Twitter Invested a Huge Amount in SoundCloud


As the trend of listening music is now changing with increasing craze of music streaming among users, Twitter seems to be interested in doing an experiment in business with music.

Twitter and SoundCloud both share an old rapport, two years ago in 2014, Twitter had been interested in buying the company, but backed off due to some reason. Now, once again Twitter has shown its sheer interest in SoundCloud by making a huge investment of 70 Million dollars.

As per the recent updates, Chief Executive Officer of Twitter Mr. Jack Dorsey confirmed about the investment and mentioned that “Earlier this year, we made an investment in SoundCloud through Twitter Ventures to help support some of our efforts with creators. They’ve been great partners of ours over the years, and their community-supported approach mirrors ours in many ways.”

Though on the behalf of SoundCloud, a spokesperson mentioned that. “Both companies facilitate and inspire contemporary culture to happen in real time while reaching millions of people around the world. This investment will enable SoundCloud to remain focused on building value for creators and listeners alike, and to continue the global rollout of many company initiatives such as our recently launched subscription service, SoundCloud Go.”

This investment will greatly help SoundCloud in relieving its financial condition that is presently grappling with losses. Though, the company has established itself as a great online music store and made a huge number of 175 million monthly users worldwide in very less time, but then also the company was going through a loss of almost 44 Million dollars.

But, the good thing is that the company is trying hard to make the listeners happy by introducing new services in the market. Following the same, in March 2016, the company has launched its much awaited service SoundCloud Go. This service provides a catalog of 125 Million songs with a price of $10 a month.

By making this investment, Twitter has called for a new partnership between two companies, and since it is a corporate deal, the profit has to be two sided. So, what does twitter is planning to gain out of this? Seems like that with this new initiative, Twitter has plans to grow its user base & engagement with the help of music streaming. Though, it is a bit difficult to evaluate the impact of this deal in advance, but it may prove to be a reason for generating higher revenues for Twitter on long-term basis.

Let’s hope that this deal will open new options of progress for both the companies.


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