SoundCloud now finds itself in major financial distress. After reports of the website running out of cash surfaced in January, the mood turned sour at streaming site’s Berlin headquarters. To make matters worse, the struggling juggernaut has shut down regional offices in London and the USA, letting go of 40% of their employees in the process.
According to a new report, this drastic measure seems to be a short lifeline at best, as the layoffs may only provide the company with enough money for about 50 days. This ominous report has subsequently been disputed by SoundCloud, who are in talks for a possible acquisition.
However, this may be a rather optimistic company statement, as an anonymous employee described the atmosphere to be, “…pretty shitty. Pretty somber. I know people who didn’t get the axe are actually quitting. The people saved from this are jumping ship. The morale is really low.” Another employee stated that they were “blowing through money, but now is saying they don’t have any money.” It has also been reported that some employees who signed on to join the company have received notices that they are laid off before officially beginning work.
SoundCloud’s user share also seems to have dropped dramatically, possibly as low as 70 million per month — down from a massive 175 million just three years ago. Their new subscription plans have also failed to revive the business, partly due to lack of user growth and partly due to the website having to pay astronomical amounts of the revenue earned by these plans back to record labels.
All these factors may be pointing to one glaring fact — SoundCloud is dying and is quite possibly beyond saving.