SoundCloud lays off about 20 percent of its workforce

SoundCloud will lay off about 20 percent of its workforce due to the “challenging economic climate” and “financial market headwinds.” The company makes the decision to ensure the ‘continued profitability’ of the company.

SoundCloud lets its employees know in an email, write including Billboard. The company is profitable today, but was not for a long time. That tide began to turn after it laid off 40 percent of its staff in 2017 and closed offices in Los Angeles, London, San Francisco and Sydney, among others. Since then, approximately $245 million has also been invested in the company. The third quarter of 2020 was the company’s first quarter with a profit.

SoundCloud switched to a . last year new royalty system. The ‘fan-powered’ royalties should pay more to smaller artists who don’t get many streams, but still have a dedicated fan base. An artist with 124,000 followers would get $120 a month under the standard system used by, say, Apple and Spotify, and with fan-powered royalties that would be $600. Warner Music Group is licensing the system.

A big difference between SoundCloud and competitors like Spotify and Apple Music is that anyone can create an account on SoundCloud and post music there. Furthermore, SoundCloud has more smaller, independent artists and the other two examples offer more big names.