Embattled streaming service SoundCloud has been saved from closure by a last-minute investment of $US170 million (about $222 million) in a deal that will also see chairman Alexander Ljung step down from his role as chief executive.
As BBC reports, the company was at risk of shutting down entirely should new funding not have been approved by its shareholders, in the wake of a string of hits to its operations, including the recent downsizing of its workforce by 40%, or 173 jobs, last month.
However, the new round of investment — which includes contributions from New York financiers The Raine Group and Singaporean company Temasek — represents the largest funding boost in the company's history, and should at least alleviate some of its woes as it looks for more ways to monetise its 40 million-strong user base, Ljung said in a statement.
"Over the last few weeks, I've been moved by the outpouring of commentary around SoundCloud's unique and crucial role in driving what global culture is today (and what it will become tomorrow)," Ljung wrote. "You've told me how, without SoundCloud, there would be a giant gaping void in today's world of music. We can't have that, and I'm happy to once again say that won't be happening."
Don't miss a beat with our FREE daily newsletter
Reiterating a previous message that "SoundCloud is here to stay", the chairman explained that the cash injection will ensure the company "remains strong & independent", and its new partnership with The Raine Group and Temasek will see new CEO Kerry Trainor and COO Mike Weissman join the fold.
"Am I leaving?" he wrote. "No, absolutely not. After a decade of balancing the roles of Founder, CEO and Chairman, I'm excited to hand the CEO reins over to Kerry to allow me to fully focus on the role of Chairman and the long-term.
"This, I know, sets us up as an even greater team for the decade(s) to come."
