharing site — saying he wanted to “live life for a bit while working with a few companies as a board member until I’m ready to announce my next full-time project.”