SoundCloud was constantly battling with the major music labels This is thought to be partly because SoundCloud wanted a deal worth $1 billion (£770 million) when its valuation was only $700 million (£386 million). It could also be because, despite its best efforts, SoundCloud had been plagued by copyright infringement issues.
Ultimately the Twitter talks fell through. Ljung and cofounder Eric Wahlforss accepted "no ownership of the responsibility and no admittance of fault," the source claimed, adding that they also failed to state whether there would be any repercussions for the executives that have led SoundCloud into the sticky position it now finds itself in.
" no real answers and politically avoiding questions." "The all hands today was absolutely horrible," another SoundCloud employee, who also wishes to remain anonymous, told Business Insider shortly after the meeting. Staff wanted to know why they hadn't been warned that cuts were on the way, and the remaining employees wanted assurance that the cost reductions would keep the company in business for the foreseeable future. SoundCloud has attempted to downplay the TechCrunch report, although the company confirmed last week that it is in the process of trying to raise more capital.ĭuring last week's all-hands meeting - held on July 11 and monitored by a number of security personnel - "SoundClouders" were looking for answers as to why the company had to suddenly lay off almost half of its staff. SoundCloud's existing cash reserves will only carry it through to the fourth quarter of the year, which is less than 50 days away, according to sources cited by TechCrunch. Those that remain at the company could be forgiven for feeling nervous. "Nobody saw it coming," a SoundCloud employee, who wishes to remain anonymous, told Business Insider. Bloomberg had read a draft blog post in which SoundCloud CEO Alex Ljung explained that the company was letting go of 173 staff, and shutting down its offices in London and San Francisco (leaving only offices in New York City and Berlin) as part of an effort to reduce costs at the company whose losses have been spiralling out of control. Reports started to appear online on July 5 that said SoundCloud was about to cut its 420-strong workforce by 40%. It's a question that Healey and many other SoundCloud employees are still struggling to understand.
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