Photo Credit: Soundtrap
Nearly six years after announcing the purchase of music-collaboration and -creation platform Soundtrap, Spotify is selling the 11-year-old company back to its founders.
Spotify execs and Soundtrap’s founders just recently confirmed their latest deal, which arrives as the former of the Stockholm-headquartered businesses is working to cut spending and pare down amid a broader push for profitability. While the transaction’s exact financial and ownership details are unclear, Soundtrap co-founder and CEO Per Emanuelsson has disclosed that he’ll continue leading the DAW independently.
“Soundtrap was built to provide the best collaboration platform for making music online,” communicated Emanuelsson, who had specifically served as MD of Soundtrap within Spotify. “Together with Soundtrap’s co-founder, Björn Melinder, we’ve made the decision to acquire the company from Spotify, returning to an independent operation.
“Over the last five years, we’ve greatly benefitted from Spotify’s expertise and global reach, enabling us to rapidly scale our service and launch new products. We thank Spotify for helping to set us on the trajectory we’re on today and are very excited for the future,” concluded the Pragmatic Work founder.
And in comparatively brief remarks, longtime Spotify exec (and current VP, global head of music product) Charlie Hellman touched upon the “great strides” made by Soundtrap.
“Soundtrap continues to make great strides in enabling more people to make music collaboratively online,” indicated the former LimeWire higher-up Hellman. “We’re proud of what we’ve achieved together and are excited to see Soundtrap’s next phase of growth over the coming years.”
With Spotify presumably poised to continue trimming expenses and reducing the scope of certain aspects of its operation in the approaching months, it’ll be worth keeping an eye out for similar sales. May of 2023 saw the platform shut down music-trivia game Heardle after less than one year of ownership – a move that ruffled the feathers of diehard players and elicited calls to sell the title back to its creators.
As it stands, though, no such sellback has been announced, and it remains to be seen whether the original owners of the Wordle-inspired game – which prompted players to guess songs’ titles after hearing audio snippets – would be receptive to the proposal.
In any event, Spotify isn’t the only music industry company that’s sold acquired businesses to their founders on the year. And one week ago, after acknowledging that it had “overpaid” for exclusive content, the service laid off about 200 podcasting employees and combined Parcast and Gimlet.
Meanwhile, with Spotify stock (NYSE: SPOT) having surged in value by nearly 83 percent since 2023’s beginning, Morgan Stanley analyst Manan Gosalia has reportedly reiterated an “overweight” rating and set a $170-per-share target price.