SoundCloud’s new investors want to replace its current CEO
The uncertainty that enveloped SoundCloud’s fate mostly diminished last week once reports surfaced that the music streaming service was salvaged by two “angel investors.” The winged investors have since been confirmed to be The Raine Group and Temasek Holdings, two respective entities in the platform’s purchase.
Seated atop a controlling stake in SoundCloud’s equity thanks to their $150-million-dollar redemptive investment, The Raine Group and Temasek Holdings are now initiating a new round of investment that involves a brand new funding deal. Under the investors’ unified proposition, SoundCloud’s current CEO, Alex Ljung, will be replaced with Kerry Trainor, the former CEO of Vimeo. Ljung would not be totally ousted from the company, but would rather remain with SoundCloud as the chair of the company’s board. Trainor and Ljung would be duly joined by a new chief operating officer, selected by Trainor.
SoundCloud’s latest funding plan seeks to raise about $170 million. The majority of the money would be supplied by The Raine Group and Temasek in support of the company, valuing SoundCloud at $150 million before the new investment. The purpose of the funding initiative is to pay off SoundCloud’s pre-existing debt, a number that includes the staggering $70 million dollar credit line taken by the service in March.
Ljung conveyed the urgency of the new funding proposal’s acceptance to existing SoundCloud investors, “suggesting” that “[SoundCloud] would not be able to ‘continue as a going concern’” otherwise.