The plot thickens in the ongoing Soundcloud funding debacle. On Thursday, July 13th, the beleaguered company’s PR team denied rumors that its funding would run out in 50 days. Days after TechCrunch published the original announcement, Soundcloud directly addressed the rumors.
The company’s official response is as follows:
“There are a number of inaccuracies within the TechCrunch article. They seem to stem from a misinterpretation of information by one or two laid off employees during a recent all hands meeting. Due to the extensive number of inaccuracies, we will only comment regarding funding and layoffs. To clarify, SoundCloud is fully funded into the fourth quarter. We continue to be confident the changes made last week put us on our path to profitability and ensure SoundCloud’s long-term viability. In terms of layoffs, it is our policy not to discuss individual employee cases, but we can share we continue to work with all employees who were let go to support them during this transition, with employment and financial assistance.”
Music enthusiasts, artists, and industry professionals should interpret Soundcloud’s statement with a healthy dose of skepticism.
Soundcloud’s vague wording is still ambiguous. It’s unclear how management treated its employees. In addition, the company did not specify the full extent of the company’s funding. However, it seems the most likely outcome is that another company or investors will buy out the company.
The first takeaway? It appears that the 50-day countdown until Soundcloud‘s demise is inaccurate. However, its funding after Q4 2017 is still up in the air.
The second takeaway is that thankfully, former staff aren’t completely in the dark when it comes to future prospects. Regardless of whether or not Soundcloud’s PR statement is entirely true, it was poor business practice to lay off 40% of its staff with little to no warning.
Ultimately, it’s wise for artists to back up all their music/mixes. For everyone else, it’s also wise to have alternatives in case the streaming platform is no more. For those upset about the company’s practices, it’s further incentive to find alternative platforms.
Look out for an upcoming post outlining River Beats’s recommendations for a contingency plan for alternatives to Soundcloud.
Feature image courtesy of Onlab. Read the full report from Variety HERE.